Evidence of meeting #90 for Finance in the 39th Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was brown.
A recording is available from Parliament.
Bloc
Paul Crête Bloc Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC
Perhaps I misunderstood just now. I would like you to tell me who these taxpayers are and the situation that they are in. You say that you received comments when the bill was tabled. We have not heard from witnesses on this bill, and no one has come to ask us for amendments in that regard.
What is the situation of these taxpayers really? What kinds of expenses give them this additional tax deduction?
Acting Director, Tax Policy Branch, Department of Finance
It's not an additional tax break. In fact, it's proposed that this bill, which, generally speaking, introduces new tightening measures vis-à-vis foreign investment entities and non-resident trusts, applies not only from 2007 onward, which is what the bill says, but on an elective basis also applies back to 2003.
Why would somebody want to do that? Well, in large part, they don't want to re-file. What they would like to do is just have us put them back into the same position as they would have been in had they not filed their returns on the basis of the draft that was out there all these years. They would like us to recognize what would happen for them if it started as of 2007 but not force them to re-file income tax returns.
Conservative
Liberal
John McCallum Liberal Markham—Unionville, ON
Mr. Chair, having heard Mr. Lalonde and having heard from Ms. Ablonczy yesterday on this, I for one am quite happy for this to proceed quickly--but not before asking one question.
I don't understand why, if the department has been working on this since 1999, all of a sudden, at the last moment, we get this huge pile of amendments. Did something happen very recently to change the department's view of what should be contained in the law, and that's why we got them at the last minute? If not, if it's nothing new, why didn't you think of this in the first place?
Acting Director, Tax Policy Branch, Department of Finance
It responds to a change in circumstances that arose with the tabling of this bill, in which the coming into force provision for the parts that relate to foreign investment entities and non-resident trusts was moved forward--or later, whichever way you look at it. Instead of starting in 2003, as originally announced, it's instead starting in 2007.
Generally speaking, this is good news for those who would otherwise not appreciate--
Liberal
John McCallum Liberal Markham—Unionville, ON
But why didn't you put that in there in the first place?
Acting Director, Tax Policy Branch, Department of Finance
This happened in November. It was generally regarded that this was going to be something that was not controversial, and well accepted. And afterwards, out of the woodwork, came...you know, there are 30 million taxpayers in Canada, and--
Liberal
John McCallum Liberal Markham—Unionville, ON
You're not answering my question. If nothing has happened very recently to make you make these changes, why did you not put these things into the bill in the first place?
Acting Director, Tax Policy Branch, Department of Finance
That's what I'm explaining. Something did happen. The coming into force got changed from starting in 2003 to starting in 2007. That's reflected in this bill.
Liberal
John McCallum Liberal Markham—Unionville, ON
Yes, but we heard the bill just a couple of week ago. Why wasn't it put in at that time, from last November?
Acting Director, Tax Policy Branch, Department of Finance
The bill was tabled as a notice of ways and means motion, I believe around November 22 or something like that, carried forward as a bill. This is the first opportunity for the government to propose amendments to the bill, so this is when they're being proposed.
Liberal
John McCallum Liberal Markham—Unionville, ON
Thank you.
Well, Mr. Chairman, I'm not going to block anything. I'll just let it get done. But I'm not at all impressed with the process.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
Perhaps I could also state my dissatisfaction.
Just to help Mr. McCallum, I think Tuesday you were here.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
On Tuesday you did not mention anything related to the fact that perhaps this bill was going to require amendments. We wasted over an hour of our time, almost two hours, and none of this was brought up. We're not talking about November here, we're talking about Tuesday.
The credibility of the finance department, to present 39 amendments.... This is a technical bill. I don't think there's any expertise around this table in terms of the legitimacy or whether we should approve the bill or the amendments. That's not the point. The point here is that we're very uncomfortable receiving 39 pages of amendments when we discussed the bill two days ago.
Now, my question, if you didn't want to answer Mr. McCallum's question--I think this is a fair question, and I would like to receive a fair answer--is that if there are 39 amendments made to a very complex bill, are there any other amendments that perhaps should be made? Because there doesn't seem to be an urgency. I'm not trying to pretend that this is not a complex bill. If you need an extra week, please tell us now. We'll provide you with that time.
If you need two days to deposit 39 amendments, I'd hate to think what you're going to come up with next week, once we've already voted for the bill.
Acting Director, Tax Policy Branch, Department of Finance
With all due respect, Mr. Chair, first of all, it's not up to me, as a civil servant, to table amendments to any bill. I did not bring up any amendments to the bill the last time I was here because that is not my place. I cannot table amendments to the bill. I can explain amendments to the bill that have been tabled by the government of the day.
You said that if I don't want to respond to the question proposed by Mr. McCallum, I could answer your question. I believe I did respond to Mr. McCallum's question. So it's not a question of whether I want to or don't want to answer that question.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
So you're going to tell me that the minister, along with the parliamentary secretary, came up with 39 amendments?
Acting Director, Tax Policy Branch, Department of Finance
You can ask the parliamentary secretary.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
Mr. Chairman, can I ask the parliamentary secretary?
Conservative
Diane Ablonczy Conservative Calgary Nose Hill, AB
First of all, I want to be clear. For whatever reason, I was not aware that these amendments were coming. As soon as I was aware, I let Mr. McCallum know and I left a message for Ms. Wasylycia-Leis. Unfortunately, I didn't have Mr. Crête's contact numbers, which I will obtain today. I was caught by surprise and didn't want others to be caught by surprise. That is quite possibly and almost certainly not the responsibility of the officials, but I think we'll have to fix that process, because when you see that many amendments, it is a bit of a surprise.
I was able, as I mentioned to Mr. McCallum, to have a briefing about these amendments this morning. I asked the same questions you're asking: why at the last second are we getting this big whack of amendments; and secondly, is there anything hidden in here that would cause us or the stakeholders any concern? Is something being slipped in, as someone said, through the back door?
I was satisfied after our discussion that this is not the case and that these amendments, for whatever reason they didn't come to our attention sooner, are simply technical amendments. The ones dealing with FIEs and NRTs, as Mr. Lalonde said, I'm satisfied allow people who filed in anticipation that this would come in, started filing in 2003—
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
We're not here for details. The question is, are there any more to come? The department is not going to submit any, and you're not aware of any. Are there any more phantom amendments that should be made to this bill before we go ahead and approve it? That's what's going to happen. I don't think anybody is disputing the necessity of this bill, or whether it should be voted on or not. The question is, are there any more phantom amendments to be tabled?
Mr. Lalonde, are you content that the bill is satisfactory in the form it is in?
