Evidence of meeting #95 for Finance in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was pbo.
A video is available from Parliament.
Liberal
Vance Badawey Liberal Niagara Centre, ON
So a lot of this money can go forward to offset those costs that would otherwise be borne by the municipality and the property taxpayers.
Chief, Employment and Education Section, Personal Income Tax Division, Tax Policy Branch, Department of Finance
Potentially.
Liberal
The Chair Liberal Wayne Easter
Mr. Albas.
We're going to be flexible here. We're well over our time frame, but go ahead.
Conservative
Dan Albas Conservative Central Okanagan—Similkameen—Nicola, BC
I'll be very brief.
We've heard that some of the monies that will be recovered from cancelling this tax credit will go to things like the infrastructure bank and to funding public transit in other ways. Let me just note that the way the Liberals have constructed both operations, basically the monies will go largely on a per capita basis to large urban municipalities, whereas users of other rural systems, like the one in my old city of Penticton, which is a legacy system of mainly road traffic, bus traffic, and HandyDART, will no longer receive this tax credit, and rather than their getting some of their tax money back, it will go toward funding transit in large urban communities.
I'm just making sure exactly what is happening is on the record, Mr. Chair.
Liberal
The Chair Liberal Wayne Easter
Are there any further thoughts?
Is there any cost-benefit analysis on this point? Were the targets met with the transit pass tax credit? Are there any figures?
Senior Legislative Chief, Legislative Review, Tax Legislation Division, Tax Policy Branch, Department of Finance
A number of studies have been undertaken, and I believe provided to members of this committee, looking at the effectiveness of the public transit tax credit in terms of achieving its stated objective of increasing transit usage. In those studies, it was concluded that it did not have a significant impact on this usage. I believe that goes to your point.
Green
Elizabeth May Green Saanich—Gulf Islands, BC
Usually I don't have a chance to speak to a section I have no amendment to, but given my history on this, I'd just like to affirm that there was no chance in hell this public transit tax credit would ever reduce greenhouse gases. It wasn't designed to reduce greenhouse gases.
I think that if we want to help low-income people take buses, there are better ways to do it. This was never going to work, and it wasn't a significant greenhouse gas reducer.
Conservative
Ron Liepert Conservative Calgary Signal Hill, AB
I would like a recorded vote.
(Clause 13 agreed to: yeas 5; nays 4)
(Clause 14 agreed to on division)
Liberal
Liberal
Liberal
The Chair Liberal Wayne Easter
We're okay? Do we have unanimous consent to deal with clauses 15 through to 22?
Liberal
Greg Fergus Liberal Hull—Aylmer, QC
Agreed.
(Clauses 15 to 22 inclusive agreed to on division)
(On clause 23)
Liberal
The Chair Liberal Wayne Easter
We have an amendment by Ms. May.
I have a technical point on PV-1. If PV-1 is carried, the question cannot be put on PV-2 due to a line conflict in the bill.
The floor is yours, Ms. May.
Green
Elizabeth May Green Saanich—Gulf Islands, BC
Thank you, Mr. Chair.
I do like to put on the record at every occasion when I am compelled by the motion passed by this committee to appear here that this actually reduces my rights as a member of Parliament and prevents me from making substantive amendments at report stage. By the use of identical motions in every committee, the rights I have under our current Standing Orders are reduced. I'm here at your insistence; otherwise, I couldn't put forward these amendments.
Parti vert 1 is dealing with a perverse subsidy, which is the mining income tax credit. It's being extended under this legislation. We in the Green Party don't believe that it should be extended. It will cost $30 million to the federal treasury to provide a tax credit. This tax credit was initially put in place before the previous administration under Stephen Harper, back in the year 2000. It essentially encourages junior mining companies to conduct exploration in places where there is less likelihood of actually discovering minerals. It's damaging to the environment.
It's also been found by other observers that on the investor side it really is used more for tax planning purposes, as a benefit for high-income taxpayers. It's been also seen administratively to have very high administrative and compliance costs.
In 2015 Maclean's magazine had a review on this. It suggested that this tax credit primarily benefited tax lawyers and accountants. My main reason for opposing it is it encourages mining activity for exploration in places where you don't have good geology but where you do have a good tax advantage. It's disrupting sensitive environments for purposes of a tax credit.
In the first amendment, Parti vert 1, we essentially delete the sections that you find on page 13 of Bill C-44 in clause 23. We delete the extension, which means that the tax credit would end in the year 2018, because the extension would not be brought forward.
Thank you, Mr. Chair. I hope our intention is clear.
Conservative
Dan Albas Conservative Central Okanagan—Similkameen—Nicola, BC
Mr. Chair, I'm going to be voting in opposition to this, simply due to the fact that I attended a natural resources summit in Prince George in January 2016. I specifically went a day early and had a first nation elder who has been working in mining for quite a number of years, most of his life, go through how mining is done from the start to the remediation of the land. There is such a change in the types of technologies and the methods that are used to respect the environment but at the same time to continue to supply good-paying Canadian jobs. Canadian mining companies are the largest users of computer technology in the country because of the sophistication, and that is reflected at all stages.
I profoundly disagree. There are challenges with junior mining companies. It is how they finance their operations, which is going to have long-term issues, but this is not going to assist in dealing with what the member is speaking to. I do appreciate her opinion. I would suggest, though, that she actually talk to some of the industry, maybe even walk some of the different projects, because the care that's given and the remediation that's done in those cases are quite significant.
Liberal
The Chair Liberal Wayne Easter
Are there any other thoughts on this amendment?
Shall amendment PV-1 carry?
(Amendment negatived [See Minutes of Proceedings])
We'll move to PV-2.
Ms. May, go ahead.
Green
Elizabeth May Green Saanich—Gulf Islands, BC
Mr. Chair, I am disappointed that there were no other members of Parliament or other parties, although my colleague from the Bloc appears to have been willing to vote with me if either of us had been allowed to have a vote.
What the Parti vert is doing here is being more aggressive in getting rid of the mining tax credit by changing the language of the amendment so that not only is it not extended, but there is an actual retreat to the year 2017.
I appreciate the comments from my friend Mr. Albas. I just want to say that I worked extensively with the Mining Association of Canada. Before I became involved in partisan politics, I was actually on the advisory board of the Mining Association of Canada and their towards sustainable mining initiative.
I completely agree that a lot of the larger mining companies show a lot of care and concern, and I wouldn't want my comments to apply to the mining industry in general. But there is no reason—and I think that the essence of conservatism should agree with this—to essentially give a $30-million tax bonus to mining companies to encourage exploration. The mining companies most likely to do environmental damage are the junior prospectors and junior miners. Many of those companies aren't members of the Mining Association of Canada.
I continue to maintain that this is a perverse subsidy. The federal government doesn't need to give mining companies money to mine, and it particularly doesn't need to give a tax credit to encourage exploration in places where you're unlikely to find anything except for a tax credit.
Conservative
Dan Albas Conservative Central Okanagan—Similkameen—Nicola, BC
Mr. Chair, I'll just reiterate. Junior mining companies, as well as the larger ones.... First of all, many large mining companies do not do exploration. They actually purchase prepackaged sites from the juniors. That's how it works. Second of all, provinces like British Columbia heavily regulate how these companies act. A big part of British Columbia is under federal crown lands, reserves, and whatnot. There are specific requirements for them to work with first nations when they are looking, and a big part is demonstrating that they are going to be very diligent in how they do their exploration.
A lot of it now is done with drone technology and is based on magnets and whatnot, as well as site checks. In the old days, absolutely, site checks would happen, large strips of land. The industry has changed enormously over the past 10 years. If you looked 30 years ago, perhaps you might see some of those things. But in British Columbia, whether it be sustainably harvesting trees or putting forward mining projects, they are doing their due diligence and making sure harm isn't done.
Unfortunately, this may not be the proper venue, Mr. Chair, but I really wanted to raise those points. There are issues with how the financing of these companies is done, but the withdrawal of a tax credit like this would be extremely damaging to the industry overall, which is why I think they have continued to support this, even with a change of government. This tax credit is not a major component, but it does help a struggling industry.
Thank you.
