Finance Committee on May 17th, 2023

[The Chair, Liberal, Peter Fonseca]

Ms. Sidhu, you have your mike on. Can you mute it? Thank you.

If you can just conclude, Mr. Kelly, that would be great.

[Daniel Kelly]

—delays in processing applications continue to plague business owners. They need workers for a job at a particular point in time. When that doesn't happen, it puts huge pressure on the business owners to try to fill the gaps themselves.

[The Chair, Liberal, Peter Fonseca]

Thank you, MP Kurek.

Now we are off to MP Dzerowicz for the next five minutes.

[Julie Dzerowicz, Liberal, Davenport, ON]

Thank you so much, Mr. Chair.

My Internet has been a little unstable, so I just want to warn everybody in case I disappear for some reason.

I want to thank everybody for being here this evening. I know it was on very short notice, so I really appreciate your being here. I also want to thank our clerk, who did a lot of very fast work to get you here. Thank you, thank you and thank you.

The conversation has been super interesting.

In my riding of Davenport, I'll tell you that one of the things they complain about a lot is airlines. They often tell me that they're not hearing back from the airlines when they put in their complaints.

I'm going to ask a question to Option consommateurs. Our legislation proposes that the airlines pay for the cost of the complaints process at the Canadian Transportation Agency. Do you feel that is appropriate? Can you comment on that?

[Sylvie De Bellefeuille]

I think that's a very good idea.

The problem is that a number of complaints could be handled internally by the airlines. Currently, the processing time for complaints filed with the Canadian Transportation Agency is so long that it almost becomes an incentive to refuse certain complaints that are justified, since it is known that people will not have quick access to another system.

The bill proposes a simplified system and imposes an obligation on airlines to respond quickly to complaints. The idea is that, if consumers are not satisfied, airlines will have to pay the expenses related to the complaint process before the Canadian Transportation Agency. In my opinion, this is a good incentive for airlines to treat their customers properly.

In the case of a refused complaint, for example, instead of an outright refusal, they could provide reasonable explanations. Often, people file complaints because they feel that they have not been treated fairly. In my opinion, what is proposed in the bill is a good incentive for airlines to treat consumers more appropriately.

[Julie Dzerowicz, Liberal, Davenport, ON]

Thank you for that.

I'd also say, and please tell me if you disagree, that the legislation proposes to shift the burden of proof from the travellers over to the airlines. I'd love for you to comment on that in a minute, but I have one more question.

I think you've given a thoughtful response. I think it's always hard to create a perfect system, but I'd love to know whether overall you would say that the measures in the legislation that's before us will significantly improve the system in Canada.

[Sylvie De Bellefeuille]

I think that, yes, it will improve things.

Concerning the change in terms of the burden of proof, I would remind you that, under the current system, when a consumer files a complaint, it is up to them to prove that the airline did not apply the regulations properly. The problem is that all the implications of the flight disruption are in the airline's hands. So it's a very difficult situation for consumers, who find themselves in the David and Goliath situation. Not only do they have to fight a giant, but they do not have the tools for the fight.

Reversal of the burden of proof helps rebalance things a little and lighten the burden on consumers.

[Julie Dzerowicz, Liberal, Davenport, ON]

Sometimes I prefer radical change in government as well, but sometimes I'll take some of the smaller steps, as long as they're moving in the right direction.

Thank you so much for your advocacy.

My last question is for the Coalition of Rail Shippers.

I would just like to ask you quickly if you're supportive of the extended interswitching pilot program that's proposed in the budget implementation act.

[John Corey]

Thank you for the question.

We are absolutely supportive of extended interswitching in the act. In fact, we would like it to go further, as Greg pointed out. Perhaps that's a longer distance, but certainly for a longer period of time because 18 months is not enough time to actually gauge if the program is going to be successful. Also, there is no measure of success. How do we determine if there has been success during those 18 months?

We're in favour of it, but we think there could be more positive changes.

[The Chair, Liberal, Peter Fonseca]

Thank you, MP Dzerowicz.

We're going to try to squeeze out a final third round. We're going to have to be pretty strict on the time now to get that done.

We're starting with the Conservatives and MP Chambers for five minutes.

[Adam Chambers, Conservative, Simcoe North, ON]

Thank you, Mr. Chair.

Mr. Davis, you mentioned the program that H&R Block does. I assume this is consistent across the industry.

Do you or your peers provide free filing services to low-income Canadians?

[Peter Davis]

Thank you for the question.

Yes, there are a number of free filing options that are operated by industry that are currently available to Canadians. A key one is through free, DIY tax software that Canadians can access just by going on the Internet. There are several options that they can choose for that. Then there are industry tax clinics that are held throughout tax season and other parts of the year that also connect those Canadians in need to tax filing services to help them get the benefits they require.

In addition to industry efforts, there is also the community volunteer income tax program, which also serves hundreds of thousands of Canadians. There is no shortage of free tax filing options to Canadians who need them.

[Adam Chambers, Conservative, Simcoe North, ON]

As I understand it, helping individuals file and providing some of these services for free doesn't represent a significant loss of revenue for you. Do these people have opportunities to file through you, for which you don't actually receive much revenue at all, if any? Is that correct?

[Peter Davis]

Yes, that's correct.

[Adam Chambers, Conservative, Simcoe North, ON]

I have a follow-up question. Without providing confidential information, how much does your organization—or say, the sector—spend on technology each year? That's R and D or development on tech.

[Peter Davis]

I think the best answer I can give on that is that it's millions of dollars annually in tech investment.

[Adam Chambers, Conservative, Simcoe North, ON]

Okay, so you invest millions of dollars a year in technology. The government is interested in developing its own technology. You actually give that technology away for free to people.

Really, this is about how we access and connect with the people who need to avail themselves of your services, as opposed to trying to build something in-house that you already basically give away for free. Is that a fair representation, as I understand it?

[Peter Davis]

Yes, generally speaking, our industry has the software and we have the ability to deploy that software to individuals who need to file their taxes.

Where the government could be very helpful is if they would agree to publish the aggregate statistical data that they may have on Canadians who don't file and in which parts of the country they are more concentrated. If our industry knew things like that, we would then be able to target more of our efforts to incentivize those individuals to file their taxes and get their benefits.

This is a low-cost option the government could avail itself of at no taxpayer expense. We are more than willing to help and participate in it. That is just one example of many other things that we could potentially do working with government to assist these individuals to get them to file their taxes at no cost to taxpayers.

[Adam Chambers, Conservative, Simcoe North, ON]

Thank you very much.

Ms. Sarangi, you've been at the committee. This may be your third time at least in a year. I always find your testimony very good in that it highlights some of the on-the-ground issues you are seeing.

One of the challenges we've had is getting the government to provide some statistics about how many low-income individuals could be affected by an amnesty. I support, frankly, exploring what that would cost government. I agree with my NDP colleague that we spent a lot of money and will spend a lot of money trying to recover this from individuals who, frankly, don't have the funds to pay it back.

It's also frustrating, and I'll just ask if you agree and if you can elaborate. Some of the support that we provided to large companies...and I don't want to name them all, but I will. I will get some emails in the morning, I'm sure, from lobbyists, but Air Canada and the telecoms all got money and we're not asking them to recover it, but we're going to try to squeeze people who might be able to pay barely five dollars a month.

That must frustrate you.

[Leila Sarangi]

“Frustrating” is putting it so very lightly. When my cellphone is ringing off the hook with people—and they call me when they're desperate and have called everywhere else they can find—it's awful because there is nowhere for me to tell them to turn except that I will bring their stories here. That's the best that I can really give them, and it is not enough. It doesn't help them get through their day or deal with the crisis they are actually in, or advocate for themselves at the CRA or at Service Canada.

It's hypocritical really, the way the differential treatment is happening between big business and these individuals and families.

[Adam Chambers, Conservative, Simcoe North, ON]

Thank you for appearing.

[The Chair, Liberal, Peter Fonseca]

Thank you, members, and thank you, Ms. Sarangi, for almost always accepting our invitations.

We are now going to MP MacDonald for five minutes.

[Heath MacDonald, Liberal, Malpeque, PE]

Thank you, Chair.

I cede my time to MP Chatel.

[The Chair, Liberal, Peter Fonseca]

Ms. Chatel.

[Sophie Chatel, Liberal, Pontiac, QC]

Thank you, Mr. Chair.

I would like to continue on a topic we discussed earlier. Recently, a report indicated that 10% to 12% of Canadians were currently not filing their tax returns. Obviously, these are often low-income people who could claim benefits and do not receive them as a result. As Mr. Lawrence said earlier, there are benefits that are due to them and are not being claimed.

Mr. Davis, I'm really in favour of your company. I think it provides an excellent service to many Canadians. However, the proposed service is truly for those people who are currently not filing their tax returns.

I have a quick anecdote. I lived in France for four years for work. I was really surprised to receive my tax return in which the French authorities asked me whether the return was accurate. I had to answer yes or no. In the case of a negative answer, the changes had to be explained. So I never thought of a conflict of interest in all of this. I think I'll reassure you, Mr. Davis, that a lot of tax jurisdictions around the world are doing automated returns.

I have a question for Mr. Kelly. The budget announced that Visa and Mastercard had committed to reducing credit card interchange fees for small businesses. Over 90% of businesses that accept credit cards will see their interchange fees reduced by up to 27% from the current average weighted rate.

What is the impact of these charges on your members? What does that mean to them?