FINA Committee Meeting

The Standing Committee on Finance met in a televised session at 11:43 a.m. this day, in Room 253-D Centre Block, the chair, Massimo Pacetti, presiding.

The Hon. John MacKay, Len Farber and Serge Nadeau answered questions.

The Committee commenced its clause-by-clause study of the Bill.

By unanimous consent, Clauses 2 to 4 inclusive carried.

On Clause 5,

“(b) for the 2007 taxation year, to be replaced by the amount that is the total of

(i) an amount that results in a reduction in personal income tax for all taxpayers, based on tax returns filed for the 2006 taxation year, that is equal to the difference between the amount that would, but for the amount that yields the reduction, be the annual surplus as provided in the Public Accounts for the fiscal year 2005-2006 prepared in accordance with sections 63 and 64 of the Financial Administration Act and $3 billion,

(ii) $100, and

(iii) the amount that would be determined for that description for that year in respect of the particular amount by applying subsection 117.1(1) to the amount determined under paragraph (a);

(c) for the 2008 taxation year, to be replaced by the amount that is the total of

(i) an amount that results in a reduction in personal income tax for all taxpayers, based on tax returns filed for the 2007 taxation year, that is equal to the difference between the amount that would, but for the amount that yields the reduction, be the annual surplus as provided in the Public Accounts for the fiscal year 2006-2007 prepared in accordance with sections 63 and 64 of the Financial Administration Act and $3 billion,

(ii) $400, and

(iii) the amount that would be determined for that description for that year in respect of the particular amount by applying subsection 117.1(1) to the amount determined under paragraph (b);”

After debate, the question was put on the amendment of Monte Solberg and it was negatived, by a show of hands: YEAS: 4; NAYS: 7.

Clause 5 was negatived.

By unanimous consent, Clauses 6 to 8 inclusive carried on division.

On Clause 9,

“for a taxation year is

(a) if the taxable capital employed in Canada of the corporation for the taxation year is equal to or less than $50,000,000 , that proportion of 4% that the number of days in the taxation year that are before 2008 is of the number of days in the taxation year; and

(b) if paragraph (a) does not apply, the percentage determined by the formula

A + B[(C - $50,000,000)/$25,000,000]

where

A is that proportion of 4% that the number of days in the taxation year that are before 2008 is of the number of days in the taxation year,

B is that proportion of 4% that the number of days in the taxation year that are after 2007 is of the number of days in the taxation year; and

C is the lesser of $75,000,000 and the taxable capital employed in Canada of the corporation for the taxation year.

(3) For the purpose of subsection (2), the taxable capital employed in Canada of a corporation for a particular taxation year is

(a) if the corporation is associated with one or more other corporations in the particular taxation year, the total of all amounts each of which is the taxable capital employed in Canada (within the meaning assigned by subsection 181.2(1) or 181.3(1) or section 181.4, as the case may be) of the corporation, or of such an associated corporation, for its last taxation year that ended in the calendar year preceding the calendar year in which the particular taxation year ends; and

(b) if the corporation is not associated with one or more other corporations in the particular taxation year, the taxable capital employed in Canada (within the meaning assigned by subsection 181.2(1) or 181.3(1) or section 181.4, as the case may be) of the corporation for the particular taxation year.”

After debate, the question was put on the amendment of John McKay and it was negatived, by a show of hands: YEAS: 5; NAYS: 6.

Clause 9 carried by a show of hands: YEAS: 6; NAYS: 5.

At 1:12 p.m., the Committee adjourned to the call of the Chair.