Mr. McTeague's bill proposes to do away with the annual limit and replace it with the limit that applies to RRSPs, while maintaining the deduction applied to contributions. This measure would cost $565 million annually.
Moreover, as I understand it, the plan would be amended with contributions continuing to be tax deductible. Since our starting premise is that people do not contribute the maximum allowable amount as it is, there would not be any changes in contribution levels. Therefore, from a fiscal standpoint, our costs would be the same, that is $565 million would be diverted from the state's coffers each year. Contribution patterns will not change, even though the limit on contributions will. Since most people do not contribute the maximum amount as it is, this limit is non restrictive.