Finance Committee on Sept. 27th, 2017

[Dan Albas, Conservative, Central Okanagan—Similkameen—Nicola, BC]

Again, with regard to saving for capital, there are obviously the passive versus active measures that are in here. Those would be quite detrimental to your members, then?

[Kevin Desjardins]

Absolutely.

[Dan Albas, Conservative, Central Okanagan—Similkameen—Nicola, BC]

My understanding is that because of provincial standards, which are good things, there is a very real cost to maintaining what some people have told me is like a mini hospital. They are expected, obviously, to have the highest standards, and it can take a million dollars to open up a practice or to replace old equipment. Is this going to be an ongoing challenge, do you think?

[Larry Levin]

Yes, it will definitely be an ongoing challenge. The expenses for maintaining practices, which as you've said, are like mini hospitals, are ever increasing, with more stringent, and properly so, requirements to improve the level of care for Canadians.

[Dan Albas, Conservative, Central Okanagan—Similkameen—Nicola, BC]

If practising dentists decide they have to pay off their training and equipment, that ends up meaning higher prices for consumers. We already know that, in most provinces, there are no dental programs. Is that going to have a detrimental effect on the ability of people with low incomes to have any kind of service from a dentist?

[Larry Levin]

There is always the potential for that. There is a lot of work that dentists do for access-to-care patients where the fees for delivering that service are below the cost of producing the service. In effect, a lot of it is more pro bono. The more difficult you make that to participate in...the potential is there. By and large, the vast majority of Canadian dentists are happy to participate in those programs, but it will be more difficult should this type of measure go through.

[Dan Albas, Conservative, Central Okanagan—Similkameen—Nicola, BC]

Okay.

[The Chair, Liberal, Wayne Easter]

I'm sorry. We'll have to end it there. We do have another panel that we have to complete before a vote. I would like to thank all of the witnesses for their presentations and for answering questions today. We'll suspend for three or four minutes while the next panel comes up.

[The Chair, Liberal, Wayne Easter]

I will call the meeting to order. I hate to rush people, but we are going to have a very hard stop on account of the vote. We might be able to go to 10 to six, but we're scheduled to a quarter to six.

We're here on the pre-budget consultations in advance of the 2018 budget. I'll ask the witnesses to hold their remarks to about five minutes. We are a little tighter on time than normal, but we thought it would be better to finish the panel rather than to have you wait until after we vote, so be as concise as possible, please.

We are starting with the Financial Advisors Association of Canada, Mr. Pollock, president and CEO.

[Greg Pollock, President and Chief Executive Officer, Advocis, The Financial Advisors Association of Canada]

Thank you, Mr. Chairman. I am delighted to be here and to present before the committee.

Advocis is the oldest and largest voluntary association of financial advisers and planners in Canada, with about 13,000 members across the country. Our goal is to work co-operatively with decision-makers and the public, stressing the value of financial advice and striving for an environment in which all Canadians have access to the advice they need.

Small business financial advisers primarily work out of independent agencies, or as exclusive advisers of life insurers and independent mutual fund and securities dealers. They are provincially licensed to provide various financial products to the public. There are about 78,000 small and medium-sized business financial advisers in Canada servicing more than 13 million client accounts.

Financial advisers are a vital part of Canada's economy and are crucial to the long-term financial health of Canadian families and small businesses. Representing $19 billion in direct GDP, Canada's small business financial advice sector is larger than the pharmaceutical, aerospace, and motor vehicle industries. Our sector accounts for 180,000 direct jobs and about $4.5 billion in total tax revenues.

The greatest value to the Canadian economy is what financial advisers do for their clients. Small business advisers are uniquely positioned to provide advice to middle-class Canadians. Over 80% of all households have less than $100,000 of investable assets. The average client assets under management are $49,000. The average life insurance coverage is $187,000.

In aggregate, Canadian households receive $27 billion annually from life insurance, annuity, and health benefit payments derived from individual solutions provided by life insurance advisers. Small business financial advisers manage $650 billion in financial assets for Canadians.

People who receive financial advice are more financially secure, better protected, and better prepared for retirement and unexpected life events than people who do not receive advice. Economic studies have shown that advised households have up to four times the financial assets compared to non-advised households. Public policy should be aimed at giving Canadians greater access to professional financial advice.

As the Minister of Finance said this week, “The economy is doing well. We are in the best place in a decade.” We agree. The Canadian economy is growing at a strong pace. That is why we have taken a keen interest in the government's proposals to change the taxation of Canadian-controlled private corporations.

Small business is the lifeblood of the Canadian economy. The 13,000 financial advisers that Advocis represents not only are small businesses themselves, but advise hundreds of thousands of small businesses across Canada with financial planning, succession and estate planning, and tax planning advice.

The small business coalition rightfully pointed out, in our recent letter to the Minister of Finance, that the changes to passive income rules could potentially result in a tax burden of 73% on corporately earned investment income, and 59% on corporately realized capital gains. The coalition also points out that the changes to income sprinkling would have an impact on all small businesses, not just the ones making over $150,000 per year. Finally, the tax bill for intergenerational transfers that result from the death of an owner could increase by 15% to 20%.

None of this, however, is new to you as members of the committee, so allow me to make an argument that doesn't solely rely on statistics or economic models.

Building a business is not an easy thing to do. They are built with blood, sweat, and tears. People use their life savings to start a small business. They take out loans and lines of credit on their houses, and borrow from friends and family. They work 80 to 90 hours a week, and deal with a level of stress that often goes unseen. At the end of the day, the sad reality is that most of the time small businesses do not succeed.

The financial advice industry is changing. Robo-advisers, regulatory challenges, and increasingly aggressive large institutions continue to put pressure on small business financial advisers.

These tax changes will not only make it more difficult for small business financial advisers to stay competitive and expand their businesses but will also limit the options for the small businesses they advise. The tax changes will make it harder for these businesses to grow at a time when large institutions in some sectors are rapidly expanding their reach.

The proposals aside, our members feel that the process, including some of the language delivered throughout the process, was not collaborative. Our members and their clients continuously hear from the government that these are tax loopholes, and that these changes will only impact the wealthy and those who make over $150,000, when we know that this is not the case.

The consultation was launched in the middle of July and finishes just two weeks after the summer. To us, that's a very short window for these fundamental changes. We would ask this committee, through the pre-budget process, to convey to the Prime Minister and the Minister of Finance the concerns and challenges that many organizations like Advocis have faced and have identified during this very short consultation.

We are worried that this is being rushed through. We must ensure that this is the right public policy for Canada.

[The Chair, Liberal, Wayne Easter]

Thank you, Mr. Pollock.

I don't know if you were here when I mentioned to the Association of Canadian Financial Officers that—

[Greg Pollock]

I was, thank you.

[The Chair, Liberal, Wayne Easter]

So you could consider doing that as well.

We'll turn now to BIOTECanada.

Mr. Casey.

[Andrew Casey, President and Chief Executive Officer, BIOTECanada]

Thank you, Mr. Chairman.

Thank you to the committee for this important opportunity, at a fairly critical time for this industry, to provide testimony.

By way of introduction, BIOTECanada is the national trade association representing Canada's biotech industry. That includes the large multinational pharmaceuticals, but the vast majority of our over 200 members are small to medium-sized start-up companies that are taking innovations and trying to move them forward.

The innovations are addressing some of the challenges we're facing as a global society. When you think about a planet whose population is rapidly moving from 7 billion to 9 billion, we need to find new ways to grow, to feed, to fuel, and to heal, and biotechnology is one of the ways in which we'll be able to do that.

Thankfully, in Canada we have a long and proud history of bringing forward innovation in this space to the global marketplace, dating back to some of the earliest days, including the development of penicillin, insulin, and even the technology that went into making canola seed, one of the biggest crops for this country. As a result, we have fantastic science and scientists right across the country. They are housed and located in clusters that exist right across the country. You'd expect to see some in the big urban centres like Montreal and Toronto, and of course that's where very significant clusters are. But when you look at the biotechnology industry, it's in every single province in every region.

Indeed, even the City of Sherbrooke, along with Sherbrooke Innopole, supports the industry.

Last week I was out in Prince Edward Island, Mr. Chairman, where I participated in the opening of the expansion of BioVectra, a very successful company that I know you're well aware of. We see huge clusters right across the country, and they're supporting companies that are bringing forward some remarkable innovation. There are companies that are taking mustard seed and turning it into jet fuel. Other companies, in parts of the country like the Okanagan Valley, are taking fruits and stopping them from turning brown. We have other companies that are looking at things like shrew saliva and turning that into a therapy for rare forms of cancer. Other companies are turning other remarkable innovations into solutions for some of these rare diseases that we're now seeing emerge into our space.

These are fantastic innovations, but the key that's actually going to make them successful is their ability to attract investment and talent, without which they are not going to be able to proceed. It requires a very special investor and very special talent to make these companies and their innovations successful.

The reason this is an important opportunity for us as BIOTECanada is that we're able to highlight the ability of government to put in place the policy and hosting conditions that will allow companies to track the investment and talent they need to be commercially successful.

For that reason, we've submitted some recommendations to the committee. There's nothing earth-shattering, but certainly they are ones we think are important and that recognize the importance of being able to track those key components to allow the industry to succeed.

First and foremost is the scientific research and experimental development tax incentive program. It has been absolutely paramount in the success of this industry. We encourage the committee to recommend that this, at a minimum, be kept in place, if not broadened. Indeed, there are some challenges for companies that have investment from outside of this country in terms of their ability to access these SR and ED tax credits. Expansion of that, to allow for some of those companies whose investors are outside of the country, would be very useful.

We would also encourage the committee to look at what we call an innovation or a patent box, which is an ability for companies to earn income from their patents at a reduced tax rate. It's being used in other jurisdictions, and we would encourage the committee to look into that and recommend that as well.

Finally, for an industry that is so important to the transformation of people's lives and of other industries in this country, we don't really measure it all that well. There was a survey that was in place many years ago that was discontinued, I think, in 2005. It was the biotechnology use and development survey, out of then Industry Canada. We would like to see the reinstatement of that survey, just to be able to figure out where we are as a country and where we need to go, because we have to keep up with other jurisdictions.

I will leave it at that, Mr. Chairman, in the interest of time, and I thank the committee for its time.

[The Chair, Liberal, Wayne Easter]

Thank you very much, Mr. Casey.

Now we'll turn to Dr. Karen R. Cohen, member of the management committee, Canadian Alliance on Mental Illness and Mental Health, and also Mr. Phelps, Saskatchewan-born at that.

Welcome.

[Fred Phelps, Member of the Management Committee, Canadian Alliance on Mental Illness and Mental Health]

Thank you, Mr. Chairman, and all members of the committee.

My name is Fred Phelps and I'm the executive director of the Canadian Association of Social Workers. I'm here today with Dr. Karen Cohen, CEO of the Canadian Psychological Association. We are proudly representing the Canadian Alliance on Mental Illness and Mental Health today.

Established in 1998, CAMIMH, as we call it, is a unique coalition of 17 organizations that represents both those who provide health and social services, and those that represent people with lived experience with mental illness, their families, and their caregivers.

CAMIMH has a long history of using its collective power for mental health advocacy, calling for the creation and then a decade later the extension of the mandate of the Mental Health Commission of Canada. CAMIMH also advocated very strongly, ahead of last year's federal-provincial discussions, for a new pan-Canadian health accord, with dedicated funding to support increased access to mental health services, so that many Canadians who need them are able to receive them.

The 2016-17 health accord and its bilateral agreements, including $5 billion in dedicated mental health funding over the next 10 years, represent a historic achievement and a strong start in seeing what CAMIMH has advocated for, which is the Government of Canada contributing 25% of provincial expenditures for mental health. CAMIMH also supports the common statement of principles on shared health priorities that will guide bilateral agreements and investments in mental health over the next 10 years.

We have all come to understand that you cannot manage what you cannot measure. There are data gaps in our understanding of what is being delivered in mental health services, its effectiveness, and who is being served, both in the public and private settings. That is why CAMIMH supports a standardized set of pan-Canadian indicators that would serve to improve the accountability and transparency of mental health care and delivery, identify areas of high performance, accelerate the adoption of leading practices, and highlight where improvements are required.

In support of nationwide indicators, CAMIMH advocates that the federal government establish a five-year, $100-million mental health innovation fund. It is our view that this targeted and time-limited fund would jump-start the spread of innovation and build a foundation for systemic and sustainable change to meet the mental health needs of all Canadians.

[Dr. Karen R. Cohen, Member of the Management Committee, Canadian Alliance on Mental Illness and Mental Health]

Canada's health systems fall short in making evidence-based psychotherapies available to Canadians who need it. Psychotherapies, delivered largely outside of publicly funded institutions by non-physician providers, are not covered by our public health insurance plans. While many Canadians have access to private health insurance through employment, coverage for psychotherapies is often too low to afford a sufficient dose of treatment.

Canada needs more systemic change to its mental health delivery systems, change which requires intergovernmental collaboration and commitment. Better access to better mental health care can be achieved by resourcing evidence-based interdisciplinary primary care that supports mental wellness, delivers early intervention, and treats chronic conditions, increasing mental health capacity and tertiary care, invests in community-based social and health services, and implementing new technologies to extend the reach of mental health care.

The United Kingdom and Australia have made systemic change with promising results. Options for Canada to implement such change to the delivery of mental health care have been proposed and costed out, either by enhancing mental health resources on primary care teams, augmenting fee-for-service models through private extended health care insurance, or adapting U.K. models for Canada.

Services and supports for mental health and illness are not limited to assessment and treatment. Improving the social determinants of health can transform the lives of those living with or at risk for mental illness. Mental illness impacts everyone, and income is one of the most important social determinants of health. A universal basic income to support all Canadians should be explored. This program could build on existing tax mechanisms, such as the guaranteed income supplement for seniors, the Canada child tax benefit for families with young children, and the goods and services tax credit.

Finally, the federal government should introduce a mental health parity act that affirms that mental health is valued equally to physical health. A mental health parity act would help ensure that communities and workplaces, through their policies, programs, and benefits, attends equally to mental and physical health.

Canada cannot afford to continue its current path of inaccessible mental health services and supports. The costs of mental illness to the economy and the workplace are massive. Some 500,000 Canadians in any given week are unable to work due to mental illness. The private sector spends between $180 billion and $300 billion on short-term disability for mental illness and $135 billion for long-term disability. In 2011, the economic cost of mental health problems was measured at $51 billion.

CAMIMH urges all levels of government to heed the recommendations of the mental health community and make mental health change happen. Our recommendations are explained in greater detail in our formal submission.

We thank you for your time today and look forward to any questions.

[The Chair, Liberal, Wayne Easter]

Thank you.

To all the witnesses, your earlier submissions are certainly a part of the consultations.

We'll now turn to Dr. Kells, president of the Canadian Cardiovascular Society. Welcome.

[Dr. Catherine Kells, President, Canadian Cardiovascular Society]

Thank you.

I'm Dr. Catherine Kells. I'm a practising interventional cardiologist in Halifax, Nova Scotia, and I'm president of the Canadian Cardiovascular Society.

On behalf of the more than 2,000 cardiovascular physicians, surgeons, and scientists across the country, I want to thank the committee for inviting me to present this important health innovation project that can improve patient care and more effectively use health care dollars.

As an interventional cardiologist, I'm the doctor you will meet in the middle of the night if you come in with a heart attack.

Despite the incredible advances we have made in cardiovascular care, heart disease remains one of the top two leading causes of death in Canada. Twenty per cent of all Canadians will die of heart disease.

I spend most of my days and every night on call working to save the lives of mothers, fathers, husbands, co-workers, and friends. I am extremely well trained in the Canadian system. I keep up with all the latest literature and techniques.

However, unbelievably, when patients ask me what their risk of death or complications might be when I'm about to put a stent in their arteries, I can't answer them. I cannot reassure my patients by telling them my own success rate, my complication rate, or their long-term risk of death or recurrence. I cannot compare our results in Nova Scotia to those of other provinces, and if my patients ask if they should go to Toronto to have heart surgery because it's the biggest centre, I cannot honestly tell them how we compare, because I don't know.

Unlike many other countries, in Canada we do not have a pan-Canadian, unbiased reporting system that reports the outcomes of our interventions and therapies in cardiovascular disease. In fact, in the 2013 OECD report, Canada's rank was 10 out of 11 countries for quality.

There are provinces and some institutions that do report outcome data. From those reports, we know that the quality of cardiac care does vary substantially, depending upon where you and your loved ones receive treatment.

Canada's inability to measure outcomes on a national scale is a critical health issue but also an economic issue. The price tag of cardiovascular care is currently $20 billion annually, and it's predicted to reach $28.3 billion by 2020 as our population ages, yet we don't measure the outcomes to ensure we're getting value for the dollars invested.

We, the professionals who take care of the patients in the cardiovascular community, want to improve cardiovascular care across the country, but as said by my friend and colleague, we cannot manage what we do not measure.

That's why the CCS is making one strong recommendation to the Government of Canada: to invest, in budget 2018, in a pan-Canadian initiative, using real-world data, to inform and improve the delivery of cardiac care across Canada.

Not only is the recommendation critical, it's highly achievable. While Canada may be information poor when it comes to national cardiovascular outcomes and comparative data, it's actually data rich.

Much of the real-world data already exists in databases and electronic medical records spread in silos throughout the country, but it's not enough to measure the quality of care within a single province or a hospital alone.

This Canada-wide problem needs a Canada-wide solution. Some provinces, including Nova Scotia, where I work, have only a single cardiac centre. Without the ability to compare hospital performance across the country, we cannot identify system-wide gaps and share best practices to benefit the health of all Canadians. By linking, analyzing, and providing data back to the doctors and health care providers on a continuous basis, we can achieve enhanced care for patients and a more effective use of our health care dollars.

By comparison to others, the recommendation I'm bringing to you today is a bite-sized innovation. For $2.5 million per year, cardiovascular specialists across Canada believe they can transform the quality of cardiovascular care. We're asking for a five-year commitment of funding to scale up our initiative and demonstrate its value.

Our initiative is physician- and surgeon-led, bottom up, and the community is highly engaged. We're working collaboratively with partners, including the provincial registries and CIHI , so we don't duplicate their work.

By bringing together data silos, connecting health professionals to the data they need to see, and translating that evidence into actions, we will enable Canadians to live longer and healthier lives, experience increased productivity in their workplaces and communities, and contribute to our country's economy.

No funding mechanism currently exists within Canada to make this project sustainable, and that's why I'm here today. Budget 2018 can send a clear signal that the federal government is committed to improving the quality of cardiovascular care for all Canadians.

Thank you for the opportunity. I look forward to questions later.

[The Chair, Liberal, Wayne Easter]

Thank you very much, Dr. Kells.

We now have the Canadian Consortium for Research, Ms. Votta-Bleeker, chair.

[Dr. Lisa Votta-Bleeker, Chair, Canadian Consortium for Research]

Good afternoon, Mr. Chair and committee members. Thank you for the invitation to present to you.

I'm Dr. Lisa Votta-Bleeker, and I'm the deputy CEO of the Canadian Psychological Association. I'm here to present today as the chair of the Canadian Consortium for Research, or the CCR.

With 20 member organizations, the CCR is a national coalition which represents more than 50,000 researchers and 650,000 students. We are the largest advocacy coalition in Canada, focusing on research funding in all science disciplines and support for post-secondary education.

Science—social, natural, and health—is a fundamental part of Canada, having relevance to societal well-being, human functioning, health, technology, innovation, productivity, and the economy. Its relevance can be measured at the individual, business, and community levels. As such, it is critical to develop, promote, and support a culture that values discovery and innovation. Achieving this requires continued and sustained investments in funding for research, students, infrastructure, and career development.

The CCR commends the government on its commitment to the review of fundamental science. The report of the prestigious panel, chaired by Dr. Naylor, was the most comprehensive review of federal support for fundamental science in 40 years. We are also pleased with yesterday's appointment of Dr. Mona Nemer as Canada's chief science adviser.

The government's investment in fundamental research for 2016-17 to the funding agencies, to students, and to research infrastructure has been an important infusion of support to help strengthen the Canadian research community. These commitments, coupled with the support for indigenous students pursuing post-secondary education, and the expanded eligibility criteria for the Canada student grants program will help to create a much-needed pool of future researchers.

The fundamental science report offers a comprehensive plan to both change and improve Canada's research ecosystem and restore the position of Canadians as research leaders on the international stage. Consistent with the CCR's recommendations to the panel, the first priority is to increase funding for independent investigator-led research. To this end, cumulative increases to the base funding of the federal research granting councils, from the current $3.5 billion to $4.8 billion by 2022, should be phased in over four years.

Enhanced personnel support for researchers and trainees at different career stages should be established, with a total base increase of $140 million per year phased in over four years, in equal increments of $35 million per year. This can be used to harmonize, upgrade, and strategically focus the system of graduate student and post-doctoral fellow supports. The report also made recommendations for stable annual funding for CFI in the amount of $300 million, another $35 million annually for major research facilities matching ratio funding, and an additional $143 million in increased support for indirect costs associated with facilities and operations.

The CCR supports efforts to improve coordination and harmonization and promote collaboration and share best practices among the four granting councils: CIHR, SSHRC, NSERC, and CFI. Balance across all research disciplines, including the social science and humanities, health, and natural sciences, as a foundational principle for funding is essential to a healthy research ecosystem.

Other foundational principles in the report include new forms of support for multidisciplinary and international research funding; support for indigenous researchers, diversity, and research that crosscuts disciplines; improved agility and timeliness in responding to emerging issues; and investment in digital research that will serve the long-term access and reuse of Canadian research. Therefore, the CCR strongly supports the implementation of all the recommendations embodied within the fundamental science review report.

Moving forward with these recommendations would enhance the well-being of Canadians, help them be as productive as possible in their workplaces and communities, help businesses to be more productive and competitive, and support a strong science culture upon which the development of good policy and programming is based.

We thank you for inviting us to speak to our input as part of the 2018 pre-budget consultations.

[The Chair, Liberal, Wayne Easter]

Thank you, Dr. Votta-Bleeker.

We now have the Chartered Professional Accountants of Canada, Mr. Ball, welcome.

[Bruce Ball, Vice-President, Taxation, Chartered Professional Accountants of Canada]

Thank you, Mr. Chair and members. I am Bruce Ball, the vice-president of tax at Chartered Professional Accountants of Canada, otherwise known as CPA Canada.

We are one of the largest and most respected national accounting organizations in the world, representing more than 210,000 chartered professional accountants at home and abroad. Collectively, CPA Canada and the profession enable, champion, and safeguard the Canadian ideal of good business that values inclusion, sustainable growth, and social development in cultivating a healthy and thriving economy. At CPA Canada we're committed to acting in the public interest, contributing to Canada's economic and social development, and helping Canadians, businesses, and the economy to succeed and prosper over the long term.

Permit me to highlight some of our priorities and recommendations for the next federal budget, as summarized in our pre-budget submission. First is responsible fiscal management, which needs to include a clear fiscal path to balancing the budget over the medium term. Next is an efficient regulatory environment for business. At CPA Canada we believe in regulatory excellence that makes it easier for businesses to comply, which facilitates trade and enhances job creation and growth opportunities. Another is a national adaptation plan that encompasses and coordinates all the aspects of adaptation in Canada to the changing climate conditions.

As a tax professional, though, I want to focus on one of our central recommendations, and that's the need for tax reform. CPA Canada has long called for a top-to-bottom review of Canada's tax system. Many other national organizations, leading think tanks, economists, and academics have joined the chorus as well. For the last four years, this committee has recommended that the income tax system be simplified and that a national consultation process should be launched. According to CPA Canada's recent “Business Monitor” survey, more than seven of 10 business leaders in Canada agree that such a review is required. With the government's proposed changes to the tax planning involving private companies, the call for a comprehensive tax review is growing even louder and more urgent.

I did hear the comments from before in terms of discussion about the private company consultation, but I think what's driving it for us is that at many business meetings and professional organization meetings, we have heard the call for tax reform being raised more and more. There is also a significant disconnect in what the government is saying about these proposals and what Canadian experts, a number of stakeholders, and our members are saying as well.

CPA Canada fully supports the government's commitment to a fair tax system that is internationally competitive, supports economic growth, and ensures that everyone pays their share of tax so that all Canadians prosper. This is in the public interest. However, in many respects the current proposals run counter to the basic principles of sound tax policy, in our view—concepts such as fairness, simplicity, competitiveness, efficiency, certainty, appropriately targeted tax measures, and being consultative. We therefore believe that these proposals are not in the public interest.

I'll list some of our many concerns about these proposals. First, they may adversely affect middle-class small business owners and entrepreneurs. They will create barriers to business investment, innovation, entrepreneurship, and job creation, harming Canadian competitiveness overall. Of significant concern is the complexity and uncertainty that we believe it will add to the tax system. We also believe that they could result in inappropriate tax results in some situations. Finally, they will raise the cost of compliance, the overall cost of doing business, and also the government's cost to administer the tax system.

These proposals also fail to provide enough time for taxpayers to bring their affairs in line with the changes. These proposals represent major policy changes to the rules that have been entrenched in Canada's tax system for decades, yet only 75 days were allowed for the consultation process. We believe it's crucial that the government examine all the alternatives before enacting these proposals into law. In fact, we believe it's time to hit the pause button and take a look at the issues more broadly.

In this light, we encourage the committee to launch its planned comprehensive review of Canada's tax system. We think this is now the time to stop and take stock. A fair, efficient, and competitive tax system is essential to sustainability and also to inclusive economic growth.

In summary, to achieve this, at CPA of Canada we firmly believe that a comprehensive tax review is required. Thank you.

[The Chair, Liberal, Wayne Easter]

Thank you, Mr. Ball.

We'll turn to five-minute rounds of questions.

Before I go to Ms. O'Connell, I can't help sitting here thinking, Dr. Kells—I'll age myself here—I remember in 1997, when Allan Rock was minister of health, he proposed a report card for health in Canada basically along the lines that you're proposing, only on the whole system. Federal-provincial jurisdiction got in the way of that, I understand, but I really think it's time we got there. You have to measure it.

Ms. O'Connell.

[Jennifer O'Connell, Liberal, Pickering—Uxbridge, ON]

Mr. Pollock, I want to start with you. You talked about income sprinkling and the effects this is going to have on small businesses, but I didn't see your brief or your background data to back up that statement. If you have that, I'd appreciate receiving it.

The Canadian Centre for Policy Alternatives put out a report called “Splitting the Difference”. In it they say:

By far the biggest winners are Canada's top 10% of families by income, who have access to nearly two-thirds of the total tax benefit from the current loophole. Nearly all of the families who benefit most from the income sprinkling are headed by male income earners, which undercuts claims that the current loophole is positive for gender equality; and almost half of all benefits flow to the richest 5% of families, those earning more than $216,000 a year.

It later goes on to say:

On the other hand, more traditional small businesses such as family-run farms or restaurants are two and a half times less likely than professionals to benefit from income sprinkling.

Are you suggesting that their data is incorrect? If so, can we see yours?