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Finance committee I'll have to give you a little more than a yes or no—sorry—because we talk about growing credit unions and large credit unions. Eligibility for the additional deduction is not linked to the size of a credit union. The income that is eligible for the additional deduction for any
May 9th, 2013Committee meeting
Geoff Trueman
Finance committee It would change from year to year, as the tax situation and parameters change for any given credit union or co-op. Among large credit unions, it's fair to say that most do not hit their limit in any given year. The credit unions that would be more likely to hit their limit may be
May 9th, 2013Committee meeting
Geoff Trueman
Finance committee Oh, looking at the five-year total. Sorry. The fully phased-in cost in the final year is $75 million, Again, as noted, given that the primary benefit of the additional deduction falls to large and growing credit unions, the flip side is that money would come from those credit uni
May 9th, 2013Committee meeting
Geoff Trueman
Finance committee I think I may have mentioned this earlier, but in fact the vast majority of credit unions that are located in the rural communities, the smaller credit unions, would have access to the small business deduction serving that smaller market. It would be a relatively smaller credit u
May 9th, 2013Committee meeting
Geoff Trueman
Finance committee No, to be clear, a credit union that has currently less than $500,000 in income and taxable capital less than $15 million would not be making use of the additional deduction. They would be paying tax at the small business rate, and that would continue unchanged.
May 9th, 2013Committee meeting
Geoff Trueman
Finance committee Without commenting on the particular tax situation of any given amalgamation of credit unions, again, as credit unions consolidate, merge, and become larger, they're able to realize economies of scale as they pass those thresholds for taxable income and taxable capital. Yes, they
May 9th, 2013Committee meeting
Geoff Trueman
Finance committee Yes, certainly it was. It's also important to remember that, again, the additional deduction only benefits credit unions and caisses populaires. There are other business forms. A mutual insurance company, which may also be based on similar social objectives, would not have extend
May 9th, 2013Committee meeting
Geoff Trueman
Finance committee Well, a mutual insurance company may have particular objectives, but when we speak of very small credit unions in small communities, they are very unlikely to be affected by this change.
May 9th, 2013Committee meeting
Geoff Trueman
Finance committee I'm not sure where the $255 million comes from.
May 9th, 2013Committee meeting
Geoff Trueman
Finance committee What they're doing in most cases in those provinces is providing an additional deduction for income that would be beyond the small business limit.
May 9th, 2013Committee meeting
Geoff Trueman
Finance committee It's not my particular area of expertise, but again, it would allow credit unions to operate under a federal model across provincial borders, whereas currently, as provincially regulated, they would have operations only in one province.
May 9th, 2013Committee meeting
Geoff Trueman
Finance committee A level tax playing field.
May 9th, 2013Committee meeting
Geoff Trueman
Finance committee Essentially, credit unions have the ability, like any other business, to access the small business deduction on the first $500,000 of income, and with a taxable capital limit of up to $15 million. That will not change. A small credit union will, in the vast majority of cases, n
May 9th, 2013Committee meeting
Geoff Trueman
Finance committee It's certainly fair to say that the vast majority of the costs associated with the additional deduction would accrue as a result of the largest credit unions. That's correct.
May 9th, 2013Committee meeting
Geoff Trueman
Finance committee Certainly, there is a broad range of credit unions across Canada. The Desjardins Group is probably the most well known—the caisse populaire—and is the largest organization. Without speaking for them, I will say that they have an asset base that is quite significant and would be s
May 9th, 2013Committee meeting
Geoff Trueman