Finance committee  With other businesses; there's no other area where the small business deduction is allowed extended access for a particular group of business. So really, it puts the small business deduction consistently available to all businesses in Canada.

Finance committee  I would make the point that credit unions and caisse populaires offer a broad range of financial services. They compete in that market, and that's the reason for levelling the tax playing field. This measure was not discussed ahead of time with the credit union sector.

Finance committee  That's correct.

Finance committee  You're absolutely right. Significant reductions have been put in place. The small business tax rate has been lowered to 11%, and at the same time the amount of income eligible for that preferred lower rate has been increased to $500,000. In the budget, you'll note that it refers

Finance committee  The mineral exploration tax credit was first introduced in 2000. There was a brief period when it expired on December 31, 2005, and it was reintroduced on May 2, 2006. Other than that roughly four- to five-month period, it's been in continuous effect since 2000.

Finance committee  You'll see when you look at those budget numbers that as the additional deduction is phased out, there's an increasing revenue impact. It reflects two things over that period. It reflects the forecast growth in the base of corporate taxable income, as well as forecast growth in

Finance committee  At the time it was introduced there was a cumulative taxable income limit that applied to all businesses, so you were able to shelter income at the preferential tax rate up until you had reached a certain level of taxable income. You could regenerate access to that by paying divi

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.

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.

Finance committee  A level tax playing field.

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

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.

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

Finance committee  No. That's absolutely correct. The additional deduction is unique in providing this tax advantage to the credit union and caisse populaire section. There are no other equivalent provisions to provide extended access to the small business deduction for other businesses or corporat

Finance committee  Absolutely. Across Canada, provinces may or may not offer an equivalent form of the additional deduction. Quebec, in particular, eliminated it in 2003. Alberta does not offer a special deduction for credit unions, nor do New Brunswick, Newfoundland, or Nova Scotia.