Mr. Speaker, I would like to thank my colleague from Repentigny for his question. He is a new member and does a remarkable job in the House of Commons in terms of speaking about this transparency and clarity. I thank him for doing such a good job in the House.
Canadians are calling for transparency. When we talk about financial issues, we are not talking about money that belongs to the Conservatives. It is not money they earned. This is money earned by the taxpayers of Canada, who then gave it to the federal government.
The former Liberal government was not transparent. The Conservatives have proven to be even worse. That is why we want to have a parliamentary budget officer who can bring some transparency to the overall financial management of this country. It is a matter of respect for Canadians.
Mr. Speaker, it is a pleasure to rise today to speak to the bill. I would like to congratulate the member for Repentigny for moving it. It is a great idea to have a tax credit for volunteers.
To summarize, the bill would allow a tax credit between $500 and $1,500 for volunteering a minimum 130 hours with 12 trips throughout the year. This is a modest tax credit in recognition of service to one's community. A lot of people volunteer in communities and this is a way to show our appreciation. It certainly would help.
I know that volunteers do not do this for money. Before I was elected to the House of Commons, I did a lot of volunteer work in my community. I certainly did not do it for money and no one else does it for money. However, it would certainly encourage more people to volunteer if there were a tax credit.
I would like to take a few moments to talk about some volunteers in my community. At an event Friday evening, I had the pleasure of meeting a volunteer named Michel Piette who lives in Chelmsford. Every day, Michel volunteers at the Alliance St-Joseph elementary school, where he helps out in many ways, including making photocopies for teachers and helping the children get dressed in their winter clothes. Last week or the week before, he even made taffy for St. Catherine's day. The teachers and students alike all appreciate everything Michel does for them.
I would like to mention three people from my community: Patty Smith-Taylor, Cathy Castanza and Reg Devost. They have been volunteers at the youth centre in Rayside-Balfour since its inception. This is a centre that was built in the late 1990s to give youth a place to go after school to do their homework, play games and get counselling from some of the volunteers. These three volunteers have been there from the start and they are still there today. Although there are others who help at the youth centre, these three people do not and never did have any kids who went to the youth centre. They are doing this out of the kindness of their hearts, which is certainly appreciated.
As well, the Sudbury Regional Hospital is manned by so many volunteers I do not know the number. They help people as they come in the door, give them directions and even take them exactly where they want to go. It is a big hospital and can be very confusing for seniors to navigate. These volunteers help them get to their appointments.
On Friday night I went to an event that celebrates co-ops.
The event centred around the Caisse populaire des Voyageurs. As we all know, Desjardins was built by volunteers, and many volunteers are still very active in this co-op. It has become quite an institution in Canada.
I do not think that we need to convince anyone in the House that volunteers play a very important role in all communities.
I would like to give an overview of what volunteers do. They run committees and boards of directors, provide advice and consulting and mentoring services, visit with seniors, prepare and deliver meals, provide transportation, advocate for social causes, and lead sports activities for children and teens. In short, volunteers contribute to the development of their communities and help non-profit organizations provide programs and services to millions of Canadians.
According to the United Nations' State of the World’s Volunteerism Report 2011, “Volunteerism benefits both society at large and the individual volunteer by strengthening trust, solidarity and reciprocity among citizens, and by purposefully creating opportunities for participation.”
Perhaps the biggest benefit people get from volunteering is the satisfaction of incorporating service into their lives and making a difference in their community and country. Volunteering gives a retired person something to do after retirement other than sitting at home. It is a proven fact that volunteering keeps seniors younger.
According to Statistics Canada, the number of hours people spent volunteering in 2010 was 2.1 billion. That is a lot of hours for people to be volunteering. That is equivalent to 1.1 million full-time jobs. If we had to pay these volunteers for 2.1 billion hours, just at minimum wage of $9 an hour, that would be $18.2 billion. That is a lot of money. However, I said a while ago, these volunteers do not expect to be paid but if they were given a tax credit it would help organizations recruit more volunteers.
Most of us here in the House of Commons have a lot of volunteers in our offices. I have Stéphanie Pépin who does my e-news letter. In my office in Sturgeon Falls, I have a young fellow by the name of Stéphane Bissonette who is 13 or 14 years of age. He does my French website. He does it because he can first of all and because he enjoys it. We are not expected to pay these people and they do not expect to receive any money but I wanted to give members a sample of what volunteers can do.
I have Holly Fryer and Sam Faubert in my office in Ottawa who are doing volunteer work as part of their program at the University of Ottawa. They are certainly enjoying themselves doing this. I also have Ray Pellerin and Denis Noël volunteering in my office in Sturgeon Falls. With the Christmas season coming, we will be having a Christmas parade in Sturgeon Falls and Ray has volunteered to drive the truck and Denis is getting the float ready. This is another good example of volunteerism.
I would like to thank the Ontario Trillium Foundation for providing start-up funding for our newest program called social enterprise in collaboration with the Greater Sudbury Chamber of Commerce. The purpose of this program is to provide training and support for local non-profit groups exploring social enterprises. Social enterprises are businesses owned by non-profit organizations selling goods or services in the marketplace for the purpose of generating income and/or creating social, environmental and cultural values.
We support Bill C-399. We hope to send it to committee to make some changes to it. All private members' bills can be amended to include other things and to make them better.
Volunteers must make 12 trips of one kilometre to the place of volunteering. In a small community, like some of the communities in my riding, one kilometre is not very far. We certainly want to look at that.
I thank all of the volunteers from coast to coast to coast for doing what they do.
Mr. Speaker, I rise to address a key issue in the debate on Bill C-399, a flawed piece of legislation, and to relate it to other more thoughtful ways in which we are helping charities and volunteers.
Before I highlight some of these areas, let me give a quick recap of what this legislation intends to do. Bill C-399 proposes a costly, new, non-refundable tax credit for individuals who perform a minimum of 130 hours of volunteer services for select organizations during a year and who make at least 12 trips in order to do so.
This proposal would cost over $100 million each year, and it would be very difficult, if not impossible, for charities to track and administer.
One would hope, and I think Canadians have an expectation, that when members of this House introduce legislation it would be with the intent of benefiting Canadians. How would Bill C-399 benefit Canadians?
The member for Repentigny might be thinking that Bill C-399 would make it more attractive for Canadians to volunteer at their church, local youth group or community centre. As it is, a large number of Canadians donate some of their time to volunteering. In fact, according to a recent report by Statistics Canada, more than 13.3 million people, or 47% of the population, volunteered some of their time through a group or organization.
Clearly, Canadians like to volunteer. However, it is unclear whether the proposed tax credit would have any significant effect in increasing the rate of volunteerism in Canada. After all, proposals to provide tax assistance for volunteerism have been suggested before.
That being said, studies in recent years suggest that tax assistance, much like the tax credit we are debating today, would in fact not lead to an increase in volunteerism. In fact, a report out of Alberta, entitled The Potential Impact of Canadian Federal and/or Provincial Tax Credit Incentives for Volunteer Participation, suggests that not only would the introduction of such a tax credit not lead to an increase in volunteerism but it might lead to a decrease in volunteerism.
The report states:
The motivations of volunteers to “donate” their time may not be shaped nor directed by the “value” of their donation. The principle motivations are altruistic and egotistic in nature. The attachment of economic and specifically tax value to the “altruistic donation” may in fact reduce the motivations of volunteers to participate.
Similarly, a volunteer group in Quebec, Réseau de l'Action Bénévole du Québec, RABQ, found that tax credits did not result in more people wanting to donate their time to volunteering.
In fact, according to the former president of the RABQ, Rosemary Byrne, tax credits:
....didn't seem to have made a difference in terms of the numbers of people volunteering.
Byrne even went on to say:
No one in a lower tax bracket would have benefited at all; that was another disincentive.
If such findings are to be believed, it is doubtful that Bill C-399 is the correct approach to encourage more Canadians to get involved in volunteering. Quite the opposite, the facts seem to suggest that if the House were to pass such a bill, it would be harmful to the rate of volunteerism in Canada.
For these reasons, I am very skeptical as to whether introducing a tax credit such as this is the right course of action. Furthermore, after the comments by the president of the RABQ, I am skeptical as to whether or not any volunteers would even be interested in taking advantage of such a credit.
That is not all. Another issue that must be considered with this proposed piece of legislation is the administrative burden it would place on charitable organizations and non-profit organizations.
It will be the charities, churches, youth groups, et cetera that will be responsible for documenting the information that will be needed by volunteers and the Canada Revenue Agency to confirm that individuals qualify for the credit under the Income Tax Act.
This means that for each volunteer, these organizations would have to track and record how many hours people are present, what they are doing and if they travelled to the location. Simply put, this sounds like a huge waste of time and effort for these organizations. Not only would this be a drain on their human and financial resources, but it would take away from the ultimate goal of charitable and non-profit organizations, helping people.
In recent years, many charitable organizations have been criticized for not using their resources in the most efficient means possible. Understandably, Canadians are frustrated when they hear stories about the donations they make to their favourite charities being used more on administration costs than on the research, aid or cause to which they donated their money. My concern here is that this legislation would not only heighten this frustration but would force charitable and non-profit organizations to divert their precious resources away from the good work they do to overcoming this obstacle. The evidence shows that this would be a significant new obstacle for these organizations.
According to Statistics Canada, Canadians volunteered nearly 2.1 billion hours in 2010. I am no expert, but I am willing to bet that it would take anyone a lot of time to record 2.1 billion hours of volunteerism. I do not understand why we would want to impose such an unnecessary burden on these organizations. What would that achieve?
What does this bill offer to those wanting to volunteer or for those seeking to attract volunteers? The answer, it seems to me, is not much. While at first glance Bill C-399 might seem like a good tool to encourage Canadians to volunteer some of their time to a cause they hold dear, this bill falls short of the mark. In my view, it would do nothing more than place an unnecessary administrative burden on charitable organizations and non-profit groups, all while having no effect on increasing the rate of volunteerism among Canadians. Evidence indicates it would likely cause a decrease in the number of volunteers.
While I feel this bill was introduced with the best of intentions, I am not convinced it would benefit Canadians. I urge my colleagues to think carefully before casting their vote in support of Bill C-399.
Mr. Speaker, it is a pleasure to rise today to speak to Bill C-399, tax credits for volunteers' travel expenses.
I would like to begin by thanking the hon. member for Repentigny for introducing the legislation. I appreciate having the opportunity to discuss ways that we, as a Parliament, can better support volunteers and encourage volunteerism.
I will start by talking about some of what has occurred in recent years, particularly around tax measures to help volunteer emergency service workers or firefighters. There has been a consensus across party lines on some of the measures that we should recognize the important work of, for instance, emergency service volunteers, those who risk their lives in order to protect and make communities safer.
As part of that discussion, the Liberal Party proposed a $3,000 refundable tax credit for volunteer firefighters. We made it refundable deliberately. The reality is that if these tax credits are not refundable, it means, perversely, that the lowest-income Canadians, Canadians who need the support the most, do not actually qualify and do not receive the benefit.
Earlier today we had a discussion on income inequality and the growing gap between rich and poor in Canada. The reality is that, to a certain extent, non-refundable tax credits can exacerbate that and make it worse by disqualifying, technically, the lowest-income Canadians who need the help the most.
For instance, we proposed a refundable family caregiver tax credit, which would have benefited all Canadian families providing care to relatives with health issues, in some cases palliative care and in other cases long-term medical issues. The Conservatives introduced, instead, a non-refundable tax credit, which looks like they are doing the same thing, but in reality it is not a lot of resources because it does not apply to a large segment of the population, the people who need the help the most.
What the government has become very effective at doing is establishing boutique tax credits that are non-refundable. They do not take a lot of money out of the federal treasury because they do not actually help a lot of people, but it looks like they are taking action.
People come to my office who are quite disappointed. They expected these new tax credits would somehow benefit them, only to find out that because of the fact they had low incomes, they did not qualify.
Let us take, for instance, a senior citizen on a modest fixed income who drives for Meals on Wheels. If the tax credit being proposed today as part of this legislation is non-refundable, that senior will not benefit because he or she is not paying taxes now. Just to make it clear, a refundable tax credit also benefits people whose incomes are so low that they are not paying taxes. A low-income senior who drives, for instance, for Meals on Wheels is still incurring expenses to volunteer. In fact, those expenses represent a very significant portion of his or her income. He or she still has to put gas in the car to get to the volunteer site or pay for public transit.
That brings me to the design of the tax credit under Bill C-399.
Bill C-399 would establish a tax credit to help volunteers defray some of the travel expenses they have because of their volunteer work. Unfortunately, the tax credit potentially established under Bill C-399 is non-refundable. We hope this could be addressed and corrected as part of the legislative process. Perhaps if this were to get to committee, it could be part of the discussion.
We support sending Bill C-399 to committee so we can discuss, among other things, design issues, including making the tax credit fully refundable.
We have a concern about the growing number of non-refundable tax credits. We believe it is in some ways exacerbating the issue of income inequality in Canada. These tax credits fail to meet the fairness test. It just seems wrong for the government to protect its own bottom line by deliberately excluding the most disadvantaged Canadians.
Beyond the non-refundable nature of the tax credit, Bill C-399 sets out some interesting parameters. To qualify for the tax credit, one must do a minimum of 130 hours of eligible volunteer work and so one must make at least 12 trips that tax year. For the purposes of Bill C-399, this would involve travelling a minimum of one kilometre from home to wherever it is one does their voluntary work.
In terms of the monetary value of the tax credit, Bill C-399 establishes a minimum value of $500 and a maximum value of $1,500. With a 15% federal personal income tax rate, the proposed tax credit would translate into a benefit of between $75 and $300 for the volunteers who qualify.
Finance Canada has estimated that Bill C-399, as it is currently written, would cost about $130 million per year. However, officials were basing their estimate on past data and assuming that there would be no change in behaviour as a result of the new tax credit. They assume that this tax credit would not encourage new volunteerism or enable existing volunteers to travel more extensively.
Officials used data from the 2010 Canada Survey of Giving, Volunteering and Participating, which shows that 1.2 million Canadians would meet the criteria of performing at least 130 hours of qualified volunteer work. They assumed that the average volunteer who had about $430 of travel expenses would be eligible for a tax credit under Bill C-399. They also assumed that the average volunteer would claim a further $500 in weekly travel expenses based on an average claim of 15 kilometres a week at 55¢ per kilometre.
The officials then estimated that one-quarter of the 1.2 million volunteers would not get any benefit from the proposed tax credit because it would be non-refundable and these volunteers would not make enough income to qualify. However, using the Department of Finance's own numbers, we extrapolated that it would cost about $40 million to make this non-refundable tax credit into a fully refundable tax credit, which would benefit all low-income Canadians who would be currently excluded.
I encourage the member for Repentigny to consider such a revision to Bill C-399. The initiative is worthy of the consideration of the House. I hope the proposed legislation will receive second reading so we can more closely examine the proposal and consider making it fully refundable.
It is important for us, as parliamentarians, to recognize the vital contributions that volunteers make to Canadian society. We should not base that recognition on how much money is in their wallet. There are a lot of low-income Canadians who, if we were to move forward with this kind of measure, would deserve the same benefit. However, because they are low-income, they would not benefit by the bill in its current form as a non-refundable tax credit.
Those are some of my thoughts and I hope government members see their way to support taking the bill to committee so we can have a more fulsome discussion on how we can strengthen our support mechanisms in the tax system and other direct support for volunteerism in Canada.
The electoral district of Repentigny (Quebec) has a population of 109,636 with 90,070 registered voters and 231 polling divisions.
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