Madam Speaker, I would like to thank members for giving me the opportunity to speak to this motion. I know that my colleague opposite had six minutes remaining, but since he is not here I will take the opportunity.
I want to commend the hon. the member for Fraser Valley for introducing this motion, which suggests that the government bring in legislation to make the tax deduction for contributions to charitable organizations no less than the tax deduction for contributions to political parties.
On the surface, if one were to look at this motion they would say it is great. For myself, as someone who represents a constituency that is urban in nature, I have thousands of organizations and community groups who on a daily basis are doing good work in the community. I do not want to name these organizations, but I can tell members that they range from hospitals to educational institutions to children's organizations to health and social service organizations to housing groups and so on.
These men, women, young boys and girls are out in their community on a daily basis, reaching out, trying to help those who are in need of help. Frankly, if we want to address the issue of charities and charitable work, it is these individuals and organizations that we have to acknowledge with regard to the well-being of our society and our community.
These individuals volunteer because they want to do good. These people contribute thousands of hours on an annual basis. They contribute their time and energy, not because they want to be rewarded, not because they want to be recognized, but because they want to do something good for the community. These individuals volunteer because it makes them feel that much better about themselves and about the society in which they live, and they feel good about supporting and helping others.
At no time have I ever heard an individual tell me that he or she was not going to support an organization or a cause because there were no financial incentives. These people volunteer because they want to. They do it because they know that they live in a compassionate and caring community.
I want to pay tribute to the parliamentary secretary for finance for speaking on this issue. He clearly stated to the House that what we require in this society is a balance.
We have a system which treats political contributions differently than charitable contributions. I will tell members how.
If I was to give $100 to a political organization, then at the end of the year I would be able to claim a tax credit of $75. However, if I was to give a charitable organization $100, at the end of the year I would only be able to claim $30.
On the surface anyone would say that is unfair and that we have to correct this situation. But that is not the whole issue.
The vast majority of Canadians give more than $300 a year, especially those who give to charities. As a result, the government has recognized the need to provide incentives to those who want to give to charities. Therefore, the government created a balance. It created a sliding scale. Those who contribute $250 or more to charities will get more of a tax rebate or more of a tax credit. For those who give to political organizations the government has created a sliding scale that decreases in terms of a tax credit.
In a sense it is not fair for us to judge the system on the first $10, $20 or $30 that my colleague was talking about. This is not what all of these men and women are giving to charities.
What they are giving to charities over a period of a whole year, which in most cases is over $250, is where we see the beauty of our tax treatment and the beauty of our system when it comes to recognizing those who are giving to charities.
It becomes clear at $1,150. Say, for example, that an individual Canadian is giving $1,160 to a charity and is giving $1,160 to a political party. He will get more credit for his contribution to the charity than to the political organization. If somebody gives a charitable organization $2,000 he will get a lot more in tax credits than if he was to give that $2,000 to a political party. If he gave $1,180, for the additional $30 he will get no tax credit. If he gave $2,000 he will get no tax credit for the additional $850.
To that extent the tax system is fair when one looks at the outer end, at those amounts above $250 or $300.
If we were to make large contributions like many organizations and individual Canadians do, for example to a hospital or to a university, if $10,000 or $20,000 was given, a tax credit of up to 75% would apply. However, if $10,000 or $20,000 was given to a political party there would not be a tax credit.
We have to look at the whole spectrum rather than simply looking at one small piece of the pie. If we were to look at the whole spectrum I would say we have gone a long way in trying to address the inequity in the system.
The government, since taking office, has introduced a number of initiatives and I would like to list only three. First, the government adopted measures that will lower the threshold for eligibility for the 29% tax credit to $200 from $250. Second, it adopted measures that will raise the annual income limit for the use of charitable donations to most charities from 20% to 75%. Third, it has reduced the income inclusion rate for capital gains arising from donations of appreciated publicly traded securities to 37.5%.
I would say that the measures which have been taken by the government are fair. Are they the best things we can do for charities? No. We can do a lot more. Are we doing more for charities? Yes. Should we do more for charities? Yes. There are over 80,000 charitable organizations across the land. Collectively their voluntary contribution in terms of manpower, in terms of men and women contributing through charities, is in excess of $12 billion a year. These are the issues that need to be addressed if we want to look at the fairness of the system and at the equity of the system.
The motion as proposed by my colleague would not solve the problem at all. It would be a complicating factor rather than solve the problem. What we have before us is a balancing act.