May 30, 1947

CCF

Clarence Gillis

Co-operative Commonwealth Federation (C.C.F.)

Mr. GILLIS:

I sent it to the minister's

office this morning about ten o'clock.

Topic:   PUBLIC WORKS
Subtopic:   INQUIRY AS TO BREAKWATER PROJECT AT MORIEN, N.S.
Permalink

TELEPHONE SERVICES

REVENUES COLLECTED-REFERENCE TO ANSWER TO QUESTION ON MAY 28


On the orders of the day:


LIB

James Joseph McCann (Minister of National Revenue; Minister of National War Services)

Liberal

Hon. J. J. McCANN (Minister of National Revenue):

Topic:   TELEPHONE SERVICES
Subtopic:   REVENUES COLLECTED-REFERENCE TO ANSWER TO QUESTION ON MAY 28
Permalink

PRICE CEILINGS

INQUIRY AS TO REIMPOSITION ON NEW AND USED CARS


On the orders of the day:


CCF

Hazen Robert Argue

Co-operative Commonwealth Federation (C.C.F.)

Mr. H. R. ARGUE (Wood Mountain):

I should like to direct a question to the Minister of Finance, notice of which I sent to him. In view of reports of widespread profiteering in new and slightly used cars, will the minister consider the reimposition of price ceilings in this field?

Topic:   PRICE CEILINGS
Subtopic:   INQUIRY AS TO REIMPOSITION ON NEW AND USED CARS
Permalink
LIB

Douglas Charles Abbott (Minister of Finance and Receiver General)

Liberal

Hon. DOUGLAS ABBOTT (Minister of Finance):

As my hon. friend has said, he was good enough to give me notice of this question. I am informed that new cars are being sold by dealers at the list prices. Officials of the wartime prices and trade board have seen reports in the press of some profiteering in used cars, but it appears to be spotty. I am informed that it is not felt that the situation is such as to justify the reimposition of price ceilings.

Topic:   PRICE CEILINGS
Subtopic:   INQUIRY AS TO REIMPOSITION ON NEW AND USED CARS
Permalink

WAYS AND MEANS


The house in committee of ways and means, Mr. Golding in the chair.


INCOME WAR TAX ACT


3. That for the 4947 taxation year the graduated rates of tax applicable to income of individuals be the average of the present rates and of the rates set out in paragraph one.


PC

Donald Methuen Fleming

Progressive Conservative

Mr. FLEMING:

I have a question which I should like to put to the Minister of Finance with reference to this third resolution. In putting it I am bearing in mind that the resolution is stated in general terms, and the question is one of interpretation. What

appears in the resolution is that the rates for the year will be the average of the present rates for the first half of the year and the new rates for the second half. In the case of a person dying in the first six months, is it the intention that the bill shall provide clearly that the rate applicable to the income received by such deceased person in the portion of the year during which he was alive and in receipt of income shall be calculated on the average method and that the income tax shall not be calculated on the rates in existence for the first six months of the year, during which period he may have died?

Topic:   INCOME WAR TAX ACT
Permalink
LIB

Douglas Charles Abbott (Minister of Finance and Receiver General)

Liberal

Mr. ABBOTT:

The answer is yes. As the resolution indicates, the rates in effect for 1947 will be the arithmetical average of the rates existing up to July 1 and the new rates. For example, the rate for the first half of 1947 in the low bracket is 22 per cent. The new starting rate is 10 per cent. The sum of those is 32, and the arithmetical average is 16. The tax payable in the case cited by my hon. friend will be at the appropriate rate for the full year. The bill when it is brought in will contain a special schedule setting forth the effective rate for 1947, which will be a schedule made up of the average of the two rates to which I have just referred.

Topic:   INCOME WAR TAX ACT
Permalink
PC

Donald Methuen Fleming

Progressive Conservative

Mr. FLEMING:

Then in any case where death has taken place and a T.l return has already been filed by the executor on behalf of the deceased in respect of 1947 income, steps should be taken now to revise the return?

Topic:   INCOME WAR TAX ACT
Permalink
LIB

Douglas Charles Abbott (Minister of Finance and Receiver General)

Liberal

Mr. ABBOTT:

To revise the return and obtain the appropriate refund, if one is due. That is correct.

Topic:   INCOME WAR TAX ACT
Permalink
CCF

Robert Ross (Roy) Knight

Co-operative Commonwealth Federation (C.C.F.)

Mr. KNIGHT:

I should like to say a word or two about taxation in connection with teacher's contributions to the superannuation fund, based upon a letter which arrived just in time to be discussed on this resolution. The system of pension for teachers in Saskatchewan has been based on a double or triple scheme. It is partly a service pension and partly made up of the proceeds of whatever annuity certain contributions made throughout the teacher's earning life will buy. Up to the present, under the Saskatchewan Teachers' Superannuation Act of 1942, the amount of statutory deduction has been four per cent. To that act there has been an amendment by which the teacher is now allowed to pay in, in addition to his compulsory four per cent, certain payments which I suppose might be classed as voluntary. They are voluntary in regard to paying in

Income War Tax Act

but they are not voluntary in regard to taking out, because I understand that the amendment sees to it that the funds are kept in there until the teacher ceases to teach. It is the desire of the Saskatchewan teachers' federation, as expressed in this letter from the secretary, that this matter be brought to the attention of the minister for the purpose of discovering the position in regard to these extra payments. I might read a line or two from the letter:

This year's amendment to the act-

That is the Saskatchewan Teachers' Superannuation Act of 1942.

- provides that not less than four per cent shall be deducted at the source but a teacher may elect to have a greater percentage deducted at source, and we are asking that any amount deducted be exempt from income tax.

My correspondents point out that the dominion act provides for exemptions up to an amount of $900 per annum. They also point out that if a teacher contributes to the fund and1 withdraws those contributions, that amount is taxable as income for the year in which it is withdrawn. That is to say, under the new policy, which I think was initiated m 1945, if pensions are liable to income tax then contributions should not be; otherwise you have a system of double taxation. Perhaps the minister would comment on that. In the meantime, in Hansard for 1945, at page 3427, I found something said by the previous minister of finance on this matter:

We are now changing the law in accordance with the recommendations of the royal commission to make all contributions to the pension plan deductible from income for tax purposes and to provide in general that pension payments shall be subject to tax.

That was where I got this idea of double taxation. On the previous page the former minister is reported to have said:

In the future it will not be possible to set up funds like that at all. The income of the fund will be free of tax, but the pensioner, the contributor, in every case will be entitled to deduct his contributions from his income for tax purposes and he will be taxed in full on his pension.

Perhaps the minister would comment on that so we can get some guidance for these people.

Topic:   INCOME WAR TAX ACT
Permalink
LIB

Douglas Charles Abbott (Minister of Finance and Receiver General)

Liberal

Mr. ABBOTT:

That is correct. Polio wing the Ives commission report the law was amended to provide that payments to a pension fund could be deducted from the income of the person paying, for income tax purposes, but that the income payments when received would be taxed. That of course is subject to the general qualification in the act that the

fund must be one that is approved by the Minister of National Revenue as being a pension fund eligible under the act. I am not familiar with the Saskatchewan statute or the practice to which the hon. gentleman refers, but I suggest that if there is any doubt as to the application of the statute the matter should be submitted to the deputy minister of national revenue for a ruling. I think the hon. gentleman will find that the matter can be best dealt with in that way.

Topic:   INCOME WAR TAX ACT
Permalink

May 30, 1947