Mr. Speaker, I too am very happy to speak to this motion and I wish to congratulate the hon. member for Nepean for bringing it to the floor.
The motion, for those watching this on television, has to do with the taxing of child support payments. It states that taxes on child tax support payments should be paid by the payer rather than the recipient. On its face it tends to make sense, but when we delve into it a bit deeper we find a host of interrelated considerations.
This bill is particularly timely following as it does the Thibaudeau decision recently received from the Supreme Court. This decision has caused a general review of the whole situation of tax status and the support paid to families after a marriage breakdown.
I have a couple of insights I would like to bring to this debate and to the broader debate, but I want to assure those watching on television that whether this bill survives or passes the Commons, this is not the end of the story. It will go on. Parliament will come to a reasoned position, one that will be satisfactory to all of the various perspectives on this issue.
The broad perception is that the tax treatment is not fair. I have a fair amount of personal experience in this because I have been paying maintenance payments, as many people have, for years. My ex-wife and I have talked at great length about this. We have come to an agreement outside the judiciary on how we would handle it.
The real problem was alluded to in a presentation by the hon. member who preceded me. It is that the vast majority of people who are required to make maintenance payments do not and they skip. When we are looking at this we have to look at it in the broader context. How do we get the deadbeat parents to accept responsibility for looking after the children that they brought into the world? Why is it that every time we turn around in our country we are able to escape whatever responsibilities we should have as individuals and pass them off to the state?
The broader question is how do we go about nailing the deadbeats, whether they are male or female. Perhaps we should look at changing the income tax structure so that if money is paid by the state, then the people who owe it have to pay it back.
If the individuals owed the tax department the money, would they get away with it? I think not. If they do not make their payments and look after their responsibilities we as a people, as a nation, are forced to look after their responsibilities.
As we go down this road it is going to be very important not only to consider what is fair to the people who are involved, but what is fair to the taxpayers and to once again inculcate the sense of responsibility to people when they bring children into the world to look after their responsibilities.
The problem is interprovincial because if people skip from one province to another, they have to be tracked. It is a question of will. If people involved in the breakdown, in the divorce, are rancorous and do not want to pay, how do we go about doing this with a sense of fairness so that they will pay? It is the children who are involved that we want to protect.
I would like to read briefly from a very thoughtful letter I received from a constituent on this issue just the other day. Her name is Zanne Cameron and she wrote quite a long and involved letter. It is very touching:
As a single parent receiving support payments, I was immediately bumped into a 33 per cent tax bracket. The GST was introduced the same year, and I have seen health care premiums increase from $80 in 1983 to $180 quarterly in 1994. A middle class income is no longer $35,000 a year. It is somewhere over $45,000 or more. Yep, it is tough out there. You know what, though? It is not tougher for me than for married couples or single people with no children. Making a living is not easy.
In the broader context of doing what is right, we have to do what is right for the family. The question then comes up, if people are not divorced and choose to stay home and raise a family or if one parent does, how is it that family then does not
get the same tax break? That family cannot income split the same as a divorced family does.
We should be ensuring there are reasons for families to stay together rather than to break up. We cannot look at this as a straight forward tax this person or tax that person situation. We have to look at it based on what is best for the children and what is best in the context of our nation.
I would like to read once more from Miss Cameron's letter:
No matter how you dice it, support payments are income to the receiving parent. This is not really a feminist issue at all. All parents, single or married, must pay taxes on their income. We as women are not special here, nor are we the only single parents. The fathers of these children are also their parents, some more so than others, but these are private issues. I do not feel that it is fair to assume that all divorced men with children neglect them.
In conclusion, we cannot automatically assume every marriage breakdown is the same. We cannot automatically assume every divorced dad or every divorced mom is not conscious of their responsibilities and may not end up being a better parent because of the situation they are in.
Miss Cameron goes on to make a solemn kind of suggestion which is that the income be split. The more one thinks of it, the more sense it makes. Rather than taxing all one or the other, split it down the middle and tax 50 per cent to the recipient and 50 per cent to the payer. It does not necessarily have to be all one way or the other. In a divorce, heaven knows there are all sorts of very complicated issues which arise.
As part of a judgment why not decide who is going to get the tax benefit so as to induce the most possible income will go to the children? Why could it not be left that a person who is in a fairly high tax bracket will make the payment to someone in a low tax bracket to give the benefit of the tax deduction 100 per cent to the payer? In another situation, if the recipient does not want to pay any tax and the payer is quite happy to pay the tax, then why could that not be done, or any combination?
We do not have to go all in one direction or all in another. If for the sake of the tax department and for the sake of simplicity we need to have it all one way or another, then it would seem to me the appropriate thing to do would be to split it 50:50.
I want to reiterate to all of the people affected by the Thibaudeau decision that on the face of it it does tend to make a lot of sense. Many people out there think that perhaps this Parliament is not sensitive to their needs. However, I want to assure everyone that at least from this side of the House, I know from the government side, but I think also from the Bloc, we are going to work together as parliamentarians to come to an agreement on this which will be palatable both to the payers and the recipients and fair to all concerned. This is particularly to benefit the children involved.