Prime Minister François Legault published on his social networks on Saturday a list of measures taken to help families facing rising consumer prices due to inflation.
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Tax cut between $814 and $1,627, $2,000 per year for low-income seniors, an amount of $500 in spring 2022… Can this financial aid really help taxpayers?
According to economist Francis Gosselin, some of these measures will instead contribute to inflation.
“It essentially consists of giving people money, which will lead to additional consumption and therefore additional inflation,” he explained in an interview with Quebec Matin on Monday.
If the extent of the tax cuts is interesting, the $500 amount given to Quebecers is “terrible,” according to the expert.
“We receive an unexpected amount, and what do we do? We spend almost all of it. And we see this in experimental economics. […] In the short term it is good, but it has no impact on people’s well-being,” emphasizes Mr. Gosselin.
Tax cuts, higher government benefits, increases in unemployment insurance and long-term family support are much more attractive.
“These are much more effective measures to mitigate the impact of inflation on families,” he explains.
“Once again, I would be in favor of giving more money to the less well-off than giving less money to 95% of the population. People making $100,000 didn’t need a $500 check to pay for groceries.”
However, he notes that the Legault government has taken several measures to mitigate the impact of inflation. “We have tried many things and overall the intention is good,” concludes Francis Gosselin.