This bill is from the 39th Parliament, 2nd session, which ended in September 2008.
Robert Bouchard Bloc
Introduced as a private member’s bill. (These don’t often become law.)
Second reading (Senate), as of June 12, 2008
(This bill did not become law.)
This is from the published bill.
This enactment amends the Income Tax Act to give every new graduate who settles in a designated region a tax credit equal to
(a) the lesser of 40% of the individual's salary or wages;
(b) $3,000; and
(c) the amount by which $8,000 exceeds all amounts paid to the Receiver General.
The purpose of this measure is to encourage new graduates to settle in designated regions, thereby curbing the exodus of young people from those regions and promoting their economic development.
All sorts of information on this bill is available at LEGISinfo, an excellent resource from Parliament. You can also read the full text of the bill.
Bill numbers are reused for different bills each new session. Perhaps you were looking for one of these other C-207s:
Income Tax ActPrivate Members' Business
The Acting Speaker Royal Galipeau
It is with regret that I must interrupt the hon. member.
I now recognize the hon. member for Lévis—Bellechasse.
Steven Blaney Conservative Lévis—Bellechasse, QC
Mr. Speaker, I am very pleased to rise today to speak to Bill C-207.
Unfortunately, I cannot support this bill, because it is flawed and expensive.
However, I supported a bill that created a fund for the manufacturing industry and I supported a budget that creates a package through which manufacturing businesses throughout Quebec can expand and create good, well paying jobs.
As usual, the sponsor of the bill introduces bills to impress the gallery, but unfortunately, he did not act at the right time. He did not stand up for Quebeckers, to support concrete measures for Quebec industry.
I would simply like to remind the sponsor of this bill that the economic outlook is very encouraging at this time. The manufacturing sector in Quebec saw an employment increase in the last quarter. Imagine that. These are encouraging numbers in terms of job creation in the manufacturing sector. There was also an increase in the net number of jobs created in Quebec.
Steven Blaney Conservative Lévis—Bellechasse, QC
Mr. Speaker, you can hear them, too. I would like the members to listen to me. I had enough respect to listen to them and I would like them to do the same.
This is yet another in a slew of disappointing and really poorly thought-out economic proposals coming from the Bloc Québécois, proposals that really do not address the priorities of Quebeckers in any meaningful way. It is such poor proposals that have even led the sponsor’s Bloc colleague, the member from Longueuil—Pierre-Boucher, to admit, and I quote:
The economy is constantly an albatross for us. We are profoundly uncomfortable when it comes to discussing the economy.
The Bloc members had the chance to support budgets that included concrete measures to help Quebec's economy, but they remained seated. Other colleagues, such as the member for Roberval—Lac-Saint-Jean, rose in this House and stood up for the people of Lac-Saint-Jean by supporting these measures. Colleagues like the member for Charlesbourg—Haute-Saint-Charles rose and stood up for Quebeckers. They are working here, proud to be both Quebeckers and Canadians.
Why did the majority of the members of the Standing Committee on Finance vote against this bill? Because of its many serious and glaring flaws and the fact that it does not hold water.
First, the designated regions referenced in the bill are drawn from a list that has not been updated in over 20 years and does not account for the economic changes that have taken place during that time.
Second, the tax credit would also introduce inequities in the tax system: inequities between recent graduates and those who graduated earlier, and inequities between new graduates who work in different regions.
Third, the credit would be exceedingly expensive. The money could be invested elsewhere to support our manufacturing sector, which would create jobs and keep our young people in regions such as Bellechasse, Les Etchemins and other regions throughout Quebec.
Bill C-207 tries to use the tax system to encourage new graduates to work in certain regions of Canada in order to address perceived skills shortages, but attempts to do that in ways which, in the end, would make the tax measure ineffective. It would, for example, only provide tax relief to a new graduate's first 52 weeks of qualified employment. What happens after the initial 52 weeks when there is no longer a credit available? Clearly, this type of measure cannot yield long term benefits to regions, and I am not even sure it would have an incremental impact in the short term beyond reducing taxes for a selected group of workers.
Another concern with the bill is that it does not make any attempt to target skills sets that are in short supply in a designated region or that could benefit its development. As I just mentioned, it has been 20 years since the list of designated regions was updated.
That is not all. There are other flaws in the bill. As I said, it would create severe inequities by discriminating between regions, and between groups of graduates.
Graduates who finish their programs around the same time, but who live and work in different regions, could face entirely different income tax burdens during their first year of employment. That would result in inequities and create two classes of graduates. As well, two graduates working in the same job and region, but whose graduation dates are a year apart, would face an $8,000 gap in their respective tax burdens. This, too, is patently unfair.
Finally, this bill would be incredibly expensive. Not only would it be ineffective, it would be costly. Estimates suggest that the credit could cost up to $600 million, money that would be taken away from other areas on a tax measure for which the outcome is uncertain.
This bill is the wrong way to go.
Steven Blaney Conservative Lévis—Bellechasse, QC
The member had opportunities to support real measures for workers and apprentices, but he chose not to stand up for those measures.
While we all believe it is important to provide our young people with the training and education opportunities they need to compete in a knowledge economy, it is important we do that in a responsible and effective manner.
This government has committed, through Advantage Canada, to creating the best educated, most skilled and most flexible workforce in the world. To achieve that goal, this government has taken action in a number of areas. The people on this side, Conservatives from Quebec, did stand up to support these measures.
For instance, Budget 2007 included a $2.4 billion transfer for social programs, a 40% increase. These tools will enable Quebec to support all of the measures and programs developed for young people. The government has provided the greatest number of scholarships ever granted to graduate students, and it has eliminated the federal income tax on all income from scholarships, bursaries and fellowships.
I want to remind the sponsor of this bill that the new Canada Student Grant Program is investing $350 million. We believe in our young people, in our young Quebeckers and young Canadians. We want them to be the most successful in the world. In 2012, this allocation will increase to $430 million. Our new grant program will support low and middle income students in particular who will be able to enrol in school with the security of knowing they will be awarded a grant for each year of study. And the new grant program will provide support to over 100,000 students more than the old, heavily criticized system would have supported. We are taking action, making corrections and getting things done.
What is more, this government is spending more money than any other on youth skills development and training. For instance, we have created a new apprenticeship tax credit of up to $2,000 per apprentice per year. Unfortunately, the Bloc did not vote in favour of this. The Conservatives, however, stood up to support this bill.
We also have a $1,000 grant system for the cost of tools so that not only can our young people work in a trade, but they can also have the financial resources to get the tools they need to be prepared for the job market, with tax deductions to boot.
It is no coincidence that with the policies put in place by our government's Minister of Finance, nearly 750,000 jobs have been created in Canada since our election—and of these jobs, 80% are full time. The employment rate is at a 33-year high. Hon. members have had an opportunity to support the budget, but unfortunately they remained seated. Fortunately, we have Conservative members from Quebec to defend the interests of Quebec.
Obviously, I will not be able to support this bill because, again, it was not well prepared. I truly hope that my colleagues will agree with the points I have raised today and join the majority of the members of the Standing Committee on Finance in realizing that this bill is going nowhere. It is nothing but smoke and mirrors.
The Liberals and the Conservatives have also rejected this bill. I hope my colleagues will vote against this proposal and instead support the concrete measures to support our young people in all the regions of Quebec and the country.
Paul Szabo Liberal Mississauga South, ON
Mr. Speaker, I am pleased to rise during private member's business to speak to Bill C-207 put forward by the Bloc member for Chicoutimi—Le Fjord.
As has been covered in the debate, and I do not want to spend too much time describing the bill, it prescribes a tax benefit through a tax credit to allow employees, in areas which have economic challenges, who may have skills needs but may not be able to compete with some of the more attractive centres, an opportunity to work in those centres.
I can only imagine what Canada would be like if some of the smaller, economically challenged regions and communities in our country were to continue to fall behind. The population and businesses would decline, people would move away, jobs would be lost, and companies would shut down.
I believe this bill is important for Canada because it has to do with the shared value of the need for regional economic development. There are areas within our country that need some assistance from time to time to ensure they have some of the tools they need to continue to be economically vibrant.
We can imagine new graduates with the needed skills having opportunities to go to work in Quebec City, Montreal, Toronto or Vancouver. What about a place like Abitibi-Témiscamingue? Is it going to be able to compete with the fancy job in Montreal? Is it going to be able to pay the same money to attract a skills set to that area?
When I look around the country, I feel like saying that Canada is a picture or painting which has many aspects to it. How many of those parts of the picture can be taken away and still retain the integrity of the picture? It is very easy to imagine that Canada could shrink to urban economic centres. Eighty per cent of our population lives within 100 kilometres of the U.S. border.
There is a real threat and it affects not just agricultural communities, not just resource communities but thriving communities that have good fundamental economic bases, and they are at risk. That is why we have regional economic development programs because we need to ensure that there is a continuation of operations and the sustainability of communities.
When I spoke to the hon. member for Chicoutimi—Le Fjord, I looked at some of the names of the places. I do not know how many members may have been to places like Avalon Peninsula, Newfoundland and Labrador; Cape Breton; the north shore of Nova Scotia; Miramichi or Edmundston in New Brunswick; Gaspésie; Îles-de-la-Madeleine, Quebec; Estrie, Quebec; Laurentides; and Abitibi-Témiscamingue.
Windsor-Sarnia right now is undergoing a tremendous downturn in its economic outlook. Housing has gone down and unemployment has gone up. This was not the case a long time ago. Communities like Windsor were vibrant. The economic spin was going very well. Now, Windsor is becoming a have not area. It is just like a number of other communities across the country, whether it be in eastern or western Canada, northern Ontario or within Quebec. Circumstances change.
In fact, we are experiencing a significant shift in wealth and economic activity in Canada right now. Resource provinces are doing extremely well: Alberta, Saskatchewan and now Newfoundland. But 60% of the economic activity in Canada is in Ontario and Quebec collectively. That is where there is a lot of manufacturing going on and that is where there are going to be great pressures in terms of both employment and population dropping.
Populations are shifting where the resources are. I do not know what happens when finite resources start to disappear. I assume that people will migrate back again to the next best opportunity.
In the meantime, what will be the consequences? What areas will have to be sacrificed because we have not taken the initiative to provide certain incentives to allow them to sustain themselves when there are significant economic challenges.
We need our young people to be proud and to continue to be part of the communities in which they were raised. We do not want them all to stay in that community. We need to allow them to be as good as they can be. It may be a matter of graduates being able to go into another community which may be very similar, maybe not an urban centre, but chances are the economic advantages will not be there and will not be attractive enough for them, compared to other opportunities.
This particular bill provides at least initial economic assistance for these individuals to go, to take that job in a community that they know is the best fit for their skills, or is in an area in which they feel most comfortable. It is a win-win situation, not only for these individuals but also for the community and for the country as a whole.
I looked at the evidence presented at the finance committee. Everybody thinks that the committee did a very good job on this. I must say that I was a little concerned because one of the members of the committee, and I will not name the member or his party, but the member did say:
So the goal of your bill is to get young people to stay where they're from; it has nothing to do with making sure that the skill sets are meeting the needs of certain areas.
That tells me that this member did not even read the bill nor even understand the bill. In fact, the objective of the bill is quite the opposite. It is not to ask people to stay where they are, it is to give them the opportunity to go where they have the best opportunity to get that job and to develop those skills.
Then I hear another member over here saying, “You give them a tax benefit for one year, and then what are they going to do?” He has a lot of studies. I did not see any, but I can only assume. He can make that assertion. He asks, “After one year, what will they do?” He would say that they may leave because they are just there for the little tax credit, but once the tax credit ends, they are gone.
I know of members, even in my own caucus, who said, “My kid went to a community. He said he is going there for a year or two years”. That was eight years ago and that individual is still there doing that job because when a person gets that first job and develops that skill, his or her career is starting to build. People do not build careers by bopping around, job to job, every year, looking for a tax credit. We have to respect people's intelligence a little bit more than that.
I see that my time is up. I have a few more things that I really would like to say about the bill, but let me just say that I have taken enough time to look at it and I believe that the approach of the bill is sound.
There may be some disagreement or some discussion about the mechanics, but Quebec has had such a program since 2006. I understand that about 10,000 graduates were eligible. It is estimated that some 30,000 Canadian students, graduating with good skill sets, ready to serve Canada no matter in what region they choose to, would be eligible for such a program.
How can we be against that? It is the right thing to do. I support it and I will encourage my caucus to support the bill.
Dennis Bevington NDP Western Arctic, NT
Mr. Speaker, it is a pleasure to stand and speak to Bill C-207, An Act to amend the Income Tax Act (tax credit for new graduates working in designated regions). The bill would give each graduate who settles in a designated region a credit equal to 40% of the individual's salary, up to $8,000. This would encourage new graduates to settle in designated regions.
This is an important concept but it only goes so far in the whole context of what is happening in the northern regions of Canada. I also have full sympathy for northern students because almost all of them must travel to institutions in different cities to get a degree in a particular subject. In my own riding in the Northwest Territories, the government invests heavily in community colleges, to the point where students can now stay in the Northwest Territories and get a degree in education or in nursing, but that is about it.
In order for students in a designated region to get the education they want, they need to travel. The expenses are greater for them at the beginning. They also do not have the luxury of living at home when they are going to school. Once again the burden is greater on students from the far reaches of our country in achieving the education they need. These things all add up and make it very difficult for students.
When I went to school, our federal government at that time--
Income Tax ActPrivate Members' Business
Daryl Kramp
That was a long time ago.
Dennis Bevington NDP Western Arctic, NT
That was a long time ago and I am not ashamed of that. I think more than education, one needs wisdom to be in this House.
However, at that time we were fully covered for post-secondary education. People in northern regions falling under the federal government's auspices had complete coverage for education. That has eroded over the years. Right now, even within my territory, there are some opportunities. If graduates return to the Northwest Territories they have the opportunity to be forgiven some of the student loans they may have taken out to achieve their degree.
Quite clearly, I am supportive of giving more opportunities to northern students to achieve an education first, and then second, to return to the north and participate in the economy there. The economy is in difficult shape. Right across northern Canada we are facing extreme increases in our cost of living this year. This has been going on actually for a number of years. We are at a point now in the Northwest Territories, where our gross domestic product rose 13% last year, we had a 1% decline in our workforce.
People simply cannot afford to live in northern regions any more. Therefore, the concept that we would make it easier for students to move back to the north and live is a good one but it does not go as far as what we need to do within the tax structure of the country to promote living in the north. We saw the Conservatives make a perfunctory gesture toward that with the increase in the northern resident tax deduction by 10%. We were asking for 50% but they did not accomplish that.
However, hopefully, now that the concept has been revitalized in this Parliament and people see what the situation is, the government will come up with a better solution next time and actually get the job done right.
When it comes to the cost of living, we are in a crisis right across northern Canada. Not only do we need to, by our nature, by our geography and by our climate, consume much more in fossil fuels than most other Canadians, we also pay extraordinary prices for it, which really hurts and will hurt even more.
Right now in the Northwest Territories, in order to have all the services, transportation and all the things that are required, it turns out that the average family unit, within the economy, consumes over 10,000 litres a year in fuel. Prices have doubled in the last year. We are going to see an enormous crisis in the ability of people to live and work in the north. We need answers right now. We need answers that can work for people.
As well as being a northern region, as well as having high costs, we are also a driver of the Canadian economy. We are not the laggards. We are not the people who are not contributing to the development of the Canadian economy. On the contrary, our communities are making massive contributions in terms of national resource extraction and in many other areas that are very beneficial to this country.
We need support for northerners. We need support for students. We need to put money into human resources across the north. We need to make it possible for young people to enjoy a decent life in northern communities so that they will return to their homes and take up the responsibility of citizenship within their region, rather than end up in a city where there is not that measure of cultural understanding or that opportunity to build their own future in their own part of the world.
I would love to support this bill, but some of the things in the bill are troublesome. One thing is the designated region definition. In examining the Regional Development Incentives Act, we do not see clearly that this lines up for the whole of northern Canada, or for all the isolated and remote areas across the country. Some of them are not that far north. There are certainly some rural and remote areas in many of the provinces. We need a strong definition of what this rural and remote policy to encourage students is and how it is to be put into place. That would certainly help.
There is no doubt that what is being proposed here is useful, but is it enough? I have trouble seeing that it is enough. Clearly, with what is happening in the northern economies across Canada we need a massive opportunity to promote living in the north.
In a kind of perverse way, with the consumption taxes that are in place, and the taxes on fuels, and everything we are doing in Canada, an extra tax burden is put on northerners across the country. In Paulatuk, Northwest Territories a gallon of bleach costs $30, but in Ottawa it costs $2. That means the consumption tax is hitting the consumer in Paulatuk harder than it is hitting the consumer in Ottawa.
In many ways northerners contribute quite a bit to the tax system and they should be recognized for that as well when consumption taxes are put on. The northern mayors in British Columbia were outraged at the idea of a carbon tax because, of course, northerners have to consume more, things cost more and they pay higher taxes. When we offer up some incentives in the tax system, we are really trying to equalize what is going on there.
I will finish my comments there.
Income Tax ActPrivate Members' Business
The Acting Speaker Royal Galipeau
Resuming debate.
I will put the question now. The question is on Motion No. 1. Is it the pleasure of the House to adopt the motion?
Income Tax ActPrivate Members' Business
Income Tax ActPrivate Members' Business