Employment Insurance Premium Rate Change for 2019, reduction in EI premiums can be used to fund RSP?

While the rate is going down this might be an opportunity to use the reduction to fund an RRSP vs taking increases on your pay and getting taxed on that amount!

September 13, 2018 – Gatineau, Quebec – Government of Canada

Today, the Honourable Bill Morneau, Minister of Finance, and the Honourable Jean-Yves Duclos, Minister of Families, Children and Social Development, issued the following statement on the Employment Insurance (EI) premium rate for 2019:

“Thanks to the hard work of Canadians, job creation has been strong, and unemployment is near 40-year lows. While more and more Canadians are feeling the benefits of Canada’s strong economy, the Government is committed to ensuring that middle class Canadians and people working hard to join the middle class have the support they need as they work to build better lives for themselves and their families.  Canada’s EI program provides that support in times of need, and also provides training and employment programs to help Canadians find and keep good, well-paying jobs.

Since 2015, the Government has improved the EI benefits available to Canadians by making EI maternity and parental benefits more flexible and inclusive, and offering Canadians more options to help them care for their critically ill loved ones. At the same time, thanks to a strong and growing economy, the EI Premium rate has been reduced and is now almost 14% lower, compared to 2015 premium rates.

Today, the Canada Employment Insurance Commission announced a further reduction in the EI premium rate. The 2019 employee EI premium rate will be $1.62 per $100 of insurable earnings—a decrease of 4 cents from the current rate. This will be the lowest EI premium rate since 1980—and for most Canadian workers, the lowest they have paid since entering the workforce.

Today’s release also reconfirms that the EI Operating Account is on track to balance over the course of its mandated seven-year break-even horizon. The Government of Canada remains committed to supporting the long-term sustainability of the EI Program and to ensuring that EI contributions are only used to fund EI programs.”

 

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