Budget 2026: Cost of living
Budget 2026 combines household supports with some changes for small businesses. For households it proposes a one-time 50% Canada Groceries and Essentials Benefit supplement, a larger Build Canada Workers Benefit and a refundable caregiver credit, and it extends the fuel excise tax suspension and funds heat pump rebates. For small businesses and the self-employed it proposes higher tax instalment thresholds and a single May 15 deadline.
Household income supports
Groceries benefit supplement, Build Canada Workers Benefit, caregiver credit and Nutrition North.
Sources
Budget 2026 proposes to enhance this benefit again through the 2027 Canada Groceries and Essentials Benefit Supplement, which would provide a one-time 50% increase for the 2026-27 benefit year, delivered in early 2027.
Budget 2026 - Masters of our Destiny · PDF p. 203Full cited page
Budget 2026 proposes to enhance this benefit again through the 2027 Canada Groceries and Essentials Benefit Supplement, which would provide a one-time 50% increase for the 2026-27 benefit year, delivered in early 2027.
The Supplement would provide up to $339 for a single person without children and up to $679 for a couple with two children.
Budget 2026 - Masters of our Destiny · PDF p. 204Full cited page
The Supplement would provide up to $339 for a single person without children and up to $679 for a couple with two children.
It would provide $4.1 billion in additional support to Canadians
Budget 2026 - Masters of our Destiny · PDF p. 204Full cited page
It would provide $4.1 billion in additional support to Canadians
The new benefit would lower the minimum earnings threshold from $3,000 to $500, and from $1,150 to $200 for the disability supplement. It would also increase the maximum benefit to $1,859 for single individuals without children and $3,143 for families, up from $1,709 and $2,943 respectively under the existing benefit.
Budget 2026 - Masters of our Destiny · PDF p. 205Full cited page
The new benefit would lower the minimum earnings threshold from $3,000 to $500, and from $1,150 to $200 for the disability supplement. It would also increase the maximum benefit to $1,859 for single individuals without children and $3,143 for families, up from $1,709 and $2,943 respectively under the existing benefit.
These enhancements would increase benefits for about 1.9 million low-income workers, including 180,000 new recipients, starting with the 2027 taxation year.
Budget 2026 - Masters of our Destiny · PDF p. 205Full cited page
These enhancements would increase benefits for about 1.9 million low-income workers, including 180,000 new recipients, starting with the 2027 taxation year.
Budget 2026 also proposes to reduce advance payments by half for the 2027 taxation year, beginning in July 2027, and eliminate advance payments starting with the 2028 taxation year.
Budget 2026 - Masters of our Destiny · PDF p. 205Full cited page
Budget 2026 also proposes to reduce advance payments by half for the 2027 taxation year, beginning in July 2027, and eliminate advance payments starting with the 2028 taxation year.
Make the Canada Caregiver Credit fully refundable, providing $845 million in additional support over four years, starting in 2027-28, and $245 million per year ongoing. 585,000 caregivers would receive support, including 180,000 who currently receive no benefit. Caregivers would receive up to $1,260 annually (for 2027, indexed thereafter).
Budget 2026 - Masters of our Destiny · PDF p. 206Full cited page
Make the Canada Caregiver Credit fully refundable, providing $845 million in additional support over four years, starting in 2027-28, and $245 million per year ongoing. 585,000 caregivers would receive support, including 180,000 who currently receive no benefit. Caregivers would receive up to $1,260 annually (for 2027, indexed thereafter).
Budget 2026 proposes to provide $610.3 million over four years, starting in 2027-28, $118.1 million in 2031-32, and $117 million ongoing to ensure that Nutrition North Canada can maintain and enhance these essential supports.
Budget 2026 - Masters of our Destiny · PDF p. 204Full cited page
Budget 2026 proposes to provide $610.3 million over four years, starting in 2027-28, $118.1 million in 2031-32, and $117 million ongoing to ensure that Nutrition North Canada can maintain and enhance these essential supports.
Fuel and energy costs
Extended fuel excise tax relief and heat pump rebates.
Sources
In September 2026, we announced that this temporary tax relief would be extended until the end of January 2027. Fuel excise tax rates will then be restored to 50% of their pre-suspension levels until the end of March 2027, before returning to their standard rates on April 1, 2027.
Budget 2026 - Masters of our Destiny · PDF p. 207Full cited page
In September 2026, we announced that this temporary tax relief would be extended until the end of January 2027. Fuel excise tax rates will then be restored to 50% of their pre-suspension levels until the end of March 2027, before returning to their standard rates on April 1, 2027.
The extension is expected to provide an additional $2.9 billion in fuel tax relief, bringing total estimated tax relief for Canadians to $5.3 billion in 2026-27.
Budget 2026 - Masters of our Destiny · PDF p. 207Full cited page
The extension is expected to provide an additional $2.9 billion in fuel tax relief, bringing total estimated tax relief for Canadians to $5.3 billion in 2026-27.
Families that switch from oil, propane, or electric resistance heating can save an average of over $1,400 a year.
Budget 2026 - Masters of our Destiny · PDF p. 207Full cited page
Families that switch from oil, propane, or electric resistance heating can save an average of over $1,400 a year.
the new National Heat Pump Rebate Program will help up to 820,000 households install eligible cold-climate heat pumps.
Budget 2026 - Masters of our Destiny · PDF p. 208Full cited page
the new National Heat Pump Rebate Program will help up to 820,000 households install eligible cold-climate heat pumps.
We announced more than $2 billion over eight years, starting in 2026-27, to Environment and Climate Change
Budget 2026 - Masters of our Destiny · PDF p. 208Full cited page
We announced more than $2 billion over eight years, starting in 2026-27, to Environment and Climate Change
Small-business tax compliance
Higher instalment thresholds and a single May 15 deadline.
Sources
Amend the Income Tax Act to increase the instalment thresholds, which have not changed since 2008, to $7,500 and index them to inflation. In addition, Budget 2026 proposes to simplify the instalment regime for self-employed business owners, including by allowing them to make a single payment of two thirds of their net tax owing by December 31. As a result, nearly 1.1 million individuals and 185,000 small incorporated businesses would no longer pay taxes in instalments.
Budget 2026 - Masters of our Destiny · PDF p. 308Full cited page
Amend the Income Tax Act to increase the instalment thresholds, which have not changed since 2008, to $7,500 and index them to inflation. In addition, Budget 2026 proposes to simplify the instalment regime for self-employed business owners, including by allowing them to make a single payment of two thirds of their net tax owing by December 31. As a result, nearly 1.1 million individuals and 185,000 small incorporated businesses would no longer pay taxes in instalments.
This measure would apply to 2028 and subsequent taxation years.
Budget 2026 - Masters of our Destiny · PDF p. 308Full cited page
This measure would apply to 2028 and subsequent taxation years.
Make tax filing simpler and more accurate by setting May 15 as the single due date for filing returns and paying taxes owing (including for self-employed individuals).
Budget 2026 - Masters of our Destiny · PDF p. 308Full cited page
Make tax filing simpler and more accurate by setting May 15 as the single due date for filing returns and paying taxes owing (including for self-employed individuals).
This measure would apply for the 2027 and subsequent taxation years and is expected to save Canadians about $230 million in interest and penalty payments over five years, starting in 2026-27, with $55 million in ongoing annual savings.
Budget 2026 - Masters of our Destiny · PDF p. 308Full cited page
This measure would apply for the 2027 and subsequent taxation years and is expected to save Canadians about $230 million in interest and penalty payments over five years, starting in 2026-27, with $55 million in ongoing annual savings.
Analysis of cited budget provisions. Proposals and forecasts are distinguished from implemented measures.
