The budget is eliminating the federal education and textbook tax credits effective January 1, 2017 and using the savings to increase financial assistance for students from the lower and middle classes.
The Liberals say they are eliminating these non-refundable federal tax credit on the grounds that they “are not targeted based on income and often provide little direct support to students at the time they need it most.”
Low and middle income families
The Trudeau government plans to use the resulting tax savings to increase the Canada Student Grant amounts. These grants are available to undergraduate students from low- and middle income families who apply and qualify for student financial assistance.
The 2016 budget is increasing the Canada Student Grant amounts by 50%:
• from $2,000 to $3,000 per year for students from low-income families;
• from $800 to $1,200 per year for students from middle-income families; and
• from $1,200 to $1,800 per year for part-time students
These higher grant amounts will be available for the 2016-2017 academic year.