Mr. Speaker, I would like to acknowledge at the outset that I will be splitting my time with the hon. member for Wentworth—Burlington.
I hope that in this debate I can offer some constructive suggestions with respect to the motion at hand. I will diligently attempt to stay away from gender politics and all of the nonsense that goes with it.
Supply days in this House are a little like playing paintball with a blind man. If you shoot often enough, after a while you hit a target by accident. Under serendipitous circumstances somehow or another you finally hit the mark.
To any great credit of the Reform Party it actually hit on an anomaly in the Income Tax Act which bears some review and is a point worth debating. I cannot say that has been often true from the opposition parties as the points frequently raised from the other side seem to bear no relevance to reality and are not worth debating.
When I went to law school I took income tax. I hated the subject. I would do everything to avoid the course. I then went on to bar admission and had to do it again. Again I would try to do everything to avoid the course. I wondered why I really objected to the Income Tax Act. The essential reason was that when I thought I had a solution to a particular problem, suddenly the solution evaporated in my hands.
This motion is similar to that. It appears to be a good idea. It seems like a good idea. Who could be against discrimination, or for discrimination as the case may be? It makes no sense whatsoever.
After 22 years of practising law, I have frequently been asked questions with respect to the Income Tax Act. I have had enough courage to say to clients that I know that I do not know a great deal about the subject. I dare say that such candour seldom is experienced by members opposite.
Income tax is extremely complicated. The act is complicated. It is understood by very few people in its entirety. There is an argument to be put that almost no one in Canada actually understands the act in all its complexities. Any time one plays with a certain part of the act, there are implications in the act that one probably does not anticipate.
Notwithstanding that, we are not being asked so much to deal with the act as we are dealing with the values that underlie the act. In that respect, the motion has merit. The motion reads “that, in the opinion of this House, the federal tax system should be reformed to end discrimination against single income families with children”. I am somewhat disappointed in the drafters of the motion having chosen somewhat inflammatory language such as discrimination.
As the member for Mississauga South pointed out, the act tries to address a number of inequities in family living situations such as people who split up, such as people with certain disabilities. Every time one tries to favour one group in that respect, one almost necessarily appears to discriminate against another group. I would rather use the word that it is an anomaly and address it as an anomaly.
Every time we use the word discriminatory we start to vision the charter of rights and freedoms. We start to get into definitions as to whether this is or is not discrimination and whether it is justifiable in a free and democratic society. Knowing members opposite, particularly the proponents of the motion, I know that is not where they intend to go with their motion.
I do not pretend to go into a legal analysis on this matter but I would like to address a family that is earning about $60,000 as a family income. Clearly the numbers do not add up. If one is married or living common law and earning $30,000, spouse one and spouse two, the total family tax is about $11,600. If however only one of the spouses is earning the $60,000, the tax burden is about $16,000.
The inequity is apparent. It is about $4,300. That inequity is further exaggerated if one is also a single parent, although when one gets into various spousal equivalents it gets somewhat closer. Clearly there is about a $4,000 discrepancy between the two situations.
What does the tax system do to exaggerate the anomaly or to minimize the anomaly? I point out to members opposite that the child care deduction has an approximate value of $4,000 to $7,000. This goes to the spouse who has the lowest income. Of course the premise is that the spouse who has no income will not be able to benefit from that child care deduction. That actually exaggerates the anomaly rather than minimizes it.
Are there aspects which actually reduce the anomaly? The most obvious is the child tax benefit which by anyone's standards is a significant initiative on the part of this government. It is approximately $2 billion.
The problem with arguing on the basis of the child tax benefit is that it applies both to single family incomes and families that have double incomes. That in and of itself does not help to reduce the anomaly.
The real issue as I see it is that it is a values decision. This government has made an attempt to minimize the effects of the Income Tax Act on those most vulnerable and most in need. If that is the damning indictment of a government, then I stand with the government to try and reduce the impact of the tax on those most vulnerable and most in need. This is something I support.
I have to say that in that respect the government has done a reasonable job. Over the past two budgets, the government has taken about 600,000 taxpayers off the rolls and that, regardless of where we sit in this House, is a considerable accomplishment. I am aware that as employment improves, there will be more taxpayers added to the rolls. Again those are results of government policies which can only bring more fairness into the system.
It seems to me that the government has made the right decision in this area to attempt to reduce the effect of the income tax on anyone below a certain threshold. Frankly, again I cannot imagine how members on any side of the House would argue that is anything other than a good thing.
As the threshold rises, it has benefits to all families, regardless of whether they are a single parent or have both parents, whether they have a single income or a double income. The additional and obvious benefit has been to move up the threshold by $675 which means that an individual is going to have to have a taxable income in excess of $7,000 before there is going to be any tax at all.
Another area in which the anomaly can be reduced is in the spousal credit. This goes somewhat toward the reduction of the anomaly by about $1,000 in our example.
An additional area where the government has attempted to address the inequity is through the Canada child tax benefit. This provides a special supplement of $213 per child under the age of 17.
These are, I would argue, modest attempts to reduce the anomalies. The 1999 budget should be credited for doing that.
In addition there was an introduction of the Canada child tax benefit which has a value of $2,600 for a family that has one income versus $1,270 for a family that has two incomes. Again if we put those benefits together, the spousal credit and the child tax benefit, we have reduced the anomaly somewhat which still leaves it in the range of approximately $3,000.
The final point I would like to make with respect to the reduction of the anomaly is that the increase in deductibility and the removal of many people from the tax rolls is an enormous benefit that is not factored into the motion.
The final issue with respect to this is whether—