The Manitoba government celebrated its new school tax refund as a way to provide financial relief to all homeowners, but more than 18,000 checks have not been deposited.
A total of 18,550 of the 456,168 checks mailed by the province last year, or 4.1%, have not yet been cashed, the government confirmed.
That’s nearly $6.8 million of taxpayers’ money sitting somewhere, unclaimed.
There are also 61,000 reimbursement checks from Manitoba Public Insurance—a provincial crown corporation—gathering dust. The uncashed MPI checks, distributed in three rounds of remittances during the pandemic, total approximately $12 million.
A provincial government spokesperson notes that remittances can be deposited at any time and said checks are still being cashed regularly.
However, the Progressive Conservative government has been pushed back for mailing checks since it introduced the education tax refund in 2021. Critics have suggested the province could instead use direct deposit or increase the education tax credit that homeowners already receive.
The average rebate for a Winnipeg homeowner was around $458 in 2021.
A taxpayer advocate applauds the government for moving to phase out what he says is an archaic way to fund the education system, but says the method of getting the tax refund is outdated.
“When you do the right thing, you have to do it the right way,” said Todd MacKay, Prairies director of the Canadian Taxpayers Federation.
“Sending checks? Licking envelopes? Like, was the fax machine down? Did the carrier pigeons fly into the chicken coop?
“Clearly there are smarter ways to move money these days – cheaper and more efficient ways to do it. The government needs to push for that.”
Checks a political calculation: financial adviser
The province’s check issuance strategy cost about $915,000 last year. Each check costs the province about $2, when you combine the price of the check, envelope and postage, the Winnipeg Free Press reported.
The government has defended sending checks as a safe and reliable way to deliver money, adding that the province does not have access to people’s electronic banking information.
But MacKay urged the government to find a better solution. Under the current approach, envelopes can get lost in the mail, be sent to the wrong address, or be forgotten.
“Every government is tempted to try to use its power to look better and put a bunch of checks in the mail – it’s quite tempting,” he said. “But they have to resist that temptation and do things the smart way.”
David Christianson, a Winnipeg financial adviser, said the government was likely making a political calculation. The mailed check reminds people of the policy decision and which government it came from.
“I spent 35 years in financial education and kind of came to realize that when things are in people’s hands, they remember them. They’re tangible. They matter,” said declared Christianson, who is also the author of the book Managing the Bull: A Pragmatic Approach to Personal Finances.
The Conservative government, whose popularity with Manitobans has plummeted, is trying to “maximize the emotional impact” of its tax relief decision, he reasons.
He also says an electronic approach doesn’t work for everyone. The Canada Revenue Agency tried to get people to sign up for direct deposit of tax returns, but they still sent 3.4 million checks printed This year.
“The harsh reality is that it’s a hard thing to do, to get money to people. It shouldn’t be hard, but it seems to be,” Christianson said.
He suspects the Manitoba government may not have had time to develop a new strategy for sending remittances in the first year of the program, but said the government should move towards a solution. digital.
Federal authorities will also send checks
However, it does not appear that the province is heading in that direction.
A government spokesperson defended Manitoba’s approach, saying other organizations and jurisdictions also issue checks.
The federal government is moving from an annual carbon tax refund that offsets income taxes to a quarterly check received by direct deposit or mail. The first payment is expected in July in four provinces, including Manitoba.
The provincial spokesperson said Manitoba’s Department of Finance has found efficiencies in sending property tax refunds for education.
Starting this year, people who own multiple properties in Winnipeg will receive one check, which was the case in all other municipalities last year. Individuals with multiple properties in more than one municipality will receive separate checks.
NDP Leader Wab Kinew has accused Heather Stefanson’s Conservative government of repeating a mistake by continuing to mail cheques, which was the method used when the rebate scheme began under former Prime Minister Brian Pallister.
“We see through these numbers that it’s not the most effective way to reach people,” the opposition leader said.
The government should look for other ways to help Manitobans through the current affordability crisis, Kinew said. He added that the NDP would present its plan in the near future.
Homeowners will receive this year’s rebate checks, which will total approximately $350 million, the same month their taxes are due, in June in Winnipeg.
People who did not receive their education rebate check last year can request a replacement at 1-866-626-4862, or they can call Manitoba Public Insurance at 1-800-665- 2410 if they have not received their eligible rebate on their car. Insurance.