In an election focused on families, an ‘implicit tax’ on parents is under the radar
There is one idea that no one has touched yet: dialing back the clawback that parents face when they work to supplement their income while they are on leave.
Currently, the standard rule for parents — as for unemployed workers, who collect benefits under the same Employment Insurance (EI) system — is that the government withholds 50 cents for every dollar earned, up to 90 per cent of your regular weekly earnings. After that threshold, the benefits are deducted dollar for dollar.
The rolling back of the benefits is like “an implicit tax,” said David Gray, a professor of economics at the University of Ottawa.