Quebec/CMEDIA: In his economic update, Quebec Finance Minister Eric Girard reportedly announced a reduction in both contribution rates as well as indexation of the tax system, giving taxpayers some relief.
An average gain of $182 per taxpayer in 2026-2027 is represented by these two measures.
Public finances being under pressure, Girard has chosen to reduce both the contribution rate to the Quebec Pension Plan (QPP) by 0.2 percentage points as well as reduction of contribution rates to the Quebec Parental Insurance Plan (QPIP) by 13 percent.
Also provided in the economic update is 2.05 percent indexation of the tax system and social insurance benefits as of Jan. 1, 2026.
Social assistance recipients would also reportedly see an increase in the basic annual benefit from $9,408 to $9,600.
Although such indexation is virtually automatic, the finance minister’s office said on Tuesday that Quebec had not granted it in full on a few occasions prior to 2004.
The Legault government is also reducing the mandatory contribution rates for businesses to the RRQ and QPIP as of Jan. 1, a saving of $421 million for approximately 280,000 employers.
Following in the footsteps of the federal government and cancelling the increase in the capital gains inclusion rate, more than $400 million over five years would be benefited, says the economic statement, by economic development in regions facing numerous challenges, particularly related to customs duties.
Of these, over $290 million will be invested in the agriculture, forestry and fishing sectors with their businesses to receive a temporary payroll tax holiday of $255 million.
Economic activity in Quebec continues to grow, says the Quebec government, as Real GDP is expected to grow by 0.9 percent in 2025 and 1.1 percent in 2026.
The deficit of $13.6 billion in absolute terms announced in the last budget has been revised and now stands at $12.4 billion.
Girard indicated on Tuesday that he was still aiming to return to a balanced budget by 2029-2030.
An additional payment to the Generations Fund estimated at $1.8 billion in 2026-2027 is being planned by Girard corresponding to the accumulated surplus of the Electrification and Climate Change Fund.
