Thank you.
Good afternoon, everyone. Thank you for inviting me here today.
The Green Budget Coalition represents 21 of Canada's leading conservation and environmental organizations, which collectively represent over 500,000 individual Canadians as active volunteers and paying members.
We believe that Canada's future prosperity depends on the effective integration of environmental, economic, and human health objectives, and we advocate the internalization of social and environmental costs into market prices through revenue-neutral fiscal reform.
The 2006 federal budget and Bill C-13, as they stand, do very little for the environment. The greatest impact of the budget really lies in what was omitted. It really left those of us within the environmental community with faith that comprehensive action to preserve clean air, clean water, a stable climate, and our cherished nature is still to come.
Today I want to highlight one prime missed opportunity for this budget to create greater long-term economic, environmental, and human health benefits at no net additional cost and that could instead cut spending.
This budget should start to phase out the over $1.6 billion in annual subsidies to the oil and gas, nuclear, and mining sectors. These subsidies, in the form of tax expenditures, tax exemptions, and direct subsidies, contribute to industrial inefficiency, unsustainable energy consumption, and unnecessary pollution and health damage. In particular, subsidies to the oil and gas sector cost the federal government about $1.4 billion per year.
The accelerated capital cost allowance, ACCA, for oil sands development is a prime example. It was established at a time when costs were higher for industry and fuel prices were lower. But the oil and gas sector is now one of the most profitable industries in the world, and the ACCA for oil sands development is now outdated and unnecessary.
The funds freed up through phasing out these tax subsidies would be more wisely used for other purposes, be they tax cuts or advancing Canada towards cleaner air and a more secure energy future by investing in energy efficiency in clean, renewable energy.
In a similar spirit, the Green Budget Coalition urges the government and committee members to support amending Bill C-13 to reverse the announced renewal of the investment tax credit for exploration, the so-called super flow-through share program to subsidize mining exploration.
This program was introduced as a temporary measure in October 2000, but is no longer necessary, again due to higher commodity prices.
We want to commend the government for amending the Income Tax Act to reduce the capital gains inclusion rate on ecological gifts from 25% to zero. This was long in coming and a good choice.
To summarize—