Increasing the Northern Residents Deduction

Bill C-401 (44-1) proposes to increase the Northern Residents Deduction. It would increase the basic residency amount to $13.00/day for residents in both intermediate and northern zones starting in 2025 and would index this amount to inflation for subsequent years. Bill C-401 would also eliminate the discounting of travel amounts for residents in intermediate zones. We estimate that Bill C-401 would reduce federal personal income tax revenues by $935 million from 2024-25 to 2028-29.