OTTAWA — The Opposition Conservatives are calling on the federal Liberal government to reduce taxes on severance packages for laid-off General Motors workers in Ingersoll, Ont.
Conservative Leader Pierre Poilievre sent a letter Sunday to Finance Minister François-Philippe Champagne calling for an exemption to the withholding taxes applied to severance pay.
Poilievre argues taxes on a big chunk of GM’s lump-sum severance payments could deprive out-of-work employees of “tens of thousands of dollars,” adding “insult to injury.”
The federal Tories said waiting until after tax season to recover funds is not a reasonable solution for workers who recently lost their regular paycheques and still need money for their mortgages and grocery bills.
“These men and women worked hard, played by the rules and built things this country depends on. The least your government can do is stop taking their money at the worst possible moment,” the letter said.
GM announced last fall it was shuttering the CAMI assembly plant, putting 1,200 people out of work. Employees were offered a one-time payout worth about six months of earnings.
The letter was co-signed by Conservative labour critic Kyle Seeback and Arpan Khanna, the local MP for Oxford where the CAMI plant is located.
Khanna said in an interview his office has received a flood of calls from anxious autoworkers reporting that taxes would be consuming more than half of their severance payouts.
“Many of them reached out to my office showing a massive withholding tax to their cheques. We saw pay stubs of folks that were supposed to be getting $60,000 gross, but are now only getting $24,000 after the withholding tax,” Khanna said.
“In a time when Canadians are struggling to put food on the table, to pay their mortgages, provide support for their kids, that’s a huge shot to their monthly income.”
Unifor Local 88 GM plant chairperson Mark Gee declined to comment on Monday, saying the branch is still working through the issue.
GM announced last year it would end its BrightDrop electric vehicle production at the CAMI Assembly plant in Ingersoll, citing weaker-than-expected market demand and a challenging regulatory environment in the U.S.
More than a thousand employees have been laid off.
GM’s Oshawa Assembly factory is meanwhile shuttering one of three shifts and laying off some 500 employees — a move expected to affect upward of a thousand workers across the supply chain.
Unifor President Lana Payne has accused U.S. President Donald Trump of upending Ontario’s auto sector and hitting the Ingersoll GM plant on multiple fronts. Trump introduced 25 per cent tariffs on non-U.S. auto content and policies that upended the U.S. EV industry.
Prime Minister Mark Carney announced a new automotive industrial strategy last Thursday, which he vowed would “drive investment” in the sector and set a “sovereign path” to reduce auto emissions.
The Conservatives dismissed Carney’s new auto strategy in their letter, claiming it won’t help laid-off auto sector workers.
“Canadians are still waiting for your government to deliver the trade deal with the United States you promised by July 21 (2025) and a clear plan to protect Canadian jobs,” the letter said. “Instead of presenting a serious plan to defend our auto workers, you’ve just announced a rebate that will subsidize American-made EVs.”
Canada is entering talks this year on renewing the Canada-United States-Mexico Agreement on trade.
Carney said Thursday his objective remains getting all tariffs removed, but since that’s clearly not Trump’s objective, Canada must “prepare for all possibilities.”
This report by The Canadian Press was first published Feb. 9, 2026.
Kyle Duggan, The Canadian Press
