An Act to amend the Income Tax Act (sports and recreation programs)

This bill was last introduced in the 39th Parliament, 1st Session, which ended in October 2007.

Sponsor

Brian Fitzpatrick  Conservative

Introduced as a private member’s bill.

Status

This bill has received Royal Assent and is now law.

Summary

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

This enactment amends the Income Tax Act to exclude certain allowances in respect of board and lodging from the computation of a taxpayer’s income from an office or employment if those allowances are paid to the taxpayer by a registered charity or a non-profit organization in connection with its operation of a sports team or recreation program for persons under 21 years of age of which the taxpayer is a registered member or participant.

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. 28, 2007 Failed That Bill C-294, in Clause 1, be amended by replacing lines 10 to 15 on page 1 with the following: “(A) the taxpayer is, in that month, a registered participant with, or member of, (I) a sports team or recreation program of the employer in respect of which membership or participation is restricted to persons under 21 years of age, or (II) a sports team or recreation program of a college or university,”
June 7, 2006 Passed That the Bill be now read a second time and referred to the Standing Committee on Finance.

Message from the SenateRoyal Assent

June 22nd, 2007 / 12:20 p.m.
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Liberal

The Speaker Liberal Peter Milliken

I have the honour to inform the House that when the House did attend Her Excellency the Governor General in the Senate chamber Her Excellency was pleased to give, in Her Majesty's name, the royal assent to the following bills:

Bill C-12, An Act to provide for emergency management and to amend and repeal certain Acts--Chapter 15;

Bill C-294, An Act to amend the Income Tax Act (sports and recreation programs)--Chapter 16;

Bill S-6, An Act to amend the First Nations Land Management Act--Chapter 17;

Bill C-40, An Act to amend the Excise Tax Act, the Excise Act, 2001 and the Air Travellers Security Charge Act and to make related amendments to other Acts--Chapter 18;

Bill C-11, An Act to amend the Canada Transportation Act and the Railway Safety Act and to make consequential amendments to other Acts--Chapter 19;

Bill C-277, An Act to amend the Criminal Code (luring a child)--Chapter 20;

Bill C-31, An Act to amend the Canada Elections Act and the Public Service Employment Act--Chapter 21;

Bill C-18, An Act to amend certain Acts in relation to DNA identification--Chapter 22;

Bill C-60, An Act for granting to Her Majesty certain sums of money for the federal public administration for the financial year ending March 31, 2008--Chapter 23;

Bill C-14, An Act to amend the Citizenship Act (adoption)--Chapter 24;

Bill C-47, An Act respecting the protection of marks related to the Olympic Games and the Paralympic Games and protection against certain misleading business associations and making a related amendment to the Trade-marks Act--Chapter 25;

Bill C-61, An Act to amend the Geneva Conventions Act, An Act to incorporate the Canadian Red Cross Society and the Trade-marks Act--Chapter 26;

Bill C-42, An Act to amend the Quarantine Act--Chapter 27;

Bill C-59, An Act to amend the Criminal Code (unauthorized recording of a movie)--Chapter 28;

Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007--Chapter 29;

Bill C-288, An Act to ensure Canada meets its global climate change obligations under the Kyoto Protocol--Chapter 30.

It being 12:23 p.m., the House stands adjourned until Monday, September 17, 2007, at 11 a.m., pursuant to Standing Orders 28(2) and 24(1).

The first session of the 39th Parliament was prorogued by royal proclamation on September 14, 2007.

Motions in AmendmentBudget Implementation Act, 2007Government Orders

June 4th, 2007 / 12:05 p.m.
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Liberal

John McCallum Liberal Markham—Unionville, ON

Mr. Speaker, I rise to contest a ruling by the chair of the finance committee during clause by clause consideration last week. During that consideration, the chair of the committee ruled that an amendment referenced at the committee under the number 2972723 was out of order and could not be moved.

The amendment in question sought to provide a tax reduction to a group of taxpayers who would have otherwise paid 31.5% tax on proceeds from income trusts. Under my amendment, they would pay only 10%. The amendment also provides for a tax refund or credit of this tax for certain taxpayers. Both of these measures are clearly tax reductions.

With respect to the general tax reduction from 31.5% to 10% contained in the amendment, it was in no way questioned by the chair at the meeting. The chair presumably knew that such a tax reduction was in order. However, in committee, the chair ruled out of order another part of the same amendment that I proposed to clause 21 of the bill to reduce the tax on Canadian residents even further by way of a tax refund or credit, in subclause 2.1. Here I will quote the chair of the committee, who said that this “would require government spending”.

He then concluded, again erroneously, that this latter tax reduction required a royal recommendation, which if this was the case obviously could not be moved in committee. Therefore, the chairman mistakenly ruled the amendment out of order and the committee did not consider the amendment that I was proposing.

In addition, a number of amendments standing under my name at the committee simply could not proceed because the central amendment, which I have just described, could not be moved. The chair's ruling thus had an adverse effect not only on the amendment itself but on a number of other amendments as well.

I now want to touch briefly on the procedural arguments as to why I think the committee chair's ruling was erroneous. While I accept that increasing a tax or levy as well as increasing a benefit or grant are prerogatives of the Crown, my amendment did no such thing. It dealt with refunding a tax to a group that would otherwise have paid it.

On Monday, October 9, 1957, Speaker Lamoureux ruled in this place that reducing a tax by way of an amendment and without a royal recommendation was in order. This decision can be found in the Journals of the House of that day at page 254.

Speaker Lamoureux, in his decision, was basing himself on Erskine May's treatise on parliamentary procedure and form, the 15th edition, which says at page 704 that provisions for the alleviation of taxes are not subject to the rules of financial procedure. At page 572, May also states that a bill diminishing or repealing a tax or other public burden, unless the imposition of a new tax is proposed by way of substitution, needs no royal recommendation.

In our own House in the last Parliament, a number of private members' bills were passed, without royal recommendation, to provide tax alleviation. Two such examples were the bills to provide for a tax deduction for tools for automobile mechanics and a bill to provide similar relief for workers who purchase transit passes.

Only a few weeks ago, we passed private member's Bill C-294 to reduce income taxes for the benefit of lodging and other such allowances to young athletes, mainly hockey players. This bill was sponsored by the Conservative member of Parliament for Prince Albert.

Surely if it is in order to offer an exoneration of taxes for hockey players, which it certainly was and which I supported, it is equally in order to offer an amendment to reduce taxes to Canadian senior citizens who are now the innocent victims of the Prime Minister's broken promise on income trusts.

Finally, I wish to draw to the attention of the House a booklet published by the Procedural Services of the House of Commons under the authority of the Speaker and entitled “Amending Bills at Committee and Report Stages in the House of Commons”. At page 5 of this document, under the rubric “Financial Initiative of the Crown”, it is stated, “Any amendment to reduce public spending or to reduce a tax is admissible”.

Clearly the chair of the Standing Committee on Finance erred when he refused to allow me to move my amendment at committee. Equally clearly, the effect of not being able to move this important amendment was such that other amendments which I was offering either could not be moved because they were subordinate in nature or, in the case where they could be moved, did not carry much support simply because the main subject could not even be debated.

For greater clarity, I note that the Chair of the committee was in error when he suggested that subclause 2.1 was new tax expenditure. It is not. The subclause itself makes this point when it states, “Every individual who is resident in Canada and liable to pay tax under Part 1 may claim a refund or credit against tax otherwise payable”.

This subclause involves no new net tax expenditure by the Crown. It simply allows an individual taxpayer who is a Canadian resident to recover tax already paid on his or her behalf to the Crown.

A taxpayer who is a Canadian resident can recover not one penny more than that which was remitted on his or her behalf already to the Crown. Therefore, there is no new tax expenditure whatsoever.

In short, the withholding in question is then reimbursable to a specific category of investors, namely, Canadian residents, who would get their money back. For example, foreign investors would not qualify because they do not pay sufficient or any Canadian taxes. Pension funds would not qualify either because of their tax exempt status.

Therefore, there is a clear case of tax alleviation as identified by Erskine May, as I mentioned earlier.

That is why I am seeking this remedy in asking the Speaker that my amendment be allowed to be debated and voted on at report stage. The Chair of the committee provided an erroneous ruling which prevented me from doing my work of representing my constituents and Canadians generally at the committee.

Income Tax ActPrivate Members' Business

March 30th, 2007 / 1:30 p.m.
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Conservative

Brian Fitzpatrick Conservative Prince Albert, SK

moved that Bill C-294, An Act to amend the Income Tax Act (sports and recreation programs), be read the third time and passed.

Mr. Speaker, I thank the members of the House at this stage because the bill has the unanimous support of all 308 members of Parliament in this esteemed chamber.

I think the members understand the specific purpose of the bill but I will quickly go over it again. It is intended to help young people under the age of 21 in amateur sports programs and the organizations that support them by exempting up to $300 of room and board or lodging costs per month from the Income Tax Act.

If the bill is passed, the direct beneficiaries of this measure will be the young people in amateur sports and the organizations that support them.

What is near and dear to my heart and what motivated me to present this bill are the junior A hockey programs in Canada. We have about 140 junior A teams in small cities and towns and in remote and rural areas across Canada that will be the direct beneficiaries of this amendment to the Income Tax Act. It will reduce the cost of their operation probably in the area of $4,000 or $5,000 a year, which in this town might appear to be chump change, but to the organizations that are trying to keep junior A hockey teams viable in their small towns and communities this is significant. It will go a long way to making their hockey operation viable.

Hockey is our national sport. I talked with Mr. Tretiak the other day, the famous Russian hockey coach. He even realized the great goaltenders that came from Saskatchewan, Glenn Hall, Johnny Bower and many others. He learned many of his techniques and skills by studying their methods of playing in goal. We have a rich history of hockey in Saskatchewan and the junior A hockey program is very much a part of that.

I want to acknowledge some of the people who should be acknowledged on this bill. The real champion of this bill and who took the bull by the horns was Roy Bailey, a good friend of mine and a former colleague in this House in the 37th Parliament. He fought hard to get this injustice sorted out when it occurred. He did not really accomplish that but he laid all the groundwork for it. I am basically finishing the job that Roy started.

I once again want to thank MPs from all parties who contributed to this matter. They have been very good in discussing the matter. When we are talking hockey, I think partisanship disappears and we are all on the same side.

The member for Renfrew—Nipissing—Pembroke and her staff have been very helpful on this matter. I specifically want to thank the member for the accommodations that were made to expedite this bill.

At report stage the bill received the unanimous support of the House. I do not intend to go over all the merits of the bill. We have done that before. I think the members of the House understand the bill quite well. Not much would be accomplished by going over the benefits of the bill, except that it is a good news story for amateur sport and young people in Canada. This is good public policy.

The cost of this amendment to the taxpayer would be minimal. I do not think it would amount to more than $700,000 or $800,000 a year, which, in the age of obesity and all the problems we are having with type two diabetes, it is a measure that would encourage people to be active and be healthy, which is something we should all be encouraging.

I will not be using all my allotted time on this matter. I commend the bill to the good judgment of the 308 members of Parliament in the House of Commons. I trust they will continue to do the right thing and push this bill into reality and make it the public policy of this country.

Income Tax ActPrivate Members' Business

February 28th, 2007 / 6:05 p.m.
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Conservative

Jay Hill Conservative Prince George—Peace River, BC

Mr. Speaker, I rise on a point of order. I think, with the permission of the sponsor, the hon. member for Prince Albert, and with the consent of all members present in the chamber this evening, you might find unanimous consent to pass Bill C-294 at report stage.

Income Tax ActPrivate Members' Business

February 28th, 2007 / 5:30 p.m.
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Conservative

The Acting Speaker Conservative Andrew Scheer

It being 5:30 p.m., the House will now proceed to the taking of the deferred recorded division on the motion at report stage of Bill C-294.

Call in the members.

The House resumed from February 23 consideration of Bill C-294, An Act to amend the Income Tax Act (sports and recreation programs), as reported (with amendment) from the committee, and of Motion No. 1.

Motion to AmendIncome Tax ActPrivate Members' Business

February 23rd, 2007 / 1:30 p.m.
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Bloc

Thierry St-Cyr Bloc Jeanne-Le Ber, QC

moved:

Motion No. 1

That Bill C-294, in Clause 1, be amended by replacing lines 10 to 15 on page 1 with the following:

“(A) the taxpayer is, in that month, a registered participant with, or member of,

(I) a sports team or recreation program of the employer in respect of which membership or participation is restricted to persons under 21 years of age, or

(II) a sports team or recreation program of a college or university,”

Mr. Speaker, the Bloc Québécois will, of course, support Bill C-294, now before us, because it helps young athletes.

The situation in which athletes find themselves is a reflection of the importance given to sports. And there is work to be done, considering that this country will host the 2010 Olympic Games.

The Bloc Québécois strongly supports this bill, which is a step forward to help athletes directly, because, in many cases, they must pay to participate in their sport, particularly young athletes, who receive very little help, both in terms of money and visibility or credibility.

There is only one program providing direct financial assistance to athletes, and that is the Assistance Athlete Program, or AAP. The funds earmarked for this program account for only 13% of the overall budget for sports in Canada.

So, despite the minister's announcement earlier this year that this program would be improved, the fact remains that athletes need more support from the federal government, which seems to perceive these athletes more as a source of visibility and pride, than as people who should get support.

So, the Bloc Québécois supports this bill, which provides additional assistance to athletes, particularly young athletes, who must often spend large sums of money to train in order to perform, on things such as food and housing, sportswear, transportation, tuition fees, medical expenses, travel and competition expenses, registration fees at competitions, training session costs, membership fees, food supplements, and so on.

The amendment that I presented at report stage, and which is proposed by the Bloc Québécois, seeks to recognize the important role of Quebec and Canadian university sports, as regards sport issues.

Mr. Speaker, the purpose of the amendment that you read is to add a second part to clause 1(A), so as to include a sports team or a recreation program of a college or university. That is an addition. The bill already includes all the teams whose members are under 21 years of age. However, university teams should be supported, because they include young athletes. In many cases, some members of those teams will be over 21 years of age, and it would be unfortunate to exclude them for that reason.

To highlight the importance of university sports in Quebec, I would like to speak about an event that takes place every year from September to March. More than 10,000 student-athletes participate in 11 sport disciplines, with a schedule of close to 3,000 events. These events lead to the ultimate goal in university sports: claiming the National Championship title. This weekly competition provides student-athletes with the best there is to offer in Quebec and in Canada.

Annually, regional champions from the four conferences vie to compete in the following disciplines or championships, which are held in November of every year: women's field hockey; men's and women's cross country; women's rugby; men's and women's soccer; the Mitchell Bowl, which is the football semi-final; the Uteck Bowl, which is also a football semi-final; and the Vanier Cup football final.

In March of every year, the following championships take place: women's and men's wrestling; women's ice hockey; men's and women's swimming; men's and women's volleyball; men's and women's indoor track and field; men's and women's basketball; and the University Cup for men's ice hockey.

There are many events at the university level which deserve to have this clause included in the bill.

No other sport organization in the country can match the breadth and scope of such a program. From Victoria to St. John's, student-athletes competing for national honours represent an exciting vibrant dimension of Quebec and Canadian society. Every Canadian Interuniversity Sport (CIS) student-athlete must attend an annual drug education seminar as part of the CIS drug education and doping control program. The seminar highlights key issues and health concerns of drugs in sport. This seminar is extremely beneficial as it allows the student-athletes to discuss the ethics of drugs in sport and educates them about CIS's zero tolerance policy.

Internationally, student-athletes can experience the excitement of the Winter and Summer World University Games, the second largest international multi-sporting events in the world, second only to the Olympics. Every two years, student-athletes have an opportunity to compete with the best from around the globe in 12 sporting disciplines at the summer games and seven sporting disciplines at the winter games. These games provide Canadian university athletes with a unique experience both culturally and athletically and are often the platform for student-athletes to launch their international athletic careers.

My purpose in summarizing these various activities was to emphasize the contribution of university sports to the next generation of Quebec and Canadian athletes, and to support the motion in amendment I tabled at the report stage.

The purpose of Bill C-294 is to amend the Income Tax Act to provide additional support for athletes by excluding from their taxable income allowances from non-profit groups or associations. Concretely, the bill proposes adding a provision to the existing Income Tax Act to exclude from their taxable income any allowances for board and lodging and any other reasonable expenses of the taxpayer that are paid to or on behalf of the taxpayer by a non-profit organization in connection with its operation of a sports team or a sports or recreation program, to a maximum of $350 for each month of the year, adjusted annually to reflect inflation. This applies in two cases: if the taxpayer is registered during the year with the organization as a member of the sports team or as a participant in the sports or recreation program; and if the taxpayer is under 21 years of age. In fact, membership in the team or participation in the program must be restricted to persons under 21 years of age. We are proposing this amendment because we found that the part that allowed only for teams whose members were all under 21 years of age automatically excluded many university students.

I would like to take a moment to illustrate how important Sport Canada is. This bill does much more than give tax credits to athletes, it reopens the debate on funding for amateur sport and the general situation of athletes in Canada and Quebec. Sport Canada is the public agency that administers sport in Canada. The agency comes under the Department of Canadian Heritage and under the direct political responsibility of the Secretary of State for Sport, who reports to the minister. Its mandate is to help athletes achieve excellence in high-level sports and build a Canadian sports system in order to reinforce the unique contribution sport makes to Canada's cultural identity.

Unfortunately, I will not have time to talk about the various programs Sport Canada offers, but the purpose of my presentation was to demonstrate that, even though some efforts are being made, we are not providing enough support for our athletes, especially young athletes. The Bloc Québécois will support this bill. We encourage all parliamentarians to support our amendment in order to ensure that this bill includes university sports.

Speaker's RulingIncome Tax ActPrivate Members' Business

February 23rd, 2007 / 1:30 p.m.
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Conservative

The Acting Speaker Conservative Royal Galipeau

There is one motion in amendment standing on the notice paper for the report stage of Bill C-294. Motion No. 1 will be debated and voted upon.

The House proceeded to the consideration of Bill C-294, An Act to amend the Income Tax Act (sports and recreation programs), as reported (with amendment) from the committee.

FinanceCommittees of the HouseRoutine Proceedings

February 13th, 2007 / 10:05 a.m.
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Conservative

Brian Pallister Conservative Portage—Lisgar, MB

Mr. Speaker, I have the honour to present, in both official languages, the tenth report of the Standing Committee on Finance, on Bill C-294, An Act to amend the Income Tax Act (sports and recreation programs).

I would like to congratulate the member for Prince Albert on being able to advance this private member's bill through committee. I think all members of this place share in respecting the diligence and effort that is required to advance a private member's bill in this place. The member has shown great persistence in doing so. We congratulate him as we present this report to you, Mr. Speaker, and to our colleagues.

February 8th, 2007 / 12:35 p.m.
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Conservative

Diane Ablonczy Conservative Calgary Nose Hill, AB

Mr. Chairman, I would be happy to do that.

The amendment is in front of all members. Is there anyone who does not have a copy of this amendment to Bill C-294? The amendment is that the bill, in clause 1—there is only clause—be amended by replacing lines 7 to 24 on page 1 with the following.

I would ask my good friend Mr. Del Mastro to read the rest of it. I am a little incapacitated at the moment.

February 8th, 2007 / 12:35 p.m.
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Conservative

The Chair Conservative Brian Pallister

Before Finance officials leave, I understand we may need some answers to some questions during clause-by-clause. I'd encourage you to stay for a few minutes, anyway. I would appreciate it if Finance officials would hang around just for 20 minutes, just in case there are some questions pertinent to the issue.

All right, we're into clause-by-clause consideration now of Bill C-294.

(On clause 1)

You have in front of you an amendment. I would emphasize to committee members, for the maximum effective use of time, that the cameras are off.

It's Diane's amendment, isn't it? Would you like to speak to that?

February 8th, 2007 / 11:05 a.m.
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Conservative

The Chair Conservative Brian Pallister

Welcome, members of the committee.

Pursuant to the order of reference of Wednesday, June 7, 2006, Bill C-294, An Act to amend the Income Tax Act (sports and recreation programs), we have some witnesses here today.

Gentlemen, welcome to the committee. We're going to start with my colleague Mr. Fitzpatrick. We'll allocate a brief time, five minutes, for a presentation or an overview and then get right into some discussion and some questioning on the issue.

Whenever you're ready, Brian, take it away. I'll give you five minutes to give us an overview on your proposal.

February 1st, 2007 / 1:25 p.m.
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Conservative

The Chair Conservative Brian Pallister

Order.

Committee members, allow me to review quickly the work schedule for committee members and their staff.

First of all, in terms of orders of business for the coming week, next Tuesday, February 6, we will be dealing with a draft report on income trusts. I'm going to endeavour to get the room fifteen minutes earlier so that you can come in and read the draft prior to beginning discussion, just to expedite the process of dealing with the draft report.

Next Thursday, February 8, we have private members' bills. We have Bill C-294, Bill C-253, and Bill C-305 to deal with at that point in time.

Following that, very likely beginning on Tuesday, February 13, we will be dealing with Bill C-37, the Bank Act review, which should encompass a fair bit of the committee's time over the next while. I would suggest to you, committee members, that you forward names of witnesses to the clerk's office. Begin that process now and we'll give you some deadlines later on, but give some thought to Bill C-37, the Bank Act review, as soon as you wish.

At this juncture, Mr. McCallum, I believe you have a motion that you'd like to bring forward. I'd like for us to deal with it now if we could.

October 31st, 2006 / 10:35 a.m.
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Conservative

The Chair Conservative Brian Pallister

Thank you, Madam Ablonczy. Thank you, all. Thanks to committee members for their attention, despite their chocolate levels here this morning.

We will excuse the panel now, and the cameras will be off momentarily so we can continue our civil discussions this morning.

I think I can deal, actually, with Monsieur St-Cyr's issue in advance. It may save us time, and we'll then move to Madam Wasylycia-Leis's motion. Also, I should notify the committee that we've received notice from Mr. Paquette of his desire to present a motion on Thursday.

I want to quickly give you an overview of the work we have before us. This Thursday we will continue dealing with Bill C-25. I will encourage all committee members, if they have amendments to this bill, to bring them forward in advance of the discussions. It would facilitate discussion of the bill. I would encourage you to give those to the clerk by 5 p.m. tomorrow, knowing, of course, that you can bring amendments during the discussion if you so desire. It would facilitate our discussion at that time.

Also, we have C-28, the budget implementation bill, before us, which we must deal with by.... When? Is there a deadline on that? It should be as soon as possible.

We also have Bill C-294. Supplementary estimates also have to be dealt with by December 5. We have the fall fiscal forecast. And the minister will be appearing, we think, but not until the week after, we hope, the Remembrance Day recess.

We also have, of course, the priorities that I've asked you to identify and forward to us, because we want to get those over to Finance so they can come to speak to those and provide us with further information. That process will begin next Tuesday. So those priorities, I'd remind you.... When did we say we wanted those in by? They should be in by tomorrow at noon. Please do so, because we do want to make sure that Finance officials have a bit of lead time to prepare fully for your questions.

As well, we have private members' bills and the tabling of reports on the pre-budget consultations. We need to prepare that as a result of our weeks of deliberations. That has to be done by December 4. As well, Mr. McCallum has a notice of motion on the record in regard to GST rebates.

We have 10 meetings to do all of that. That being said, Mr. St-Cyr has raised with the chair his concern about--

FinanceCommittees of the HouseRoutine Proceedings

October 18th, 2006 / 3:25 p.m.
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Conservative

Jay Hill Conservative Prince George—Peace River, BC

Mr. Speaker, I have a couple of motions to deal with today. I would like to indicate at the outset that discussions have taken place between all the parties.

The first motion is concerning the recorded division scheduled to take place later today on the motion to concur in the third report of the Standing Committee on Finance, requesting an extension of time to consider Bill C-294. I believe you would find unanimous consent for the following motion. I move:

That the recorded division scheduled to take place later today on the motion to concur in the third report of the Standing Committee on Finance, be deemed concurred in.

FinanceCommittees of the HouseRoutine Proceedings

October 16th, 2006 / 4:45 p.m.
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Conservative

The Acting Speaker Conservative Andrew Scheer

Before moving on to the next speaker, I note that earlier today the third report of the Standing Committee on Finance, requesting an extension of 30 days to consider Bill C-294, was tabled. Pursuant to Standing Order 97.1(3)(a), a motion to concur in the report is deemed moved, the question deemed put and a recorded division deemed demanded and deferred until Wednesday, October 18, immediately before the time provided for private members' business.

Official LanguagesCommittees of the HouseRoutine Proceedings

October 16th, 2006 / 3:20 p.m.
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Conservative

Brian Pallister Conservative Portage—Lisgar, MB

Mr. Speaker, I have the honour to present, in both official languages, the third report of the Standing Committee on Finance.

This is requesting an extension of 30 sitting days from the hard-working committee to consider Bill C-294, An Act to amend the Income Tax Act (sports and recreation programs).

Income Tax ActPrivate Members' Business

June 7th, 2006 / 5:30 p.m.
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Conservative

The Acting Speaker Conservative Andrew Scheer

It being 5:30 p.m., the House will now proceed to the taking of the deferred recorded division on the motion at second reading stage of Bill C-294 under private members' business.

Call in the members.

The House resumed from June 1 consideration of the motion that Bill C-294, An Act to amend the Income Tax Act (sports and recreation programs), be read the second time and referred to committee.

Income Tax ActPrivate Members' Business

June 1st, 2006 / 5:35 p.m.
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Conservative

Brian Fitzpatrick Conservative Prince Albert, SK

moved that Bill C-294, An Act to amend the Income Tax Act (sports and recreation programs), be read the second time and referred to a committee.

Mr. Speaker, I want to point out that my colleague, the member for Saskatoon—Humboldt, will be making a friendly amendment, which I have no objection to when he speaks later on today.

I will start with a rhetorical question to get everybody's attention in the House. What if the Canada Revenue Agency decided tomorrow that the housing allowance, which members of Parliament receive while in Ottawa, would now be considered a taxable benefit and it would have to be brought into our income tax returns? We would be looking at full taxation on that. How many members in the House would applaud that move?

This is precisely what happened a number of years ago with amateur junior hockey in Saskatchewan. The tax department told tier two junior teams, struggling to keep their heads above water and keep their teams alive in their communities, that the room and board being provided to the players was a taxable benefit and that it was subject to Canada pension and income tax deductions. These are 17, 18 and 19 year old kids who generally attend school and board hundreds of miles away from these communities.

This brought a real hardship to the teams. Some of them were looking at $20,000 to $25,000 assessments on their operations and they were already in debt. They were selling lottery, raffle tickets, et cetera, to keep their teams alive and then along came the ruling by the Canada Revenue Agency.

The amendment to the Income Tax Act would have the effect of providing a small exemption to amateur athletic teams of $300 per month per player for the duration of the season. That would be exempt from the reaches of the income tax department. It would extend to all amateur sports teams in which the membership would be 21 years or under. It also would be limited to teams that were non-profit, community-based organizations trying to operate a junior team, or a midget triple A team, or a skate team, or gymnastics team or whatever it may be.

There are restrictions on the amendment to avoid abuses by people who are not legitimately amateur and who try to find loopholes to get around this. I think it is well crafted to ensure that it meets the test of helping amateur athletic development in all provinces of Canada.

I will give a bit of history on this matter. About four or five years ago, the tax department descended upon the 11 teams of the Saskatchewan junior hockey league, audited their books and came to the determination that they should have been reporting the room and board being provided to the players on the teams as a taxable benefit.

It is like a person who has a garden in the backyard and grows potatoes, carrots, peas. The tax department tells the person that is a taxable benefit, saying that normally people buy potatoes and carrots at the grocery store with after tax money and this person is getting the vegetables without having to pay for them.

The rationale was very questionable. The rationale was that this was an employer-employee relationship. This is not an employer and employee relationship. That is a questionable determination. In the fall, 70 or 80 kids will show up in these communities to compete to be on these teams. What are they trying to do? They are trying to enhance their skills as hockey players. It is like a school for hockey players.

Parents entrust their kids to those teams, to put them in good homes, to attend school and to develop their hockey skills. For a lot of parents, the end game of going to tier two hockey is to obtain an athletic scholarship to the United States.

Every year in Saskatchewan two or three players on a team receive a full four-year scholarship to major American universities to pursue their hockey careers and also to receive an education. This ruling quite seriously casts some doubt over their continued eligibility on this matter.

However, 80 players show up in the fall and they compete to get on these teams. Twenty to twenty-four players make the team. The other ones take the bus ride home. There is no payment to these players. There is no employer-employee relationship. The parents basically entrust their kids to the guardianship of these junior hockey teams. They attend high school or if they are over the age of 18, they attend a community college. They are expected to behave themselves and conduct themselves in a responsible manner in those communities.

That was the criteria for imposing this case. I know a junior team is taking on the Canada Revenue Agency and fighting it in court on such an issue. This is not the same as the softwood lumber dispute where millions of dollars are spent fighting something big for many years, hoping to get somewhere. Junior hockey teams do not have that kind of money. These teams are selling raffle tickets to pay the room and board for players. They do not have the money to spend on lawyers to go to court to fight our tax department.

This is some of the background of the bill. It is more than just the Saskatchewan tier two junior hockey league. This year the Prince Albert Mintos won the AAA midget Canadian hockey championship. It is the third time in the last fives that Saskatchewan has won the premier Canadian championship for the best midget hockey players in the country. Tisdale, a town of 3,700 people, won it in 2002. Since 1978, Saskatchewan has won the AAA midget championship something like 35% of the time. This is from a province with less than a million people.

There is definitely a culture of hockey history in Saskatchewan. We should be encouraging this part of our heritage. Saskatchewan is the home of Gordie Howe and Johnny Bower. A whole list of players have come through the Saskatchewan junior hockey league. We should encourage our young people to be involved in this type of program. Our tax department should not be there with assessments that almost have the effect, in some cases, of virtually putting these teams out of existence.

This is a major cultural event in the community. I come from Nipawin, Saskatchewan, which has a population of 5,000 people. When winter sets in, it is long. Hockey brings the community together.

If I go down to that hockey rink, professional people, business people, retired people, first nations people, people from all income perspectives in that community all come together. They are united in that community for one thing, and that is to cheer on their team and hope that it will advance through the hockey process. This happens in 11 communities throughout Saskatchewan. It has been going on for well over 60 years. It has been going on as long as Gordie Howe laced up his first set of skates in Saskatchewan.

Dave King is a product of that league. He has received the Order of Canada. He coached our Canadian team at the Olympics many times. He has coached in the NHL. I talked with Dave King and he could not believe the tax department would do something like this. He thought it was outrageous.

At that time, five NHL coaches had cut their teeth in the Saskatchewan junior hockey league. I believe four players on the team won the Olympic gold medal. They came from that league. They had developed their skills and worked their way through that league. Our policies should encourage the sport of hockey.

Too many Canadians sit at home watching TV, especially our young people. Young Canadians have a problem with obesity and diabetes and all kinds of problems. Why in the world does the government not encourage our young people to be active and to get involved in different activities, whether it is hockey, gymnastics or any other sport? The whole point of the amendment is to give these teams a bit of a break and some leeway.

There are 130 tier two junior hockey teams across the country. It is not just something for Saskatchewan. It would benefit other teams as well. Ontario has a whole pile of Junior B teams, maybe more of them than tier two teams. This would benefit them. The AAA midget teams would benefit as well. I am not an expert on other sports programs throughout the country, but if the tax department wanted to take its policy approach and extend it to gymnastic clubs, swim clubs, or junior football clubs, which have players under 21 years old, it would have a negative effect.

I want to also bring home a point with respect to the $300 amount. Some people would say that the income tax on $300 would not be a lot, but that is not the issue. The issue is the Canada pension assessment, which is very high when one is either at the beginning or the end of the income scale. It is basically 10%. The assessment for EI benefits, especially under the Liberal administration, was more a tax grab than an insurance premium. If we do the math involving a team with 25 players at $300 a player, it adds up. If we could pass the amendment, it would eliminate this hardship. I estimate that we are talking $5,000 or $6,000 a year.

A large group of volunteers selling tickets to raise funds for a community project would probably make $5,000 at the end of the day. What in the world would be the sense of selling raffle tickets so $5,000 could be paid to the Canada Revenue Agency? It does not make any sense. I have real doubts the amount collected, whether under EI or Canada pension, would ever amount to any tangible benefit to the player anyway. It is not enough to qualify for anything.

Some of my Liberal colleagues have mentioned disability benefits for players who might get injured. This is not enough to get them into any real meaningful disability benefit. Those members do not understand how our junior hockey leagues operate. They have disability insurance plans in place so if a player is injured, those plans provide them with much better benefits than they could ever get under the Canada pension plan. This shows a profound ignorance on the part of some members to even raise this issue. This argument could be used for school basketball teams or football teams as well. There are no Canada pension benefits for them.

A lot of my Liberal friends like to talk about our culture. I cannot think of anything that is more a part of our culture than hockey. We can go to just about any country and ask people, especially Europeans, what really sticks out about Canadian culture. They will tell us it is our hockey. Canada is the hockey centre of the world. It is our culture and it is very much a part of rural Canada.

This thing was an anti-rural Canada decision too. Our rural communities were the ones that were really hit by this. Larger cities like Toronto do not have a room and board issue. The kids live within close distance of the rinks. Nipawin, Saskatchewan is three hours away from Saskatoon and an hour and a half from Prince Albert. It is a long way away from other communities. Players travel long distances and are put in good homes.

I encourage everyone in the House of Commons to stand up for our culture, for our hockey and rural way of doing things. I urge them to tell people that the government is here to help them, not always to get in their way and make life difficult for them.

Income Tax ActRoutine Proceedings

May 17th, 2006 / 3:25 p.m.
See context

Conservative

Brian Fitzpatrick Conservative Prince Albert, SK

moved for leave to introduce Bill C-294, An Act to amend the Income Tax Act (sports and recreation programs).

Mr. Speaker, I am pleased to rise on behalf of the constituents of Prince Albert to introduce this bill entitled “An Act to amend the Income Tax Act (sports and recreation programs)”.

With this legislation an allowance given to young amateur athletes of up to $350 per month by non-profit sports organizations for board and lodging will be exempt from taxation. The bill would allow non-profit amateur junior teams to once again operate without the fear of being taxed out of business. The bill would also protect the amateur status of athletes wishing to pursue athletic scholarships elsewhere.

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