Mr. Speaker, I am pleased to speak today to Bill C-40, An Act to amend the Excise Tax Act, the Excise Act, 2001 and the Air Travellers Security Charge Act and to make related amendments to other Acts. As the title suggests, this probably is not the most exciting or gripping topics that we have discussed in this place but it is, nonetheless, an extremely important one, as my colleague on the other side of the House has already indicated.
Much of the bill has to do with bringing previous legislation in line with the original policy intent of the government. Much of the bill has to do with implementing previously proposed legislation that, as has been indicated, required further study. This has been done in consultation with affected individuals and industries which, as I understand, was the procedure followed in this instance and most appropriately.
Bill C-40 has three main components which I will deal with separately. The first includes new measures related to the goods and services tax and the harmonized sales tax. The second part contains amendments to the Excise Act, 2001 and other acts with respect to the taxation of tobacco, spirits and wine, a subject matter that will be of interest to more than just those in the House. Finally, the bill contains measures that affect the Air Travellers Security Charge Act.
I will begin with the first part. The bill would confirm the GST-HST exemption for speech language pathology services. Speech language pathologists can include occupational therapists, physical therapists, therapist assistants, public health nurses, child psychologists and others. Typically, they provide services to young children with communication disorders and adults in rehabilitation centres.
We on this side are glad to see that this has been done. We are also glad that the Liberals' draft GST exemption for these services will be implemented. Clearly, speech language pathology services should fall under the act of GST-HST exempt health care services.
The bill also says that the sale and importation of a blood substitute, known as plasma expander, will be zero rated for GST purposes. As my colleague from the other side has pointed out, plasma expander is a blood substitute product that is used primarily to maintain circulatory blood volume during surgical procedures or trauma care. As we all know, Canadians are very generous when it comes to our health care system and donating their blood but there is also always a pressing need for more, and that is why the Liberals proposed this change in a previous budget and began consulting with affected industries.
Bill C-40 would also broaden the specially equipped vehicle GST-HST rebate so that the rebate applies to motor vehicles that have been used subsequent to being specifically equipped for use by individuals with disabilities. This would broaden the previous government's initiative which ensured that individuals and organizations, such as municipalities, non-profit or charitable organizations and school authorities, would qualify for the rebate on purchases when payment becomes due after today or when the vehicle is imported.
The bill also affects the harmonized sales tax in Nova Scotia where the government has called for the provincial tax portion of the home buyer's rebate to be limited to $1,500. It is good to see that this bill that the government has brought forward finally acknowledges the fact that a GST-HST rebate on new housing does in fact exist.
Last spring, when the Prime Minister was touring the country lauding the savings that a 1% GST reduction would provide for a new homeowner, he conveniently happened to forget that the existence of this value program already was there. As a result, I think he somewhat inflated the amount of savings a new homeowner could expect.
In Newfoundland, I believe the Prime Minister pulled out of his hat a savings figure of $2,000 on a $200,000 home. In reality, of course, the savings are some $650 less due to the GST rebate on new housing, but facts and correct figures tend to be lost on the government when it wants people to think it is lowering their income taxes when in reality it is doing just the opposite.
It would be our position that adjustment to income taxes is perhaps a more progressive way that would remove the inequities, in particular for the working poor and those on fixed incomes, other than treating the GST this way, but we also support the reductions to the GST that have been suggested.
The final Liberal budget in 2005 announced new funding over five years to enhance federal tax compliance and enforcement in the tobacco industry. We set aside new money for enhanced markings of tobacco. I am glad to see that this bill extends requirements to identify the origin of tobacco products to all products, including those for sale at duty-free shops or for export.
I can tell members that, from comments made by those who have discussed this issue with me, tobacco contraband needs to be addressed in a serious fashion. That is why we allocated $8 million to fight tobacco contraband two years ago. I certainly hope that the current government will take up that very cause.
The final part of the bill also focuses on an initiative announced by the previous Liberal government and confirmed in this bill. It will ensure that certain air travel donated to charities through air carriers is not subject to the air travellers security charge. I think it is worthwhile to repeat what has been said previously in explanation of this by my colleague.
In the months following 9/11, the previous Liberal government jumped into action with a series of measures to improve public safety, secure our borders and ensure that the lives of Canadians and Canadian businesses could go on with as little disruption to daily life as possible. As a result, the government of that day strengthened Canada's borders dramatically. We increased security at Canadian airports with as little disruption to passengers as possible.
The air travellers security charge was levied to help pay for these upgrades. While no one particularly enjoys a new tax, I think most Canadians would agree that in February 2002 we did the right thing by instituting the air travellers security charge in order to protect Canadians.
As a side note, the current government, which at the time was comprised mostly of the Canadian Alliance Party, voted against the security charge and in fact against the creation of the Canadian Air Transport Security Authority. Liberals, however, did believe that Canadians would be willing to pay a little more to ensure that air travel in Canada was as safe as possible. As a result, I am proud to say that Canadians are in fact safer.
Furthermore, as new technology was installed at airports across Canada and new security procedures created, the cost of the program diminished as time went on. Accordingly, the Liberals used their last three budgets to lower the air travellers security charge three times so that Canadians would need to pay only what was necessary to ensure their safety on flights.
As was mentioned, this was another initiative that was started by the previous government. Lowering barriers such as the travellers security charge on donated seats, then, is an excellent way to ensure that businesses such as airlines can help charities carry out their excellent work. In Canada, there are currently over 80,000 registered charities, the vast majority of which are honest and hard-working organizations that provide valuable services for Canadians.
I am sure that Canadians were dismayed this fall when the current government chose to eliminate the charities advisory committee. The committee was comprised of members of the charitable community as well as Canada Revenue Agency employees. Together they worked to ensure that charities were aware of their obligations under the Income Tax Act. They worked to ensure that Canadians could be confident that when they donate their hard-earned money to a charitable cause, the bulk of that donation actually goes toward the cause.
Furthermore, the charities advisory committee proposed new and interesting changes to Canada's tax laws, such as eliminating the air travellers security charge when an airline donates a seat to a registered charity. I cannot recall if this proposal came from that committee, but I do know that committee members had many proposals such as this one before them and made recommendations to that effect. I do not believe that the saving of a few thousand dollars by the government in eliminating the committee is in the best interests of our charitable sector or Canadians at large.
As I said at the beginning of my remarks, this may not be the most exciting or glamorous fare that the House has had to discuss, but as we can see from what has been said thus far, these measures are all very vital and important. The vast majority of these initiatives are either a result of the consultation process set up by the previous government or a direct result of funding provided by us.
Accordingly, I am happy to support the bill, as my party will be, at second reading and further study it when it arrives at the finance committee.