Mr. Speaker, I rise on a point of order.
On June 9, 2009 you made a statement with respect to the management of private members' business and noted the spending provision in three private members' bills appeared to infringe on the financial prerogative of the crown. At that time you invited members to make arguments on whether these bills required a royal recommendation.
One of the bills is Bill C-290, An Act to amend the Income Tax Act (tax credit for loss of retirement income), which will be debated later today. Notwithstanding the possible merits of Bill C-290, the bill would create a new refundable tax credit for the loss of retirement income, and I believe it would require a royal recommendation.
Refundable credits are direct benefits paid to individuals regardless of whether tax is owed or not and are paid out of the consolidated revenue fund, also known as the CRF. As a result, any legislative proposal to create a refundable tax credit requires a royal recommendation.
Two recent rulings in the House of Commons and the Senate concluded that creating or increasing a refundable tax credit would require a royal recommendation.
On June 4, 2007 the Speaker of the House ruled that a proposed amendment to Bill C-52, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007, to create a refundable tax credit could not be selected at report stage because the amendment required a royal recommendation.
On May 11, 2006 the Speaker of the Senate ruled that private member's Bill S-212, an Act to Amend the Income Tax Act (Tax Relief) was out of order because it would have increased a refundable tax credit. The Speaker of the Senate stated:
--bills proposing to alter refundable tax credits need a royal recommendation. This is because the payouts that will be made to taxpayers who are entitled to claim them must be authorized. This authorization is the royal recommendation. These payments can only be made from the CRF; they are expenditures of public money.
Since Bill C-290 would create a new refundable tax credit, it must be accompanied by a royal recommendation.