Regulations Amending the Passport and Other Travel Document Services Fees Regulations (Removal of Fee Adjustments): SOR/2026-7

Canada Gazette, Part II, Volume 160, Number 3

Registration
SOR/2026-7 January 26, 2026

FINANCIAL ADMINISTRATION ACT

P.C. 2026-46 January 26, 2026

Her Excellency the Governor General in Council, on the recommendation of the Treasury Board and the Minister of Citizenship and Immigration, makes the annexed Regulations Amending the Passport and Other Travel Document Services Fees Regulations (Removal of Fee Adjustments) under paragraph 19(1)(a)^{footnote a} of the Financial Administration Act^{footnote b}.

Regulations Amending the Passport and Other Travel Document Services Fees Regulations (Removal of Fee Adjustments)

Amendments

1 The definitions base year and reference year in section 1 of the Passport and Other Travel Document Services Fees Regulations^{footnote 1} are repealed.

2 The heading before section 4 and sections 4 to 10 of the Regulations are repealed.

3 Section 15 of the Regulations is repealed.

4 The schedule to the Regulations is amended by replacing the reference “, subsections 3(2), 4(1), 5(1), 6(1) and 7(1), section 8 and subsection” after the heading “SCHEDULE” with “ and subsections 3(2) and”.

Coming into Force

5 These Regulations come into force on the day on which they are registered.

REGULATORY IMPACT ANALYSIS STATEMENT

(This statement is not part of the Regulations.)

Issues

The Passport and Other Travel Document Services Fees Regulations (the Regulations) set out the fees to be charged for passport services. The Regulations include fee adjustment formulas that require Immigration, Refugees and Citizenship Canada (IRCC) to review annually certain passport service fees and adjust them up or down based on the results of the formulas. The fee adjustment formulas were intended to respond to changes in costs outside of the Program’s control (e.g. courier services). However, the fee adjustment formulas do not account for the majority of the costs to deliver passport services, as they only focus on a limited number of categories in which costs are incurred by the Passport Program on a yearly basis. When the Passport Program’s base fees were introduced in 2013, the fees accounted for projected inflation at 2% per annum over the course of the business cycle ending on March 31, 2023. However, actual inflation over the business cycle was higher than projected. As well, since the close of the 10-year business cycle, fees have not accounted for inflation. As a result, the fee adjustment formulas set out in the Regulations are not sufficient to keep up with the cost of delivering passport services to Canadians.

Repealing the adjustment formulas set out in the Regulations would subject the fees to the annual inflation adjustment requirement of the Service Fees Act (SFA). Generally, the SFA requires service fees that are not adjusted annually to account for changes in service delivery costs by implementing annual inflationary adjustments in line with changes in the Consumer Price Index (CPI). Adjusting passport and other travel document fees by annual changes in the CPI would result in fees that are more representative of the costs of delivering passport services to Canadians.

Amendments to the Regulations are needed to repeal the adjustment formulas to allow for the application of annual inflationary adjustments.

Background

IRCC’s Passport Program is responsible for issuing a range of passports and other travel documents to facilitate travel outside of Canada, including regular and temporary passports and emergency travel documents for Canadian citizens, diplomatic and special passports for official government travellers, refugee travel documents for protected persons residing in Canada, and certificates of identity for permanent residents who are unable to obtain a passport from another country. The Passport Program is primarily funded by application and service fees collected from applicants. The Program operates on a cost-recovery basis, meaning that its revenues and expenditures are required to balance out over the course of its business cycle.

The Passport Program’s current fee structure took effect in 2013. The new fee structure was based on demand and cost forecasts for the 10-year business cycle, from April 1, 2013, through to March 31, 2023, including projected inflation at an average of 2% per annum. To account for the uncertainties in projecting costs over 10 years, the Regulations also include fee adjustment formulas, effective April 1, 2016, requiring IRCC to review Passport Program fees annually and to adjust them up or down each year based on formula results. The formulas sought to ensure that sufficient revenues were being generated from fees to offset external cost increases beyond IRCC’s control, such as mailing and courier costs, and also that the amount Canadians pay for these services were adjusted down should external costs decrease. The adjustment formulas apply to the application fees for many of the travel documents listed in the Regulations, such as regular passports, refugee travel documents, and certificates of identity, but not to the supplementary services reflected in the Regulations, such as pick-up fees, expedited fees (express and urgent), call back service fees, emergency travel documents, or temporary passports.

IRCC has determined that the fee adjustment formulas are an unsuitable mechanism to adjust Passport Program fees due to the limited number of cost categories they account for. The costs factored into the adjustment formulas do not account for the large majority of activities driving costs related to processing applications, Program IT and other support costs. For example, if the Program were to collect on the adjustments in accordance with these formulas in fiscal year 2025–2026, they would require a 20% fee increase for abroad applications, but a 1% decrease for domestic applications. Domestic applications account for approximately 90–95% of all applications, and therefore the majority of processing efforts. Therefore, it would be very difficult to justify such an increase to abroad clients and a decrease to domestic clients, particularly when they differ so vastly from the actual increase in cost of operations.

Additionally, the fee adjustment formulas do not capture the impact of inflation. Many of the primary costs to the Passport Program, such as salaries, increase with inflation. Adjusting Passport Program fees for inflationary changes rather than using the formula-based approach set out in the Regulations would be more aligned with the costs of delivering passports and other travel document services.

To remit the outstanding debts resulting from the non-collection of passport fee increases as indicated by the adjustment formulas, in January 2024, the Governor in Council, on the recommendation of the Treasury Board and the Minister of Citizenship and Immigration, approved a Remission Order that remitted approximately $53 million in foregone revenue between April 1, 2020, and March 31, 2023.

Objective

The objective of the Regulations Amending the Passport and Other Travel Document Services Fees Regulations (Removal of Fee Adjustments) referred to herein as “the Amendments” is to repeal the fee adjustment formulas, subjecting the fees in the Regulations to annual adjustments tied to changes in the Consumer Price Index (CPI) as per the SFA.

Description

The Amendments repeal sections of the Regulations that set out the fee adjustment formulas and the annual requirement for the Passport Program to calculate certain application fees.

The Amendments also make other coordinating changes to account for the repeal of the fee adjustment formulas.

Regulatory development

Consultation

The Amendments are exempt from prepublication in the Canada Gazette, Part I. IRCC did not consult publicly on these Amendments given the legal requirement for the Passport Program to adjust its fees annually and the inappropriateness of the adjustment formulas set out in the Regulations for such an adjustment, in addition to the financial state of the Passport Revolving Fund.

The adjustment formulas have proven to be an unsuitable mechanism with which to make fee adjustments. Given that the adjustment formulas inaccurately reflect the cost of delivery of the Passport Program, the Program has never implemented these fee adjustments. However, as per the SFA, the Passport Program is legally obligated to adjust its fees. Adjusting fees annually in accordance with CPI, as per the SFA, will more accurately reflect the changes in costs associated with delivering the Passport Program.

In addition, the Passport Program’s base fee structure alone can no longer support the cost of Program operations. Since the last time inflation was accounted for in Program fees, the CPI increased by 14.5%, leading to expenditures outpacing revenues by approximately $121 million in fiscal year 2024–2025. The Program is in the midst of a comprehensive fee structure review, which will result in options for fee adjustments to account for the true cost of operations. The results of this review will be the subject of public consultation; however, in the meantime, adjusting base fees with inflation annually will prevent the annual funding deficit from increasing further while this review is underway.

Indigenous engagement, consultation and modern treaty obligations

In accordance with the Cabinet Directive on the Federal Approach to Modern Treaty Implementation, an initial assessment was undertaken to determine whether the Amendments are likely to give rise to modern treaty obligations. The initial assessment examined the geographical scope and subject matter of the initiative in relation to modern treaties in effect and did not identify any potential modern treaty implications.

Instrument choice

As the fee adjustment formulas are set in the Regulations, a regulatory amendment is the only instrument to repeal the adjustment formulas.

Regulatory analysis

Benefits and costs

An important first step in developing a cost-benefit methodology is establishing a baseline scenario against which options may be measured. For this analysis, the baseline scenario is one wherein the adjustment formulas are in place, but passport fees do not capture the full cost of the program. The baseline scenario is then compared with the regulatory scenario, in which the fee adjustment formulas are repealed, and fees are adjusted annually to align with inflation.

The Amendments will result in both transition and ongoing costs to IRCC to implement and monitor the changes and are estimated at $0.77M over 10 periods.

Costs to IRCC

Incremental costs to IRCC will consist of both transition and ongoing costs. Transition costs are estimated at $59,000 and include items such as updates to communications products, responding to both public and media inquiries, and updates to program delivery instructions and other administrative materials. These costs will be incurred in the fiscal year 2025–2026. Ongoing costs to IRCC are estimated at $71,000 per year and reflect the cost of manually adjusting fees in the passport IT systems each year to align with inflation, updating passport forms to reflect the new fees, and corresponding communications products. There will also be costs associated with performing the calculations each year to adjust fees; however, IRCC does not expect these costs will be significant.

Costs to applicants

Following the coming into force of the Amendments, fees for travel documents will be adjusted each year to align with inflation. While Canadians may be required to pay more for their travel documents following this annual adjustment, for the purposes of cost-benefit analysis, this does not represent a change in costs. As cost-benefit analyses assess impacts in real terms, inflationary impacts are excluded.

Benefits to IRCC

The Amendments will benefit the Passport Revolving Fund in that fees will be adjusted annually to account for inflation, and thereby fees will be more reflective of the cost of providing the service. It is acknowledged that, while inflationary adjustments will likely generate additional revenue each year from an increase in fees, this will not represent an incremental benefit. Any increase in revenue will simply correspond to inflation and thus not impose a real change in benefits. As cost-benefit analyses assess impacts in real terms, inflationary impacts are excluded.

Small business lens

Analysis under the small business lens concluded that the Amendments will not impact Canadian small businesses.

One-for-one rule

The one-for-one rule does not apply, as there is no incremental change in administrative burden on business.

Regulatory cooperation and alignment

Regulatory cooperation and alignment were considered but do not apply in the case of this amendment. The Passport Program is in the sole jurisdiction of the federal Government.

Effects on the environment

In accordance with the Cabinet Directive on Strategic Environmental and Economic Assessment, the Amendments have been exempted from the requirement to complete a Strategic Environmental and Economic Assessment (SEEA), as the amendments are administrative with no anticipated environmental effects.

Gender-based analysis plus

Passport Program fees have remained consistent since they were introduced in 2013. Therefore, once the Amendments come into force, annual fee adjustments in line with inflation, as per the SFA, could impact clients and their ability to obtain or renew a travel document, particularly those with lower incomes, families, and larger families. While the Passport Program is required by law to amend its fees by way of inflation, any exposure to fee increases could negatively impact clients with low incomes, families with multiple children, elderly clients, those with fixed incomes, students and youth, refugees, and vulnerable Canadian consular clients.

Rationale

The current fee adjustment formulas account for changes in costs associated with mailing and courier services, receiving agents and services abroad, whereas IRCC has identified the greatest contributor to Passport Program costs as being domestic processing costs. For instance, expenses not included within the makeup of the adjustment formulas include material costs, processing costs for the domestic delivery of passports and other travel documents, program support costs (including salaried employees), and information and technology costs. Altogether, the adjustment formulas do not account for roughly 85% of the Passport Program cost of operations. The fee adjustment formulas also do not account for the impacts of inflation. Therefore, adjusting fees annually in accordance with the CPI, as per the SFA, would be a more appropriate fee adjustment method for the Passport Program, as CPI is the most widely used measure of inflation, and therefore a more trusted and transparent metric on which to adjust fees.

Implementation, compliance and enforcement, and service standards

The Amendments come into force upon registration.

The first annual fee adjustment to account for inflation will occur on March 31, 2026, and increase with the April 2024 All-items Consumer Price Index for Canada, as published by Statistics Canada under the Statistics Act.

Contact

Kathryn Fredericks
Director
Passport Program Policy
Immigration, Refugees and Citizenship Canada
Email: Kathryn.Fredericks@cic.gc.ca