Mr. Speaker, I am pleased to join the budget implementation debate. I will do something that is unusual in two ways. First, I will talk about budget implementation, and second, I will talk about a tax measure which is unusual for me. It is something that I should do more often.
I understand that our taxation system is critical to productivity and creativity in the country. I tend to talk about other things. I would like to talk about report stage Motions Nos. 18 and 19 that deal with the federal capital tax. It is not the sort of thing that I would normally deal with, but these report stage motions propose to delete clauses 85 and 86 of Bill C-28. The two motions deal with the federal capital tax in different ways, but they are both in fact linked so I will talk about the two of them together.
Unlike income taxes which are paid when a corporation has taxable income, capital taxes must be paid even where a corporation has not been profitable. This is important because even people who are anti-business recognize that small and medium sized businesses are basic to our society, and in reasonable periods of time these businesses must be profitable.
Capital taxes, which are paid even when the business is not profitable, have been identified as a significant impediment to investment in Canada. That is a significant thing because we do need to attract business. A country of our size, although we are prosperous and wealthy, needs investment from outside the country.
The federal capital tax was introduced in 1989 as part I.3 of the Income Tax Act. The tax has been levied annually at a rate of .225% of a corporation's taxable capital employed in Canada in excess of a $10 million capital deduction. A corporation's taxable capital is generally described as the total of its shareholders' equity, surpluses and reserves, as well as loans and advances to the corporation, less certain types of investments in other corporations.
A corporation's federal income tax surtax, 1.12% of taxable income, is deductible against the corporation's capital tax liability. That is very clear and my colleague from Quebec understands that much better than I do.
In order to promote investment, the 2003 budget proposed to eliminate the federal capital tax over a period of seven years but beginning January 1, 2004. Clauses 85 and 86 of Bill C-28 would implement this proposal by increasing the threshold for application of the federal capital tax from $10 million to $50 million of capital for taxation years ending after 2003 and by reducing the rate of tax over the period 2004 to 2010.
Under the bill the federal capital tax liability would be eliminated for almost 5,000 medium-sized corporations in 2004. The federal capital tax would be fully eliminated by 2010. Report stage Motions Nos. 18 and 19, if adopted, would deny the benefits of these changes to Canadian businesses and would harm Canada's economy. Therefore, I will not be supporting report stage Motions Nos. 18 and 19.
There is an aspect of the budget I would also like to mention that is tiny in one sense and has not received a great deal of play. In the whole order of things, the billions of dollars we deal with and so on, it does not seem to be that much, and it is the palliative tax credit. This is the fact that at last, and I regret it is only in a very small way, people who give up work to look after a close relative who is dying will in fact get EI support, will get benefits from the system.
As a beginning, and I hope that it is just a beginning for this palliative care program, it is for four weeks. It may not sound like much, but people could take it and look after the person who is needing palliative care for four straight weeks. Or on the other hand, as I understand it, they could take a week at a certain point in the illness of the person and then go back to work and the person could be looked after by another relative and then they could take another week and a break and then another week and so on. In total, any way that they do it, I think it has to be a minimum of a week. It cannot be done a day at a time and I can understand that even though there might be some benefits from that particular approach.
I have to say that after many years of lobbying by some members, and by the way, members on both sides of the House, this is now in. Palliative care is a term which only a few years ago people watching this would not have recognized, but now in all of our communities there are groups and institutions devoted to the proper and appropriate care of people who are dying. Sometimes it is literally a bricks and mortar institution, a hospice, into which the sick person can move. Other times, as in the case of Hospice Peterborough in my riding, it is teams of people who work with the family and the dying person in their own homes. They will work around the clock if necessary, providing whatever care is necessary, ranging from counselling to the family to simply sitting with the family or with the sick person.
It is not a coincidence that this type of wonderful activity in our communities has arisen at the present time, because as we know our population is aging. There are great benefits to that. Years ago people used to die when they were 30 and 40. They were cut off in their prime from illnesses or overwork and their children would be deprived of them early in life.
Now people live to a much greater age, an extraordinarily greater age. This winter I have been to five birthday parties for people who were a hundred years old, in each case a woman. At these parties, the 100 year old person was not only present but was actively involved in the organization and what went on at those birthday parties. If I, as one MP, have been able to go to five in my riding, we can imagine how many more 100th birthdays there have been in my riding. Since I was elected nine and half years ago, I have sent greetings to over 200 people who were 100 or more. And you and I should know, Mr. Speaker, that all but one were female. Mine is but one riding of 301 ridings in the country, so that gives us an idea of how aging is affecting the pyramid. At the top of our age pyramid there are more and more people who, with their families, may not always but are most likely to need palliative care.
That is why I was particularly pleased that this time we started with this four weeks of palliative leave. I hope that future budgets and future people debating budget implementation will see a strengthening of that type of support for people looking after those who are dying and their families in this period in our history when our population is aging.