The program is designed so Canadians who die early in life subsidize those who live longer.
canada pension plan
The increased CPP tax alone translates into $1,624 more in taxes.
For retirees born after 1993, the CPP rate of return will be a meagre 2.5 per cent.
Reversing course and raising the age of eligibility for retirement benefits to 67 from 65 would be politically costly, but it makes eminent sense when one considers the aging of our population.
CPP expansion will mean several thousands of dollars more in annual contributions from working Canadians.
An expanded Canada Pension Plan naturally comes with higher CPP taxes.
High marginal effective tax rates weaken the incentives for people to earn extra money.
The new Canada Child Benefit program, and the expansion of the CPP, may hurt middle-income Canadians.
The rate of return Canadians—especially younger workers—will receive on their CPP contributions is meagre and will remain so even after expansion.