March 26, 1952

CCF

Mr. Noseworthy:

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

1. What categories of individuals are allowed to purchase liquor free of import and excise duties?

2. What classes of institutions, if any, are allowed to purchase liquor free of import and excise duties?

3. In the last year for which figures are available how much liquor was so freed of excise and import duties?

Topic:   PURCHASE OF LIQUOR DUTY FREE
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MOTION FOR PAPERS

GREAT LAKES WATER LEVELS

PC

Frank Exton Lennard

Progressive Conservative

Mr. Lennard:

For a copy of all correspondence, telegrams and other documents exchanged between any department of the federal government of Canada and any provincial government in Canada; any state government in the United States or the federal government of the United States, since January 1, 1950, relative to rising water levels on the great lakes.

Topic:   MOTION FOR PAPERS
Subtopic:   GREAT LAKES WATER LEVELS
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LIB

Louis Stephen St-Laurent (Prime Minister; President of the Privy Council)

Liberal

Mr. St. Laurent:

Subject to the usual reservation with respect to the consent of other governments concerned.

Topic:   MOTION FOR PAPERS
Subtopic:   GREAT LAKES WATER LEVELS
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Motion agreed to.


INCOME TAX ACT

PROPOSED AMENDMENT WITH RESPECT TO MEDICAL EXPENSES

CCF

Stanley Howard Knowles (Whip of the Co-operative Commonwealth Federation)

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

Mr. Stanley Knowles (Winnipeg North Centre) moved:

That, in the opinion of this house, the government should give consideration to the advisability of introducing legislation amending the Income Tax Act so as to permit taxpayers to deduct from their incomes, before computing the amount of income tax to be paid, the aggregate of their medical expenses, as defined in the said act, rather than only the portion in excess of 4 per cent of the taxpayer's income, as is provided by the act as it now stands.

He said: Mr. Speaker, in rising to present this resolution to the house, may I point out that the principle which underlies it is already incorporated, at least in part, in the Income Tax Act. What this resolution asks for is that the implementation of that principle be extended, and in particular that medical expenses be put on a basis comparable to that which applies to charitable donations so far as income tax deductions are concerned.

I said that the principle underlying this resolution has already been recognized by the government. In saying that I have in mind the fact that since 1942 there has been a provision in the former Income War Tax Act and in the current Income Tax Act to the effect that under certain conditions taxpayers may deduct medical expenses from their net income before computing the amount of income tax to be paid.

Income Tax Act

I have already indicated that that right is circumscribed by certain conditions. In the main, these conditions are three. In the first place, the Income Tax Act defines what are medical expenses for the purposes of this deduction. The act, and the forms that are furnished to taxpayers, make it clear that one cannot deduct everything that he may regard as a medical expense, but rather only the specific kinds of medical expenses that are spelled out in the act.

I should point out that the definition of medical expenses has been amended from time to time since 1942. Each of those amendments has broadened the definition, but it is still true that there is a limitation; there are many expenses, medical in character, which people are called upon to pay but which are not included in the definition set out in the act.

The second limitation imposed on the right to deduct medical expenses for income tax purposes is the condition to which my resolution relates. It provides that a taxpayer may deduct from his net income, before he computes the income tax to be paid, not the aggregate of his medical expenses but only that portion of his medical expenses which is in excess of four per cent of his net income. I should point out that when this right was first written into the Income War Tax Act in 1942 the floor was five per cent rather than four per cent. It was in 1944 that the change was made to the present four per cent level, and later on in my remarks I shall have something to say about the circumstances under which that change was made.

The third condition that attaches to this right is that there is an upper ceiling, a limit on the amount that one can claim. For example, if a person has $2,000 or $3,000 of medical expenses in the course of a year he cannot enter all of that portion above four per cent of his net income, but only the portion above four per cent of his net income which is below a certain ceiling. The ceiling is $750 a year in the case of a single person and $1,000 in the case of a married person, with certain additions for dependents.

I have pointed out that there are these three conditions that limit the right to deduct medical expenses for income tax purposes. In my view each of the three should be reviewed. In my view the definition of medical expenses should be broadened. Likewise, in my view, the ceiling on the amount you can charge should be reviewed, and perhaps raised. It is my experience in this house, however, that if you ask for too many things in one resolution you do not get any

of them; so I am concentrating in this resolution on the limitation, or the condition, attached to this right, which I think is the most serious one, and I am satisfied that the taxpayers generally in this country agree with me.

I have raised this question in the house on a number of occasions in times gone by, although this is the first time I have brought it before the house in the form of a formal resolution. As I say, this matter hasi been brought before the house on other occasions, and when one does that he soon gets public reaction. I can say from letters I have had, from editorial comments I have read in various publications, that there is wide support for my contention that the four per cent floor should be wiped out and that the taxpayer should be permitted to deduct from his net income, before computing his tax, the aggregate amount of his medical expenses as defined in the act. So as not to obscure the issue, so as not to give any member from the government side who may choose to reply to this the opportunity to confuse the issue, I have accepted for purposes of my resolution medical expenses as defined in the act. In other words, the issue before us today is clear-cut and simple; it is just the one point, namely, that that four per cent floor should be wiped out, and that the taxpayer, in computing his income tax, should be permitted to add up all his medical expenses as defined in the act and deduct that total sum from his net income before he computes the income tax to be paid. I am not asking, in this resolution, for any other change.

May I point out, Mr. Speaker, as I implied in something I said a few moments ago, that in asking this I am only asking in effect that the same treatment be accorded medical expenses as is accorded charitable donations. I quite approve the right that is accorded taxpayers with respect to charitable donations. May I point out that when one enters on his income tax form his charitable donations, although there is a ceiling of ten per cent of one's income-in other words, you cannot give away more than ten per cent of your total income and get credit for that higher amount-still you are permitted to charge the aggregate right from the first dollar that you give to an approved charity. Thus a person, we will say, who has $2,000 a year income and has made contributions of $200 during the course of the year can charge the whole of that $200; but a person with a $2,000 income who has $200 of medical expenses can charge only the amount of his expenses which is in excess of four per cent

of his net income. The net income being $2,000, four per cent is $80; thus he can charge as a deduction only $120.

Now, that is just one example pulled out of the air. I want to go on and give at this point in my remarks three concrete examples, comparing what happens in the case of medical expenses with what happens in the case of charitable donations. Two of these examples are the identical examples that I gave on a former occasion; the other is slightly different from what I gave before. I have still others which I can give later on if there is time.

First of all, I ask the house to consider the case of a married couple without children whose income is $2,400 a year. The income tax to be paid by that couple under the rates as they obtain at the present time, the rates set out in the Income Tax Act, plus the twenty per cent defence surtax, is $70.80. Now, if that couple in the course of the taxation year have had to pay medical bills of $200, when they come to compute their income tax they will find that by deducting only the portion above four per cent of their net income they will end up by paying an income tax of $52.80. That represents a saving of $18; in other words, they get tax relief of $18 in respect of $200 of medical expenses in the year. But suppose that same couple, instead of having $200 medical expenses during the year, give away $200 in charitable donations, that same couple will find when they compute their income tax that they have to pay only $34.80, which, against the original tax of $70.80, represents' a saving of $36. Now, $36 is twice $18; in other words, a couple which of their own free will give away $200 get tax relief for that to the extent of $36. A couple faced with uncontrollable medical expenses of $200 in the year get tax relief of only $18. I submit that that is not fair, and that we are perfectly justified in asking for the same consideration for medical expenses as now obtains with respect to charitable donations.

Let me take another example, the case of a married couple with two children. Let us assume their income is $3,600 a year. The income tax for them at the present rate, without deductions, would be $240. Let us assume that this year they have medical bills of $300. So long as the four per cent floor is there, they will be required to pay $210 income tax, which means that they will get a saving of only $30 against medical bills of $300. If that same couple, instead of being faced with uncontrollable medical expenses of $300, were to give away $300 to approved charities, their tax would be $178.80, or a saving of $61.20.

Income Tax Act

There you have it again-a tax relief of only $30 to one couple for medical expenses of $300, and a tax relief of $61.20 to that couple or to any other couple if their donations are of the same amount.

I turn now to an example in a little higher bracket. Let us look at the case of a married couple with an income of $5,000, and with two children. Their income tax at the present rate, without deductions, would be $542.40. If they have $500 worth of medical bills during the year, their tax will be reduced to $474, or a saving of $68.40. But if that same couple give away $500 during the course of the year, their taxes would be reduced to $428.40, or a saving of $114,

I put the two side by side again: This

couple will get only $68.40 relief in respect of medical bills amounting to $500, but they would get $114 tax relief in respect of charitable contributions of the same amount. My case is so clear one wonders that it requires any argument at all. Surely people faced with these uncontrollable medical expenses should get at least the same tax relief as is afforded to those who make contributions to approved charities.

May I point out, in support of this argument, that one of the reasons we need to extend this privilege by wiping out the floor lies in the difficulty that would be faced if one tried to avoid any definition of medical expenses. I have argued already that I think the present definition is too narrow. It does not include many of the drugs some people have to purchase. But, no matter what definition is arrived at, there would have to be some definition, and it would not include all of the things people come up against at a time of illness.

For example, extra help is often required. Food bills go up if one of the members of the family is ill. There are taxi fares back and forth to hospitals, sitters to look after children-and all the rest of it. There are plenty of expenses that come into the picture that increase costs when there is illness in the family. I submit that one way of trying to cope with that situation is to wipe out the four per cent floor and to allow the aggregate of such expenses as are defined in the act.

Another point I should like to make is that there are people who have heavy medical bills but cannot afford to pay off the total amount during the course of one taxation year, or during the course of one period of twelve months. It is a fact that, under the act as it now reads, a person can charge his medical bills for any twelve-month period ending in the taxation year. But there are people who are faced with bills they simply cannot pay off in one year; and when that

Income Tax Act

happens we find that those people lose even the small amount of tax relief indicated in the examples I have given.

For example, if a couple with an income of $2,400 and with medical bills of $200 require two years to pay off those bills-$100 in each year-then, instead of getting but $18 by way of tax relief, as would happen if they paid it all in one year, paying it in two years they receive no tax relief at all.

Similarly, the couple receiving $3,600, with two children, and with medical bills of $300 in the course of the year, by paying $150 in each of two years receive no tax relief at all. The $5,000 couple with two children, and with $500 medical expenses, and paying $250 in each of two years, would receive some slight relief, amounting to only $10.80 in each of those two years. In other words they would receive relief to the extent of only $21.60 against medical bills of $500.

I could go on to place on the record many more examples; but the point I am trying to make is that, in addition to the unfairness created by the four per cent floor, other aspects of the problem aggravate the situation. I recognize the fact that a perfect solution of the problem cannot be devised, but I do suggest that the government could go a long way if it were to accept the proposal I make, namely that the four per cent floor should be wiped out.

I see that the parliamentary assistant to the Minister of Finance (Mr. Sinclair) is working hard with his pencil over there. If he, or anyone else on that side of the house, is trying to think up some answers to my case, perhaps I had better ask if there are any objections to the suggestion which I have made.

The first objection someone might raise- that is, if he is just fishing around and trying to find something wrong with it because it comes from the opposition side of the house- would be the contention that if the floor were wiped out we would be giving greater tax relief to those in the upper brackets than to those with smaller incomes. To an extent that is true. It so happens, however, that illness is no respecter of persons or of wealth, and there is no reason why we should not be concerned about the costs of medical care for all our people, including some of those in what is sometimes described as the middle bracket-and even those in the upper middle bracket.

But the fact of the matter is that when you work out actual examples, the average relief in percentage terms which is afforded' by wiping out the four per cent floor decreases as you go up the income scale. The greatest relief to be given by wiping out this

four per cent floor is to those in the lower brackets. That is why my motion concentrates on that point.

But, just to trot this problem right out into the open, and to deal with it, may I take the case of the couple earning $3,600 and having no children, but having $200 medical expenses during the course of the year-which is the same medical bill I mentioned in respect of the first example I gave. My first example concerned the couple earning $2,400 and having medical expenses of $200. If my proposal were accepted, the couple having $2,400 and with medical bills of $200 would get a tax relief of $36, while the couple with $3,600, having the same medical bill, would get slightly more tax relief, or the sum of $40.80. The increase in relief is very slight. But may I point out as well that the couple in the higher bracket would still be paying $260.40 in income tax along with this $200 medical bill, whereas the couple in the $2,400 bracket would be paying only $34.80 along with their $200 medical bill. Thus the slightly greater relief given to those in the upper bracket comes out of the higher amount of income tax that they are paying. I do not see that that is any argument against the case at all. It simply proves that my case is completely fair, although the most effective help would be that afforded to those in the lower brackets.

Similarly I have worked out the case of a married couple with two children whose income is $10,000 a year, and have assumed the same $500 medical expenses as applied in the case of my example where the income was $5,000 a year. In the case of the couple with $5,000 a year and two children, with medical expenses of $500, if my proposal were accepted their tax relief would be $114 a year. In the case of the -couple with $10,000, with precisely the same medical expenses, if my proposal were accepted the tax relief to them would be $155 a year. That is not very much more, when you consider that the couple in the higher bracket would still be paying an income tax of $1,431.40 as compared with an income tax of $428.40 paid by the couple receiving $5,000.

In other words, the only argument that comes to my mind that anyone on the other side of the house might trot out against my claim is exploded when we consider these few examples and work them out as I have done.

However, it is also to be recalled that years ago, when this matter was under discussion it was said by the present Minister of Finance (Mr. Abbott)-and this was back in 1044 when he was parliamentary assistant to Mr. Ilsley- that we should not go too far with this matter, that we should not press it too far

because, after all, it was intended to be just a measure of relief in a time of high taxation. I-t was not intended to be a form of national health insurance. I would point out that we are again in a period of high taxation and it is time to consider granting relief of this kind to those who are faced with medical bills. With regard to the other phase of what the Minister of Finance said back in 1944, may I point out that if we are going to have to wait and wait for national health insurance, in the meantime some tax relief of this kind should be afforded.

Having mentioned the question of health insurance in relation to this whole question, may I take just a moment to say that I am glad to note the suggestion regarding health insurance which was made in a memorandum presented to the government today by the Trades and Labour Congress of Canada. Pages 17 and 18 of that memorandum contain this interesting section:

Health Insurance

The greatest blow we could deal inflation would be to improve the health of the nation. Production is a pressing and urgent need. Illness, on the other hand, frustrates production, and poor health is the cause of more lost time than any other factor. As a defence measure and as a means of directly strengthening and protecting our democratic way of life, we believe that the early inauguration of a nation-wide health insurance scheme should be considered.

Topic:   INCOME TAX ACT
Subtopic:   PROPOSED AMENDMENT WITH RESPECT TO MEDICAL EXPENSES
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LIB

Elie Beauregard (Speaker of the Senate)

Liberal

Mr. Speaker:

I wonder if that question should be discussed on this resolution.

Topic:   INCOME TAX ACT
Subtopic:   PROPOSED AMENDMENT WITH RESPECT TO MEDICAL EXPENSES
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CCF

Stanley Howard Knowles (Whip of the Co-operative Commonwealth Federation)

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

Mr. Knowles:

If you rule that it should not be discussed, Mr. Speaker, I am prepared not to read the rest of the quotation. The reason I was reading it was-

Topic:   INCOME TAX ACT
Subtopic:   PROPOSED AMENDMENT WITH RESPECT TO MEDICAL EXPENSES
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LIB

Elie Beauregard (Speaker of the Senate)

Liberal

Mr. Speaker:

I stopped the hon. gentleman because I did not think the house should discuss that question on 'this resolution. I agree with the hon. member when he says it is very important, but we now have another matter before the house.

Topic:   INCOME TAX ACT
Subtopic:   PROPOSED AMENDMENT WITH RESPECT TO MEDICAL EXPENSES
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CCF

Stanley Howard Knowles (Whip of the Co-operative Commonwealth Federation)

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

Mr. Knowles:

I will accept your ruling sir, and will not discuss that matter further. Might I just point out that I thought it was in order because I was seeking to answer the argument which was made against my resolution in August, 1944, by the present Minister of Finance. He said at that time that this was not to be considered as a health insurance matter. It was on that basis that I made reference to it. But I have made the reference, and I am prepared to let it go at that.

My reference back to 1944 prompts me to tell the house something of what happened on that occasion, and I do so to indicate the confidence I have that one of these days the gist of this resolution will be accepted

Income Tax Act

and incorporated into the Income Tax Act. In other words, I am bold enough to hope *that in speaking in support of this resolution and presenting it to the house, whatever may happen to it today, one of these days it will be adopted, as other measures I have fought for in this house have been adopted.

My reason for that confidence in respect of this matter, as I say, is what happened back in 1944. I pointed out earlier that the provision for medical expenses to be allowed as deductions for income tax purposes was established first in 1942. In that year the floor was five per cent of the net income and the ceiling was $400 single and $600 married. It was not long before members of the house began impressing upon the government the need of lowering the floor of five per cent and raising the ceiling. Indeed, in 1943 representations were made to the government that that be done.

In 1944, when Mr. Ilsley brought down his budget, it included two resolutions referring to the question of medical expenses in relation to income tax. I have in my hand a copy of the budget resolutions of June 26, 1944, and the two resolutions that related to this question of medical expenses were No. 4 and No. 5. I shall not take the time of the house to read them, but I would point out that those resolutions had nothing at all to say about the five per cent floor or the ceiling on the amount that could be deducted.

When those resolutions were debated in the committee of ways and means the question that I am now discussing was debated on the basis of budget resolutions No. 4 and No. 5. That debate took place on July 13, 1944, and can be found in Hansard from pages 4807 to 4816. It was a most interesting debate, in which quite a number of hon. members of the house took part. As a matter of fact it was initiated by the then member for Saskatoon, Mr. Bence. Several members of the Progressive Conservative party took part, as well as the hon. member for Cape Breton South (Mr. Gillis) and other members of this party, including myself.

Several Liberal members also took part in the debate. For instance, the hon. member for Ottawa West (Mr. Mcllraith) got into the debate, as reported on page 4808 of Hansard, and made the point that the cost of artificial limbs should be allowed as a deduction for purposes of income tax. He pressed his point strongly and was supported by other members.

Another hon. member who took part at that time was the then private member for Renfrew South, who is today the Minister of National Revenue (Mr. McCann). When the

Income Tax Act

minister was the private member for Renfrew South the chances are that he had the taxpayer's viewpoint a little more clearly than he has at the present time. At any rate, he made a claim upon the then parliamentary assistant to the minister of finance, who is now the Minister of Finance (Mr. Abbott), that funeral expenses should be allowed as a deduction. In that interesting debate he did not agree with everything the government was proposing, but, as I say, perhaps he was closer to the taxpayer's viewpoint than he is at the present time. He pleaded with the government to allow funeral expenses as a deduction.

As I say, that debate which took place on July 13, 1944, was quite interesting. It covers about ten pages of Hansard and was participated in by members of all parties in the house. They accepted the slight changes that the government was proposing in the budget resolutions but they called on the government to go further in connection with this matter.

During that debate I made the specific proposal that the five per cent floor which then obtained in the act should be reduced to three per cent, or preferably to two per cent. The then parliamentary assistant, now the Minister of Finance, debated the matter back and forth. He raised the question which Your Honour stopped me from discussing a moment ago as to its relation to health insurance and so on. I repeat, the discussion was quite interesting because the private members were pressing a point from the viewpoint of the taxpayer. They were urging the spokesman for the government to give consideration to the matter.

What happened? I have the evidence here. The budget resolutions in the form in which they had been brought in contained no reference to any change in the five per cent floor. However, as a result of the discussion which took place in- committee of ways and means- this is a classic example of the fact that debate in the House of Commons is worth while- when Mr. Ilsley brought down his Bill No. 180, to amend the Income War Tax Act, that bill included changes along the lines suggested, although he did not go all the way we had asked him to go in the committee of ways and means. Nevertheless, these changes were in the bill, even though they had not been in the budget resolutions which preceded the bill.

Section 4, subsection 4 of that bill provided for a lowering of the floor from five per cent to four per cent and a raising of the ceiling on the amount that could be deducted. I well remember the occasion and how the house was gratified that Mr. Ilsley had acceded to

the suggestions made on the floor of the house, at least to the extent that he had gone. He did not go as far as we asked, but at least he recognized in principle that our claim was just and that the floor should be lowered and the ceiling raised.

As a result of that action by the government they were complimented from this side of the house. In fact, I did not hesitate to pay them a compliment myself. I find that on August 7, 1944, as recorded on page 6409 of Hansard, the then parliamentary assistant to the Minister of Finance moved the second reading of Bill No. 180, to amend the Income War Tax Act. I was given the floor immediately and I commended the government for the various changes that had been made in the bill consequent upon the disoussion in committee of ways and means. I complimented the government for its proposal to drop the floor from five per cent down to four per cent.

That was on Monday, August 7, 1944. At the close of that afternoon we reached section 4, subsection 4 of the amending bill, and I should like to quote this interesting paragraph of a statement by -the present Minister of Finance, as reported on page 6072 of Hansard:

Topic:   INCOME TAX ACT
Subtopic:   PROPOSED AMENDMENT WITH RESPECT TO MEDICAL EXPENSES
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LIB

Douglas Charles Abbott (Minister of Finance and Receiver General)

Liberal

Mr. Abbott:

The hon. member for Winnipeg

North Centre has already spoken about this. This is a clause where, in spite of charges to the contrary, the government has not only listened to representations which have been made by all sides of the house but acceded to them in some respects. If the committee will bear with me for a moment- it is one minute to six o'clock-I should like to conclude this section. The government has done this in three ways.

The then parliamentary assistant to the Minister of Finance went on to point out that the bill lowered the floor from five per cent to four per cent, increased the upper limits from $400 to $600 and from $600 to $900, and broadened the provisions with respect to medical expenses to include artificial limbs and certain other items of that kind. The result of that was, of course, that the subsection was agreed to immediately. The house was extremely pleased that the debate had been worth while, and that the government had accepted our suggestions, at least in part.

It is in that spirit, Mr. Speaker, that I present this motion to the house today. I am conscious of the fact that this year's budget will be brought down in less than two weeks, on Tuesday, April 8. But there is still time for the government to give consideration to this point. I do not think there is any argument against it. I believe the people of Canada wholeheartedly support this proposal, and I think they deserve it. I present it in

the name of fairness, and out of consideration to the burdens that medical expenses place upon our people. I hope that steps will be taken immediately to wipe out this four per cent floor and permit taxpayers, when they compute their income taxes, to deduct not just their medical expenses above four per cent of their net income but the whole of their medical expenses as defined in the act.

Topic:   INCOME TAX ACT
Subtopic:   PROPOSED AMENDMENT WITH RESPECT TO MEDICAL EXPENSES
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LIB

James Sinclair (Parliamentary Assistant to the Minister of Finance)

Liberal

Mr. James Sinclair (Parliamentary Assistant to the Minister of Finance):

Mr. Speaker-

Mrs. Fairclough (rising) -

Topic:   INCOME TAX ACT
Subtopic:   PROPOSED AMENDMENT WITH RESPECT TO MEDICAL EXPENSES
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PC

Gordon Graydon

Progressive Conservative

Mr. Graydon:

Ladies first.

Topic:   INCOME TAX ACT
Subtopic:   PROPOSED AMENDMENT WITH RESPECT TO MEDICAL EXPENSES
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LIB

James Sinclair (Parliamentary Assistant to the Minister of Finance)

Liberal

Mr. Sinclair:

Despite the observation of the hon. member for Peel (Mr. Graydon) concerning ladies first, I think a government speaker should follow an opposition speaker; and I would have thought that the member for Hamilton West (Mrs. Fairclough) would regard herself as the peer of any member in this house and take her turn. I am rather anxious to speak now because I think I shall be able to save the hon. member for Hamilton West, and other members perhaps, a waste of time by prolonging a debate for which there is no necessity at this time.

Topic:   INCOME TAX ACT
Subtopic:   PROPOSED AMENDMENT WITH RESPECT TO MEDICAL EXPENSES
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PC

Julian Harcourt Ferguson

Progressive Conservative

Mr. Ferguson:

That is what you think every time you speak.

Topic:   INCOME TAX ACT
Subtopic:   PROPOSED AMENDMENT WITH RESPECT TO MEDICAL EXPENSES
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LIB

James Sinclair (Parliamentary Assistant to the Minister of Finance)

Liberal

Mr. Sinclair:

I am delighted that the member for Simcoe North (Mr. Ferguson) is back in the house. I hope he will listen carefully, and give us all the benefit of the very apt interruptions on which he prides himself.

This resolution asks the Minister of Finance to give consideration to a certain proposal. At this time of year the minister is asked to give consideration to many proposals, and that is the proper democratic way for the people of this country, either as individuals or as groups, or acting through their members of parliament, to call the attention of the minister to changes which they believe to be desirable in our taxation system. These requests to the minister may take the form of letters, the most common way; of interviews, and many of the members of this house have participated in interviews concerning some problem in their riding; or of actual resolutions in this house such as the present one.

Now, of course, as the date of the budget draws near, is the time of year when we receive the most requests, but I think there is no time of the year when the Minister of Finance is not giving consideration to briefs, letters or interviews asking for tax changes. I believe the degree of consideration depends

Income Tax Act

upon several things. The first is the feasibility and practicability of the actual proposal made. Second, and a thing which must never be forgotten, is the effect upon revenues. After all, the purpose of taxes in this country is to raise revenues for those national projects and services which the people, and certain members of parliament, are not at all backward about putting forward.

Last night, for example, we heard a Pacific pact suggested for the second time by an opposition member. The Atlantic pact is costing us about $2 billion a year, so I imagine a Pacific pact would cost about the same amount. No mention was made, of course, of the fact that taxes would have to be greatly raised to meet that enormous extra expense.

Topic:   INCOME TAX ACT
Subtopic:   PROPOSED AMENDMENT WITH RESPECT TO MEDICAL EXPENSES
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PC

Gordon Graydon

Progressive Conservative

Mr. Graydon:

Is it just that that is holding you back?

Topic:   INCOME TAX ACT
Subtopic:   PROPOSED AMENDMENT WITH RESPECT TO MEDICAL EXPENSES
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March 26, 1952