Mr. Speaker, I am pleased to have the opportunity to talk about the motion rather than a rant about NDP ideologies.
I want to speak in strong support of today's motion brought forward by the member for Kitchener—Waterloo, which has nothing to do with the Fraser Institute or in fact Greenpeace, the one about which he obviously avoided even talking. I do not think we want to address the funding of that.
Let me first of applaud the member for Kitchener—Waterloo for his hard work on this motion and his noble goal of helping Canada's charitable sector. What is more, since being elected in 2008, the member has been an intelligent and effective representative for his constituents, ensuring their voices are heard in Ottawa and their concerns are addressed. Without a doubt, Kitchener—Waterloo has a strong representative in Parliament, putting their best interests first.
Today's motion calls for the finance committee, of which I am a member, to conduct a study on charitable giving in Canada. Specifically, it asks the committee to examine how current tax incentives may be made more effective to encourage increased giving.
Unlike some other private members' proposals we see too often in Parliament, chiefly from the opposition, this is an intelligent way of developing good public policy. Instead of unilaterally dictating a solution to an issue, the member for Kitchener—Waterloo has asked the finance committee to study the issue first. He is asking for hearings to talk directly to Canadians, to listen to the experts, to listen to those who are involved in the charitable sector and to listen to them together across partisan lines.
I believe in working together, consulting with Canadians, looking at the facts, considering the costs and doing all of this in an open, public forum at our finance committee. I see this as a positive and constructive way to approach this issue. I am entirely confident my fellow committee members will be eager to undertake such a study and ensure it has a fulsome study.
Again, I strongly support the motion and truly hope all members would as well.
For the remainder of this speech, to help inform the discussion, I would like to provide some background on the framework for charitable giving in Canada and how tax incentives help support it.
First and foremost, all parliamentarians have long recognized the immense importance and good work of charities in communities across this country. There are currently over 85,000 charities registered with the Canada Revenue Agency. Being a registered charity under the Income Tax Act provides a unique privilege, namely the ability to issue tax receipts to donors for gifts.
Donors, in turn, are entitled to claim a tax credit for donations made to registered charities, thereby reducing the amount of income tax that they pay. I should note that even though Canadians can receive tax benefits for their giving, in most cases that is only a secondary consideration.
In the words of Peter Nicholson, an experienced investment adviser:
The last reason that someone is going to give is because they are going to get a tax break. I show clients how they should give but prior to me showing you how, there has to be a 'why' and a 'who,' and that is all done on emotion.
Clearly we all know Canadians support charities because of their desire to help others or to support the causes in which they believe. Make no mistake about it, Canadians firmly believe in the importance of charities.
That is why we are among the most generous people in the world. In fact, Canada recently ranked third on the 2010 world giving index, an international comparison of giving and volunteering generosity in over 153 different countries.
As I have already noted, the tax system encourages Canadians to support the charitable sector by allowing individuals to claim a tax credit for gifts made to charities. For instance, the charitable donations tax credit allows Canadians to increase their charitable giving by providing tax relief. This credit provides federal tax assistance of 15% on the first $200 of donations and 29% on accounts above $200. Combined with the provincial tax relief for donations, the total average tax assistance for giving is about 46% for donations over $200.
In addition to the general tax incentives for charitable donations, special incentives are provided to encourage Canadians to donate particular types of property. Donations of ecologically sensitive land, Canadian cultural property and publicly listed securities are generally exempt from capital gains. As a result, the total tax assistance provided on these types of donations can be even higher, in fact as high as 60% of the value of the donation.
Since taking office in 2006, our Conservative government has taken key steps to build on that framework by increasing the generosity of tax incentives to better help the important role charities play in communities across Canada. For example, we have introduced a complete exemption on capital gains tax associated with the donation of publicly listed securities and exchangeable shares to public charities and private foundations. We also extended the exemption to donations of ecologically sensitive land to public conservation charities.
I note that our Conservative government's actions have been warmly welcomed by charities across Canada.
For instance, the Community Foundations of Canada has noted it would “help philanthropy continue to grow and will benefit charities across the country. We all win when the government encourages people to give. This tax relief will be welcome news”.
The steps have already had a positive impact on charitable giving in Canada.
For instance, commenting on our change in 2006 to encourage the giving of publicly listed securities, the Saskatoon Community Foundation has publicly declared, “in less than two years the foundation's endowment has grown by several hundred thousand dollars through donated stock. We've had some pretty significant donations so far in terms of size”.
We continued to build on our record of supporting charities earlier this year in budget 2010. We did this when we significantly reformed the disbursement quota rules for charities, reducing administrative complexity to better enable charities to focus their time and resources on charitable activities. This made it easier for charities to raise the funds they needed to help people who needed it most. Again, this action was warmly welcomed by charities as well.
In the words of the Salvation Army, the reform would “provide the Salvation Army, one of Canada's largest charities, with increased flexibility in meeting the needs of Canadians...allow(ing) us to better respond to the needs of the people we serve in 400 communities across Canada”.
We have also taken steps to encourage more giving in response to specific international crises in Haiti and Pakistan by matching dollar for dollar the donations of Canadians to those relief efforts.
Clearly our Conservative government has been a strong supporter of charities and charitable giving in Canada. Nonetheless, we recognize it is always important to study whether we could increase charitable giving in Canada to keep the charitable sector vibrant. That is why I strongly support today's motion as it calls for a finance committee study.
Moreover, I am confident that I and other finance committee members will give careful consideration to both the effectiveness of any new measures we might propose and their cost, ensuring they are affordable and sustainable.
I strongly hope the motion will be successful and we can undertake this study. I again applaud the member for Kitchener—Waterloo for his leadership on this issue and for the great work he is doing in Parliament on behalf of his constituents.