Bill C-47 (Historical)

Sustaining Canada's Economic Recovery Act

A second Act to implement certain provisions of the budget tabled in Parliament on March 4, 2010 and other measures

Part 1 of this enactment implements a number of income tax measures proposed in the March 4, 2010 Budget. In particular it
(a) allows for the sharing of the Canada Child Tax Benefit, the Universal Child Care Benefit and the Goods and Services Tax/Harmonized Sales Tax credit for eligible shared custody parents;
(b) allows Registered Retirement Savings Plan proceeds to be transferred to a Registered Disability Savings Plan on a tax-deferred basis;
(c) implements disbursement quota reform for registered charities;
(d) better targets the tax incentives in place for employee stock options;
(e) expands the availability of accelerated capital cost allowance for clean energy generation;
(f) adjusts the capital cost allowance rate for television set-top boxes to better reflect the useful life of these assets;
(g) clarifies the definition of a principal-business corporation for the purposes of the rules relating to Canadian Renewable and Conservation Expenses;
(h) introduces amendments that are consequential to the introduction in 2011 of new International Financial Reporting Standards by the Accounting Standards Board; and
(i) amends the Canada Pension Plan, the Employment Insurance Act and the Income Tax Act to provide legislative authority for the Canada Revenue Agency to issue online notices if the taxpayer so requests.
Part 1 also implements income tax measures that were previously announced regarding:
(a) rules to facilitate the implementation of Employee Life and Health Trusts, released in draft form on February 26, 2010;
(b) indexing of the working income tax benefit announced in the 2009 Budget;
(c) technical changes concerning TFSAs announced on October 16, 2009; and
(d) an amendment to the rules regarding labour sponsored venture capital corporations that are consequential to the introduction of TFSAs.
Part 2 amends the Air Travellers Security Charge Act, the Excise Act, 2001, the Excise Tax Act and the New Harmonized Value-added Tax System Regulations to provide legislative authority for the Canada Revenue Agency to issue online notices if the taxpayer so requests.
Part 2 also amends the Air Travellers Security Charge Act, the Excise Act, the Excise Act, 2001, the Excise Tax Act, the Brewery Departmental Regulations and the Brewery Regulations to allow certain small remitters to file and remit semi-annually rather than monthly.
Finally, Part 2 amends the Air Travellers Security Charge Act and the Excise Tax Act to extend the protection from civil liability claims that is already provided under the Income Tax Act and other federal statutes to agents of the Crown who collect the Goods and Services Tax/Harmonized Sales Tax and the air travellers security charge in intended compliance with their statutory obligations.
Part 3 amends the Federal-Provincial Fiscal Arrangements Act to facilitate the sharing of taxes under Part I.01 and Part X.5 of the Income Tax Act with provinces and territories.
Part 4 amends the Bank Act and the Financial Consumer Agency of Canada Act to require that banks belong to an approved external complaints body and to authorize the Governor in Council to prescribe the approval requirement for that body. The amendments also assign the responsibility for managing the approval process and supervising the approved external complaints bodies to the Financial Consumer Agency of Canada.
Part 5 amends the Canada Disability Savings Act to allow a 10-year carry forward of Canada Disability Savings Grant and Canada Disability Savings Bond entitlements.
Part 6 amends section 11.1 of the Customs Act to exempt from the User Fees Act fees that are charged for expedited border clearance programs and that are coordinated with international partners.
Part 7 amends the Federal-Provincial Fiscal Arrangements Act to implement the total transfer protection for 2010-11, to set out the treatment of the one-time transfer protection payment under the fiscal stabilization program, update legislative references made in the fiscal stabilization provisions and give greater clarity to the calculation of the fiscal stabilization payment.
Part 8 amends the Office of the Superintendent of Financial Institutions Act. In particular, the Act is amended to
(a) harmonize the assessment of costs associated with the administration of the Pension Benefits Standards Act, 1985 with the regime in place for the assessment of costs associated with the administration of laws governing financial institutions; and
(b) allow the Superintendent to remit assessments, interim assessments and penalties and to write off certain debts.
Part 9 amends the Pension Benefits Standards Act, 1985. In particular, the Act is amended to
(a) authorize the Minister of Finance to enter into an agreement with the provinces respecting pension plans that are subject to the pension legislation of more than one jurisdiction;
(b) authorize the Minister of Finance to designate an entity for the purposes of receiving, holding and disbursing the pension benefit credit of any person who cannot be located;
(c) permit information to be provided in electronic form, including information provided by the administrator of a pension plan to members or to the Superintendent;
(d) allow the administrator of a pension plan to offer investment options with respect to accounts maintained in respect of a defined contribution provision or accounts maintained for additional voluntary contributions;
(e) provide rules regarding negotiated contribution plans;
(f) require consent of a member’s spouse or common-law partner before the transfer of the member’s pension benefit credit to a retirement savings plan; and
(g) authorize the Superintendent to direct the administrator of a pension plan that is subject to the pension legislation of more than one jurisdiction to establish a separate pension plan for certain members, former members and survivors.

Sustaining Canada's Economic Recovery Act

[Andrew Saxton, Conservative, North Vancouver, BC]

Mr. Speaker, my colleague's question allows me to explain the largest debt in Canadian history measured by deficit to equity ratio was actually in 1984 after successive Liberal governments were in power. It was over 8%, compared to 5% today.

The Liberals and the opposition over the past two years have been encouraging us to spend even more money. So it is not as a result of anything they have been doing.

However, I explain what we have been investing in. We paid down $40 billion of debt prior to the recession, which placed us in a very strong position to tackle the recession when it actually happened. We cut over 100 taxes, putting over $3,000 back into the pockets of the average Canadian family. Over one million lower income Canadians are no longer on the tax rolls. We have allowed income splitting for seniors. We have doubled the age credit amount for seniors. We have raised the age for converting RRSPs to RRIFs from 69 to 71 years. We have introduced the tax free savings account which almost 5 million Canadians have taken advantage of.

I have much more if the House would like me to continue.

[Geoff Regan, Liberal, Halifax West, NS]

Mr. Speaker, I am pleased to speak to Bill C-47, the implementation act for budget 2010.

Canadians across the country are struggling to pay their bills and plan for the future and so obviously is the government. The government has shown itself to be so fiscally irresponsible that Canadians no longer trust it. They cannot trust it to manage the fiscal future of Canada. They are growing tired of the constant missed budget targets, ballooning budgets and reckless spending. Unfortunately for Canadians the government governs with ideology instead of facts and even then its outrageous spending is hardly conservative.

While the Conservative government focuses only on the electoral cycle and short-term progress, it fails to plan for the future of Canadian industry and for the jobs of tomorrow. Its visionless spending risks Canada's fragile economy and threatens to create even larger issues down the road. Canadians are aging and their government has no plans to help them.

The finance minister recently lectured Canadians saying, “This is not the time for dangerous and risky new spending schemes that will increase deficits and raise taxes”. However, Canadians are wondering why he does not take his own advice. Canadians are wondering why he is lecturing them and not his own government.

As the finance minister asks Canadians to tighten their belts, he continues to borrow from their already underfunded futures and recklessly spends on everything under the sun. His risky spending outlined in budget 2010 delivers deafening blow after blow to the future of our economy and our country.

To really get an idea of the lack of vision and lack of value for tax dollars the government has provided, we need only look to its record of reckless borrow and spend fiscal irresponsibility.

The Minister of Finance talks about restraint when his government has never shown an ounce of fiscal restraint. I do not have enough time to tell the House about all of the finance minister's own risky spending schemes. I would need infinite and unlimited time for that, so instead I will take this time to tell the House about some of the risky and reckless, borrow and spend Conservative schemes that are leaving Canadians scratching their heads and asking where their tax dollars have disappeared to.

Even before the downturn, the Conservative government burned through the $13 billion surplus it inherited from the previous Liberal government. The government claims to want to eliminate the deficit when the only thing it ever eliminated was the surplus.

Under the Conservative government, Canada holds the largest deficit in Canadian history, at $56 billion. The Conservative spending that led to the deficit is exactly the kind of risky spending Canadians cannot afford.

In October 2008 the finance minister said, “At a time of global economic uncertainty, no responsible economic manager would suggest experimenting with...massive increases in government spending”. He then increased government spending by 17.8% the next year. Imagine that. In fact, before the economic downturn, the finance minister increased spending by 18% over three years. He put the country in deficit before the recession. He took a $13 billion surplus and turned it into a deficit before the recession began.

[John McKay, Liberal, Scarborough—Guildwood, ON]

It's a talent.

[Geoff Regan, Liberal, Halifax West, NS]

It is quite a talent, as my hon. colleague from Scarborough—Guildwood says.

That is over three times the rate of inflation the way he increased spending. It seems that even the finance minister, based upon his quote, finds his own massive increases in government spending irresponsible. Surely he must.

The Conservative, out of control, borrow and spend fiscal policy put Canada into a structural deficit. The finance minister needs to stop the government's risky spending and show some leadership when it comes to fiscal responsibility.

He said, “The record shows we take a principled, practical, and prudent approach to leadership”. What a claim. Has he looked at his own record? I do not think so. As a Conservative member himself described, one of my colleagues, has he been too busy “spending like it's Christmas”? That is what a member on that side actually said the government was doing. It is spending like it is Christmas.

Let us take some more time to look at the minister's record since he seems to have forgotten about it.

The fact is he has never been right on deficit projection in his history as both a provincial finance minister and a federal finance minister. Even now, against all logic, the finance minister is guessing there will be a $2.6 billion surplus in five years when the Parliamentary Budget Officer has said that in five years there will still be an $11 billion deficit. The Parliamentary Budget Officer, or PBO, reports that by that time the government will have added over $200 billion to the national debt. It inherited a $13 billion surplus and it will add $200 billion to our country's debt. What a record.

The PBO predicts that there is an 85% chance the finance minister will break his promise to balance the budget by 2015-16, basically because the numbers are not there based upon what he has been given so far. We are not talking just a little off. There is a $13.6 billion spread between the government and the budget officer.

The government's willingness to gamble Canada's future on a 15% chance is disturbing. Does the finance minister not understand that when he is wrong, like he has been in the past, Canadian citizens will be left holding the bag and the bill?

The Conservatives talk of leadership, but they do not lead. At a time when it should be curbing frivolous spending, the government spent $10 billion on expensive Conservative consultants.

Let us just look at one of the examples of these costly consultants. While the finance minister speaks of fiscal prudence, the Conservative government paid an outside consultant $3,400 to write two simple press releases for VIA Rail and then promptly hired the consultant to work in a Conservative MP's office. Is $3,400 for 1,300 words the finance minister's definition of “fiscal prudence”?

The Conservatives have recklessly issued thousands of irresponsible contracts at a time when most Canadians are struggling to make ends meet. Budget 2010 continues the Conservative history of risky spending schemes.

Even at the height of the economic downturn, when Canadians were drowning in debt, the Conservatives continued their trend of risky spending schemes by tripling the advertising budget to a whopping $130 million, with no clear benefit or value to Canadians, a $130 million of taxpayer dollars for Conservative propaganda. The borrow and spend government added to its record $56 billion deficit by wasting $130 million on shiny billboards and flashy ads, while Canadian families struggled through the recession.

It is time that Canada's money went toward Canadian priorities instead of Conservative propaganda.

Canadians want thefinance minister to put a leash on his Conservative spendaholics and urge them to stop their risky spending schemes. Instead of helping Canadians recover from the downturn, the government was busy blowing over a billion dollars on the G20 photo op. Only that government could find a way to spend six times more on G20 security than the previous equivalent G20 summit in Pittsburgh. Only that government could recklessly borrow and spend so much on the G20 photo op, making it a priority ahead of helping Canadian families.

A Liberal government would put that money to much better use with our family care plan, which would help Canadians deal with the difficult task of caring for their ill-lived loved ones.

Has the finance minister considered his government's G20 purchase of $14,000 in glow sticks and building a fake lake responsible and prudent leadership? Canadians hope not, because they certainly do not want their money being wasted on costly photo ops for the Prime Minister.

Adding to the Conservative risky spending schemes is the ever-increasing expense of an untendered F-35 stealth fighter jet contract. The Auditor General warned us that its F-35 contract “carries significant risk of delays or cost increases. They represent it as being off the shelf or what would be a simple purchase. But this was anything but the case”.

Even the Pentagon is worried about escalating costs and delays with their F-35 contract. In fact it is reviewing its contract, yet the Conservative government refuses to review ours. Even John McCain is calling the F-35 costs “outrageous”. He has also said, “I share our allies' and friends' deep disappointment about the cost overruns and the difficulties that we've experienced in development of this aircraft”.

The Conservative government seems to be the only government that does not have a problem overpaying for things, as its fiscal record continues to show.

Originally the Conservatives falsely claimed that their prison bill would only cost $90 million when they introduced the legislation. They later amended these estimates to $2 billion. The Parliamentary Budget Officer has priced the bill at between $10 billion to $13 billion. It started at $90 million and we know now that it is likely to be in the range of $10 billion and $13 billion. What kind of control of spending is that?

It is beyond risky for the Conservative government to ask Parliament to vote on its legislation when it grossly misrepresents the true cost of implementing that legislation. Risky spending schemes that build unnecessary, U.S.-style megaprisons for a country with a declining crime rate is not an effective use of taxpayer dollars.

Bank of Canada governor Mark Carney said that an abrupt correction in Canada's housing market was in fact possible. The Economist says that Canada's housing is overvalued by 23 points. That is 7.3 points more than it rates Ireland's housing overvaluations. Even the National Post reports that there is a housing bubble. Yet the finance minister defies them all by saying there is no housing bubble. He also said, “It's a long stretch to compare our housing market with that of Ireland”.

Unfortunately he is right because our houses, according to these experts, are 32% more overvalued than Ireland's. Let us hope that is not the case. Let us hope there is no bubble here and it does not burst, but we should be concerned about this. This reckless and risky strategy of ignoring the facts by the finance minister is what steered Canada into deficit in the first place.

As Aldous Huxley famously said, “Facts do not cease to exist because they are ignored”.

A Liberal government would clean up the fiscal mess created by the borrow and spend Conservative government. I remember the challenge that faced the Liberal government in 1993 when it came into office, because I was there. I was part of the process and watched as the prime minister and finance minister worked very hard, and as Canadians sacrificed, to get us back to balanced budgets, to get us into surpluses. When the Liberal government left, there was a $13 billion surplus that the Conservative government inherited and then quickly blew.

The Conservatives have to stop ignoring the facts and focus government spending on the Canadian priorities of family care, seniors, the economy and job creation. Budget 2010 has been a complete disaster in this regard. The Conservative method of governance unfortunately is ideologically based. It is based on ideology instead of on facts. That is why they do not like information such as a census, for example.

The finance minister's arrogance in telling Canadians not to ask for things they need during the upcoming budget consultations because the government has spent the cupboard bare is disheartening for all Canadians. The Conservatives talk of restraint, but they do not restrain. It is time the government takes its own advice and stops its risky borrowing and spending and stops raising the deficit.

[Brian Jean, Conservative, Parliamentary Secretary to the Minister of Transport]

Mr. Speaker, I listened to the Parliamentary Secretary to the President of the Treasury Board. He started to talk about the capital cost allowance that had been brought in by this government on clean energy initiatives. The Prime Minister has said that we want to be a clean energy superpower. Certainly we have a lot of natural and competitive advantages to do that.

The Liberals, under Jean Chrétien, brought in the capital cost allowance in the nineties to kick-start the oil sand industry in Northern Alberta. It was very successful because it cost a lot more to develop that kind of oil than other places in the world.

What does the member think about the capital cost initiative by this government on the issue of clean energy and the clean energy initiative? What are some of the ways he sees it being utilized for Canada's advantage in the future?

[Geoff Regan, Liberal, Halifax West, NS]

Mr. Speaker, I am surprised that a Conservative member wants to talk about clean energy and the government's record on clean energy when we consider what has happened over the past almost five years since the government was elected. It removed the renewable power production incentive and killed the wind power production incentive. The government has had very little interest over that five-year period in anything related to clean energy. The capital allowance is finally something toward clean energy but it is not very much.

Overall, the government has shown little appetite or interest for this matter at all. Until August, I was the critic for the last year or so on natural resources and had occasions to sit in the Standing Committee of the House of Commons on Natural Resources and heard from people working in this industry about how frustrated they were.

These were people working in renewable energy, for instance, assessing homes, examining the energy efficiency of a house and helping people to renew them based upon the program that existed until the end of March last year, which the government killed. They said that it had a devastating impact on an industry that was involved not only in examining and assessing the energy standards in a house and giving advice to people on how they could improve their energy use, reduce their costs and better insulate, but also on the companies that were doing the renovations to actually reduce heating costs. Those are lost jobs because of the government's action.

[Brian Masse, NDP, Windsor West, ON]

Mr. Speaker, I have a question for my colleague regarding the account gap that is growing and the trade deficit that is happening because of the petro-dollar.

We know the government has been using the oil industry to inflate Canada's dollar and now we have lost hundreds of thousands of value-added manufacturing jobs. That is important to note because some of the job creation has been through public spending, through borrowing and a lot of part-time jobs in which Canadians cannot sustain themselves. I would simply ask the member about that.

As well, it is now projected that the actual growth rate that will be announced for GDP tomorrow will be lower than expected and will create further problems.

[Geoff Regan, Liberal, Halifax West, NS]

Mr. Speaker, when we consider this issue, it is one that has been a real challenge for the member's ridings, I realize, but also for much of industrial Ontario, the industrial heartland of the country, when we have seen so many jobs lost in manufacturing largely because of the high dollar. We have seen the same thing in Nova Scotia. It not only affects manufacturing but also the resource industries. It affects, for example, the forestry sector, but it certainly affects the fishery. In Boston, which is a major seafood market, when our lobsters are costing more because our dollar is higher, it is harder to sell them. We end up having to lower the price of the lobsters in order to sell them. It has an impact.

By the way, in my part of Atlantic Canada, fishermen went out today. Today is the first day of the lobster fishery, the last Monday of November in much of my province. People are out on the sea and I pray and hope that they will all be safe because today is a day we all worry about. They go out with their boats fully laden with lobster pots and it can be a dangerous day. Let us hope they are all right.

It is a problem for many people, not just manufacturers. At the same time, what is interesting is that the U.S. dollar is so low. The Canadian dollar is high largely because of our oil sector. The oil sector is actually impacted by that as well because barrels of oil are priced in U.S. dollars. With the U.S. dollar being low, from what I have been reading and hearing, it has a negative impact on places like Alberta and Newfoundland. They are doing better than most places still, thank goodness, and that—

[The Deputy Speaker, Andrew Scheer]

Order, please. I must to stop the hon. member there because I think there are a few other members who wish to ask a question.

The hon. member for Scarborough—Guildwood.

[John McKay, Liberal, Scarborough—Guildwood, ON]

Mr. Speaker, I was listening to the previous Conservative speaker patting his government and himself on the back. I thought at one point that he would get back strain from so much self-adulation. One of the things he was back-patting about had to do with the shape in which Canadian banks find themselves. Canadian banks are in good shape certainly relative to international banks. The most significant reason that they are in good shape has to do with the previous Liberal administration which denied them the opportunity to merge, plus set out some fairly stringent capital ratio requirements.

The finance minister, whose party opposed all of the regulations put forward by the previous Liberal government, now wanders around the world saying what good fellows they are and how brilliant they are in their management of our financial services sector. I wonder if the hon. member would wish to comment upon the hypocrisy of the Minister of Finance with respect to our financial services sector.

[Geoff Regan, Liberal, Halifax West, NS]

Mr. Speaker, I almost do not need to answer what my colleague has said because the words he used are very accurate. He has made the argument and the case very strongly.

However, it is an important point to restate because I cannot imagine a finance minister going around the world, as the finance minister has, taking credit for doing nothing about the banks, or actually that he and his party were opposed to the regulations that kept our banks solvent during the crisis that happened two years ago.

It is important to set the record straight in this regard, because we are thankful in this country that our banks have been secure and have weathered the recession so very well. Obviously they had some problems. There were cases where some banks had a little too much asset backed commercial paper and that was risky. It bothered me that we had banks that were holding basically paper but had not really done the job of checking out whether the loans that paper was based upon supported that value, that they paid for those.

Basically, the loans were sold between banks but the ones that were buying them were not going back and checking before they bought the stuff whether people who were being given the loans could afford to make payments. I have heard horror stories. People who might qualify in this country for a mortgage of $30,000, in the U.S. actually getting a mortgage in the range of $500,000. When we hear that kind of story it is no wonder that the system in the U.S. fell apart the way it did. However, thank goodness our banks did not have much of that and that they had regulations that made sure they had to be governed better.

[Daniel Paillé, Bloc, Hochelaga, QC]

Mr. Speaker, I would first like to reassure the member for Mississauga South. There are days when a lot of talking happens, but I have no intention of taking as much time here in the House as he has, with so much imagination.

This bill is a perfect example of how thorough the Bloc is. Yes, we said that that we were against the overall budget speech and we voted against it. But now that it has been passed, we need to move on. That is what we are doing.

We have thoroughly analyzed this bill and our opinion is: why not? We should vote in favour of passing this bill at this stage because we have done a thorough analysis of it.

It is unfortunate that not all the opposition parties work like that. We know full well that the Liberals say they will vote against it, but when it comes time to vote, they will not be here. The NDP will vote against it because they are against it. Do not ask them why, but they are against it. At least they will be here.

Certain measures in this bill are important, and it would be proper for us to point out what we agree with. Some measures deal with personal income tax. The first measure I will talk about would allow the following benefits to be shared between parents who have shared custody of children: the universal child care benefit, the Canada child tax benefit and the GST or HST credit.

It can be a sad thing for families, but we have to accept the fact that, in Quebec and Canada, many families are blended and many children's parents do not live together. More and more parents share custody of their children. For example, the universal child care benefit is $100 per month, and as we know, it is given to parents of children under the age of six. This bill would divide that benefit between the two parents who share custody of their children. This is why the Bloc is so important. This is our hallmark. Having thoroughly analyzed this measure, how can we oppose it? The answer is clear for anyone who has done a thorough analysis. I cannot see myself telling my Hochelaga constituents that we will vote against this kind of measure because we are ideologically opposed to the government.

Another measure that we find completely acceptable is the one that would enable people to roll over the proceeds of a registered retirement savings plan to the lesser-known registered disability savings plan (RDSP), where investment income accumulates tax-free. Everyone knows about RRSPs, but RDSPs were created to enable parents to save for the long-term financial security of a child with a severe disability. These measures make it possible to save money depending on the degree of the child's disability. In many cases, parents of such children have RRSPs.

What happened when they die? These registered retirement savings plans have been taxed like any other. Now, parents and grandparents of a child with severe disabilities will be allowed to roll their RRSP, if they have one, into a registered disability savings plan, which will help meet the child's needs. If the child should pass away, it will be taxed in the usual way.

How can anyone be against such a beneficial social measure that—fortunately—will not affect very many people, but that can help families caring for a child with a severe disability get through the grief of losing a parent or grandparent?

These measures apply to personal income taxes, but there are also other measures that apply to charities. We all have charities in our respective ridings. Some of the administrative rules that were—pardon the expression—a bloody nuisance have been repealed. Everyone knows how hard the people who run charitable organizations work. These people work all day long, sometimes seven days a week, to achieve their charity's goals. Yet those organizations are weighed down by completely unreasonable administrative requirements.

Charities will now be allowed to give the Canada Revenue Agency information. That agency was already receiving information from charities, but it forced them to give information concerning the percentage of donations it had to spend in a year based on the tax receipts they had issued, for example. Thus, a charitable organization that has issued $100,000 in tax receipts for 2010 has to spend at least $80,000 the next year. Sometimes charities would not meet that standard and near the end of the year, they would have a tax problem. That standard will be reviewed and charities will simply have to fill out the information requested by the CRA, and that will be sufficient.

Charities were also obliged to spend the equivalent of 3.5% of the organization's assets every year. If a charity wanted to accumulate a certain amount of capital in a given year, it could not do so, because it absolutely had to liquidate 3.5% of its assets. That was another administrative nuisance.

The government finally seems to realize that the left hand was asking for information while the right hand—the Canada Revenue Agency—already had all the information. I do not see how anyone could be against more flexible requirements for charitable organizations.

As far as charities are concerned, there were different stories. However, we think that the government should not be saying that it was nice to charities while it is cutting funding to NGOs and development agencies around the world. The Bloc Québécois position on that is very well known: we must not stop pressing the government to give 0.7% of GDP to international development agencies. We will continue to press the government to achieve that objective, which obviously was set by the UN. Nevertheless, we must commend the establishment of more flexible administrative rules.

Other measures have to do with corporate taxation. In January, the Bloc Québécois toured Quebec. It asked the Minister of Finance to do better when it comes to taxing stock options. We said that a certain number of bonuses should be taxed more, in other words excessive bonuses should not be deductible from corporate profits as an expense. We regret that such a measure is not included.

Let us now talk about a measure related to performance bonuses. Sometimes corporations offer their employees stock options. There is nothing wrong with that. It is part of the benefits offered to the employees. However, when the stock options are issued, a loophole in the legislation allowed a double deduction, in other words, the employee and the employer could both deduct those options. That is no longer the case. The government is announcing that in 2014 and in 2015, it will bring in $400 million thanks to the elimination of this double deduction.

We agree with this measure, but it does not go far enough. The government could take this even further. What the government is showing us is that it is possible to close loopholes in the legislation and tax stock options. It is not as though the Conservatives are being adamant about not touching this. In fact, the Conservatives are handling this quite well in Bill C-47, and we are supporting them.

The measure is good, but the government could do better. That reminds us of school report cards. We have all received the comment “good behaviour, but could do better”.

The rules related to tax-free savings accounts, TFSAs, have also been tightened. Last week, my colleague from Saint-Lambert asked a question regarding the guaranteed income supplement. The Parliamentary Secretary to the Minister of Human Resources and Skills Development and to the Minister of Labour told her that the government was doing everything it could for seniors living close to the poverty line by creating TFSAs. Clearly, he did not understand the documents he had before him at all. The bill also resolves a number of issues with the TFSA. Everyone knows that someone can contribute $5,000 per year after taxes to a TFSA and that the income generated by the account will not be taxed.

Some wily investors were depositing much more than $5,000 per year into their TFSAs. They had to pay a penalty of 1%, which was not really a penalty at all considering that returns could be far higher than 1%. Now the bill will close the loophole. How? Any amount over $5,000 will be taxed at 100%. I find this interesting. What does this tell me? It tells me that this government, when it wants to close loopholes, can impose tax rates of up to 100% on excessive income. It is doing that very thing. However, last year, when we suggested a very high tax rate on extremely large bonuses, we were told that implementing such a measure would be impossible. I have been watching the government and I say that it is possible. Yes, it is possible. The government is doing that very thing and we support its actions. We are in favour of this bill because of these types of measures.

There are also clean energy measures. Very few people are interested in the phenomenon of capital cost allowances, or depreciation. Many people do not have any idea what that even means. I understand. When it does not fall within the realm of your occupation, it can be a bit of a dry topic, but capital cost allowances permit businesses or individuals who have investments to deduct the cost of an asset based on the useful life of that asset.

Naturally, when you own a business and you purchase a truck, you do not depreciate the truck over 20 years. It will not last 20 years. There are many formulas and tables used to calculate depreciation of an automobile or computer hardware, for example, over three years. However, when the goal is to help the business and to foster a form of investment, accelerated capital cost allowance makes it possible to recover the cost more quickly. This is the case for geothermal equipment.

Our colleague from Brome—Missisquoi is an expert in geothermal energy in Quebec and Canada. He could talk about it for hours. When we examined solar heating, geothermal energy and distribution equipment for district energies, we obviously agreed.

For that reason, the Bloc Québécois, which is known for its thoroughness and which examines bills one after another, says that unfortunately with regard to geothermal equipment, we agree. We have to agree.

The bill also contains measures concerning the implementation of international standards. It will allow international accounting standards adopted by everyone to be used by public corporations. We will no longer use generally accepted Canadian accounting principles. We will be using accounting principles from international financial reporting standards. Can we oppose this? Everyone uses them. Therefore, we support this measure.

This bill will also authorize the Canada Revenue Agency to issue online notices. It is about time. The time has come to issue online notices of assessment. Everything is online. Is the Conservative government behind the times? Yes. Is it far behind? Yes, but it is catching up. It is getting there, and we cannot vote against that. We must at least mark the gesture. It is behind the times but at least it is getting there in situations such as these.

It is because of these types of measures, and after thorough study of the bill, that we are making an exception and voting in favour of the bill. However, we voted against the government's budget as a whole and we were present. The Liberals were against it but they were not present. The NDP were against it, although they do not know why, but at least they were present.

[Paul Szabo, Liberal, Mississauga South, ON]

Mr. Speaker, at committee last Tuesday when the minister and officials were there, I asked about the tax-free savings account that the member referred to in his speech. The amendments in this bill include things like: to make any income attributed, to deliver overcontributions and prohibited investments subject to existing anti-avoidance rules.

As the member laid out, there are about four or five different provisions amending the tax-free savings account regulations or legislation.

The question I had to the officials was whether or not they had considered if there would be any overcontributions when they first brought it in. Had they considered whether there would be any ineligible or prohibited investments? Had they considered the fact that, in their experience, there would be certain people who would figure out that the penalty of 1% may not be sufficient to deter overcontributions because returns greater than 1% could be received?

The response from the government officials was basically that there are these very sharp tax lawyers, et cetera, and they figure these things out.

I do not know whether the member agrees, but my point is that it would appear that in this particular case the government had not used due diligence in formulating the tax-free savings account rules and regulations. It caused a lot of grief to a lot of Canadians inadvertently. The government does not seem to have used the same kind of rigour and due diligence to make sure that proposed legislation, in the first place, was in fact given proper sign-off at all levels. That does not seem to be the case. In fact, it seems to be inept.

I wonder if the member would care to comment.

[Daniel Paillé, Bloc, Hochelaga, QC]

Mr. Speaker, I thank the member, who is a valuable member of the committee. He did ask that kind of question, and we absolutely got that kind of answer. I remember making a comment, it may have been in camera, that that was the only answer the senior officials could give. That is why, in this kind of standing committee, it is a bit frustrating to ask questions to senior public officials because we know very well that although we have an excellent public service here in Canada, the officials can only give responses that correspond to what the government put in its bill or the government's tax policy.

Should the bill have some more teeth? Did the government look carefully at all the ways the law could be circumvented? We do not know. This is why tax laws have become so huge, because when a government introduces tax legislation, the main goal of tax experts, whether they are from law firms or major corporations, is to look for loopholes. That is why tax laws never last longer than a year or two. Then they need to be amended. That is how tax laws in Canada are created. Everyone knows that the goal of the vice-president of finance of a public corporation is to maximize profit, but the goal of the vice-president of finance or the CFO of a private corporation is to minimize taxes.

[Steven Fletcher, Conservative, Minister of State (Democratic Reform)]

Mr. Speaker, I would like to thank the member for his compliments to the government on the budget.

In this debate some discussion has been made around the The Economist magazine. I would like to quote from The Economist, this week's print edition, November 25. It said:

Compared with many other developed countries, Canada has had a good financial crisis. Its banks and public finances are sound, and the economy recovered quickly and strongly from recession....

I think this demonstrates the fact that the government has dealt with an extraordinarily difficult situation better than other countries in the developed world and throughout the world. Does the member agree with The Economist and virtually every other economist, profession-wise, throughout the world?

Also, does the member agree with the strong savings measures, like the tax-free savings account, the RRSP contribution issues and so on, to make it better and easier for Canadians to save for their future?