Yes. Thank you.
Evidence of meeting #199 for Finance in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was chair.
A video is available from Parliament.
Evidence of meeting #199 for Finance in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was chair.
A video is available from Parliament.
11:50 a.m.
Conservative
Larry Miller Conservative Bruce—Grey—Owen Sound, ON
Thank you, Mr. Chair. It's good to be here. I have been here before, but not very often.
Thank you to the witnesses for being here.
Mr. Hamilton, this question would be for you.
How many years have you been in the public service, or with CRA?
11:50 a.m.
Commissioner of Revenue and Chief Executive Officer, Canada Revenue Agency
Those are two different questions.
I've been in the public service for 34 years and I've been with CRA for just over two years.
11:50 a.m.
Conservative
Larry Miller Conservative Bruce—Grey—Owen Sound, ON
Okay. I still think my question is relevant.
In your years in the public service or CRA, and so on, have you ever been exposed to a situation or a budget where something similar to the changes that would benefit SNC-Lavalin were included in the budget bill? Have you ever seen a situation such as that?
11:50 a.m.
Commissioner of Revenue and Chief Executive Officer, Canada Revenue Agency
I don't really have any comment, off the top of my head, in terms of what I've seen over the years. I've spent a number of years at the Department of Finance and have seen a lot of things come and go in budgets.
In general, probably yes, but I would have to think about that question, about the similarity. I'm not sure I have anything constructive to offer.
11:50 a.m.
Conservative
Larry Miller Conservative Bruce—Grey—Owen Sound, ON
That's fair enough.
This is my last question before I turn it over to Mr. Richards. Do you think it's appropriate or relevant that changes such as that be included in a regular budget bill? Is that the right place for it?
11:50 a.m.
Commissioner of Revenue and Chief Executive Officer, Canada Revenue Agency
I really have no comment on that. Whether it's appropriate or not is for governments and Parliament to decide.
11:50 a.m.
Conservative
11:50 a.m.
Liberal
The Chair Liberal Wayne Easter
Mr. Miller, I think it does relate to a policy issue that the government itself decides and it isn't really fair for Mr. Hamilton to answer that.
11:50 a.m.
Banff—Airdrie, CPC
I suspect the desire not to answer that probably speaks for itself, Mr. Chair, but I don't blame him for not wanting to.
I would like to ask about something I have asked before at committee and elsewhere of both the elected officials and you. This is the issue of the government unfairly targeting some small businesses, and it has to do with rules that determine active versus passive income and how those rules are affecting some small businesses, like campgrounds, mini-storage companies and others. I'll focus on the campgrounds because they seem to have been the ones that have been the most unfairly targeted.
It's of great concern to me because it's shutting down businesses, frankly. What is happening is that these rules around active versus passive income are being used to target small businesses like campgrounds and taking what has in the past been considered active income—and frankly should be considered active income because we're talking about businesses that provide a lot of services to their customers here—and now arbitrarily assigning to them a passive income status, and there's no doubt that that work is not passive.
They're getting these huge new tax bills and it has shut some of them right out of business. There's no question about that. It has happened.
I've asked this question a number of times and have not had an answer. Therefore, I am wondering if you could give me some sense today, how the government and therefore Canada Revenue Agency can tell some small businesses that they're too small to be a small business. The ridiculousness of that statement...it just makes no sense to me to tell a business that they're too small to be a small business. Essentially what we're telling them—what you're telling them—is that if they have more than five full-time year-round employees, they're a small business and they can have the small business tax deduction, but if they have less than that, they're too small to be a small business. We all know that in Canada there aren't a lot of campgrounds that are open year-round, so they might have five employees even in their season. In fact, many of them do, far more than that in some cases, but they don't always have them year-round.
Can you tell me why the government or the revenue agency continues to persist in trying to attack these small businesses and put them out of business? That may not be your intention but that's what you're doing.
Why is that happening? Why is it continuing to happen? What's being done to try to make sure that we're not affecting these small businesses that are really trying to just make a living?
11:55 a.m.
Commissioner of Revenue and Chief Executive Officer, Canada Revenue Agency
Mr. Chair, just to respond to that question, and again, I would split the question into two for appropriateness.
No one should attribute any motives to why I may or may not answer questions on the policy side. It's just not for CRA to speak to that, but in the question you've asked, there is a policy dimension about the right way to tax businesses, to tax active versus passive income, and the law actually has rules that dictate how that should be applied. That, I'm not going to comment on.
Where we come in, at CRA, is we take the act that is in place and figure out how to best administer it, and if the act tells us we need to do it this way, we try to find the best way possible to administer it. Whether five employees or the rule is appropriate or not, I would put that aside for the moment. We have to find a way to help the business comply with their responsibilities under the act, and I would just say that our role is to make sure we're doing that fairly and consistently with the act, but also we do try to make sure that there's a good communication between us and the businesses about why we're doing what we're doing, and how we think the rules should apply—
11:55 a.m.
Commissioner of Revenue and Chief Executive Officer, Canada Revenue Agency
—and have an opportunity for them to express their concerns and for us to evaluate those.
That's an ongoing process for us and I think, frankly, at the agency we're trying to do that job a little bit better overall, outside of this case, do a better job of explaining how the act operates, what our responsibility is, and why we're administering it the way we do. But we're certainly not operating with an eye to attacking small businesses. It's really with an eye to informing and making sure that we apply the law consistently.
11:55 a.m.
Banff—Airdrie, CPC
Mr. Chair, you indicated that I had to let him finish and then you didn't give me time.
11:55 a.m.
Liberal
11:55 a.m.
Banff—Airdrie, CPC
Come on, Mr. Chair.
The reason why I chose to ask to interrupt when I did was so that I—
11:55 a.m.
Banff—Airdrie, CPC
On a point of order, Mr. Chair, when a member of Parliament in this committee has the floor, the floor is theirs.
You indicated that you wanted to have me let him finish. Out of politeness I did so. Having said that, I understood that my time was short. My understanding from what you had said was that you were going to give me an opportunity to ask the follow-up question I had. That's why I allowed that to continue, but really that time as a member of Parliament is my time to use as I see fit, and if I felt the witness was talking the clock out, I should have had the opportunity to ask him that question. I thought that's what you were indicating to me when you said you were going to allow that.
Mr. Chair, can you tell me what ruling you're making that says I can't as a member of Parliament use my time as I see fit during the questioning period that I have?
11:55 a.m.
Liberal
The Chair Liberal Wayne Easter
The time frames were established at our organization meeting. I think anybody who would say that I've not been very fair with letting lots of questions go over the time by a couple of minutes, and sometimes longer, in order to finish a discussion.... I've always done that at this committee, and I'll continue to do so.
Can you put your question down to 30 seconds? We'll let you sum it up, and then I'll go to Mr. Fragiskatos.