February 27, 2008 - Ottawa - Finance Minister Jim Flaherty has proposed a new Tax-Free Savings Account (TFSA). The TFSA is a flexible, registered general-purpose account that will allow Canadians to save and earn tax-free investment income. This income may be used any time to cover any expense, including dental care.
Canadian Dental Association (CDA) president Dr. Darryl Smith says the government deserves praise for creating this powerful incentive for financial savings. “73% of Canadians do not have a plan for how they will pay for their dental care once they retire. The federal government can play an important role in ensuring that seniors have access to quality oral health care by creating financial incentives to savings.”
Adds Dr. Smith, “At a time when a record number of Canadians are reaching retirement age, employer-sponsored, post-retirement health benefits are in sharp decline. Today’s seniors are accustomed to superior dental care, and have far more of their natural teeth than their predecessors.”
57% of Canadian organizations surveyed in 2006 plan to reduce post-retirement health care benefits over the next three years. Several of Canada’s large corporations have already made announcements to do just that, including Nortel, Sun Life, Bell, Sears, and Manulife Financial. Of those Canadians surveyed by CDA who say they do have a plan for how they will pay for their dental care once they retire, 62% are relying on post-retirement benefits offered by their employer.
However, while the RRSP signaled to Canadians the need to earmark money specifically for retirement, the TFSA does not have a similarly implicit message.
“It is imperative that Canadians realize that employer benefit plans may not be available in their retirement years. The TFSA can be an important tool while planning for your future oral health care needs,” says Dr. Smith.
Contact
Aaron Levo
Coordinator, Government Relations
Canada Dental Association
(613) 523-1770 ext. 2210 or 613-263-4548
alevo@cda-adc.ca
