Quebec Health Contribution Ends Ahead of Schedule | KPMG | CA

Quebec to Eliminate Health Contribution Ahead of Schedule

Quebec Health Contribution Ends Ahead of Schedule

Finance Quebec announces the health contribution will end as of January 1, 2017.

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Finance Quebec has announced in a new bulletin that it will be eliminating the health contribution as of January 1, 2017, which is two years ahead of schedule. According to Information bulletin 2016-11, individuals in Quebec who pay their income tax in instalments should consider adjusting payments that are due after December 31, 2016, in order to take into account the effects of the complete elimination of the health contribution in 2017.

According to the bulletin, which was published on October 25, 2016:

  • The Act respecting the Régie de l'assurance maladie du Québec will be amended so that taxpayers are no longer required to pay a health contribution as of 2017 
  • The Quebec income tax source deduction table and the formulas for calculating source deductions will be changed accordingly as of January 1, 2017.

Background
The health contribution reduction plan was originally announced as part of Quebec's 2015-2016 budget. The plan was then modified in the province's 2016 budget to ultimately eliminate the health contribution in 2018, but with plans for a progressive elimination in 2016 and 2017 for lower-income taxpayers, and the 2018 date applying to all other taxpayers. With this bulletin, the process has been sped up significantly.

For full details of Quebec's proposed changes, see Information Bulletin 2016-11 [PDF 88 KB] and the press release re The Québec Economic Plan - October 2016 Update: "Québec's fiscal integrity has been restored" - Minister Leitao declared on the Quebec Finance site.

For more information, contact your KPMG adviser.

Information is current to November 08, 2016. The information contained in this publication is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's National Tax Centre at 416.777.8500

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