Sioux Lookout, Ont., isn't north enough for federal tax relief program but a movement aims to change that

For decades, residents of Canada's northern communities have qualified for a federal tax deduction program aimed at addressing their higher cost of living — but it doesn't apply to Sioux Lookout, Ont.

Reece Van Breda wants that changed.

The Sioux Lookout councillor has been drawing support from neighbouring communities as he looks to lobby the federal government to include his constituents in the program.

Known as northern residents deductions, those who live in the prescribed northern zone can claim a residency deduction on their income taxes for up to $22 per day, a travel deduction for two vacation trips per year and unlimited medical travel. Anyone living in the prescribed intermediate zone is eligible for half the deduction amounts.

While nearby municipalities, including Red Lake, Pickle Lake and Ear Falls, are still located within the intermediate zone, Sioux Lookout was removed in the 1990s even though Ear Falls and Sioux Lookout share the same latitude.

"It's more about righting a wrong that we should have not been taken off of it in the first place," Van Breda told CBC News.

CBC News reached out to Ottawa's Department of Finance for comment on why the town was exempted from the program.

A spokesperson, Benoit Mayrand, said in an email that the program first launched in 1987. Until 1991, eligibility was based on a community-by-community approach, which "raised fairness concerns, as residents of some neighbouring communities were treated differently even though they often shared common workplaces, services, and cultural and recreational facilities."

In 1988, a task force made to assess the program resulted in the creation of the northern and intermediate zones based on:

"The task force attempted to minimize border delineation problems by having as much separation as possible between qualifying and non-qualifying communities," Mayrand said.

"Sioux Lookout is located south of the intermediate zone boundary, and consequently residents do not qualify for the northern residents deductions."

In a followup email, CBC asked the Department of Finance whether the government would reconsider the current zones given how much time has passed as well as the rising cost of living, but no immediate response was provided.

While Sioux Lookout has a permanent population of about 5,800, thousands of others from 33 surrounding First Nations travel to the town for medical appointments and social services.

Kiiwetinoong MPP Sol Mamakwa told CBC News he would like to see Sioux Lookout qualify for the tax relief program, especially considering the added pressures it faces as a regional hub.