Finance Committee on Nov. 28th, 2007

[Bernard D'Amours]

Mr. Chair, I want to thank the member for the question.

Yes, what we're asking for right now, $2 billion, is for capital.

[Mike Wallace, Conservative, Burlington, ON]

For capital, not operating.

[Bernard D'Amours]

Yes.

[Mike Wallace, Conservative, Burlington, ON]

I did a little bit of studying of what the federal government does south of the border, and it's basically capital that they support.

I don't disagree with you on us having a role, as a federal government, on that.

[Bernard D'Amours]

And I wish to thank the member for his support for public transit. It's very appreciated.

[Mike Wallace, Conservative, Burlington, ON]

No problem.

Just for clarification, Ms. Brown, you're okay with the child fitness tax credit that we've offered, correct? You just want to increase it?

And when you say “all” Canadians, you'd like to see it extended to adults also, then. Is that what you're telling me here?

[Sally Brown]

No. We think it should be much broader than it is, however, and that there should be other mechanisms targeted to adults to help them also lead a healthier lifestyle.

[Mike Wallace, Conservative, Burlington, ON]

Okay.

Just for my clarification, I had a grocery group come to see me this week, and they told me that a piece of fruit doesn't attract GST, but if it's cut up and put in a tray with other fruit, it attracts GST.

Is that the kind of thing you're talking about?

[Sally Brown]

That's the kind of thing, yes. If you buy one donut, you pay GST. If you buy six donuts, you don't have to pay GST.

So I think there are some sensitivities around there that we should look at.

[Mike Wallace, Conservative, Burlington, ON]

Okay, I appreciate that.

Mr. Creber, just for my clarification, I think you have to have sales of $60,000 or something before you need a GST number. I think that's the number, off the top of my head.

For the thing you're recommending here, is that to avoid your members getting a GST number? Is that what that is?

[Ross Creber]

Yes, that's partially the reason. The direct selling companies pre-collect the GST at the time of the sale to the independent direct seller. The direct selling companies then remit the tax to the federal government on behalf of those they collected it from.

[Mike Wallace, Conservative, Burlington, ON]

Okay. I may call on you on that to get more clarification.

Ms. Jamieson, thank you for coming. I think your organization is absolutely fabulous.

Now, there are no numbers in here other than how much money you've given out. What percentage of the money that your foundation generates or gets is from the federal government? I couldn't see that here.

[Chief Roberta Jamieson]

We have public sector funding. The federal government, specifically, has given two endowments to the organization, one of $12 million and one of $10 million. We distribute the interest from that.

On an annual basis, what the Government of Canada gives—I want to give you the figure and I will follow up with the exact figure—in public sector funds for the distribution of scholarships is about half. The private sector also provides funding, as do individual donors as well.

[Mike Wallace, Conservative, Burlington, ON]

Okay. And I want to congratulate you on the work you're doing. Hopefully that will continue.

Ms. Pearson, we had another non-profit fundraising organization here; I forget what the actual organization was called. They talked about the donation of land and having it treated basically...the capital gains issue that we dealt with in terms of other issues.

Do you see, from a foundation point of view, that the land issue is something...in terms of ecological land? Is that a demand? Is that an option you've looked at?

[Hilary Pearson]

I represent the grant makers, not the fundraisers. My members typically are not in a position to seek gifts from others. Some of my members are certainly involved in the work of the Nature Conservancy, for example, which would very much appreciate, I think, tax incentives for more donations of ecologically sensitive land.

So in general, I think in the non-profit sector that would be much appreciated.

[Mike Wallace, Conservative, Burlington, ON]

Okay.

Mr. Monk, just quickly, you had six items here. The sixth I think we've done with the public safety committee and the industry committee. It was to combat counterfeiting and piracy of intellectual property. I think we implemented that.

Is this something you've written recently, or was it written during the summer, when we asked?

[Richard Monk]

It was written in August.

[The Chair, Conservative, Rob Merrifield]

Thank you.

Monsieur Mulcair, very quickly.

[Thomas Mulcair, NDP, Outremont, QC]

Thank you, Mr. Chair.

My first question goes to Ms. Pearson. A colleague from Windsor, Brian Masse, recently proposed that charitable donations should be treated in the same way as political donations are at present for tax purposes. That is, that you get a tax refund of $300 on the first $400 in donations. Of course, we would have to be sure that donations were made only to charities that could provide a similar level of checking. The two clearly go hand in hand. There was good media response, especially an editorial in the [Editorial Note: inaudible], but there was not much resonance nationally.

I wonder if I can achieve some by asking you if you would be in favour of an initiative like that.

[Hilary Pearson]

I'll answer that in English.

I haven't actually thought about that particular issue. Again, I represent organizations that don't tend to benefit from those kinds of incentives, except in the actual establishment of a foundation. I represent private foundations and some public foundations, largely. So I'll answer in general terms as opposed to speaking specifically on behalf of my members.

Certainly there is an interest in having greater tax incentives for giving. I think incentives are generous, and I have to say that the Department of Finance has many times told us that they believe that the incentives provided now for giving cash, and now assets, are as generous as anywhere in comparable jurisdictions. Certainly in North America, but probably in Europe, as well, they are more generous. Does that mean they're as generous as they could be? No. I think it would certainly be greeted with a lot of enthusiasm if we were to receive a boost in the incentives that are provided.

The message in this brief is that it's not just the giving of cash by individuals in the form of charitable donations that is important to the non-profit sector. In fact, the non-profit sector needs to have access to sources of financing that could take the form of loans or debt capital in some form. The capital market in Canada for charities is seriously underdeveloped.

That's what we would like to see more emphasis on now.

[Thomas Mulcair, NDP, Outremont, QC]

You highlighted it very clearly when you made the comparison with England.

I will end my questions to you with congratulations on the extraordinary quality of the French in your document. You spent a lot of time on it. Congratulations to you as well, for the same reason.

Ms. Jamieson, my next comment goes to you. I made note of your proposal and I am with you on it. You surprised me. I did not know the extent of the gap that you described in your document. I can only assure you that your proposal has been heard on our side of the table and I will do everything in my power to move it forward.

Thank you very much for your presentation. it was very moving. Thank you.

[The Chair, Conservative, Rob Merrifield]

Thank you very much.

Thank you very much to the witnesses for coming in.

We have one motion that Mr. Crête would like to introduce.

I know the bells are ringing. We'll allow five minutes and hopefully we can get this completed.

Mr. Crête.

[Paul Crête, Bloc, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

The motion is clear. I am ready to vote on it.

[The Chair, Conservative, Rob Merrifield]

We will have debate on the motion.

Mr. Dykstra.

[Rick Dykstra, Conservative, St. Catharines, ON]

Thank you, Mr. Chair.

I will do my best to not take a lot of time on this. I realize we have a vote, but I think it's pretty important for us on the government side to put our thoughts on the record on this.

Mr. Rajotte is here, as the chair of the industry committee, to show his support for the work that he and the committee he chaired did to bring this report forward. This certainly proves that we are intent on moving forward to help manufacturing and industry in this country. The report indicates the direction we want to take. It also shows, by the actions we've taken in the 2007 budget, that we are intent on doing so.

Let me point out a couple of things. One is that we have tried to work with Mr. Crête to amend the motion to be able to support it. But what we have is a request of the minister that will effectively tie his hands. He will not be able to act promptly.

It's very clear in the report on page 51, when we're talking about the SR and ED tax incentive program, that we are considering moving forward on this. The industry committee moved to consider this. It's incumbent upon us to move forward as quickly but as effectively as we possibly can. It's not responsible to move this motion forward without a true understanding of costs.

I want to quote from one of the last sentences that Mr. Rajotte had in the chair's foreword to the report. It speaks very directly, that “the recommendations presented in its report should be implemented in a timely fashion”.

If there had been an amendment that Mr. Crête supported, we certainly could have supported the motion to be able to speak about a timely fashion in which this could move forward--an allocation of time that made sense for the ministry, the government, and the manufacturing industry. Representatives from that industry were here yesterday and spoke directly to the fact that they didn't want us to move forward and spend funds on something that wasn't going to have a direct benefit and a direct impact on the industry itself.

I'm merely suggesting that if the amendment had been accepted, we would be supporting this, but as the motion now stands we will be abstaining from the vote.