Finance Committee on May 16th, 2012

[Brian McCauley]

They'll be in the form they return annually. We're going to integrate them in there, so there will not be an additional form.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

I'm sure they'll be glad to be hear that, because it's a chronic complaint.

[Brian McCauley]

It makes it easier for us too.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

Absolutely.

On the expanded reporting requirements on foreign donations for political activities, how do you see that being of value to the donors and the taxpayers? We're thrilled when we make a donation to the United Way. We get our receipt. They do the reporting, and we claim it. You ask yourself why this particular change is in place. How can that be construed as somehow being to the benefit of the donor, or even the taxpayers? Maybe that's a political question.

[Sean Keenan]

Fair enough. One of the purposes of having charities provide information and making it available on CRA's website is so Canadians who are donating to those charities can have information about their activities. How much do they spend on fundraising and certain administrative expenses? How much goes for other purposes? To the extent that they are engaging in political activities that are being funded from outside Canada, that may be information that donors will find informative in making decisions on how to donate.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

If there was controversy about who was—

[The Chair, Conservative, James Rajotte]

Thank you, Mr. Marston.

Mrs. McLeod is next, please.

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

Thank you, Mr. Chair.

I went to the technical briefing, so I don't have any questions at this time about the section.

Thank you.

[The Chair, Conservative, James Rajotte]

Thank you.

Ms. Nash, please.

[Peggy Nash, NDP, Parkdale—High Park, ON]

Thank you.

The first section talks a great deal about tax credits and changes in taxation. I'm wondering if you have a sense of the cumulative costs of these changes per budget year.

[Ted Cook]

Sorry, you're referring to the changes that are set out in part 1 of the budget implementation act. In the actual budget materials at the start of the supplementaries, there's an outline of the cost of the various measures. If you'd like, I can just mention them.

In terms of the measures that are in part 1 of Bill C-38, the measure with respect to RDSP plan holders will be approximately $1 million. The cost with respect to the mineral exploration tax credit for flow-through share investors would be $130 million for the year in which there is the expansion.

Really, those are the only major costs that are outlined in the budget materials for the particular budget measures that are included in this budget implementation act.

[Peggy Nash, NDP, Parkdale—High Park, ON]

For other measures that just continue, there's no changes. So, for example, I'm thinking about oil and gas exploration. There's no change to the taxation of that particular area.

[Ted Cook]

The budget does have some measures that potentially impact the oil and gas sector; however, they are not included in this budget implementation act.

[Peggy Nash, NDP, Parkdale—High Park, ON]

What would those additional measures be?

[Ted Cook]

The budget has one measure with respect to the Atlantic investment tax credit and whether oil and gas and mining activities are eligible for that tax credit. The eligibility for that particular tax credit is proposed in the budget to be phased out.

[Peggy Nash, NDP, Parkdale—High Park, ON]

But otherwise, would the $1 billion or so tax subsidies continue to the oil and gas sector?

[Ted Cook]

I'm not familiar with what particular subsidies or amounts you are referring to.

[Peggy Nash, NDP, Parkdale—High Park, ON]

Okay, I'm just looking at the overall cost. I'm just looking at what the overall impact of tax subsidies and deferrals are on the budget. But under part 1, as the witness has explained, it's about $130 million. So thank you.

I have another question, moving on to a completely different subject, about the Governor General. I'm wondering why other forms of income, such as investment income, earned by the Governor General are not included in the definition of “taxable income” for income tax purposes.

[Sean Keenan]

The Income Tax Act currently only exempts income from the Office of the Governor General. Therefore any of his other income, personal income from pensions or investments, is not exempt from tax. So he already pays tax on whatever other types of income he has.

[Peggy Nash, NDP, Parkdale—High Park, ON]

So investment income, that kind of thing, is taxed not through his office but through other tax measures.

[Sean Keenan]

That's the taxes in his hands as an individual.

[Peggy Nash, NDP, Parkdale—High Park, ON]

Lastly, on the increase in salary for the Governor General, I'm just wondering why the increase of $100,000 for 2013 and subsequent years. What's the rationale for that, when the government is cutting back in many other areas?

[Sean Keenan]

The salary for 2013 is set such that his net compensation from the Office of the Governor General remains unchanged. So currently he receives a salary that is not taxed, and then as a result of this bill he would receive a higher salary that would be taxable. And we estimated that because he would pay a certain amount of tax on that income, his salary should be set at the level in the bill, such that his net compensation is unchanged.

[Peggy Nash, NDP, Parkdale—High Park, ON]

So there's no austerity for the Governor General.

Okay, thank you.

[The Chair, Conservative, James Rajotte]

Thank you.

We'll go to Mr. Adler, please.