Thank you, Mr. Chairman.
Good morning everyone. My name is Teri Kirk and I'm the Vice-President of Imagine Canada.
I'm speaking to you on behalf of Imagine Canada and the approximately twenty agencies listed on page one of our submission. This list includes professional organizations, church groups, cultural associations, volunteer agencies and others that contribute to the quality of life of Canadians which has made us the envy of the world. The community non-profit sector attracts and retains individuals and businesses that help make Canada competitive. Our submission includes an overview of Imagine Canada and of the non-profit community sector agencies that support its recommendations.
Principally, we urge the Government of Canada to develop a sector investment strategy for the community non-profit sector and to commit to a joint examination of a significant new funding instrument to support investment in the sector, which would supplement and complement federal funding to sector organizations through grants and contributions.
The sector is now sufficiently large in terms of its economic impact--8.6% of GDP--its role in job creation--2.2 million jobs, giving it more paid employment than the manufacturing sector in Canada--and its significance in attracting and retaining people and enterprises in Canada to merit being treated as a sector.
The government has in place a sector strategy for virtually every other sector, whether it be SMEs, manufacturing, IT, mining, or fishing, and yet there is no overarching strategy for addressing the well-being of this sector and informing investment decisions in the sector. This is in stark contrast with the SME sector, for which there are a half dozen crown corporations in place, from BDC to EDC to CCC, to address the financing, exporting, insurance, and other needs of small and medium enterprises.
We're asking that this strategy incorporate a joint examination of investment instruments such as a national foundation, fund or granting council. Examples at the federal level include the Canada Foundation for Innovation, and at the provincial level, the Trillium, the Wild Rose, and the Fondation communautaire du grand Québec.
We would also like to bring forward the Budget 2006 measures, which eliminated capital gains tax on donations of listed stock to charities, and ask that they be extended to private foundations. Considerable work has been done on this recommendation by Philanthropic Foundations Canada and the 20 sector organizations that Imagine Canada is representing here today that support that brief.
Finally, I'd like to bring forward a couple of information items. The first relates to charitable remainder trusts. Again, the Canadian Association of Gift Planners has done considerable work on this. These charitable remainder trusts are existing instruments; however, the law and taxation of these instruments is unclear. Donors and the gift planning community are reluctant to use them when the law remains so unclear, so we're asking for a clarification of the law.
Finally, in respect of the federal charitable donation tax credit, as some of you may know, this is a two-tier credit. For the first $200 that each of us gives to a charity, one receives a credit of 16%, which moves up to 29% at the $200-plus threshold. This has given rise to some administrative challenges, with people pooling among spouses or deferring for a number of years to attract the higher credit rate. The recommendation is that we move to a single tier at the 29% level. Associated with that, the federal policy has been to provide a credit based on the highest marginal tax rate, which in the past has been 50%, and therefore, effectively, to match our individual donations. The decline of marginal tax rates, which is of course welcome, has meant that the federal contribution to donations has declined, so that Canadians are bearing more at the 60% to 70% rate.
Those are our comments. I certainly welcome any questions from members.