Mr. Speaker, I rise on a point of order concerning Bill C-253, an act to amend the Income Tax Act (deductibility of RESP contributions) standing in the name of the member for Pickering—Ajax--Uxbridge. While the intent of the bill is to alleviate the tax burden for individuals who contribute to registered education savings plans, it is my submission that Bill C-253 contains specific provisions that would effectively increase the amount of tax payable by the taxpayer.
If I am correct, the bill should have been preceded by the adoption of a ways and means motion and is therefore improperly before the House.
Two of the amendments proposed in the bill are amendments to section 146.1 of the Income Tax Act, which sets out RESP payments that are to be included in computing a taxpayer's income for a taxation year.
Subclause 2(5) of the bill would add a paragraph (c) to subsection 146.1(7.1) that would require refunds of payments made in respect of any contribution paid by a taxpayer to be included in computing a taxpayer income per taxation year. Subclause 2(6) of the bill would repeal subsection 146.1(7.2) of the Income Tax Act, which excludes certain amounts received under RESPs as income for a taxation year.
Taken together with paragraph 56(1)(q) of the Income Tax Act, which identifies amounts to be included as taxable income under section 3 of the act, these amendments would effectively increase the amount of tax payable by the taxpayer.
Citation 980 of the sixth edition of Beauchesne's states:
A Ways and Means motion is a necessary preliminary to the imposition of a new tax, the continuation of an expiring tax, an increase in the rate of an existing tax, or an extension of the incidence of a tax so as to include persons not already [tax] payers.
In other words, any measure that would have the effect of increasing the tax burden on an individual should be first preceded by a ways and means motion.
Although the general purpose of these bills is to reduce the tax burden on individuals, this legislation should not evade the requirements of a ways and means motion.
The 21st edition of Erskine May states at page 730:
To escape the rules of financial procedure, a scheme for the alleviation of taxation must not include any incidental increase of the burden upon any taxpayer, however indirect or relatively insignificant that increase may be.
I therefore submit to you, Mr. Speaker, that Bill C-253 is improperly before the House, and if you agree, I ask that the bill be stricken from the order paper.