Mr. Speaker, this is something that has been talked about for quite some time. Actually, it was in practice in a general sense back in the 1970s and 1980s. I believe that it was discontinued around 1987.
I want to congratulate the member for Jeanne-Le Ber for bringing this forward. It is a comprehensive bill. I said to him that when one amends the tax code this way and uses the formula to do it, there are probably only about five people who could truly understand how the formula works and those five people should probably be locked away. It is comprehensive, no doubt, but nonetheless it is something that is necessary. I congratulate the member because he did some fine work in the legislation.
Before getting into the discussion of the actual bill, there are several things in it. This is something for the arts industry in this country, for people who create, who disseminate material from their own imaginations. The dissemination process today is not what it used to be. It is far more instantaneous. We are not even getting into talking about copies anymore. Now it is all about clouds and instant access for the world.
It is difficult for artists nowadays to recoup their investment in their own work, whether through music, through art, productions, plays, movies and so on. This would allow, through the tax code, these people to actually make a living or at least get them to the point where they could make a better living and reap the benefits of what they do. That is because of the nature of what they do and how they are able to receive remuneration.
If we think about this for a moment, authors spend roughly three to five years writing a book. I am not an author but I assume three to five years is in the ballpark for a major novel. All of a sudden, they publish it and it is out there in the market. If they are lucky the book gets on the bestseller list for a period of two or three months and the income comes in dramatically, and most of it during that period. Then the book goes to paperback and then to digital, and slowly but surely, the amount of revenue received from it dwindles.
However, all that money that is received in income falls into one taxation period. If artists receive all revenues from their created work in one year, obviously they will be taxed at a higher level than if the income were spaced over three to five years. If this were treated like a normal job in the world of taxation, people would be taxed over the period that they worked on it, three to five years or maybe more.
There is an unfairness in this. There are other industries where that is the case. There used to be a situation where we could apply this principle to the general public, but we no longer do that. It was changed because the tax code was simplified in the late 1980s and the difference in rates between the top and bottom were not as great, so that concept was thrown out because it was said not to be as beneficial.
It is beneficial for certain industries to this day and this is one of those industries. It would allow artists to average their income over a two- to five-year period. We can debate and amend as to what that number would be, but certainly the principle is sound in the sense that artists could amortize income over a certain period of time that reflects the amount of work put into the body, as opposed to all the money they have received in a short period of time. That is simply the nature of the business.
Income averaging is a concept that dates back to agriculture and to the fisheries as well, where people get an incredible amount of money in a short period of time and try to average that out. Luckily, we have government programs to help them do that. Fisherman's EI is another example of that. It is not called income averaging, but that is essentially what they are doing. They get an average income over the course of the year instead over a short period of time.
Many of these projects, when it comes to the artistic world, reflect that nature. There may be a project that goes year over year. That is fine. The bill does not affect those people who are getting a steady income. However, what it does do is even out income for those who are on their own.
Let us face it, artists in our country are on their own, doing their own thing. Not only are they artists but they have to become financial analysts and tax people. It is difficult for them to follow all the rules, given that there are so many rules around what they do because they are pretty much on their own. It is expensive to hire a taxicab. What we see reflected in the bill is fairness in the tax system.
I may have neglected to mention it and members may have figured this out, but I will be voting yes to this particular bill, just in case I gave anyone the wrong impression.
The number of stakeholders who agree with this all over the artistic community is phenomenal. This is why we have been talking about this issue for quite some time. The stakeholders have talked about this ad nauseam. The individual who brought the bill here is an artist. I have seen him in movies. He is good at what he does.
Stakeholders who support the bill are: the Canadian Federation of Musicians, ACTRA, the Independent Media Arts Alliance and the Canadian Conference of the Arts. These are broad umbrella groups that give the bill a lot of support.
The angst from all this, as I am sure members will hear, is whether we can do it for this one group and not do it for the others. Someone once said to me that if we cannot do it for all, we should not do it for any. Does that really make a lot of sense? What about when Saskatchewan created medicare? Would the federal government at the time have said it could not do it because if it did it for one province it would have to do it for the rest? We did do it for the rest. It took one province to show leadership and do it.
By being a leader on this particular issue, the arts community could be the leader and open it up for others. Granted, it could be an expensive endeavour. We realize that. In a time of austerity we have to keep that in mind. However, it is certainly one of those things where we should allow these people to continue to make a living at what they do.
The other thing is to look at how many of our talented people go south of the border. Would income averaging allow these people to have a better life in our country and they would not have to go south of the border, particularly actors and performers? The numbers are out there. I think it would. Some people could argue that it would not. It is hard to tell. However, it certainly gives them a better footing in our country to be able to make a living, to pay their mortgages, to pay for their vehicles and to help raise their families. That, in essence, is what this is about. It is a social concern. It is something that provides this particular community with the tax fairness it needs.
Back in the last election campaign, the Liberal Party endorsed this. This is from the 2008 election. It states:
Support for Canada’s arts and culture must also extend to support for artists themselves. That is why a Liberal government will provide income averaging for artists drawing on the inspiration of Quebec’s income-averaging provisions.
There we go. We have a leader here, a province to look to for how this is done, similar to the way the Province of Quebec handled pensions and similar to the way Saskatchewan handled medicare. What Quebec represents is a vanguard to how this plan could be implemented.
As for costing, Finance Canada estimates the income averaging bill, Bill C-427, would cost the federal treasury approximately $10 million a year. That is not a lot in total spending for the government. It estimated that this measure would benefit approximately 55,000 individuals, with an average benefit of $130 or more.
We get the idea that it is not a tremendous measure. It is not a great anchor hoisted upon our federal treasury. However, it is something that would go a long way for the individual artist or artist groups who want to receive fairness from the tax system and to make a living in our country without having to go somewhere else.
I applaud my colleague for bringing this forward.