Mr. Chair, committee, good afternoon.
On behalf of the Association of Fundraising Professionals, or AFP, I want to thank the standing committee for allowing us to speak today, but before I really talk, I want to thank the committee for its support of the elimination of the capital gains exemption on marketable securities in this year's budget. This committee supported that provision for several years and it's actually under your committee's leadership on this issue that it was finally helped to come to complete fruition. All of us at AFP and the charities across the land are so grateful for your leadership on this issue. It has been incredibly important for the voluntary sector.
AFP is the largest community of fundraisers in the world, with over 28,000 members represented in 180 chapters in five different continents. AFP works to advance philanthropy though ethical fundraising, with the development in 1964 of the Code of Ethical Principles and Standards of Professional Practice. I am the past-chair of the association in Canada. In Canada, we have more than 2,700 members working in 14 active chapters. The Toronto chapter, in fact, is the largest chapter of fundraisers in the world.
While it may not seem at first glance that this provision, as well as those that AFP is proposing today, have everything to do with competitiveness, the focus of his year's pre-budget consultation helped immensely, providing for the programs and services offered by the voluntary sector directly affecting education, health care, training, and social services.
In fact, I know the dean here at the University of Toronto. This is my alma mater. They were in a recent $1 billion campaign at the University of Toronto, and it was in fact the beginnings of the capital gains exemption that really helped propel that particular effort, which transformed philanthropy as we know it in this country.
Understand that the programs and services offered by the sector are not small and insignificant. Some 87,000 charities in Canada, which receive more than $10 million in contributions and so forth, affect over $100 billion worth of our economy. In fact, it's estimated that the sector accounts for nearly 7% of our country's gross domestic product, which is greater than many business sectors, including agriculture and the automotive industry. The proposals that increase the capacity of charities to provide these programs are critical. Unfortunately, the same kinds of barriers and obstacles that used to apply to gifts and securities need to be applied to land and real estate. That's why we're here today.
The Survey of Financial Security 2001 shows that more than 16% have assets of land beyond their principal residence. Many of these donors want to give gifts of land and real estate. Eliminating the capital gains tax creates a strong incentive for donors to give gifts. Most charities will simply sell the land and use the funds or the property in support of their programs and services. This incentive will help benefactors in propelling them to give thoughtful consideration to those types of requests that come forth from the charities that are seeking funds.
Given the evidence from our experience with gifts of securities, AFP does not believe that any sort of trial period is needed for eliminating the capital gains on gifts of land and real estate. If this committee will recall, it took nine years before this past winter for the committee, with the budget, to eliminate completely the capital gains. That was done forthwith, with the recommendations of both the standing committee for virtually eight of the nine years, as well as the Senate banking committee, which in 2004, in the pre-budget consultations, recommended in an interim report that we do have elimination of the capital gains on both land and property.
Winding up, Mr. Chair, we would also propose that the government give thoughtful consideration to a government-sponsored day called national philanthropy day.
We thank you very much. We also support our other sister organizations who are also asking for the capital gains exemption for private foundations.
Thank you.