Mr. Speaker, the motion by the member for Kitchener—Waterloo reads:
That the Standing Committee on Finance be instructed to undertake a study of the current tax incentives for charitable donations with a view to encouraging increased giving, including but not limited to (i) reviewing changes to the charitable tax credit amount, (ii) reviewing the possible extension of the capital gains exemption to private company shares and real estate when donated to a charitable organizations, (iii) considering the feasibility of implementing these measures; and that the Committee report its findings to the House.
On the surface of it, I do not think we would have a problem supporting this particular motion but there are some observations that I would like to make about it.
The member indicates that the sector is a very significant part of the economy, that it employs over 1.5 million people, that it generates an estimated $100 million a year and that it represents 7% of our GDP, which is larger than the tourism industry, the automotive manufacturing industry and the agriculture sector. I was certainly not aware of that and I do not think a lot of people would be.
We have a number of issues that need to be dealt with, which is why it is a really good idea to conduct this study. As has been pointed out, there are a number of indicators, bad omens, showing that the number of donations actually dropped during the recession, which has put some pressure on some of the organizations.
There is also a need to cost the item because, with a $56 billion deficit, the government will need to look at dealing with a program to reduce and eliminate that deficit. I think we would want to know, before we approve it, how much revenue the government would be losing as a result of any changes that it would want to make.
I do want to mention an approach that I found quite exciting. It is what is happening in the United States with Warren Buffett and Bill Gates. Over the last three or four years, they have collectively gotten together and committed to giving away, while they are still alive, I believe it is half of their assets. Since they are worth about $50 billion each, we are probably talking about $25 billion each. More important, they have encouraged other billionaires to get involved in their club and quite a number of American billionaires have joined the club. I think they are on to something. They have certainly started something. They are both very interesting people, if members read about them.
Warren Buffett's attitude toward American capitalism is not what one would think. He is actually highly critical of most of the big corporate elites in the United States and the salaries they get. Warren Buffett, himself, is a man whose salary is $100,000 a year. He still lives in Omaha, although he does have some other houses, but he is easy to find when driving through Omaha. He is a hands on type of guy. He has decided that his children do not need all his money. The children will be well taken care of but they will not be given billions when their parents die.
Bill Gates seems to be taking that same approach. They have now enlisted, and I am not certain what their current numbers are in terms of American billionaires, but their goal is to give away half of their assets while they are still alive.
Bill Gates and Warren Buffett's charities are heavily involved in sending prescription drugs to Africa, which is a very commendable direction for them to be involved in.
I would encourage Canadian activity in this area. I do not know if there are any Canadian billionaires being invited into this group but it is certainly something that I hope gets a lot of encouragement.
We have indicated that donations dropped off during the recession. There is also the odd complaint about the salaries and benefits of some of the managers of the charities. There was an example in Toronto where the charity head was making very excessive amounts of money, in the opinion of some of the donors.