An Act to amend the Income Tax Act (physical activity and amateur sport fees)

This bill was last introduced in the 38th Parliament, 1st Session, which ended in November 2005.

Sponsor

Peter Stoffer  NDP

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

Status

Not active, as of Nov. 1, 2004
(This bill did not become law.)

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.

Excise Tax ActPrivate Members' Business

June 7th, 2005 / 7:05 p.m.
See context

Saint Boniface Manitoba

Liberal

Raymond Simard LiberalParliamentary Secretary to the Deputy Leader of the Government in the House of Commons

Mr. Speaker, this private member's bill, Bill C-259, asks parliamentarians to legislate the repeal of the excise tax on jewellery. I am very pleased to have the opportunity to further debate this proposal. It is an issue that I have been very active on and I was very pleased that we were able to have this tax removed over five years.

Given that Bill C-259 touches on the taxation system and has implications for the fiscal framework, let me begin by making reference to Canada's fiscal record over the past 10 years and the impressive social and economic progress that has followed.

This government has recorded eight consecutive surplus budgets and has reduced the federal debt by more than $60 billion. At the same time, more than $100 billion in cumulative tax cuts has been delivered since 1996, with a primary focus on middle and low income families, and more than $200 billion has been invested in Canada's highest social and economic priorities: health care and equalization; the well-being of children and families; learning, skills and innovation; affordable housing, community infrastructure; and the environment.

We achieved these results through our unwavering commitment to budget balance and fiscal prudence. Indeed, the commitment to fiscal responsibility is a cornerstone of this government. Furthermore, the federal budget tabled in this House on February 23 projects balanced budgets or better in 2004-05 and in each of the next five fiscal years.

According to the Organisation for Economic Co-operation and Development, the OECD, Canada was the only group of seven, or G-7, country to record a total government budget surplus in 2004, for the third consecutive year, and is projected to be the only country in surplus again in 2005-06.

Against this backdrop I would like to turn now to discuss private members' bills, in particular those that affect the taxation system. It is worth noting that the number of such bills tabled in the current session is now approaching 20, all of which propose tax relief in specific circumstances and could collectively represent a total fiscal cost of as much as $3 billion in annual tax relief measures.

Each of these private members' bills deals with a unique aspect of the taxation system. The measures that are proposed in these bills range from the income tax treatment of tools required by employment to deductions for public transportation costs and to the creation of a deduction for charity workers and volunteers.

There can be no doubt that these bills put forward by private members are done out of genuine concern for Canadians and their interaction with the taxation system. At the same time, it is important to remember that each and every one of these bills carries a cost for the fiscal framework.

For example, one private member's bill, Bill C-252, proposes a tax credit for fees pertaining to participation of an individual in physical activity or amateur sport. There can be little doubt as to the many benefits of physical activity and exercise, but with an estimated cost of over $400 million per annum, it is plain that this proposal needs to be rigorously evaluated against other fiscal priorities, including both spending priorities and tax relief priorities. That is to say, we all may agree that encouraging physical activity is a good thing, but we need to consider whether it is the best way to spend over $400 million per year or whether there are more pressing priorities.

This is one of the central points I would like to make: that no matter how laudable or defensible any given proposal might be on its own merits, it is imperative that we not lose sight of the broader implications for the integrity of the taxation system and fiscal framework.

For example, individual proposals, even those that are relatively inexpensive, may create unfairness relative to other taxpayers who then need to be considered as well. Bills may create difficult precedents, have unintended effects or even create opportunities for tax avoidance or evasion and hence end up costing more money. Indeed, the continued consideration of one-off measures may over time increase the complexity of the tax system and affect its overall operation.

Given these concerns, I would suggest that caution must be exercised when giving consideration to private members' bills affecting the taxation system. Rather than being considered on an ad hoc basis, what is required is that these proposals be managed in the context of an integrated policy and fiscal framework.

Indeed, this is precisely the type of approach that underlies the annual budget process, whereby the government consults with Canadians on their priorities for the next budget in order to help determine the important choices that must be made in a world of limited resources. It is this type of comprehensive approach to fiscal planning that has not only preserved the robustness and integrity of the federal tax system, but has also facilitated Canada's impressive economic and social progress over the past decade.

This performance, which has required some difficult choices along the way, provides the foundation for the continued delivery of initiatives that matter most to Canadians, including announcements concerning additional funding for health care, improvements to the equalization system and new funds for community infrastructure across Canada.

These and other initiatives can only be addressed where our economy continues to thrive and it is rooted in a prudent and disciplined approach to fiscal and taxation policy. Within the context of a comprehensive approach to consultation and evaluation of budgetary proposals, I would like to draw the attention of members to the important role that is played by the House of Commons Standing Committee on Finance in advising the government on the initiative proposed in budget 2005 respecting the excise tax on jewellery.

Going back to the lead-up to budget 2005, it is noteworthy that budget 2004 referred to the importance of suggestions from entrepreneurs and small business as part of the budget consultation process. In order to assist the government in identifying the best options for future consideration among the broad range of competing priorities, the government indicated at that time that it would seek the advice of the Standing Committee on Finance.

This provided the finance committee with an opportunity to assess the merits of proposed small business tax relief measures and to advise the government on the relative priority that should be accorded to them, taking into account limited fiscal resources.

In fact, the finance committee delivered in October of 2004 its second report on small business tax measures, focusing on excise duties and taxes as they affect Canada's winemakers, small brewers and jewellers. The finance committee put forward as its priority recommendation two options for phasing out the excise tax on jewellery over five years, either by reducing the rate or increasing the threshold at which the tax applies.

In deciding between these options, the committee indicated that consideration should be given to which of the options would be the more expeditious and involve greater administrative simplicity for the jewellery sector.

The finance committee went on to note that there are many other small business sectors that would benefit from the implementation of appropriate tax changes and that the committee would welcome comments from these sectors during the next round of prebudget consultations. Significantly, the committee was also expressly mindful of the fact that the number of worthy tax relief proposals brought to its attention exceeded the ability of the government to finance them all in a fiscally responsible manner.

The government was very pleased to receive the report from the committee and gave careful attention to the views of the committee on these and other proposals for tax relief in the deliberations leading up to budget 2005. Indeed, the government followed the advice of the finance committee in budget 2005 and proposed that the excise tax on jewellery, clocks and watches and items made of semi-precious stones be phased out through a series of rate reductions over the next four years.

The budget stated that this phase-out would be accomplished by an immediate reduction in the rate of tax on jewellery to 8% from 10% and would then be reduced by an additional two percentage points in each of the next four years until the tax was eliminated. This proposal sets out a clear plan to remove the excise tax to benefit the Canadian jewellery industry in a manner that is entirely consistent with the report and recommendation from the finance committee and that also respects the need to develop and deliver tax policy in a comprehensive, integrated manner.

Bearing these facts in mind, I must admit that it is somewhat disconcerting and disappointing to see that the finance committee is no longer willing to follow its own advice to the House that the excise tax on jewellery should be phased out over a number of years. Instead, contrary to its own report and recommendation, the finance committee has chosen to endorse the private member's bill, Bill C-259, which would repeal the existing tax, although not on all items, on royal assent.

Accordingly, I would like to conclude by noting that the endorsement of Bill C-259 by the finance committee simply does not demonstrate the kind of fiscal prudence and financial responsibility that has allowed Canada to enjoy eight consecutive surplus budgets.

Income Tax ActPrivate Members' Business

February 3rd, 2005 / 5:45 p.m.
See context

NDP

Peter Stoffer NDP Sackville—Eastern Shore, NS

Mr. Speaker, I want to thank the hon. member for Cypress Hills—Grasslands for bringing this bill forward in order for us to have a proper debate on something that we do not debate often in this House, which is what to do with physical activity and sports in this country.

I absolutely believe in what the hon. member is trying to do. The member believes that we can enhance sports activities and encourage further sports activities through the taxation system.

As the member knows and as the House knows, I have a private member's bill myself on a similar issue, Bill C-252, which I hope to be able to debate one day in the House. My bill would offer a tax deduction to any citizen in the country who participates in a physical activity, be it in a dance club or a gym, be it hockey, soccer or baseball, whatever physical activity it is.

For argument's sake, I will use the example of a soccer registration fee of $100 a year. That $100 should be tax deductible. This is similar to the limit we have for charitable donations. For example, if a person gives the Red Cross $100, the Red Cross provides a tax receipt for a certain amount. At the end of the year we are able to file that with our income tax. I believe that the same principle should apply to the registration for sporting fees as well.

We in this House all know that all members of Parliament have been hit up many, many times by various groups and organizations in order to support individuals going somewhere in an individual sport or a team sport.

At this time, I want to convey on behalf of the House our sincere condolences to the hockey team from Windsor that had the unfortunate accident and suffered the loss of life of four great residents and some injuries. We extend our condolences to their families and their friends and to the teams as well.

We in the NDP will be supporting the initiative of Bill C-285. We do know, as was pointed out by one of the Liberal members, that there are a couple of preambles that need to be expanded upon. This is why it is so important to bring this bill to a committee. Then the committee itself can look at the concerns that have been addressed. It can look at furtherance in terms of expansion in allowing the committee, in an all party sense, to really seriously look at the bill.

If we really sit down and think about it, the Olympics of 2010 will be here in Vancouver and Whistler. Everyone is talking about how if we put in x number of dollars we will be able to have more athletes standing on the podium. The reality is that this is very important for the Olympic athletes and for those training for that high level, but what about the athletes and the sports enthusiasts who will never achieve that level? What about the athletes that play sport for the pure love of the sport, be it team sports or individual sports? We need to support those organizations that in turn support those athletes.

The definition of an athlete is a bit of a misnomer. That is something we can work out. We notice that every single time an initiative comes from the opposition through the tax system in order to assist our citizens, the Liberals generally oppose it. They absolutely oppose it. Yet when it comes to tax incentives for the oil and gas industry, let us say, to make it more competitive, to bring in more investment or to have more economic activity in the country, there is no problem. Right away those incentives are put through.

If we look at physical activity, not economic activity but physical activity, we should be trying to get our citizenry more active physically in order to prevent the obesity that is increasing in our country at a rapid rate, to prevent the health issues that occur with it, and to prevent justice issues and social issues because of that. I believe that every kid in this country has a right to play. I believe that every community should have facilities for its citizens to participate in, regardless of the age of the individuals and regardless of the activity they wish to participate in, be it curling, lawn bowling, be it whatever. If we can get Canadian citizens more active and more cohesive as a society in terms of team and individual sports that would be a very good thing for this country.

There is no question about it: as Canadians we are generally out of shape. There is no question about that. In fact, I would question if the average grade 12 student could run a mile around a track. I question whether a person of that age could do it.

This particular type of initiative is something that we need to expand upon, not only in the committee but in the general discussion of this country.

The hon. member who introduced the bill may or may not realize this, but the fact is that federal government investment in sport in this country is one-tenth of 1% of total GDP. That is one-tenth of 1% of the total GDP for the federal investment into sport in this country.

The hon. member and his party know what that means. Volunteers and sporting groups of all kinds are picking up that slack by doing bottle drives, by standing in front of the grocery stores with their cans and their bottles asking for donations, by holding bake sales, and name it, they do it. These are the activities that Canadians have from coast to coast to coast. They will support their individual athletes and their team sports because it is the Canadian thing to do.

There is nothing better than watching teams from across the country competing in sports, not only at the adult level but at the children's level as well. I have coached soccer for over 30 years in British Columbia, Yukon and in Nova Scotia. Being with those kids has been a tremendous experience. I play organized sports as well, but I do know that there are many people who cannot participate in a sport, not because of physical infirmities but because of financial reasons.

Various organizations, as we know, are “volunteered out”. Our volunteers are getting burnt out. They are getting to the point where, after raising funds and money time after time, they are looking for assistance and leadership from the government, not just at the federal level but at the provincial and municipal levels as well.

One thing I have been advocating for quite some time is to have the provincial governments use the lottery funds for their initial purpose: sports, culture and recreation. We know that the initial lottery of Montreal in 1976 was for sports, culture and recreation. That is what the 1976 lotto was all about. In the mid-1980s the responsibility was transferred to the provinces and territories and now most of the provinces put that revenue into general revenues, whereas in our own province of Nova Scotia less than 2% of those total revenues actually goes to sports, culture or recreation. That has to change.

The federal government cannot just do it on its own, but it can show leadership in an initiative by the bill that was brought forward by the hon. member. It can also encourage dialogue with the provinces, the territories and the municipal governments to see what can be done not only to advocate changes within the tax system to assist our athletes and their organizations, but also in the development of fields, arenas and sporting events. We owe this to our future.

I know that my hon. colleague from Cape Breton who has just come into the House has been a long-time advocate of sports and especially the great sport of hockey. I will say that his reputation as a coach far exceeds his reputation as a member of Parliament, but that is just my own political view. The reality is that he knows, on the Liberal side, the value of sport. He has his own children involved in sports, as I do my own.

It is very clear that we thank the hon. member for bringing the initiative forward. We would hope that in turn when our bill comes up that party would support our initiative as well. The member is absolutely correct when he says that we can increase physical and sporting activity in this country through the taxation system.

If there are any concerns within this bill that the Liberals would like to discuss, we believe that instead of voting it down they should be supporting it and working with us in bringing this bill to committee so that we can enhance its opportunities and intentions for the good of all Canadians. Once again I thank the House for this opportunity and I thank the hon. member for bringing forward this important initiative. He has the NDP's total support for this initiative.

Income Tax ActRoutine Proceedings

November 1st, 2004 / 3:20 p.m.
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NDP

Peter Stoffer NDP Sackville—Eastern Shore, NS

moved for leave to introduce Bill C-252, an act to amend the Income Tax Act (physical activity and amateur sport fees).

Mr. Speaker, it is quite fitting that today we have with us the athletes with disabilities, those who won medals for us at the Olympics. However, our government needs to concentrate on those people throughout the entire country.

This bill pertains to families and individuals who register either themselves or their children in sports or other physical activities. For example, if they spend $400 to register a child in hockey, they should be able to claim it as a tax deduction similar to a charitable donation. This would put money back into the hands of working families to become more physically active and become a much better society in terms of sports and physical activity.

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