Conservative Leader Pierre Poilievre is pledging to raise the maximum contribution limit for the Tax-Free Savings Account by $5,000 so long as the money goes towards Canadian investments.
Poilievre announced the top-up on Thursday, promising to award “patriotic Canadians” who invest in Canada amid an escalating trade war with the U.S.
“Something is backwards. When greedy globalist corporate insiders profit by moving money out of Canada, they avoid paying Canadian taxes. But when patriotic Canadians invest in our country, they pay more,” he said in a video ad. “Throughout their 10 years in power, the Liberals have raised taxes and blocked pipelines and other projects, pushing a half trillion dollars of investment out of Canada to the US, making us weak and helpless against President Trump.”
When Trudeau’s Liberals first took office, they rolled back former prime minister Steven Harper’s $10,000 limit outlined in its 2015 budget to $5,500 for the 2016 tax year. The left-wing opposition parties at the time, the NDP, Greens, and Liberals, pledged to roll back the Conservatives’ limit, claiming it would only benefit wealthy Canadians.
Had the limit remained, some Canadians could have saved more for down payments, retirements or any other major expense as costs have skyrocketed due to inflation since the TFSA was first introduced.
Poilievre’s plan means that for most Canadians, their existing TFSA will not change, but the “top-up” would allow an additional $5,000 a year on top of the current $7,000 limit, as long as that money is used to invest in Canadian companies, employ Canadian workers, and pay Canadian taxes.
In the ad announcing the plan, Poilievre said his government would help financial institutions and advisors inform Canadians about which investments are Canadian, thereby qualifying for the TFSA contribution increase.
“It will bring home billions of dollars of investment and jobs to Canada while bringing home savings for you,” Poilievre said. “Money will rush into Canadian businesses, who will in turn hire more people and pay more taxes, and it will help us become more self-reliant and sovereign if we stand on our own two feet and stand up to the Americans.”
Critics of the plan say only around 10% of Canadians contributed to the maximum amount in 2022, so it is targeted at the most successful among Canadians.
The move comes after Conservatives announced a 15% cut to income taxes earlier in the week, which was estimated to save two-income families $1,800 each year.