Finance Committee on Feb. 3rd, 2020

[Michael Cooper, Conservative, St. Albert—Edmonton, AB]

Right.

[Andrew Marsland]

As I mentioned earlier, that was an important measure in 2018 to effectively reduce the cost of investment through allowing for faster writeoffs. As you say, those measures were put in place I think until 2023-24, if my memory serves me correctly, for a five-year period. I guess that's where we stand now. I can't really comment on matters of policy, which are issues for ministers.

[Michael Cooper, Conservative, St. Albert—Edmonton, AB]

Thank you.

[The Chair, Liberal, Wayne Easter]

Ms. Dzerowicz.

[Julie Dzerowicz, Liberal, Davenport, ON]

Thank you so much, Mr. Chair, and I want to say thanks to the department for being here today.

In my riding of Davenport, which is downtown west Toronto, climate change was one of the top two issues that I heard about during the recent campaign. One of the key things people there have asked our national government about is whether or not we can move faster on eliminating fossil fuel subsidies.

How far along are we in eliminating fossil fuel subsidies and can we go faster?

[Andrew Marsland]

Perhaps I could begin by categorizing them. Being the tax policy guy, I see the world as tax and everything else, so I focus on tax all the time, which makes me pretty boring, but there you go. Maybe I'll speak to the tax component of that.

Back in I think 2007, the G20 committed to essentially rationalize inefficient fossil fuel subsidies over the medium term. I guess in more recent years—I think in the last two or three years—that's been crystalized by some countries, including Canada, to mean 2025.

[Julie Dzerowicz, Liberal, Davenport, ON]

I'm sorry to interrupt. I'm assuming that inefficient subsidies are those that promote emissions, GHG emissions.

[Andrew Marsland]

There's a whole debate about what “inefficiency” means. Essentially, I could go through a whole range of criteria—

[Julie Dzerowicz, Liberal, Davenport, ON]

We don't have time, unfortunately.

[Andrew Marsland]

From a tax perspective, every year we publish a report on federal tax expenditures and table it in Parliament. It's about 300 pages long. It identifies every deviation from a benchmark tax system, that being the most basic tax system. In a way, you can say that any tax expenditure is in essence a subsidy in one way or another. We have a pretty good handle on it, and we identify in that report which ones relate to the fossil fuel sector.

When you look back over the past decade or so, at one point you could say, looking at the measures that have been eliminated—phased out or in the course of being phased out—about eight significant measures are in that category. Then, when you look at what else relates to the fossil fuels industry, there's very little left. There is essentially one measure that we're identifying there that relates both to the mining section and to the fossil fuel sector—

[Julie Dzerowicz, Liberal, Davenport, ON]

I'm running out of time, and I have two other questions. Is it that we're 80% or 90% of the way there? What's your best guess?

[Andrew Marsland]

From the measures in the tax system, we've made very significant progress. There's very little left that is effective.

[Julie Dzerowicz, Liberal, Davenport, ON]

So, I can go back to Davenport and say we have largely eliminated fossil fuel subsidies.

[Andrew Marsland]

That's fair in the tax system that I'm speaking to.

[Julie Dzerowicz, Liberal, Davenport, ON]

My second question, and this is another thing that's a topic within my riding, is whether or not we have started making budget decisions based on the impact on climate change. Our budget decisions are moving Canada to being more sustainable and achieving our Paris accord targets. Is that something we're systematically doing?

[Andrew Marsland]

From a departmental perspective, we analyze every budget proposal through a strategic environmental assessment that includes those considerations.

[Julie Dzerowicz, Liberal, Davenport, ON]

That's good news, and good to know. I know my constituents will be very happy to hear that.

The last question I have is based on a comment made by one of my colleagues across the way, who said that we have to clearly define “middle class” before we would be able to create policies that would positively impact the middle class in Canada. Yet, I note we have introduced a tax cut, which you indicated earlier, that, if passed, would benefit over 20 million Canadians, which is the broad swath of Canadians. It would also eliminate taxes for one million Canadians.

Do we need to clearly define “middle class” in order to create policies that broadly benefit Canadians?

[Andrew Marsland]

Building on what my colleague, Mr. Leswick, said earlier, and given the challenges in clearly defining the middle class, you wouldn't want to wait until you had that definition before you....

[Julie Dzerowicz, Liberal, Davenport, ON]

And we obviously haven't.

Thank you.

[The Chair, Liberal, Wayne Easter]

We're going to two-and-a-half minute rounds for the next two questioners.

Mr. Ste-Marie and then Mr. Julian.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

I have a rather technical question.

The House decided to compensate dairy producers under the supply management system to make up for expanded market access conceded under the Canada–European Union Comprehensive Economic and Trade Agreement and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership. That measure was announced in the budget back in the spring, but the necessary funding wasn't in the corresponding budget implementation bill.

Technically speaking, which vote did the money for the compensation come from? Could you also tell me approximately when the first cheque was issued?

[Evelyn Dancey]

Thank you for the question.

Indeed, it is the case. I know you have the figures already of the government announcing a total of $2.5 billion in compensation for supply-managed farmers and processors, with $2.4 billion being allocated to farmers. To date, payment for the current fiscal year is what has been announced. I have the number here; I think it was $345 million. I can check my notes if that's not right.

The remaining compensation for that has been announced. My suggestion would be, in following the government steps on this, is to raise that question with the Minister of Agriculture and Agri-Food. I would refer you to Minister Bibeau.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

If I understand correctly, you can't tell me the approximate date that the first cheque went out or which vote the money came from. You're saying the minister is the person who can answer my questions. Is that right?

[Evelyn Dancey]

Yes. It’s not within the purview of the Department of Finance, so I don’t know the date or the vote.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

I see. Thank you.

My fellow member Ms. Dzerowicz asked you whether the climate impact of budget measures was taken into account. If I’m not mistaken, you said that it was. Is it possible to make those analyses publicly available?