An Act to amend the Income Tax Act (travel and accommodation deduction for tradespersons)

This bill was previously introduced in the 41st Parliament, 1st Session.

Sponsor

Chris Charlton  NDP

Introduced as a private member’s bill. (These don’t often become law.)

Status

Defeated, as of Feb. 5, 2014

Subscribe to a feed of speeches and votes in the House related to Bill C-201.

Summary

This is from the published bill. The Library of Parliament often publishes better independent summaries.

This enactment allows tradespersons and indentured apprentices to deduct from their taxable income any travel and accommodation expenses that they have incurred in order to secure and maintain employment in a construction activity at a job site that is located at least 80 kilometres away from their ordinary place of residence.

Elsewhere

All sorts of information on this bill is available at LEGISinfo, provided by the Library of Parliament. You can also read the full text of the bill.

Votes

  • Feb. 5, 2014 Failed That the Bill be now read a second time and referred to the Standing Committee on Finance.

Income Tax Act
Private Members' Business

January 30th, 2014 / 5:25 p.m.
See context

Liberal

Scott Brison Kings—Hants, NS

Mr. Speaker, it is a pleasure to rise today to speak to Bill C-201, which would provide skilled trades workers with a tax deduction for certain work-related travel and accommodations.

I will be supporting this bill at second reading, so that it can move forward and be examined more thoroughly by the House of Commons finance committee.

Bill C-201 would help skilled tradespeople with the costs of travelling to work. It might help address some of the regional skills shortages that exist in Canada. This is an important issue, with a thriving construction industry being a vital source of good, well-paying, middle-class jobs. It is important that we do what we can to support these workers and their families.

Large parts of the construction industry are involved in short- to medium-term projects, and skilled tradespeople are often required to travel or temporarily relocate for work. In my part of the country and throughout Atlantic Canada we have a lot of workers and tradespeople who travel to other parts of the country to work for periods of time and then return to their families and make money in the meantime, which helps pay their mortgage, their family costs, and expenses in their homes in places like Hants County and Kings County of Nova Scotia. However, among construction workers, the cost of relocating is cited as a significant impediment to labour mobility. Not only would this bill provide tradespeople with some relief from the costs of relocating for work, but it would also provide them with a financial benefit that they or members of their family could spend in their home community, which would help support their local economies at home, such as in places like Kings—Hants.

By helping skilled tradespeople with the costs of travelling to work, Bill C-201 could also help address these regional skill shortages and potentially help to increase Canada's productivity. However, there are some important questions surrounding this bill that have yet to be answered, especially regarding the costs. I would hope the finance committee will be able to study the costs of implementing this kind of measure, once the bill has passed at second reading. It is important for parliamentarians to know how much legislation will actually cost before we make final decisions. As parliamentarians, we have a fiduciary responsibility to our citizens and Canadian taxpayers to fully understand the impacts on the fiscal framework in Canada of our decisions and the legislation we pass.

In the first hour of debate on the bill, the member for Hamilton Mountain estimated that approximately 160,000 construction workers in Canada could benefit from the tax credit in Bill C-201 at a cost of $84 million per year to the federal treasury. Then she estimated that when we consider economic spinoffs and potentially reduced EI payouts, the government could actually save $167 million per year under Bill C-201. On the other hand, the parliamentary secretary to the revenue minister argued that Bill C-201 would cost the treasury approximately $60 million per year at maturity. Therefore, there is a wide disparity in the numbers being cited in terms of what this would cost or potentially save taxpayers.

In cases where private member's bills are expected to have significant costs or impact on the fiscal framework, the finance committee in the past has asked the PBO to calculate what that fiscal impact would be before a second reading vote. However, the PBO has not been able to estimate the fiscal impact of this particular bill. The PBO told my office that it had tried to estimate the costs of this bill but could not. This is why. It stated:

There was not sufficient detail in the bill around the definition of trades persons nor around the details of what constituted travel for the purposes of commuting or for the purposes of relocating, nor was there sufficient data from stats can to allow any meaningful costing of this bill.

Therefore, it appears that Bill C-201 is still lacking details that are essential to providing a meaningful cost estimate, and the PBO has said that its office is having difficulty costing it because of that lack of granularity.

Still that is no reason, necessarily, to throw out the baby with the bathwater on this one, because there still may be some positives in the intentions to provide some level of support to skilled tradespeople and their families, and an opportunity for us to do this. We at the finance committee, perhaps, can pass some clarifying amendments that can help address some of these concerns, can better define “skilled tradespeople” exactly in terms of how we would constitute it for this application, and also more clearly define “relocation” or “commuting expense” so we can actually cost the bill and the PBO can actually cost it.

Another area where we have some questions is around the distance a worker must travel to qualify for a tax deduction. Bill C-201 proposes that a skilled tradesperson would qualify for this tax deduction if the worker travels at least 80 kilometres for work. The threshold of 80 kilometres may result in a large proportion of the benefit potentially going to daily commuters in the Toronto area or other metropolitan areas, workers for whom this credit is not necessarily intended.

For instance, workers who commute between Barrie and Toronto travel 96 kilometres each way, and those who commute between Guelph and Toronto would travel 95 kilometres each way. We would want to have this discussion. Is that the intention of this bill? Perhaps it is, but I am saying that there may be some definitions of what defines appropriately a commute for financial benefit considered under this bill. These are areas where there are good roads, infrastructure, strong or reasonable public transit, which help to facilitate a daily commute more so than that which would exist in other areas of Canada that do not have the same highly evolved infrastructure. Therefore, the finance committee may want to consider establishing different thresholds, depending on geography and infrastructure, instead of having one across-the-board threshold when it comes to how far people must travel to qualify for this benefit.

We may want to look at examples from other jurisdictions. As I mentioned before, a thriving construction industry in Canada is an important source of good jobs and incomes for Canadian middle class families, and we can no doubt all talk about individual stories of workers who have travelled great distances for work. I know in my father's case he was not in the construction trade but he drove 52 miles from Cheverie to downtown Halifax every day for work, for decades. Today, I know the local construction workers in my home community of Cheverie drive into Halifax every single day on sometimes terrible roads in awful conditions in the middle of winter, leaving their homes at 5 a.m., driving home in the evenings, leaving before dawn and getting home after dark, and piling into cars with their lunch boxes and their thermoses and their gear ready to go to work, driving over these rough roads in terrible conditions, every single day from Cheverie, Bramber, Walton, Scotch Village, and all our local communities.

Part of the discussions around this bill will enable us to talk to the people in our own communities who commute long distances every day, and particularly people in skilled trades whom we need to support in any way we can. I appreciate the challenges facing the construction industry in areas where there are serious labour shortages, but we need to ensure this bill is targeted in such a way that it actually addresses those issues.

Improving labour mobility in Canada would lead to greater productivity and more prosperity for Canadians. At the same time, we must be careful not to drive a critical mass of young Canadians out of economically disadvantaged communities that need them. We have to monitor this and we have to craft public policy carefully.

Canada is experiencing very uneven economic growth. There is a strong connection between our growing provinces and the existence of natural resources. We need national strategies around the extractive sector in oil and gas and the related construction industry if we are going to ensure that the prosperity is shared across Canada and enjoyed by all Canadians, regardless of where they are from.

This bill could perhaps help to address some of those inequities and help young Canadians see some of those opportunities. However, we will have to delve into those details on a more granular basis at the House of Commons finance committee.

Income Tax Act
Private Members' Business

January 30th, 2014 / 5:35 p.m.
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NDP

Anne Minh-Thu Quach Beauharnois—Salaberry, QC

Mr. Speaker, I am pleased to speak to such an important issue for tradespeople across the country.

The bill introduced by the hon. member for Hamilton Mountain would allow skilled workers to deduct from their taxable income travel and accommodation expenses. It would also allow them to maintain employment at a construction site that is more than 80 kilometres from their home.

This is a much-needed bill. Tradespeople are the engine of our economy. Construction is the biggest private sector industry in the country. It boasts 17,000 companies and employs a million Canadians. It creates more than 12% of our gross domestic product.

Skilled tradespeople include heavy equipment operators, electricians, welders, carpenters and so on. These workers are essential on construction sites. It is impossible to do the work without them.

However, the trades are facing significant challenges, including a shortage of workers and workforce mobility issues.

The Conference Board of Canada estimates that Canada will need at least a million more skilled tradespeople by 2020. In Quebec alone, more than 730,000 professional and technical jobs will open up in the coming year alone. Some of the most sought after workers include industrial mechanics, welders and industrial management supervisors.

The construction industry estimates that it will need an additional 252,000 workers.

These trades require solid math skills, creativity and technological know-how. The pay is good. Skilled professionals earn 3.1% more than the average Canadian.

However, there is a recurring issue and that is workforce mobility. I am not talking about interprovincial mobility, just regional mobility. The placement of work sites in Canada is based on need. In construction, mining and infrastructure, major work sites are often in regions that are far from major cities.

Workers who want jobs far from home have to pay for their own travel and accommodations while still paying for their permanent residences. Those costs eat up a significant portion of their earnings and are not deductible under the Income Tax Act. That makes working far from home a less attractive proposition, not to mention that these people are also away from their families.

According to the building and construction trades department of the AFL-CIO, mobile workers spend an average of $3,500 of their personal savings to relocate temporarily.

While some regions of the country are experiencing high unemployment, others are suffering from a labour shortage. The bill introduced by the member for Hamilton Mountain offers a two-fold solution to the problem. Workers working at job sites at least 80 kilometres away from home would not have to take a financial hit. This solution is needed all the more because of the Conservatives' employment insurance reform, which forces workers to accept jobs within 100 kilometres of home.

In addition, Bill C-201 would boost government revenues because the cost of these tax credits will be outweighed by the employment insurance savings this bill will generate.

We also have to consider employers. They will have access to a larger pool of skilled workers, and Canadians will have access to jobs. Employers will no longer have to resort to temporary foreign workers.

Tradespeople have been waiting for a solution to this problem for a long time. The construction trades have actually been asking for this law for the past 30 years. The Conservatives and the Liberals have done absolutely nothing. The NDP has put forward a real solution.

I would like to congratulate my colleague from Hamilton Mountain because she has been fighting for this for years. In 2006, she introduced Bill C-390 and in 2008, Bill C-227. Now she is at it again with Bill C-201.

If the members of this House really want to support tradespeople, they must support this bill. It is time to pass this bill.

This bill will enable mobile workers across Canada to maintain their residences while relocating to get work. The tax credit would cover travel, meals and accommodation reduce amounts paid by employers for those purposes.

The 2008 budget provided this kind of tax relief to truckers as a way to minimize mobility issues in that sector. Everyone in the industry agrees. This bill will really help workers relocate to job sites.

According to the president of the United Association of Journeymen and Apprentices of Plumbing and Pipe Fitting Local 67, Geoff Roman, we have become too reliant on skilled workers to foot the bill when the country faces a labour shortage.

Robert Blakely, Director of the Canadian Affairs Building and Construction Trades Department agrees. He said:

The baby boomer generation, which no one expected was ever going to retire, is going to retire. We have spaces for nearly 2,500 people to enter the construction industry in the next five years, and another 163,000 people in the five years after that...If we have trained people all across the country, we need to be able to move them.

In Quebec, the International Brotherhood of Electrical Workers, Local 568, strongly supports the bill. Financial secretary Laurent Talbot stated:

The math is simple. More tradespeople working equals a lower unemployment rate.

It is true. There are roughly 1.6 million construction workers in the country and 10% of them move every year. At an average cost of $3,500 per worker per year, a 15% tax credit would cost the government $525 per worker per year, for a total cost of $84 million a year. For the same number of tradespeople receiving on average $393 in EI benefits a week for an unemployment period of four weeks, the government would pay $251 million in EI benefits a year, or nearly two and a half times more than under the bill, if it were passed.

The tax credit proposed in Bill C-201 would translate into a net savings of $167 million a year. That is not insignificant. This solution has been advocated by a number of experts. The Standing Committee on Human Resources, Skills and Social Development and the Status of Persons with Disabilities made two similar recommendations in 2008 as part of a study on employability.

Last year, the committee addressed the issue of labour shortages again and made the following recommendation:

Recommendation 30.

The Committee recommends that the Government of Canada study the anticipated cost of introducing new fiscal measures that would help people who find jobs far away from where they live, for example a tax credit for travel and lodging if a person must work more than 80 kilometres from his or her residence, and that it study the potential impact of such measures on labour mobility and labour shortages.

After eight Conservative budgets, there still is no measure to correct this problem, which this government does not seem to take very seriously. Conservative members have said they support labour mobility, which is inconsistent. This is true of the member for Fort McMurray—Athabasca and the member for Prince Albert. Liberal members should also support this bill, given that it affects the entire country and there are construction workers in all ridings.

I hope that the bill introduced by my colleague from Hamilton Mountain, Bill C-201, passes. Tradespersons need to be supported across Canada, and they need to be treated with respect, like all workers in Canada.

Income Tax Act
Private Members' Business

January 30th, 2014 / 5:45 p.m.
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Conservative

Dave Van Kesteren Chatham-Kent—Essex, ON

Mr. Speaker, I appreciate this opportunity to speak on Bill C-201. It is a well-intentioned bill, but there are some serious flaws.

The economy is and still remains fragile. Simply put, now is not the time to engage in an estimated $60 million per year of reckless and duplicate spending.

Our government will continue to identify efficient ways of supporting our apprentices and tradespeople while creating jobs and economic growth. To put it bluntly, Bill C-201 does the exact opposite of this. It is a costly and flawed piece of legislation that could expose Canada's tax system to a high likelihood of abuse.

Specifically, it would create new costly tax loopholes that would be vulnerable to unfair tax planning, as the deduction is drafted in an open-ended manner. It would give workers in one field an unfair advantage, potentially distorting the labour market. It would make it difficult to ensure that tax relief is not provided for personal expenses, solely reflecting lifestyle decisions. It would result in certain individuals receiving a windfall gain for those individuals who would have incurred eligible travel and accommodation expenses in any case. Also, it would cost in excess of $60 million per year. These are clear and plain reasons why our government cannot support such a bill.

Rather than advance the flawed policy of the NDP bill, our Conservative government has introduced a number of measures that actually support tradespersons, encourage businesses to hire apprentices and encourage Canadians to pursue careers in the trades.

In 2006, members will remember that our government introduced the apprenticeship job creation tax credit which provides eligible employers with a tax credit equal to 10% of the wages paid to qualifying apprentices in the first two years of their contract, or up to $2,000 per apprentice per year.

Also back in 2006, our government introduced in the budget the apprenticeship incentive grant which provides $1,000 per year to apprentices upon completion of each of the first two years of an apprenticeship program in the red seal trade. Then, in budget 2009, our government introduced the apprenticeship completion grant which provides $2,000 to apprentices upon the completion of their certification in a red seal trade.

Let us not forget that it was our government that introduced, in 2014, an annual deduction of up to $500 for tradespersons for the cost of new tools in excess of $1,127 that they must acquire as a condition of employment. Budget 2006 also increased to $500 from $200 the limit on the cost of tools eligible for the 100% capital cost deduction which may be claimed by self-employed tradespersons and businesses.

In addition, there are a number of existing measures under the Income Tax Act for employees, including tradespersons, who travel or relocate for employment.

First, the moving expense deduction recognizes costs incurred by workers who move their ordinary place of residence at least 40 kilometres closer to their place of business or employment in order to pursue employment opportunities. Eligible costs are limited to the amount of income earned at the new location for the year.

Second, the special and remote work sites tax exemption allows employers to provide board and lodging expenses to employees on a tax-free basis. This exemption is limited to benefits paid by the employers on behalf of the employees, which ensures that eligible expenses are incurred for employment purposes.

Third, the travel expenses deduction allows employees who are ordinarily required to carry out the duties of employment away from the employers' place of business or in a different location to deduct travel expenses incurred, including 50% of meal expenses where they are required by the employer to pay their own expenses.

Fourth, similar to the travel expenses deduction for employees, self-employed individuals may deduct reasonable expenses incurred in connection with the generation of income from a business, including travel expenses, for example, lodging, and 50% of meal costs, while they are away from home.

Fifth, the northern residents deduction provides tax relief to individuals in northern and isolated communities to assist in attracting skilled labour to these communities.

Finally, the Canada employment credit, the CEC, introduced by the government in budget 2006 recognizes work-related expenses in a general way. In 2014, the CEC provides a tax credit on employment income up to $1,127.

As hon. members can see, our government recognizes the importance of the skilled trades to Canada's economy. We continue through our economic action plan to support economic growth and job creation, which includes a number of initiatives that directly support the development of a skilled, mobile and inclusive workforce within an efficient labour market.

Economic action plan 2013 proposes new measures to support the use of apprenticeships in four key ways: supporting the use of apprentices in federal construction and maintenance contracts; ensuring the funds transferred to provinces and territories through the investment in affordable housing support the use of apprentices; encouraging provinces, territories and municipalities to support the use of apprentices in infrastructure projects receiving federal funding as part of the new building Canada plan for infrastructure; and providing $4 million to work with provinces and territories to harmonize requirements for apprentices.

This kind of support for skills training is crucial to Canada's long-term growth, which is why our Conservative government is committed to maintaining this strong momentum. What the opposition does not understand is that in order to sustain this momentum more needs to be done than just creating training opportunities in high demand areas. It also requires creating the overall conditions for economic success that create high demand in the first place. It is for this reason Canada's economic action plan is a low-tax plan that will eliminate the deficit in 2015, reduce red tape and continue to promote free trade and innovation.

The results of our efforts speak for themselves. Since the depths of the global economic recession, the worst since the Great Depression, Canada's economy has created over one million net new jobs. These are overwhelmingly full-time, well-paying jobs in the private sector. I am proud to say that this is the strongest growth record among G7 countries, and others are noticing.

We are garnering international attention with Bloomberg recently declaring that Canada was the second best country in which to do business, just behind Hong Kong. Both the International Monetary Fund and the Organisation for Economic Co-operation and Development have recognized the benefits of our plan. They expect Canada to be among the strongest growing economies in the G7 over the next few years.

Our government remains focused on the drivers of growth and job creation: innovation, investment, education, skills and communities. These are underpinned by our ongoing commitment to keeping taxes low and returning a balanced budget in 2015. Unfortunately, bills such as Bill C-201 would do nothing to strengthen Canada's economy. It contains too many flaws, would cost too much, and it fails to take into account the effective policies we currently have in place to help not only tradespersons but all hard-working Canadians.

Given the many shortcomings in the proposal before us today, I encourage my fellow members to vote against this legislation.

Income Tax Act
Private Members' Business

January 30th, 2014 / 5:55 p.m.
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NDP

Claude Gravelle Nickel Belt, ON

Mr. Speaker, I am happy to rise today to speak to this bill amending the Income Tax Act to deal with travel and accommodation deductions for tradespersons.

It is no surprise that this legislation comes from my colleague and friend, the member for Hamilton Mountain. Nickel Belt and Hamilton have much in common besides their good sense in electing New Democrats to the House of Commons.

My colleague has been tireless in her support and advocacy for working men and women. Like her, I understand the extraordinary contributions made by tradespeople for our economy and our communities. People in Hamilton and Nickel Belt get this.

Like her, I know the extraordinary contributions unions make in the fight for justice, fair wages, pension protection of workers, and so much more. Examples are the Edgar Burton food drive in Sudbury, led by local 6500 USW, and the building of the cancer treatment centre in Sudbury, which was driven by all union members in Sudbury and Nickel Belt.

Unlike the government opposite, we on this side respect the union movement and the role unions play in building our communities and our country. The Conservatives proved last night, by supporting Bill C-525, how they feel about unions.

This is a reasonable proposal before the House today. It would allow tradespersons and apprentices to deduct travel and accommodation expenses from their taxable incomes so that they could secure and maintain employment at a construction site that is more than 80 kilometres away from their homes.

I worked for a mining company for 34 years as a tradesman. I know the importance of the trades and the need, from time to time, for those skilled labourers to travel great distances to projects in other parts of the province or country.

Sitting these past two years on the natural resources committee, I understand the demand for skills in these major oil and mining projects and the likelihood of our workers travelling great distances to secure these jobs. This is an issue that is going to become increasingly important in our country.

This bill will help our working people and their families. The Canadian building and construction trades have been asking for this legislation for over 30 years. They got a lot of words from successive Liberal and Conservative governments, but no action.

Let us think about taking this reasonable small step in helping these tradespeople and our economy.

Construction workers cannot claim their travel or accommodation expenses when they accept jobs in other parts of the province or country. Building and trades officials report that the average expenses to relocate can be about $3,500. Some cannot afford to pay those expenses knowing that they cannot get a tax credit for them.

The member for Hamilton Mountain has done her homework on making this a win-win situation for everyone. It would solve the challenges in our regions where one area suffers from high unemployment while another suffers from temporary skilled labour shortages. Let us help the skilled workers get to where they need to be.

This legislation is even revenue neutral, given the savings that would happen in employment insurance benefits. The government has trouble figuring this out.

I have a response to a petition I submitted last month that was in favour of Bill C-201. The government calls this bill costly and flawed. The government insults workers, claiming that this tax relief could be open to much abuse, with moves done for lifestyle decisions rather than for work.

Any tax credit is, of course, open to abuse and requires safeguards and monitoring, which the Canada Revenue Agency is supposed to provide. It is not that difficult to confirm that a move has been made to take a skilled job that has not been filled.

The government response also alleges that certain individuals might receive a windfall gain and would have incurred ineligible travel and accommodation expenses in any case. I do not know who they were thinking about when they made these comments. It was probably Duffy, Wallin, Brazeau, Harb, and Lavigne. These people I named are not tradesmen. They are professional fraudsters. They are senators.

It is not difficult to make clear what an eligible expense is and who qualifies.

The CRA is also there to investigate any double-dipping.

This is also a win-win for the employers, giving them access to much larger pools of qualified workers. We need to act when we look at this country's demographics, including the baby boom generation, the numbers to retire in the next 10 years, and the statistics on shortage of skilled workers.

This bill has been introduced in every parliamentary session since 2006. It was part of the NDP's election platforms in 2008 and 2011. What we want is simple. The bill would allow tradespersons and apprentices to deduct travel and accommodation expenses from their taxable income so that they can secure and maintain employment at a construction site that is more than 80 kilometres away from their home.

These mobile workers across Canada continue to have to worry about maintaining a residence and their family, while spending their own money to travel in order to find work. The tax credit would cover the cost of travel, meals and accommodation and reduce the amounts paid by employers for the same things. The 2008 budget offered a similar break to truck drivers in order to reduce problems associated with mobility in that industry.

I remember what the AFL-CIO's Building and Construction Trades Department director, Robert Blakely, said at the 2012 pre-budget consultations:

We have spaces for nearly 2,500 people to enter the construction industry in the next five years, and another 163,000 people in the five years after that. It's an industry that is going to change. If we have trained people all across the country, we need to be able to move them.

There are an estimated 1.6 million construction workers in Canada. An estimated 10% of them travel each year. This legislation is even revenue neutral, given the savings that would happen in employment insurance payments.

The government has trouble figuring this out. The government needs to do the real math, not the nonsense of estimating the cost of the bill at $60 million per year.

Income Tax Act
Private Members' Business

January 30th, 2014 / 6 p.m.
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Conservative

Colin Mayes Okanagan—Shuswap, BC

Mr. Speaker, Bill C-201, an act to amend the Income Tax Act , would in essence allow tradespersons and indentured apprentices to deduct from their taxable income any travel and accommodation expenses that they have incurred in order to secure and maintain employment in a construction activity at a job site that is located at least 80 kilometres away from their ordinary residence.

Let me first say that our government encourages new ways and ideas to improve Canada's tax system. Our government has a strong record of tax fairness and tax relief. We work diligently to treat each tax dollar we receive responsibly. Therefore, we are always open to ways that can keep money where it belongs, in the pockets of hard-working Canadians.

We realize that Bill C-201 has good intentions, such as providing tax relief for tradespersons and indentured apprentices who have to travel a long distance to work. We thank the member for her concern for these hard-working Canadians, but unfortunately the bill itself has too many problems for the government to support it.

Like speakers before me have mentioned when the bill was first debated, the bill contains flaws that could create opportunities for tax planning. It is a piece of legislation that could pose a very significant cost to taxpayers. Further, the bill is redundant, considering that our government already has thoughtful and practical measures to support apprenticeships and tradespersons.

Allow me to elaborate on that point. In response to growing shortages of skilled labour in some parts of our country, our government already provides a number of measures to support apprentices and tradespersons who are an integral part of our economy. Specifically, the government has introduced a number of measures to encourage businesses to hire apprentices and Canadians to pursue careers in the trades.

Let me share what we have done. Budget 2006 introduced the apprenticeship job creation tax credit which provides eligible employers a tax credit equal to 10% of the wages paid to qualifying apprentices in the first two years of their contract, up to $2,000 per apprentice per year. Budget 2006 also introduced the apprenticeship incentive grant, which provides $1,000 per year to apprentices upon completion of each of the first two years of an apprenticeship program in the red seal trades. Also, budget 2009 introduced the apprenticeship completion grant, which provides $2,000 to apprentices upon completion of their certification in red seal trades.

We have consistently supported tradespersons in Canada. Budget 2006 also introduced an annual deduction of up to $500, in 2013, for tradespersons for the cost of new tools in excess of $1,117 that they must acquire as a condition of employment. Budget 2006 also increased to $500 from $200 the limit on the cost of tools eligible for the 100% capital cost deduction which may be claimed by self-employed tradespersons and businesses. Our government has also extended the fees eligible for the tuition tax credit to include those from examinations required to be certified as a tradesperson in Canada.

It does not stop there. In addition to these tax measures and grants, our government, through economic action plan 2013, proposed new measures to support the use of apprentices in three key areas. The first is changing the government's approach to procurement by introducing measures to support the use of apprentices in federal construction and maintenance contracts. Second is ensuring that funds transferred to provinces and territories through the investment in affordable housing support the use of apprentices. Third, we are encouraging provinces, territories and municipalities to support the use of apprentices in infrastructure projects receiving federal funding as part of the new building Canada plan for infrastructure.

To further reduce barriers to accreditation in the skilled trades, economic action plan 2013 announced the government's intention to reallocate $4 million over three years to work with provinces and territories to harmonize requirements for apprentices, as well as examining the use of practical tests as a means of assessment in targeted skilled trades.

Economic action plan 2013 was a large commitment by our government to support the skilled trades and encourage growth in these very important industries. Unfortunately, the member opposite who put forward Bill C-201 voted against every one of these measures. Therefore, it is surprising to see her claim full support for tradespeople across the country.

Having established how our government has been, and continues to be, proactive when it comes to providing practical support for apprentices and tradespeople, I would like to discuss the important policy concerns that the bill raises. To put it bluntly, as drafted, Bill C-201 would make it difficult to ensure that tax relief is not provided in respect of personal expenses reflecting lifestyle decisions. For example, expenses incurred by eligible individuals who choose to live more than 80 kilometres away from the workplace for personal reasons would qualify for the tax relief. Furthermore, the open-ended nature of the proposed deduction would make it vulnerable to unfair tax planning. For example, individuals could arrange their affairs to claim a recreational property, such as a cottage more than 80 kilometres away from work, as their principal residence and deduct the cost of maintaining their urban residence as an expense required to secure and maintain employment. Legislating tax credits that are open to abuse is not how we create a fair tax system for all Canadians.

Finally, implementing Bill C-201 would cost taxpayers up to $60 million. Since our government already has significant measures in place to provide tax relief to tradespeople, we do not see any added benefit to forgoing more tax revenue for a measure that may not prove to be effective, and a measure that could subsidize personal choices, for that matter.

We take pride in the fact that under our government the overall federal tax burden is the lowest it has been in 50 years. In total, our government has introduced more than 160 tax-relief measures since 2006, reducing taxes in every way that the Government of Canada collects them. These are real measures that are helping all Canadians across the country: tradespeople, apprentices, families, seniors, and the list goes on. Canadians at all income levels are benefiting from the personal income tax relief introduced by the government, with low- and middle-income Canadians receiving proportionately greater relief. The average family of four is saving over $3,200 per year in taxes, and more than one million low-income Canadians have been removed from the tax rolls.

This is great news, and more work must be done. However, we must be cautious of proposals that would unnecessarily burden the work our government is doing to balance the budget. Our government is focused on the drivers of growth and job creation: innovation, investment, education, skills, and communities, underpinned by our ongoing commitment to keep taxes low, and returning to a balanced budget.

Therefore, it is our position that Canadians do not need Bill C-201. It contains too many flaws. It costs too much, and it is redundant, considering the policies we currently have in place to help not only tradespeople, but all working Canadians as well. With that, I encourage my fellow members to vote against the bill.

Income Tax Act
Private Members' Business

January 30th, 2014 / 6:20 p.m.
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NDP

Chris Charlton Hamilton Mountain, ON

Mr. Speaker, I had hoped to be able to rise in the chamber tonight to thank my colleagues from all sides of the House for putting partisanship aside and doing the right thing; the right thing for Canada's building and construction trades, for employers who cannot find enough skilled workers to meet their job requirements, for regional economies and for the taxpayers of this country. We could have achieved all of that simply by supporting Bill C-201, an act that would allow tradespersons and indentured apprentices to deduct from their taxable income any travel and accommodation expenses they incur to secure and maintain employment in a construction activity at a job site located at least 80 kilometres away from their ordinary place of residence.

However, it is clear from the Conservative members' comments in this debate that they are once again going to allow partisanship to stand in the way of good public policy. In fact, the member for Yukon basically said as much when he stated essentially that I should not have had the audacity to introduce this bill because, in his view, it should have been introduced by the Conservatives as part of their budget process. I would have been happy for that to happen. In fact, ever since I first introduced this bill in 2006, I have repeatedly been in touch with the government, including the Prime Minister and the Minister of Finance, to indicate that I would happily withdraw my bill if the government wanted to introduce it as a Conservative budget measure. However, eight years later, the building trades have still only received lip service instead of action and, frankly, they deserve better. What they are getting from the current government is the same run-around that they got from previous Liberal and Conservative governments for the last 35 years. It is a disgrace. The reasons being articulated by members on the government side just do not hold water. I only have five minutes to participate in tonight's debate, but thankfully all of the arguments are easy to rebut.

The first argument put forward by the Parliamentary Secretary to the Minister of National Revenue was that the bill would be very costly and that the cost would be significant to our economy at this time. However, just a few minutes later he went on to take credit for “Canada's strong economic performance”. Well, which is it? Did the Conservatives fail and the economy is still fragile? Or is the economy robust and the Conservatives are simply refusing to act? Either way, the government is failing Canada's building and construction trades.

The next argument put forth by government MPs is that the Canada jobs grant is a better solution than my bill for the skilled labour shortage, which has been identified by the Canadian Chamber of Commerce as the number one issue facing its membership. However, oops, the Canada jobs grant does not actually exist yet and, given the provinces' rejection of the federal approach on this file, it may in fact never get off the ground. However, that of course has not stopped the government from already spending taxpayer dollars on advertising this non-existent program.

To add insult to injury, the Conservative talking points then suggest that my bill would provide tax relief for “personal expenses that reflect lifestyle decisions”. That argument is buttressed by examples of imaginary workers who would use my bill to scam the government by going to the cottage so they could claim to be more than 80 kilometres away from a job site that in reality is close to their primary residence. That argument is so absurd that I do not even know where to begin, but suffice it to say that tax credits only return a percentage of the actual money spent on travel, so no one is going to come out ahead financially under this bizarrely concocted Conservative scenario. It would be cheaper for them to live at home. I do not think I will be taking any lessons on tax evasion from a government that has done nothing to recover the $5 billion to $7.8 billion in Canadian tax revenue that is lost annually to tax havens around the world.

The last argument put forth by the government is that the bill would “raise equity concerns”, meaning that by singling out tradespersons my bill would not go far enough in offering the same benefits to other workers. On that point, we can agree, and I would be more than happy to entertain amendments in committee to broaden the coverage of my bill. I had specifically kept the focus narrow to keep the bill revenue-neutral and to alleviate the cost concerns that I knew would be at the root of the government's objections. However, by all means let us include others; the members of ACTRA, for one, would be delighted. However, the only way to do that is to actually vote in favour of my bill at second reading, so it will end up in committee where amendments could be made. That is where the rubber would hit the road.

I know the Conservatives are not sincere in wanting to improve the bill. They have their marching orders. Even those members like the MPs for Brant and Mississauga—Streetsville and the Minister of Labour, who spoke out in favour of my bill at the HUMA committee, now appear to be backtracking. I cannot believe they would just allow themselves to be muzzled by the PMO. Nor do I want to believe they are the kind of politicians who say one thing to one audience and something else to a different crowd. I want to believe they are more principled than that.

So today in these final few seconds of second-reading debate, I want to speak directly to them and say to stand up for what they believe in, that they know this bill is the right thing to do; to talk to their colleagues and tell them that it is never wrong to fight for what is right.

On February 5 when this bill comes to a vote, let us make history. Let us pass this initiative that helps the very men and women who have literally built our country. Canada's building and construction trades deserve nothing less.

Income Tax
Petitions
Routine Proceedings

October 31st, 2013 / 12:25 p.m.
See context

NDP

Chris Charlton Hamilton Mountain, ON

Mr. Speaker, later today the House will begin debate on Bill C-201, which is my private member's bill to allow tradespeople to deduct travel and accommodation expenses from their taxable income so that they can secure and maintain employment at a construction site that is more than 80 kilometres away from their home.

In support of this bill, I have been flooded by petitions. I am pleased to table yet another set in the House today. This time the petitioners are from Saskatchewan, British Columbia, Alberta, and Ontario, including Whitby, the hometown of the Minister of Finance. There are literally hundreds of names on the petition, all urging the government to give quick passage to my bill.

I thank the petitioners for their support and I am pleased to be able to table this petition on their behalf.

Income Tax Act
Private Members' Business

October 31st, 2013 / 1:30 p.m.
See context

NDP

Chris Charlton Hamilton Mountain, ON

moved that Bill C-201, an act to amend the Income Tax Act (travel and accommodation deduction for tradespersons), be read the second time and referred to a committee.

Mr. Speaker, I cannot believe that the time has finally come to debate Bill C-201, an act to amend the Income Tax Act (travel and accommodation deduction for tradespersons). It is the very first bill I introduced in this chamber after being elected in January 2006 and it is a bill that is near and dear to my heart.

However, my wait is nothing compared with the wait experienced by the workers who are at the heart of my bill. The Canadian building and construction trades have been lobbying for this legislation for over 35 years. Their tenacity on this file is remarkable and ought to be indicative to the government that this issue matters deeply to the very people who have literally built our country.

In fact, I would be remiss if I did not publicly thank Bob Blakely, the chief operating officer of the Canadian Building Trades Unions, for his personal commitment to this bill and for never ceasing to fight for the best interests of his members. Bob knows only too well what a bumpy road it has been to get to this point today.

Both Liberal and Conservative governments have made promises to the building trades in the past about concrete action to come. However, those games of political footsie led exactly nowhere.

It is time for the games to stop and for all members in the House to stand up and be counted. Lip service is no longer good enough. I am delighted to give members the opportunity to clarify their positions in the coming vote on my bill.

I know, Mr. Speaker, that you follow American politics closely, so you will remember former Speaker Tip O'Neill coining the phrase “all politics is local”. It is the principle that a politician's success is directly tied to his or her ability to understand and influence the issues of constituents.

While that certainly encapsulates the genesis of bill that we are debating today, I introduced it because of the amazing education and awareness-raising efforts of the members of the Building and Construction Trades Council in my hometown of Hamilton.

In particular, I want to single out the leadership of business manager Joe Beattie, who invited me to meet with the building trades about this issue before I was even elected.

We can see that the Hamilton building trades are not just savvy lobbyists, they are also clairvoyant. They knew I would eventually get elected, even before I believed it myself.

The case that was put to me by Joe, along with the members of Carpenters Local 18, UA Local 67 and Sheetmetal Workers Local 537, made sense then, and it still makes sense now. It makes sense for workers, who would benefit from a reduction in their temporary relocation costs and a reduction in time spent unemployed. It makes sense for employers which will benefit from access to larger pools of qualified workers and reduced costs relating to participation in programs such as the temporary foreign workers program. It makes sense for the government, because it would benefit from increased long-term income tax revenues and reduced dependence on costly social programs.

However, let me not put the cart before the horse. Let us start at the beginning and look at the issue that my bill is seeking to address, the specific remedy that it offers and the opportunity that it represents for the government and all members of the House.

Right now, there are two major human resource challenges facing Canada's construction industry: regional labour shortages and barriers to labour mobility.

The 2011 edition of the Construction Sector Council's “Construction Looking Forward” report suggests that to replace retiring workers and maintain productivity, construction employers, collectively, must hire more than 320,000 new workers between now and 2019. While training programs and recruitment from non-traditional labour sources are part of the solution, they will not be enough to ameliorate the significant labour shortages that are projected for the decade ahead.

Compounding this problem is the unevenness of demand for construction workers. Some regions of the country, such as Newfoundland and Labrador, are expected to face significant worker shortages until next year. Others, such as Ontario, will offer fewer work opportunities in the short term, but many more between 2015 and 2019. A third group, including Quebec, Nova Scotia and Alberta, will offer consistently high numbers throughout the forecast period.

With the demand for labour thus high in some parts of the country and lower in others, it would be in everyone's best interest to facilitate the mobility of unemployed workers from one part of the country to job openings in another.

This would be an easy problem to solve if construction jobs were permanent, but they are not. Construction is a transitory business. When a hospital, a mall or, for that matter, a Pan Am stadium is built, the job is done. Work can last for days, weeks or months, but the bottom line is that it is not permanent and no worker can fairly be expected to move his or her family to a new city every time the workplace changes, and therein lies the rub.

Under current rules, construction workers often incur large personal expenses to accept jobs in other parts of the province or country because neither their travel nor accommodation expenses are tax deductible under the Income Tax Act. As a result, these costs create a huge disincentive for workers to accept work in those parts of the country that are experiencing skills shortages.

Figures compiled on behalf of the building and construction trades department of the AFL-CIO suggest that the average mobile worker spends approximately $3,500 of his or her own money to temporarily relocate. That is a significant barrier to the appeal of working mobile. Without wanting to be too cute, I ask my hon. colleagues to imagine what would happen in this place if we told members tomorrow that they could no longer get financial assistance for their secondary residence here in Ottawa while they are here on the job, or for their travel for that matter.

If that is not enough to spur us on to creating fairness for the building trades, let me just remind members that this House already acknowledged that transitory workers merit financial support, and budget 2008 provided a tax break to truck drivers to assist with mobility challenges in that industry. I am calling on us to do the right thing here today and create a labour mobility tax credit for the building and construction industry too. Specifically, my bill would allow tradespersons and indentured apprentices to deduct travel and accommodation expenses from their taxable income, so they can secure and maintain employment at a construction site that is more than 80 kilometres from their home. Adopting this bill would remove one of the largest stated barriers to labour mobility in our country and would pave the road for workers to move freely between regions of the country where their skills are in demand. For me, this is absolutely the right thing to do, and I do not believe that this issue has to be partisan. In fact, I know it is not.

Let me remind members than in April 2008, the Standing Committee on Human Resources, Skills and Social Development and the Status of Persons with Disabilities supported my bill in intent if not by name. The two germane recommendations were numbers 1.6 and 1.7. Recommendation number 1.6 reads:

The Committee recommends that the federal government examine the moving expenses provision of the Income Tax Act with a view to extending this provision to individuals who must leave their principal residence to work on a temporary basis, provided their principal residence is retained.

Recommendation number 1.7 says:

The Committee recommends that the federal government provide funding to assist individuals who agree to relocate to enter employment in occupations experiencing skills shortages.

Both of those recommendations are spot-on.

Yes, these recommendations were adopted during a minority Parliament, so it may be assumed that the government members did not actually support them. However, let me provide further evidence to the contrary. Before the Standing Committee on Finance on November 19, 2012, the Conservative member for Fort McMurray—Athabasca responded to a presentation by a representative of the building trades by saying, “...I've been advocating since 2005 for a tax credit on travel and mobility”.

Just a month later, another report by the Standing Committee on Human Resources, Skills and Social Development and the Status of Persons with Disabilities made this its 30th recommendation. It stated:

The Committee recommends that the Government of Canada study the anticipated cost of introducing new fiscal measures that would help people who find jobs far away from where they live, for example a tax credit for travel and lodging if a person must work more than 80 kilometres from his or her residence, and that it study the potential impact of such measures on labour mobility and labour shortages.

This time, the government had the majority of members on the committee, so that recommendation would not have passed without the support of the Conservatives.

I want to publicly thank the Conservatives who were members of the committee at that time. They are the members for Mississauga—Streetsville, Don Valley East, Okanagan—Shuswap, Brant and Calgary Northeast, and the member for Simcoe—Grey, who is now Canada's Minister of Labour. I know that the member for Mississauga—Streetsville, in particular, understands this issue and has been advocating for it inside his own caucus. Also, I hope the Minister of Labour is using her new clout to assist his efforts in every possible way. Since she has repeatedly mentioned her own family roots in Alberta's construction industry, I trust that she understands what is at stake here.

Certainly, all of the opposition members on the committee got it right away. I was but one member of that committee, and I was proud to note that my NDP colleagues at HUMA, the members for Hochelaga, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup and St. John's South—Mount Pearl, have always stood four-square behind the building trades in their communities and immediately expressed their support for my bill.

I am also cautiously optimistic that my Liberal colleague from Cape Breton—Canso will see fit to vote for it, although truthfully I am not sure which side he was on when the issue was being discussed when the Liberals were in government, during their 13 years in office. What I do know is that in opposition he has been nothing but supportive, and I want to thank him for that.

This issue does have broad-based support. What is stopping it from becoming law? At one point both the Minister of Finance and the former Minister of Labour were concerned about how much my proposed tax credit would cost. They were not entirely convinced by the admittedly rough initial calculations, which showed that it would be revenue neutral, since the cost of the tax credit would be more than offset by savings in employment insurance payments that would no longer have to be made as unemployed Canadians went to work in other parts of the country.

However, the building trades took the minister's concern seriously and had the projections related to my bill audited by Hendry Warren. The audited numbers were given to every member of this House during the last building trades lobby day, and I trust that everyone will have familiarized themselves with the costing of my proposal. However, let us take a quick look at the numbers again just to make absolutely certain that we are all on the same page.

Hendry Warren estimated that there are 1.6 million construction workers in Canada. An estimated 10% of them travel each year. At an average cost of $3,500 per worker per year, a 15% tax credit would cost the government $525 per mobile worker per year, for a total cost of $84 million.

Working with the same number of 160,000 travelling skilled trades workers whose average weekly employment insurance benefit would be $393 per week for an average period of unemployment of four weeks if they were not working means that the government would pay $251 million in EI benefits per year. That means that the tax credit proposal in my bill would actually save the government $167 million per year.

Let me repeat that, Mr. Speaker, because these numbers will be germane in your consideration of whether my bill will ultimately require a royal recommendation. Far from being an expenditure, my bill would actually save the government $167 million each and every year, and that is just premised on savings on EI.

As the audited statement makes clear, when savings from all social programs are taken into account along with increased long-term income tax revenues from employment, the labour mobility tax credit is more likely to yield a return on the government's investment of nearly five to one. We would think the Minister of Finance would be doing a happy dance at the prospect of such a windfall.

The bill really is a win, win, win. As I said at the outset, workers win because the travel and accommodation costs would no longer be a barrier to accepting decent jobs for decent wages in other regions of the country; employers win because they would have access to larger pools of qualified workers without needing to resort to the costly temporary foreign workers program; the government wins by having taken a concrete step toward addressing regional skilled labour shortages, all the while reducing dependence on costly social programs and actually boosting long-term income tax revenues. It does not get much better than that.

Let me conclude by bringing this discussion full circle. I want to end where I began.

Locally and nationally, the building and construction trades have lobbied for the bill for over 35 years. They represent an industry that is critical to our economy. In fact, construction is Canada's largest private sector industry. Its direct impact is immense. Construction accounts for 12% of Canada's GDP.

The industry has more than 260,000 businesses, employing more than a million Canadians. It is responsible for installing, repairing, and renovating more than $150 billion worth of infrastructure every single year. It is a threshold industry on which everything else is based.

In a very real sense, the building and construction trades have built our country. It is time for us to shore up their work. It is time for us to heed their call for action. It is time for us to provide them with a tax credit for travel and accommodation expenses when they accept work more than 80 kilometres away from their home. It is time to pass my bill.

Income Tax Act
Private Members' Business

October 31st, 2013 / 1:50 p.m.
See context

South Shore—St. Margaret's
Nova Scotia

Conservative

Gerald Keddy Parliamentary Secretary to the Minister of National Revenue and for the Atlantic Canada Opportunities Agency

Mr. Speaker, it is a pleasure to rise in debate today on Bill C-201, which is sponsored by the member for Hamilton Mountain.

The bill proposes to allow tradespeople and apprentices to deduct from their taxable income travel and accommodation expenses that they incur in order to secure and maintain employment. These deductions would be subject to certain conditions.

I would like to focus on a few reasons why I oppose Bill C-201.

First of all, our government is quite focused on providing support for employees and tradespeople across the country. Second, the bill would be ineffective and inequitable. It would be ineffective because there is no evidence that the proposal would increase the likelihood that tradespeople will travel more for work, and inequitable in that some tradespeople would receive tax relief for work-related travel while other workers would not.

Third, especially during a time of fiscal responsibility, the bill would be very costly and that cost would be significant at this time in our economy. The bill looks nice and has a nice sound to it. It is kind of like a chocolate cake with a lot of icing on it. We look at the icing on the chocolate cake and say it looks tasty, but it really is not good for us. There is no way to square that piece of cake to be good for us.

I will start by highlighting our government's role in supporting employees and tradespeople. I would like to say that the hon. member for Hamilton Mountain did not support any of the legislation that we brought in to support employees and tradespeople. That needs to be noted during this debate. I mean, it is one thing to have a personal preference. It is one thing to have a party bias. I think we all have some party bias in this place. However, it is another thing to ignore good legislation simply because it is the government that brings it in.

Canada's strong economic performance during the global recession has been widely recognized around the world. Although it may not have gotten the same amount of press as other key initiatives, Canada's economic action plan provided key funding to several organizations to stimulate growth and jobs during the recent recession and helped tradespeople and other Canadians find jobs.

Our government knows that Canadian workers are among the best educated and the best trained in the world. However, Canada is facing a skilled labour shortage. In particular, persistent pockets of unfilled positions exist for some skilled tradespeople and professional occupations. The Canadian Chamber of Commerce, for example, has identified Canada's skills shortage as the number one issue facing its membership.

Our government takes this issue seriously. To help Canadians connect with available jobs, in economic action plan 2013 we set out a three-point plan to address these challenges. First, economic action plan 2013 introduced the new Canada job grant, which would provide $15,000 or more per person, including the maximum federal contribution of $5,000, to be matched by the provinces, territories and employers, to ensure Canadians are getting the skills employers are seeking.

Second, the plan would create opportunities for apprentices by working with provinces and territories to examine the use of practical tests as a method of assessment and to harmonize requirements, and by introducing measures that would support the use of apprentices through federal construction and maintenance contracts, investments in affordable housing and infrastructure projects that receive federal funding. Finally, it would provide support to groups that are under-represented in the job market, such as persons with disabilities, youth, aboriginal peoples and newcomers, to help them find good jobs.

These are great initiatives that are directly helping to fill the labour shortages and connect Canadians with jobs. These are all measures that the opposition has voted against. If the member's bill attempts to focus on apprentices and tradespeople, let me highlight some of the measures our government has already taken to support these individuals.

Since 2006, our government has invested nearly $2.7 billion per year to support skills and training programs. We have supported tradespeople with the tradesperson's tools deduction and extended the fees eligible for the tuition tax credit to include those examinations required to be certified as a tradesperson in Canada, thereby encouraging more tradespeople to become red seal tradesmen. With a red seal, they can work anywhere in the country.

Our government has legislated measures such as the apprenticeship job creation tax credit, the apprenticeship incentive grant, and the apprenticeship completion grant. Tax credits already exist for employers and tradespersons, such as the Canada employment credit, the moving expenses deduction, and the special or remote work sites tax exemptions.

That is not all. We understand that education has a big part in this equation as well. We will promote education in fields where there is high demand for employees, including science, technology, engineering, mathematics, and skilled trades. We will help improve educational and labour market outcomes for aboriginal peoples by investing to improve the on-reserve income assistance program and by providing funding for post-secondary scholarships and bursaries.

We will continue to work with the provinces and territories and stakeholders to improve the foreign credential recognition process, thereby enhancing the integration of internationally trained individuals in the job market.

Put simply, our government remains focused on what matters to Canadians—jobs and economic growth and ensuring that Canada's economic advantage today will translate into the long-term prosperity of tomorrow.

Let me now address some of the specific concerns we have with the bill before us.

First, we believe that providing an income tax deduction for job-related travel and accommodation expenses, as proposed under Bill C-201, would make it difficult to ensure that tax relief is not provided for personal expenses that reflect lifestyle decisions. Under the provisions of this bill, expenses incurred by eligible individuals who choose to live more than 80 kilometres from the workplace for personal reasons would quality for tax relief.

Second, the open-ended nature of the proposed deduction would make it vulnerable to unfair tax planning and abuse. For example, individuals could arrange their affairs to claim a recreational property, such as a cottage that is more than 80 kilometres from work, as their principal residence. They could then deduct the cost of maintaining their urban residence as an expense required to secure and maintain employment. That is a serious flaw with this piece of proposed legislation. This is not conductive to a fair tax system, especially as we have just been debating Bill C-4, which emphasizes our government's commitment to a fair tax system for all Canadians.

Third, the bill would raise equity concerns, as eligible tradespersons and indentured apprentices would be able to reduce their tax liability when they incurred eligible travel and accommodation expenses whereas other workers who had to incur similar work-related travel expenses, such as nurses, would not receive tax assistance. This would result in individuals with a similar capacity to pay taxes having markedly different tax liabilities, due solely to occupational differences.

Fourth, it is not clear that the bill would increase travel by tradespersons and indentured apprentices. In fact, for individuals who would have incurred eligible travel and accommodation expenses in any case, the deduction would represent a windfall gain.

Finally, and perhaps most importantly, the cost of the proposal would be significant. Preliminary estimates suggest that providing tax assistance to tradespersons and indentured apprentices for travel and accommodation expenses would cost approximately $60 million per year at maturity. At a time when our government is committed to returning to balanced budgets and eliminating the deficit, this bill, which already raises some concerns, would be extremely costly to the government.

In addition, Bill C-201 would create pressure to extend tax relief in respect of other expenses or other types of employees, at a higher fiscal cost.

Make no mistake. Our government believes in tax relief for all Canadians. Canadians know that when it comes to tax reductions, this government has a long-standing record of significant achievements. By keeping taxes low, our government is allowing Canadians to keep more of their hard-earned money.

In conclusion, this bill is poorly targeted, would subsidize personal choices, and would open the door to unfair tax planning. It would also entail a cost of approximately $60 million per year. It would create pressure to extend tax relief to other work-related expenses at a higher fiscal cost. In addition, our government already provides tax relief and program support for tradespersons and apprentices and tax relief for employees who must incur travel-related expenses in the course of their employment.

Income Tax Act
Private Members' Business

October 31st, 2013 / 2:10 p.m.
See context

NDP

Ryan Cleary St. John's South—Mount Pearl, NL

Mr. Speaker, I stand in support of Bill C-201, an act to amend the Income Tax Act, travel and accommodation deduction for tradespersons. I want to thank the hon. member for Hamilton Mountain for tabling the bill in the House of Commons. I want to thank the hon. member on behalf of untold thousands, tens of thousands of Newfoundlanders and Labradorians, Atlantic Canadians and Canadians in general who migrate for work across the country and around the world. I meet them at airports. I talk to them on airplanes. I knock on the doors of their families left behind.

Newfoundlanders and Labradorians have a history of working away from home. Our forefathers worked on the Grand Banks and off the Labrador coast for months on end. They lived on wooden walls, the sealing ships, for weeks, when they were in the fat, when the seal hunt was in its prime.

In my riding of St. John's South—Mount Pearl, on the top of Signal Hill, at the entrance to St. John's harbour, is a peak that is known as Ladies Lookout. Ladies Lookout is the very point where women gathered for generations to look for their men returning from sea after days, weeks, months and years. The wharf and lookout of yesterday is the airport of today.

So many Newfoundland and Labrador families live on a rotation: two weeks on, one week off; four weeks on, two weeks off. Long commutes and extended absences have been a way of life in Newfoundland and Labrador. However, the scale and intensity of the westward move to places like Fort McMurray, Grande Prairie and Lloydminster that began a few decades ago sets it apart from past experience. Let me quote from a recent article I read on the Newfoundland and Labrador migration: “Some call it a rite of passage. Some wives back home call it a fiscal blessing, but a blow to the heart”.

It is not just men who migrate for work; it is women too. It is our youth, our newly educated, bayman and townie alike. Leaving for work is a way of life, especially since the early 1990s when our fisheries collapsed. We have lost 90,000 people since then. One-sixth of our population left. They are gone. Untold thousands of Newfoundlanders and Labradorians migrate for work on a weekly or monthly basis so that their families can live comfortably back home. It is how I grew up, personally, with my father away for six to nine months at a time. He worked on what was then known as the Distant Early Warning line across the north.

If one drives through the outports today in rural Newfoundland and Labrador one will see nice, new homes and nice vehicles. There is pride in property, but we've always seen that. My office has tried to research the amount of money that migrant Newfoundland and Labrador workers bring back with them. There are no accurate numbers, but I can say it is in the hundreds of millions of dollars. It is in the billions of dollars. According to Statistics Canada, the number of workers commuting from Atlantic Canada to Alberta increased threefold between 2004 and 2008. The median earning for oil and gas workers in Alberta who live out of province was just under $60,000 in 2009.

Bill C-201 would impact thousands of Atlantic Canadians and Newfoundlanders and Labradorians. The bill would allow tradespersons and apprentices to deduct travel and accommodation expenses from their taxable income. The bill would allow tradespeople to maintain employment on work sites that are more than 80 kilometres away. The bill would help migratory workers and migratory construction workers. There is no doubt that the bill would help workers in my riding of St. John's South—Mount Pearl, in all of Newfoundland and Labrador and in Atlantic Canada.

Workers have to leave home. That is hard enough, but they should not have to foot the bill for travel and accommodation too. Under current rules, construction workers often incur large personal expenses to accept jobs in other parts of the province or country because neither travel nor accommodation expenses are tax deductible under the Income Tax Act. These costs create a huge disincentive for workers to accept work in other parts of the country that are experiencing skills shortages.

Figures suggest that the average mobile worker spends approximately $3,500 of his or her own money to temporarily relocate. That $3,500 is a significant barrier to the appeal of accepting jobs away from home. We have to make it easier and more enticing for skilled labourers in this country to fill labour shortages in other parts of the country.

How much will the bill cost? It is actually revenue neutral for the federal government, because the cost associated with the income tax cut is more than made up by savings in employment insurance. Instead of punishing Canadians who receive EI, we can start helping skilled labourers in this country by making it easier for them to accept work.

Let me throw out some numbers. There are an estimated 1.6 million construction workers in Canada, and 10% of them travel each year. At an average cost of $3,500 per worker, a 15% tax credit would cost the federal government $525 per mobile worker per year, for a total cost of $84 million. However, if the same number of 160,000 travelling skilled trades workers, which is 10% of 1.6 million, received average weekly employment insurance benefits of $393 per week, for an average period of unemployment of four weeks, the government would pay $250 million in EI benefits per year. That works out to $84 million from a tax cut versus $250 million in EI benefits. The tax credit proposed in the bill would result in net savings of more than $160 million a year.

The bill would not just help workers. The bill would help employers, because they would have larger pools of skilled workers across this country to draw from. They would not have to resort to hiring temporary foreign workers to get the jobs done.

The bill would also help Newfoundland and Labrador. We have huge projects on the horizon, such as Labrador's Muskrat Falls and offshore oil projects. We have had three new offshore oil discoveries within the past year off Newfoundland and Labrador.

Despite successive Conservative and Liberal governments making promises for years about helping migratory workers, there has been nothing done. In fact, this bill has been tabled in each Parliament since 2006. It was part of the New Democratic Party's platform in 2008 and 2011. Now we have the opportunity again to help migratory workers in this country.

The ask is simple. Allow our tradespeople and apprentices to deduct travel and accommodation expenses from their taxable incomes so that they can secure and maintain employment at a construction site that is more than 80 kilometres away from their homes. It is that simple.

People in this mobile workforce maintain homes and families in communities across Canada, in Atlantic Canada, and in Newfoundland and Labrador while using personal funds to maintain employment.

Included in the tax credit would be the cost of travel, meals, and accommodation, less any money paid by the employer for those purposes.

To conclude, the bill makes sense for workers. The bill makes sense for families. The bill makes sense for employers. The bill makes sense for industry. The bill makes sense for taxpayers. The bill makes sense, period.

Income Tax Act
Private Members' Business

October 31st, 2013 / 2:20 p.m.
See context

Conservative

Ryan Leef Yukon, YT

Mr. Speaker, I appreciate the opportunity today to speak to Bill C-201, an act to amend the Income Tax Act, to allow:

—tradespersons and indentured apprentices to deduct from their taxable income any travel and accommodation expenses that they have incurred in order to secure and maintain employment in a construction activity at a job site that is located at least 80 kilometres away from their ordinary place of residence.

While the hon. member's goal is worthy, to support tradespersons and indentured apprentices, her proposal contains a few flaws. Providing a deduction for job-related travel and accommodation expenses as proposed under Bill C-201 will make it difficult to ensure that tax relief is not provided for personal expenses solely reflecting lifestyle decisions.

Similarly, the open-ended nature of the proposed deduction raises serious concerns that could also make it vulnerable to abuse and unfair tax planning. For example, one can envision a situation where an individual can claim a residence, perhaps a cottage, more than 80 kilometres from work as their principal residence and then deduct those costs of maintaining their urban residence as an expense required to secure and maintain employment.

This bill would raise equality concerns as eligible tradespersons and indentured apprentices would be able to reduce their tax liability when they incurred eligible travel and accommodation expenses, whereas other workers who must incur similar work-related travel expenses, such as nurses, firefighters, correctional officers, would not receive that same tax assistance.

There is also a risk that this bill would simply result in a windfall gain to individuals who have incurred eligible travel expenses and accommodation in any case. Estimates suggest that providing tax assistance to tradespersons and apprentices for travel and accommodation could cost approximately $60 million every year at maturity. These costs are substantial. Our government is already on track to eliminate the deficit and remain squarely focused on this goal. Canadians expect us to be fiscally responsible at all times. Therefore, while our government is ensuring that we continue to support tradespersons and apprentices, this bill is not a measure that we can support.

Let me also suggest to the member opposite that tax changes should be undertaken through the budget process and not on an ad hoc basis. The budget process enables the government to fully consider trade-offs, balance priorities and undertake new fiscal commitments only to the extent that they are affordable. The hon. member should also be aware that Canada's tax system already provides a number of tax relief provisions for employees, including tradespersons who travel or relocate for their employment. For example, there is a moving expense deduction which recognizes costs incurred by workers who move their ordinary place of residence at least 40 kilometres closer to their place of business or employment in order to pursue employment or education opportunities.

There is a also a special and remote work sites tax provision that allows employers to provide board and lodging benefits to employees on a tax-free basis. Under this provision, where an employee is required to work at a remote location where only employer-provided accommodation is available, while continuing to pay expenses associated with his or her own home, amounts paid by the employer for room and board at the remote location are not included in the employee's income. The exemption recognizes in many instances employers need to provide these benefits in order to attract workers to a particular work site.

There is also a travel expense deduction which recognizes costs associated with business travel. The travel expense deduction allows employees who are ordinarily required to carry on the duties of employment away from the employer's place of business or in different locations to deduct travel expenses incurred, including 50% of their meal expenses when they are required by the employer to pay their expenses on their own. For example, an employee who must travel from his normal work site in Ottawa to Brampton or from Whitehorse to Carmacks in order to perform employment-related duties may claim a deduction for eligible travel and meal expenses to the extent that their employer does not already pay those expenses.

Similarly, self-employed individuals may deduct reasonable expenses incurred in connection with the generation of income from a business, including travel expenses such as lodging and, again, 50% of their meal costs while they are away from home.

Close to home for me, there is the northern residents deduction, which provides tax relief to individuals in northern and isolated communities to assist in drawing skilled labour to the North.

Finally, in 2006 our government introduced the Canada employment credit for all employees. In 2013, the Canada employment credit provides a tax credit of up to $1,117 on employment income. By increasing the amount of income that employed Canadians can earn without paying federal income tax, the employment credit recognizes that some of the income that individuals earn is used to pay for work-related expenses.

Our government is committed to lower taxes for all Canadians, tradespersons included. That is why, since coming into office in 2006, we have introduced broad-based tax relief such as lowering the GST from 7% to 5% and introducing the tax-free savings account.

In total, we have introduced more than 160 tax-relief measures, reducing taxes in every way that the Government of Canada collects them. Canadians at all income levels are benefiting from the personal income tax relief introduced by our government, with low- and middle-income Canadians receiving proportionally greater relief. Overall, personal income tax rates are now 11% lower with the tax relief provided by the government, and more than one million low-income Canadians have been removed entirely from our tax rolls.

Our strong record of tax relief is saving the typical Canadian family of four more than $3,200 each and every year. This is significant. It means that hard-working Canadians from coast to coast to coast have more money in their own pockets at the end of every year so they can decide how best to spend that money.

In addition, our government has been aggressive in closing tax loopholes used by a small group of taxpayers who have been trying to avoid paying their fair share of taxes. Ensuring tax fairness keeps taxes low for all Canadians and their families.

To conclude, while we understand the objectives of the bill, it is flawed, and therefore we simply cannot support it.

The proposed deductions would be hard to monitor, would make it vulnerable to unfair tax planning, would be limited to amounts earned at the new work location in the year, and would cost approximately $60 million a year at maturity. Therefore, I urge all members to join me in opposing the bill before us for reasons I have mentioned.

Some questions about mobility rights and the importance of mobility across our country were discussed earlier. While we recognize that mobility is important, the one thing I have heard as the member of Parliament for Yukon as I have travelled across the North is people saying that they want Yukon people for Yukon jobs, northern people for northern jobs. I would say that the same thing is true for all regions in our country.

Proposing the bill without supporting the other important measures that our government has put in place in budget 2013 and previous budgets that would actually make it a reality for Yukon people to get Yukon jobs, northern people to get northern jobs, and regional people to get regional jobs so that mobility is not a requirement would be something the opposition should seriously take a look at.

I can point to examples like the Centre for Northern Innovation in Mining in my home territory where we are trying to improve working conditions and take an unskilled labour force and move it into semi-skilled and highly skilled labour opportunities. The literacy investments that our government is making across the three territories to give people that first chance of success in their own home so they do not have to exercise those mobility rights is a critical measure.

I am surprised that the members of the opposition have not supported those measures, in particular the member for Western Arctic, who has voted against those critical measures each and every time we put them in place.

Income Tax Act
Routine Proceedings

June 8th, 2011 / 3:10 p.m.
See context

NDP

Chris Charlton Hamilton Mountain, ON

moved for leave to introduce Bill C-201, An Act to amend the Income Tax Act (travel and accommodation deduction for tradespersons).

Mr. Speaker, I am delighted to reintroduce this bill on behalf of Canada's building and construction trades as well as their indentured apprentices for the third time since I was first elected.

The building and construction trades have been lobbying for this bill for over 30 years and it continues to be one of the key priorities at each and every one of their legislative conferences.

In every Parliament the government has made vague promises of progress to come, then each Parliament ends without concrete action. The time to rectify that situation is now.

The ask is simple: allow tradespersons and apprentices to deduct travel and accommodation expenses from their taxable income so that they can secure and maintain employment at a construction site that is more than 80 kilometres away from their home.

At a time when some regions of the country suffer from high unemployment while others suffer from temporary skilled labour shortages, this bill offers a solution to both. Best of all, it is revenue neutral for the government because the cost associated with the income tax cut is more than made up by the savings in employment insurance.

Now that the Conservatives have a majority in the House of Commons there are no more excuses. The government can and must support this bill and act unequivocally to support Canada's building and construction trades.

(Motions deemed adopted, bill read the first time and printed)