Finance Committee on Nov. 19th, 2014

[Gerald Keddy, Conservative, South Shore—St. Margaret's, NS]

Thank you, Mr. Chairman.

Welcome, Minister and department officials.

First of all, Minister, congratulations on the budget. Quite frankly, when any budget measures give any portion of EI remittances back to the small businesses who pay those remittances, I think that's good policy.

There are a couple of steps in Bill C-43 that make the tax system simpler and fairer for Canadians. In particular, two that are near and dear to my heart are the changes to the tax rules for combined farming and fishing businesses and the changes to the rules for farmers who face catastrophic weather-related losses to breeding livestock.

Can you just expand on those a bit, please?

[Joe Oliver, Conservative, Eglinton—Lawrence, ON]

I would be happy to do that.

Bill C-43 makes the tax system simpler and fairer for farming and fishing businesses.

A special income tax rule will be available to farmers who dispose of breeding livestock due to drought or excess moisture conditions existing in specific regions in a given year. This rule permits farmers to exclude up to 90% of the sale proceeds from their taxable income until the year following the sale, or a later year if the conditions persist.

Bill C-43 will also help amateur athletes. Currently, income contributed to an amateur athlete trust does not qualify as earned income in determining an athlete's annual RRSP contribution limit.

I can elaborate on that if you like.

[Gerald Keddy, Conservative, South Shore—St. Margaret's, NS]

The other thing in Bill C-43 is how it addresses tax non-compliance and how it combats money laundering and terrorist financing.

One of the issues that we've heard from Canadians on a constant basis is the amount of tax non-compliance and money laundering that we believe is going on offshore. We've done a good job of collecting a lot of those dollars back.

In particular, with the events of the last month and a half to two months, the idea that we can shut down the source of terrorist financing is something that I think all Canadians will embrace.

Can you expand on how this budget works to do that?

[Joe Oliver, Conservative, Eglinton—Lawrence, ON]

A well-functioning tax system is essential to keeping Canada positioned as an attractive place to work, invest, and do business. Since 2006, and including measures proposed in this year's budget, we've introduced over 85 measures to improve the integrity of Canada's tax system.

Our government is committed to a strong and comprehensive regime that is the forefront of the global fight against money laundering and terrorist financing. We're taking concrete steps to safeguard the integrity of Canada's financial system and the safety and security of Canadians.

To strengthen Canada's anti-money laundering and anti-terrorist financing regime, this bill will improve monitoring, compliance, and enforcement. It will close gaps of the regime, such as online casinos, persons and entities that deal in virtual currencies and foreign money services businesses. It will also strengthen information-sharing, such as allowing FINTRAC to disclose threats to national security to federal partners.

[The Chair, Conservative, James Rajotte]

You have about one minute.

[Gerald Keddy, Conservative, South Shore—St. Margaret's, NS]

Just quickly, you mentioned amateur athletes.

The income contributed to an amateur athlete trust will qualify as earned income for the purpose of determining an athlete's annual RRSP contribution limit. Will that contribution limit be increased?

[Joe Oliver, Conservative, Eglinton—Lawrence, ON]

This is a sort of technical question and I'm not sure that I have the answer for you.

[The Chair, Conservative, James Rajotte]

This round is over the time, so we can come back to this.

Colleagues, we do have bells. I'm going to suggest and seek unanimous consent that we get in at least four more rounds. We'll try to go to as many members as we can.

[Some hon. members]

Agreed.

[The Chair, Conservative, James Rajotte]

Thank you.

Mr. Caron, go ahead for five minutes.

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Thank you, Mr. Chair.

Minister, thank you for joining us today.

I must admit that I'm a bit puzzled about this EI credit for hiring, which is not specifically for hiring. It's more like a credit on premiums.

Have you looked at the Parliamentary Budget Officer's study on the lowering of business premiums?

[Joe Oliver, Conservative, Eglinton—Lawrence, ON]

In general, yes.

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

What do you mean by “in general”? Have you read about the study, its results and the methodology used?

[Joe Oliver, Conservative, Eglinton—Lawrence, ON]

In a general sense, yes.

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Can you make a comparison between the Parliamentary Budget Officer's study and the study carried out by the Canadian Federation of Independent Business?

[Joe Oliver, Conservative, Eglinton—Lawrence, ON]

As it has been said, there is clearly a difference between the two. We relied on an organization with in-depth knowledge of small companies—the CFIB.

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Here's my problem, Mr. Minister.

The fact is that I have the utmost respect for the Canadian Federation of Independent Business. They do good work in representing their members. They've prepared a study that actually recommends a measure that will cost half a billion dollars and will be to the advantage of their members. They're doing what they should be doing, which is working for their members, and they are getting some money for their members.

My question is not about the CFIB. Here's what it's about. In this instance, wouldn't it be standard procedure for a government department, such as the finance department, to actually undertake its own independent study to ensure the numbers are accurate and not coming from what is basically a lobby group?

[Joe Oliver, Conservative, Eglinton—Lawrence, ON]

They are a lobby group, but they represent small businesses and have the in-depth expertise to understand and to convey the implications of a decrease in EI for their members.

We have looked at the impact. Our department has looked at the impact of these 780,000 individual companies on a macro basis and we're comfortable with that.

the CFIB projects that this measure will create 25,000 person-years of employment, it is relying on experts' analyses.

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

So what you're saying is that you did an internal study of a macro analysis of the 780,000 businesses in relation to this measure?

[Joe Oliver, Conservative, Eglinton—Lawrence, ON]

The department looked at the measure in relation to the businesses that would be affected by it, and then we relied specifically on the analysis of the Canadian federation, which, as I said, concluded that it would create 25,000 person-years of employment.

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

We understand that. This is what the CFIB said. My question is saying that this is a group that is working to get benefits for their members and the government is not supposed to just take that at face value. It's supposed to be undertaking its own independent assessment to spend—because this is basically a fiscal expenditure—the funds that have been allocated to it. Why doesn't the federal government undertake an independent study of a measure that will basically forgo over half a billion dollars?

To put it another way, if the Canadian Federation of Students were coming to you and saying that with half a billion dollars they could create 25,000 jobs for youth, you wouldn't take that at face value, would you?

[The Chair, Conservative, James Rajotte]

A very brief response, Minister.

[Joe Oliver, Conservative, Eglinton—Lawrence, ON]

Well, we would do what we did in this case. We would do an overall review, but we would also look at whether the federation had the economic expertise to do that analysis. If they did, we would be influenced by it, and so on.

[The Chair, Conservative, James Rajotte]

Thank you.

Thank you, Mr. Caron.

Mr. Allen, please. It's your round.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

Thank you very much, Mr. Chair. Just so you know, so we can get all the rounds in, I'm going to be splitting my time with Mr. Van Kesteren.

Minister, one of the things I'd like to ask you, being a former member of the natural resources committee and also recognizing your former position as the Minister of Natural Resources, is this question with respect to part 4 and division 28 on the natural resources extractive sector.

In 2013 and in the past number of years, there have been a lot of things in the House in with respect to the extractive sector, as you're well aware. We made a G-8 commitment to establish reporting standards for the extractive sector. Recognizing your experience in the past and also as the minister, how do you see Bill C-43 helping our government to demonstrate our leadership on this issue?