Finance Committee on Dec. 5th, 2006

[Gérard Lalonde]

There are a lot of questions there.

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

They're very short questions, but I know these answers can go on for ages.

[Gérard Lalonde]

As the member well knows, I'm a word merchant from the Department of Finance, not an economist.

Yes, they were costed. If you look in the budget measures, you will see that the children's fitness tax credit was estimated to cost $40 million in 2006-07 and $160 million in 2007-08.

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

That is, though, the money that the government expects to lose, if you will, to use a poor term. What I'm talking about is the amount of money the government expects to spend in administration of this particular credit.

[Gérard Lalonde]

This credit would be administered by the Department of National Revenue—or the Canada Revenue Agency; I'm showing my age—and it would be folded in within the general, overall administration of the CRA.

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

So there's been no breakout of the cost of this administrative burden on CRA?

[Gérard Lalonde]

No.

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

Has there been any breakout of the cost of the administrative burden on other taxpayers?

[Gérard Lalonde]

No.

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

Has there been...? Your definition is—how shall we say this—somewhat loose. How are you going to monitor what a taxpayer or say a camp...? I'll use that as an example, because it's probably easier. How are you going to know and certify that a camp that is a “fitness” camp is in fact doing the fitness activities it says it's doing and that it meets whatever the criteria might be, without in effect incurring huge costs in checking that out?

[Gérard Lalonde]

You've indicated that our definition is somewhat loose. We don't have a definition yet. We have a report from a committee that's been struck to provide recommendations on what would qualify as a prescribed physical activity. I expect our minister will be releasing a response to that report soon indicating the government's intentions with respect to a more formal definition of what a prescribed physical or education activity—

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

I read that report, and I thought that was going to be incorporated into the regulations. And it was loose.

[Gérard Lalonde]

Well, the regulations have not been released yet. I understand that the minister has accepted a number of recommendations of the report, but it remains to be seen when the draft regulations are released to give more guidance to taxpayers.

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

So we don't know the administrative cost to CCRA, we don't know the administrative cost to other taxpayers, and we have as yet no regulations for this credit.

[Gérard Lalonde]

With all due respect, none of the measures in the budget have been costed with respect to administrative costs to the CRA. The CRA is obligated to administer the Income Tax Act as amended and passed by the government of the day. They're a very professional organization, and they don't seem to have a lot of difficulty with these proposals.

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

You'll pardon me if I'm not among the true believers.

[The Chair, Conservative, Brian Pallister]

Ms. Wasylycia-Leis.

[Judy Wasylycia-Leis, NDP, Winnipeg North, MB]

Thank you, Mr. Chairperson.

I was going to ask about the three-person task force report that the minister had initiated, but I think I have the answer. You're saying that the minister will announce his response to the report at some point in the near future. Do you have any idea when?

[Gérard Lalonde]

Those decisions aren't up to me at the officials level.

[Judy Wasylycia-Leis, NDP, Winnipeg North, MB]

Have you heard any rumblings?

[Gérard Lalonde]

I've heard lots of rumblings, but I'm not going to engage in spreading rumours here at the finance committee.

[Judy Wasylycia-Leis, NDP, Winnipeg North, MB]

All right.

[The Chair, Conservative, Brian Pallister]

The chair appreciates that.

Are there any further questions?

[Judy Wasylycia-Leis, NDP, Winnipeg North, MB]

I have another question.

Let me approach it from another angle. This is supposed to be up and running by when?

[Gérard Lalonde]

It's supposed to be effective for expenses incurred after 2006; i.e., for the 2007 and subsequent taxation years.