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CBTU is campaigning to have the federal government introduce a skilled trades workforce mobility tax deduction — a personal tax exemption on expenses construction workers typically incur when they temporarily relocate for work.
In the construction sector, growth across the country is oftentimes uneven, with some areas experiencing higher levels of construction activity resulting in labour shortages, while others will see high unemployment levels. Skilled trades workers have always had to travel for work – that’s why we’re called journeypersons. Sometimes, mobility creates a barrier for workers to go to where the work is. Skilled trades workers need government support to address the financial barriers to labour mobility.
Unfairness in the Tax Act
The Income Tax Act in its current form, is inequitable towards skilled trades workers. Salespeople, professionals and Canadians in other industries can receive a tax deduction for the cost of their travel, meals, and accommodations. The same option is denied to skilled trades workers who work on jobsites that are in different regions or provinces from their primary residence. This is an unfair tax policy. The Federal Government has a responsibility to ensure a system of tax fairness is in place for all Canadians and to support skilled trades workers, who play an integral role in building our communities.
Other jurisdictions such as the United States already permit a tax deduction like this to those working in the skilled trades. The US Revenue Code allows workers to deduct meals, travel, and accommodation expenses for temporary work away from home. Implementing a similar measure will help put Canadians to work, address labour shortages and reduce reliance on government programs like Employment Insurance, ultimately saving the government hundreds of millions of dollars.
Skilled trades workers across Canada want to go to work, but that work isn’t always close to home. To build a strong economic recovery, the Federal Government has the opportunity to address the long-standing issue of labour mobility in the skilled trades by implementing financial incentives and/or allowing skilled trades workers to deduct from their income, the cost to travel and go to work. This will help put Canadians to work, address labour shortages and reduce reliance on government programs like Employment Insurance, ultimately saving the government hundreds of millions of dollars.
In March 2021, CBTU commissioned an independent financial analysis [RR1] which estimates that a Canada-wide implementation of a skilled trades workforce mobility tax deduction could save the Federal Government an estimated $347 million dollars annually through increased tax revenues and reduced reliance on EI and other government programs.
Learn about this issue by reading our brief or visiting our campaign at building2021.ca