The temporary refundable tax credit for personal support workers (PSWs) for tax years 2026 to 2030 proposed in Budget 2025 will cost $1.37 billion, the Parliamentary Budget Officer (PBO) estimates.
Eligible PSWs employed by qualifying health care organizations can claim 5% of eligible earnings, up to a non-indexed maximum of $1,100.
The temporary measure, which the federal government said is to support PSWs and their important role in communities, would cost $77 million in tax year 2025-26 and about $320 million per year for the subsequent four years.
PSWs employed in British Columbia, Newfoundland and Labrador and the Northwest Territories are ineligible due to existing bilateral agreements.
Estimates of the number of personal support workers and their employment income were derived from labour force survey data. Projected growth in employment income reflects the wage growth from the PBO’s September 2025 economic and fiscal outlook.
Employment income derived from self-reported surveys and imprecise identification of the exact number and incomes of eligible workers are sources of uncertainty for the estimates, the PBO said. In addition, the PBO didn’t account for behavioural responses, such as a possible increase in the number of PSWs after the tax credit is introduced.