Evidence of meeting #72 for International Trade in the 44th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was information.
A recording is available from Parliament.
12:45 p.m.
Director General, GST/HST Rulings Directorate, Legislative Policy and Regulatory Affairs Branch, Canada Revenue Agency
I don't have anything further to add to that. My expertise is on the GST side of housing.
12:45 p.m.
NDP
Richard Cannings NDP South Okanagan—West Kootenay, BC
To make this simpler, could you say, “Do you own property that is subject to the underused housing tax?” Check a box and move on. That might help Canadian taxpayers deal with that.
Are there any other parts of the tax law that require a lot more information, even though we've heard that some 95% of people who own an extra house aren't going to be paying this tax. I'm just trying to make things simpler.
12:45 p.m.
Director General, Business Returns Directorate; Assessment, Benefit and Service Branch, Canada Revenue Agency
There are, of course, exclusions within the form. We can only rely, as far as broader communication is concerned, on the messaging we put out there for people to first identify whether they're impacted or not. If they are impacted, we have created a form. That's one of the reasons the form is as long as it is. It allows our clients to make the right determination of whether they should be paying the UHT or not. That's the avenue we have taken.
12:45 p.m.
Liberal
June 19th, 2023 / 12:45 p.m.
Conservative
Colin Carrie Conservative Oshawa, ON
Thank you very much, Madam Chair, and I want to thank the witnesses for being here.
From what I'm hearing here today, it's like Finance officials came up with this idea based on the ministerial directive. As Mr. Baldinelli said, they did their consultations in the middle of an election, so there's no surprise that there seem to be some challenges here.
I'm a little concerned, though, from some of the answers we are getting today that we should have had Finance officials here. They have already been here, and they're kind of going right hand, left hand. It would be great to have both of you here at the same time, because we would like to see a solution. There doesn't appear to be one coming very quickly.
I do have a number of questions, because the idea of the legislation was good. Everybody is aware of that. What might be happening is that we may end up having a bunch American friends selling their properties, and, inadvertently, they will go to Airbnb. Instead of actually being a solution, it's going to add to the problem.
I only have a bit of time here. I'd like to know, have you done a cost-benefit analysis on the actual bottom line of implementing this policy? Is that going to be good? We heard the idea that this is gathering data, but there's also tax revenue. Have you done a cost-benefit analysis of it?
The other question I'd like to ask is, who can stakeholders talk to? We receive a lot of correspondence on this. People are trying and are not getting the answers they need, or they're getting conflicting answers. That's the second question.
Third, I think you might be underestimating the U.S. situation with our snowbirds. Have you heard, Mr. Khan, about a potential retaliatory response by the Americans? According to a 2015 survey by BMO, roughly 500,000 Canadians own property in the State of Florida alone. This could be problematic for Canadians.
I have some other things to talk about. Could we address those things, the cost-benefit, who can stakeholders talk to, and whether you have heard about any possible retaliatory action by the U.S.?
12:50 p.m.
Liberal
The Chair Liberal Judy Sgro
If they could all be addressed in two minutes and 41 seconds, I would appreciate it.
12:50 p.m.
Conservative
Colin Carrie Conservative Oshawa, ON
If you can't, it would be great if you could give it to us in writing.
12:50 p.m.
Director General, Business Returns Directorate; Assessment, Benefit and Service Branch, Canada Revenue Agency
I'll start off with the cost-benefit analysis. That would be within the domain of the Department of Finance. When we're asked to administer a piece of legislation, we do our own internal costing and provide that number as part of a Treasury Board submission. We would have certainly done that on our side, estimating how much it would cost the agency to administer such a program.
I cannot speak to the cost-benefit analysis that might have been done by the Department of Finance.
12:50 p.m.
Director General, Small and Medium Enterprises Directorate; Compliance Programs Branch, Canada Revenue Agency
Madam Chair, quickly on question number two—around what taxpayers can do to get more information—of course, our websites are available and quite descriptive but, as mentioned previously, we have a liaison officer service. There have been 350 organizations contacted. They include taxpayer associations, lawyers, municipalities, chambers of commerce, etc.
As of June 16, we've had 26 such sessions, and we have another eight planned by the end of July. I think the offer is to connect with us and seek more clarification. We're there to support them in meeting their tax obligations.
12:50 p.m.
Director General, GST/HST Rulings Directorate, Legislative Policy and Regulatory Affairs Branch, Canada Revenue Agency
Madam Chair, if I could add to that, as well, we also have a rulings and interpretation service. If they have very specific, fact-oriented questions, they can write in to us and we respond to those. If a ruling can be issued, we will issue it. If not, an interpretation of the information will be given.
12:50 p.m.
Conservative
Colin Carrie Conservative Oshawa, ON
For the third one on possible retaliatory.... Have you guys looked at that?
12:50 p.m.
Special Advisor to the Commissioner of the Canada Revenue Agency, Canada Revenue Agency
We're certainly aware of the issue and following the situation in the U.S., but it's not something we could comment on at this time.
12:50 p.m.
Conservative
Colin Carrie Conservative Oshawa, ON
Actually, I'm at four minutes and 15 seconds, so I have 45 seconds. Is that right? We were warm and fuzzy.
12:50 p.m.
Liberal
The Chair Liberal Judy Sgro
There are 45 seconds, but I'd like to get one other member in and it's five minutes to one.
12:50 p.m.
Conservative
Colin Carrie Conservative Oshawa, ON
Quickly, have you been directed by the minister, or has the minister directed Finance, to fix the problem or come up with something? That's because we're getting.... You may have that there. We're just worried about not getting that feedback.
Thank you.
12:50 p.m.
Liberal
Viviane LaPointe Liberal Sudbury, ON
Thank you, Madam Chair.
I'll be sharing my time with my colleague MP Arya.
You talked about the data that was being collected. Unfortunately, you can't break it down by geographical area, but can you tell us what the most common inquiry is that you're getting, and the most common concern you're receiving?
12:50 p.m.
Director General, Business Returns Directorate; Assessment, Benefit and Service Branch, Canada Revenue Agency
The most common inquiries we receive on our general inquiry line or the line dedicated to business is with regard to filing the form itself. “How do I answer the following, on this or that question?” There are questions about exemptions and location, because we have created a tool, as you know, that allows our clients to identify where exactly, based on the postal code, their property is located and the tax implication for them.
It works in about 98% plus of the cases, but there are those odd situations where individuals will call, because they couldn't get the right answer from the tool.
12:55 p.m.
Liberal
Viviane LaPointe Liberal Sudbury, ON
I have one more question before I hand it over.
Can you tell us how many people say they owe money and how much money you have collected?
12:55 p.m.
Director General, Business Returns Directorate; Assessment, Benefit and Service Branch, Canada Revenue Agency
As I mentioned, based on the returns filed as of last week, we have less than 5% who actually owe money. The amount owed was just over $7.5 million and it's based on the number of returns that have been filed thus far. That number, as I responded earlier, Madam Chair, was 135,000.
12:55 p.m.
Liberal
Chandra Arya Liberal Nepean, ON
Thank you, Madam Chair.
Quickly, you said about 6,000 people owed money out of 135,000. You also mentioned that, out of 135,000, about 50% are individuals.
Can I assume that, out of the 6,000 people who have to pay, about 50% are individuals?
12:55 p.m.
Director General, Business Returns Directorate; Assessment, Benefit and Service Branch, Canada Revenue Agency
I don't have the exact data, but—
12:55 p.m.
Liberal
Chandra Arya Liberal Nepean, ON
That's okay. I have limited time.
I'm not surprised that the questions you're getting are about exemptions and the location thing. When U.S. Representative Higgins was at our committee, I recall that he, too, was not fully aware of the exemptions that were provided.
This being the first year, we can expect to have a lot of these questions. This will get streamlined by next year.