Mr. Speaker, it gives me great pleasure to stand and express my strong support for Bill C-43, the economic action plan 2014 act, no.2.
The success of Canada's economy is the result of the hard work and innovation of millions of individual Canadians and Canadian businesses. Our government wants to build on this success by creating the conditions that will continue to allow them to prosper.
Canada's economic action plan creates jobs and economic growth. It supports families and communities. It improves the fairness and integrity of the tax system. In short, it keeps Canada strong.
Canadian businesses, especially small and medium-sized businesses, are the engine of economic prosperity. They create jobs and growth in communities across the country.
Our government is committed to supporting Canadian businesses. That is why economic action plan 2014 includes our proposal for a new small business job credit.
The new tax credit would save small businesses more than half a billion dollars in the next two years. The small business job credit would lower the employment insurance premiums that small businesses are required to pay. The current legislated rate is $1.88 per $100 of insurable earnings. In 2015 and 2016, it would go down to $1.60 per $100 of insurable earnings. If a business pays $15,000 or less in employer EI premiums, it would be eligible for the new credit in 2015 and 2016.
These are more than just numbers to the millions of small business owners in this country. The effect of this change would be huge. It would effectively reduce EI payroll taxes by nearly 15% for eligible businesses, and almost 90% of all EI premium-paying businesses in Canada would be eligible.
Mindful of our commitment to red tape reduction, we have ensured that no new paper burden would be imposed on business owners in relation to the new credit. The Canada Revenue Agency would determine eligibility based on information in the business' tax return and automatically calculate the credit amount. There would be no additional application form to fill out to benefit from this new tax relief.
Furthermore, both employers and employees would soon see a substantial reduction in their EI premiums. A new rate-setting mechanism, which would come into effect in 2017, would make sure that EI premiums are high enough to pay for the EI program over time, but no higher than required.
The proposed small business job credit builds on the many other actions our government has taken to foster an environment for small businesses to grow and prosper.
We have delivered tax reductions totalling more than $60 billion to job-creating businesses from 2008-09 through 2013-14.
In 2012, we reduced the federal general corporate income tax rate to 15%, down from 22% in 2007.
We have also worked hard to reduce red tape and make it easier for business owners to meet their tax obligations. For example, we have introduced many enhancements to the Canada Revenue Agency's online services. Businesses can now complete 50 different kinds of transactions online with the CRA, including managing their banking information and signing up for pre-authorized debit services through My Business Account.
To help business owners remember what is due and when, the CRA has recently launched its first-ever mobile app. The Business Tax Reminders app enables users to create custom reminders and alerts for key CRA due dates related to instalment payments, returns, and remittances.
Earlier this year, the CRA launched the liaison officer initiative and consultations for the proposed registration of tax-preparers program. Both are designed to reduce red tape and help small and medium-sized businesses more easily meet their tax obligations.
These are specific examples of the real results we are delivering for small and medium-sized businesses across the country.
We are delivering results for Canadian families, too. In fact, families have been major beneficiaries of the numerous tax relief measures that our government has introduced since 2006.
With balanced budgets just around the corner, our priority is to continue to lower taxes so that Canadians can invest more of their hard-earned money in the economy.
One of the most popular family-related tax credits we have introduced is the children's fitness tax credit, which came into effect in 2007. What parents do not want to start their children on the road to a healthy, active lifestyle early in life?
Every year, millions of Canadian families register their children in supervised programs of physical activity: basketball, baseball, gymnastics, karate, soccer, figure skating, folk dancing, and the like. Activities such as these, which require a significant amount of physical activity, are all eligible for the children's fitness tax credit.
The children's fitness tax credit allows parents to claim a 15% non-refundable tax credit for expenses up to $500 each year. They may claim the credit for registering their children in eligible physical fitness activities, as I have just outlined. Until now, this has meant that they could receive a credit of up to $75.00 per child each year. Our government wants to double the maximum amount that could be claimed under the credit, and we want to make the credit refundable so that more families could benefit from tax savings.
These proposals would fulfill a commitment we made to Canadians in 2011, and they are contained in the legislation we are debating today. The new limit of $1,000 would come into effect for the 2014 tax year, so families could see the savings when they file their tax and benefit returns next spring.
The children's fitness tax credit would then become a refundable tax credit starting with the new 2015 tax year. This would mean that people with no tax owing might be eligible for a refund of 15% of the amount claimed. As a non-refundable credit, the children's fitness amount could only be applied against taxes that they owed.
The children's fitness tax credit provides about $115 million in tax relief to 1.4 million Canadian families each year. With the changes we are proposing, about 850,000 families would benefit from this additional tax relief.
In addition to the two tax credits I have highlighted today, the economic action plan 2014 act, no. 2, contains many other measures that would affirm our government's commitment to economic growth, families, and communities.
The facts speak for themselves. Canada has one of the strongest job creation records in the developed world; our performance, in terms of real gross domestic product, is the best in the G7; our economy is growing; and our economic action plan is working.
I sincerely hope that all members on all sides of this House will join me in giving Bill C-43, the economic action plan act, no. 2, their full support.
This country is moving forward. We are moving forward in a judicious manner. There is tax relief in the bill and economic policies that would benefit all Canadians. I ask for the total support of the members in this House.