Madam Speaker, I am very pleased to be able to rise again in the House to debate this bill. In fact, life sometimes hands us pleasant surprises. Between the time that I finished the first part of my speech on this bill, which as members know is on the taxation of charitable gifts, and the time I rose just now, something interesting happened; I am referring to the publication of the parliamentary budget officer's report on this bill. In fact, it is in line with the expectations I had for this bill.
Initially, the person who introduced the bill talked about the possibility that the tax expenditures associated with the bill could run into the hundreds of millions of dollars. The parliamentary budget officer was much more forceful in studying the scope of this bill. In fact, he said that by 2020, this bill could cost the Canadian government anywhere from $1.7 billion to $2 billion in lost additional revenue. This is not a detail; we are talking about a measure that fundamentally harms the country's finances.
We all know that the bill would modify the tax credit for people who make charitable gifts to make it similar to the tax credit for political donations. Instead of what is in place now, the exemption would be 75% for the first $400, then 50% for amounts between $500 and $750, and 25% for any amount above $750. The problem it that there is no cap mentioned in the bill. We know that political donations currently have a cap of $1,500. That is problematic because the parliamentary budget officer assessed not only the costs of this measure for the public purse, but also who would benefit from it, namely who makes charitable donations and is eligible to this tax deduction. His conclusion is that a large proportion of these donations are made by the 10% of the population with the highest income. In fact, those who earn $91,000 and over give six times more than average.
It is very important to make charitable donations and to support these organizations. During the previous Parliament, the NDP supported a number of these measures, including the first-time donor's super credit. However, at some point, we have to wonder how far we want to go with supporting these types of donations.
Since this is a private member's bill, we will have a free vote, but I think that the proposed tax credit disproportionately benefits people with high incomes who are in a much better position to donate.
The scope of this bill is different from the other measures we debated in the previous Parliament. I mentioned the first-time donor's super credit. The NDP supported other measures regarding tax benefits, for example, for donations of art, land, public assets, or shares. I think that going in this direction would be too much, not only because of the cost, but also because it would not necessarily generate donations, as much as it would support major donors who have the highest incomes.
We also have to wonder about something for which we have yet to get a proper answer. This tax credit is generally combined with a provincial tax credit. When you take the impact this measure will have at the federal level and add it to impact of the existing provincial tax credits, in some tax brackets, the tax credit would be higher than what would be paid in tax for this income. This would mean that someone could donate more and more to a charity in order to avoid paying taxes and to make a net gain.
This measure will support charities, but it will not be about a donor's commitment. The measure will be designed to allow people to pay less and get more.
Donations would no longer be made solely to satisfy charitable impulses, but for tax planning purposes. People would come out on top because the amount of the tax credit would be higher than that of the charitable donation.
That brings up some questions about how the Government of Canada wants to support various causes. If government revenues drop by between $1.7 billion and $2 billion, that is obviously going to affect public services eventually.
The fact that the government, guided by the public good, can make appropriate choices about how that money is allocated to public services makes that money much more important than a charitable donation to a particular organization selected by an individual. I am not saying that the causes themselves are not worthwhile. On the contrary, most of them are.
However, if we are talking about how to allocate up to $2 billion, decisions will have to be made about which services to cut, and the outcome could be bad for the public good.
That is why I will be voting against Bill C-239 at second reading. It would cost the public purse an awful lot of money; there is no cap on donations; we already have measures in place, some of them thanks to the former government, to encourage people to donate to charity; and there will be unintended tax consequences when people no longer make donations to causes they care about with no expectation of personal gain and being doing so for tax planning purposes.
Those are all of the reasons why I will be voting against the bill. I invite the member to address some of these major concerns in his reply.