Mr. Benidickson:

There is a ceiling on

the amount paid to charity.

Mr. Knowles:

The parliamentary assistant suggests that there is a ceiling in the case of charitable donations, but may I point out to him that in the case of medical expenses we have both a floor and a ceiling; but if a ceiling is sufficient in the case of charitable donations why is a ceiling not sufficient in the case of medical expenses?

Another argument that has been put in the past, and it will probably be put up today, is that if the government has money available-and it is pretty obvious that it has; as this session goes on it becomes more obvious that there is money available for one thing and another-it will be argued that that money should be put to something that provides more general benefits. Why not reduce taxes for everybody, the parliamentary assistant will say, rather than make this special concession in the case of those who have medical expenses? Well, the total amount that this would cost, on the government's own estimate, runs from $35 million to $50 million, and that would not go very far in the direction of reducing taxes for everybody, but that amount applied to individuals in relation to their medical expenses

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would, I submit, mean something to those individuals. If you asked the average Canadian whether he would be willing to forgo a few cents decrease in his normal taxes in return for which he could have the assurance that he would get special consideration for his medical expenses in years when those expenses are heavy he would choose the latter. It is for that reason I say that this is the way in which Canadians would like to have $35 million to $50 million of the government's surplus applied, namely, in making this provision of medical expenses being allowed deductibility right from the first dollar.

Another argument that has been put up in the past which may or may not be repeated today, depending upon how the Minister of National Health and Welfare is getting on with his opposite numbers in some of the provinces, is that this government is going in for a program of health insurance. Well, Mr. Speaker, we do not know when that is to come in; we hope it will come soon. We hope it will come this year, at this session, before the election. But even if it does, Mr. Speaker, the plan before the country at the present time in one dealing only with hospital costs, not with medical expenses as a whole. Indeed, a wide range of costs will still be left on the individual, precisely because the government's proposed hospitalization insurance plan does not touch the other aspects of medical expenses. I submit it is important that all medical expenses that the individual has to bear should be allowed income tax deductibility right from the first dollar. I say this to the government. If they want to prove their earnestness and their sincerity in the field of health; if they want to give the lie to those who think the government is stalling in the matter of health insurance, they can show that sincerity, they can show that concern, by taking this step this year, before the election, of removing this 3 per cent floor and making all medical expenses deductible right from the first dollar.

I have already indicated, Mr. Speaker, that this resolution has had every possible form of parliamentary treatment, including one year when it had the support of the entire House of Commons. In various sessions different members have spoken on the resolution, supporting it in full or supporting some aspect of this matter. They have included, of course, members in all three parties on the opposition side of the house and there have been half a dozen members on the Liberal side who across the years from time to time have had something to say in support of extending the principle of income tax deductibility for medical

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expenses. I hope that that wide range of support that has been shown in this house, which reflects, I feel, the views of the Canadian people, will express itself in the government's being willing to accept this resolution today and to act on it in the forthcoming budget.

I have indicated, Mr. Speaker, that there is wide popular support, which is reflected in editorials across the country; it is also reflected in an interesting resolution that was laid before the government this year by the Canadian Chamber of Commerce in its brief to the Minister of Finance and the Minister of National Revenue on fiscal policy and related matters. I wish to make it clear that the Canadian Chamber of Commerce did not ask for precisely the same thing that my resolution asks for, but it comes awfully close to it. The Canadian Chamber of Commerce asked that the 3 per cent floor be made to apply to incomes after the personal deduction, after the deduction of $1,000, $2,000 or more, as the case may be, rather than before. Well, in the case of most of the people of this country that is going practically the whole way. If you apply the 3 per cent floor only to the taxable income it would certainly be a lot better than applying it to practically the total income, as is the case today.

I was interested in the comments the Minister of Finance made on the submission made to him by the chamber of commerce. He suggested to hon. members that we might study these submissions, that they were very interesting. Well, I hope he has taken note of the extent to which the chamber of commerce thinks the government should go in respect of this matter. I submit that if the chamber of commerce wants to go that far, people generally-and this view is reflected in the submissions by organized labour-will support this resolution that the government go all the way and remove the 3 per cent floor entirely.

As hon. members know, when deductibility for medical expenses was first introduced in the early years of the war it was provided that those expenses be deductible only to the extent that they were higher than 5 per cent. After a while we got it down to 4 per cent. It stayed there for a long time, right down to 1953 just before the last election, and in that year we got it down to 3 per cent. I hope we are not going to have to go through the laborious process of hacking away at it and having it reduced one percentage point at a time. Surely this is the time and the appropriate year for the government to make this change and show the sincerity of its interest

in the health of the people by meeting the just grievance that is felt by Canadians from coast to coast.

Last year, Mr. Speaker, after the debate on this resolution had taken place and after the government had voted it down by a vote of 98 to 66, there appeared a number of editorial comments in some of the newspapers of the country and there also appeared what I thought was a rather interesting cartoon in the Toronto Telegram. The cartoonist of that newspaper portrayed the member for Winnipeg North Centre trying to break down a stone wall of government complacency about this matter of the 3 per cent floor in relation to income tax deductibility for medical expenses. The cartoonist pictured at the top of the wall two well known characters, the Prime Minister and the Minister of Finance, who were pouring down on the member for Winnipeg North Centre the boiling oil of a negative vote. I suggest to the government that the boiling oil of a negative vote of May 27 or June 17 might be something to consider at this time. I suggest to the government that this is a year in which to pay some attention to the real grievances of the Canadian people. This is a minor one in terms of dollars but in terms of what seems right and fair it is an important issue. I hope that this year the government will act in accord with the position that was taken when the resolution to consider this matter was adopted unanimously in 1952. I also hope it will consider what the Canadian people want, namely that medical expenses be allowed income tax deductibility right from the first dollar.

Mr. Hamilton (York West):

Mr. Speaker, I wonder if I might ask the hon. member a question. Would the hon. member include in the amount to be allowed as a deduction an individual's payment of premiums on insurance to protect himself against this type of thing?

Mr. Knowles:

Mr. Speaker, that is one of the items included under the general heading of definitions. I think some change might be made in that regard provided the government did not give the right to deduct premiums and take away the right that is now granted of deducting what is paid for one's medical expenses by an insurance fund. The point 1 tried to make in my remarks is that there are times in this house when you have to turn your fire on one point in order to make headway on that point. There are three limiting factors as far as the deductibility of expenditures is concerned, the ceiling, the definitions and the floor. My hon. friend is right in suggesting that the definitions need

to be changed. Some hon. members think the ceiling should be changed. However, I think my hon. friend would agree we should concentrate on one point at a time, and in my view the important point is the floor.

Mr. Donald M. Fleming (Eglinton):

Mr. Speaker, this resolution is not new; it has been before the house on previous occasions that are now numerous. The positions of the various parties in this house on the resolution are a matter of record and are well known. As far as Her Majesty's loyal opposition is concerned our position is unchanged and we shall support the resolution.

The resolution is, I believe, in identical terms with that introduced at the 1956 session. It asks the government to give consideration to the advisability of introducing legislation amending the Income Tax Act so as to remove therefrom the 3 per cent floor in relation to the deductibility of medical expenses for income tax purposes. The effect of the resolution if legislation were introduced to give effect to it would be to allow as deductions from taxable income all medical expenses as defined by the act instead of only the excess of those medical expenses over 3 per cent of taxable income.

The history of the legislation now to be found in section 27 (1) (c) of the Income Tax Act begins with the year 1943. It was in that year that the progenitor of the present provision was first introduced and for the first time taxpayers were allowed a deduction in respect of that portion of their medical expenses in excess of 5 per cent of taxable income. In 1944 the percentage was changed to 4 per cent, and it continued at that figure for the next nine years. Something very significant happened in 1952, sir. You will remember the day, March 26, 1952, when a resolution in form almost identical with the one now under discussion but proposing at that time to eliminate the 4 per cent figure, was actually carried in this house. No voice was raised against it. The present Minister of Fisheries (Mr. Sinclair), who at the time was parliamentary assistant to the minister of finance, spoke following the hon. member who introduced the resolution and indicated that he and the minister for whom he spoke had no objection and the resolution was passed unanimously, so far as the record was concerned.

Mr. Benidickson:

No objection to giving

it consideration prior to the budget.

Mr. Fleming:

The present parliamentary assistant to the Minister of Finance will have his opportunity to work sleight of hand on the plain terms of that resolution as he

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may choose to attempt. Let him wait his turn and practise his arts in due course.

Mr. Winters:

That was the clear understanding then, though.

Mr. Fleming:

That is the understanding

that embarrassed members of the government sought to attach to their attitude a year later, but that is not the attitude they expressed in plain terms in this house at that time. I should have thought the expressions of that time were the really significant ones and those which really expressed the true meaning and thought of the government.

It is very clear that at that time, March 26, 1952, the parliamentary assistant, speaking on behalf of the Minister of Finance, did not attach the qualification that is now uttered by interrupting members to your right, sir.

Mr. Benidickson:

That is not so.

Mr. Fleming:

The following session when the Minister of Finance spoke on a similar resolution on January 12, 1953 he made it quite clear-you will find his words on page 900 of Hansard of that date-that his parliamentary assistant in speaking as he did on March 28, 1952 had his full instructions in the matter and that the then minister of finance, Mr. Abbott, had informed his parliamentary assistant he had no objection to the resolution being carried.

Mr. Benidickson:

I do not think my hon. friend has read page 822 of Hansard of March 26, 1952.

Mr. Fleming:

I have read all those pages. I ask the hon. gentleman to be good enough to take his seat and wait his turn and refrain from these quite superfluous interruptions. The fact is that the minister of finance made it perfectly plain, if the English language means anything to my hon. friend, at page 900 of Hansard of January 12, 1953, that his parliamentary assistant speaking on March 26, 1952 spoke with his authority and on his instruction and that he, the minister, had made it quite plain to the parliamentary assistant that he had no objection to the resolution.

Mr. Winters:

No objection to considering it.

Mr. Fleming:

No objection to the resolution is the way it was put, and it passed. On January 12, 1953, we entered upon an era of recantation on the part of the government, an era of second thought, an era of the reinterpretation of the position the government had taken on March 26, 1952. This second thought was accompanied by an attempt to quibble on the word "consideration".

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Every hon. member of this house knows that a resolution introduced by a private member must be so qualified if it has any bearing at all upon the expenditure of money or the balance of ways and means. Had such words not been incorporated in the resolution it would have been ruled out of order at once. There was no play upon this word on March 26, 1952; there was no statement that, after all, all that was intended was consideration in the ordinary sense of the word. No. That is why it belongs to the period of recantation. No matter what the parliamentary assistant may say, no matter how much trouble it gives him now, that qualification was not introduced. All that the parliamentary assistant said on March 26, 1952 was that there were matters coming before the minister of finance all the time for consideration with regard to the writing of his budget proposals. That is what he talked about at that time. There was no play made at that time on the word "consideration", as has been attempted since and as apparently is being attempted today by the parliamentary assistant to the Minister of Finance (Mr. Benidickson).

So we may take it that the government through the parliamentary assistant to the Minister of Finance is preparing now to say that they are against this and that in saying that they had no objection to the motion being passed in 1952 they meant something quite different. We believe that the treatment given to the resolution on January 12, 1953 was not to put it on the basis of consideration in the sense in which the government is now asking that that word be understood. No. What the government did was to apply the guillotine to the discussion, when a motion was introduced by the then minister of finance to adjourn the debate. Of course that motion was passed with the assistance of the submissive government majority by a vote of 109 to 42.

A few weeks later in his budget proposals the same minister of finance included a reduction from 4 per cent to 3 per cent in the figure about which we had been speaking. That of course was welcomed and accepted as at least being a step in the right direction and as being at least an instalment on performance, but it did not fully meet the needs of the situation. The figure has remained at 3 per cent since. In the annual debate on this subject the lines have been quite definitely drawn without exception. The government has opposed the resolution and the parties in opposition have all supported it. That was the position when it was last before the house on January 30, 1956, when in the face of the government's determined opposition to the resolution it was defeated by a

vote of 98 to 66. The vote was remarkably close having regard to the political complexion of the house.

There are some matters pertaining to this subject which require some comment. The first is the matter of the ceiling. As has already been pointed out by the hon. member who has introduced this resolution, that ceiling contemplates in the case of a married man with a maximum number of permissible dependents an aggregate of $4,000 on the deductions he may make. The resolution as such does not contemplate any interference with that so-called ceiling on the total deductions. It may well be that that subject needs to be reviewed in relation to a number of other matters upon which I should like to touch briefly under this general subject as it now appears in section 27 of the Income Tax Act. Obviously a ceiling in some form would need to be retained having regard to the general principle of the equitable treatment of taxpayers.

The second matter that calls for consideration is the premiums paid by taxpayers for sickness and accident insurance. It will be remembered by the house that the late lamented hon. member for Winnipeg South, Dr. Owen C. Trainor, introduced a resolution on February 13, 1956, dealing specifically with that subject. This will be found on page 1114 of Hansard of that date and is in these terms:

That, in the opinion of this house, the government should give consideration to the advisability of amending the Income Tax Act so as to provide that the taxpayer shall at his option be entitled to deduct from his taxable income either (a) his medical expenses as now determined; (b) the premiums paid by him for insurance against sickness or accident or both; (c) the specific provincial tax paid by him under any provincial scheme of health insurance.

During the course of the debate an amendment was moved by the hon. member for Winnipeg North Centre, which amendment was accepted by the late Dr. Trainor. The resolution as amended would have read:

That, in the opinion of this house, the government should give consideration to the advisability of amending the Income Tax Act so as to provide that the taxpayer shall at his option be entitled to include in his deductible medical expenses either (a) any amounts billed and paid under a contributory insurance or hospitalization plan, as is now provided, or (b) any premium or tax paid by him for insurance against sickness or accident or under any plan of health insurance.

This subject does present some difficulty in view of the fact that in some provinces by reason of public insurance schemes of this kind it might not be possible, unless the scheme involved a specific contribution, to determine the precise amount that a taxpayer under those circumstances might contribute by way of premium to a public hospital insurance plan, and it was pointed out

at that time that there might be problems with respect to differences in treatment as between citizens of different provinces.

The house, rallying around the negative attitude of the government, defeated the amendment introduced by the hon. member for Winnipeg North Centre by a vote of 89 to 61, and then to prevent the resolution introduced by the late Dr. Trainor coming to a vote the present Minister of Finance introduced a motion to adjourn the debate, the familiar guillotine, and it was carried and the debate was adjourned.

But, sir, before debate was adjourned in that way the Minister of Finance had given what he himself referred to as an undertaking, and I will read two passages from the remarks he made on that occasion.

At page 1128 of Hansard of February 13, 1956, before the amendment was put, he ended his speech with these words:

For that reason, sir, I am going to suggest that while I intend to vote against this motion it is only because of what has already occurred and of which I have given an example, and it does not indicate that we are not giving careful consideration to all methods which affect the taxpayer, especially those who are obliged to spend considerable sums of money with respect to medical expenses.

And then, sir, after the amendment had been voted down and the minister was about to apply the guillotine to the discussion on the main motion, he used these words, reported at page 1133:

We have heard expressions of opinion from, I think, all the opposition groups and from the government side. I have made an engagement to give serious consideration to the amended resolution or motion. Of course I fully appreciate the fact that hon. members expect us on all occasions to consider the 3 per cent floor or ceiling, as you will.

That, I take it, sir, was an undertaking in clear terms on the part of the Minister of Finance to give serious consideration to two things: first, the removal of the present 3 per cent limitation on the right to deduct medical expenses-the subject matter of the present resolution-and, second, the proposal to permit deductions also, at the option of the taxpayer, of contributions made by him whether in the form of payments to a private insurance scheme or to some form of public hospital or health insurance plan. So far as that undertaking by the minister is concerned I suppose that the minister's parliamentary assistant, if he utters the time-honoured-I should not say "honoured"-if he expresses the invariable negative attitude of the government on this matter, will repeat those assurances.

We want something more than those assurances. We have not yet seen any tangible result of whatever consideration the minister has been pleased to extend to this subject.

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But if we were given an undertaking that something might be looked for when the minister brings in his budget, that would certainly be received with very great interest.

The third matter that calls for some mention is the question of the introduction of a scheme of hospital insurance. If and when such a scheme is introduced and becomes effective, undoubtedly this whole subject embraced now within the scope of section 27 of the Income Tax Act will require some reexamination, especially if conditions are going to vary as among different provinces. That is a bridge that we can cross at that time; in the meantime, let us deal with the situation as we find it.

The fourth matter which I should like to mention is the subject of the scope of "medical expenses", as that expression appears in section 27 of the act. As now defined, it is my submission to the house that that expression is too narrow in scope. This is not the first time I have directed the attention of the house to this matter. Indeed, I have done so on many previous occasions.

Let us look, first of all, at the subject of drugs. It should, I think, shock the conscience and the intelligence of most Canadians to think that with only five exceptions whatever is expended on drugs for medicinal purposes is not treated as medical expenses under this section of the act. Why should that be so? Surely outlays by a taxpayer on the purchase of necessary drugs are just as essential, in the course of seeking relief and applying medical knowledge, as the skill of the physician who prescribes the drugs themselves? And yet this statute, without any pretence of logic and, in my view, with no regard for elementary considerations of fair play and justice, does not, in general, permit the deduction of expenditure upon the drugs.

It is true that by special amendments exceptions were made, in the first place, for four drugs, and in a later session, for one more drug. Thus we have the curious, the anomalous situation today that expenditures on these five drugs-insulin, cortisone, ACTH, liver extract injectible for pernicious anaemia, or vitamin B-12 for pernicious anaemia are deductible as medical expenses, but expenditures on all other types of drugs for medicinal purposes are not allowed as deductible. By what curious logic, by what extraordinary demonstration of the art of reasoning do we single out these five drugs and deny similar treatment to all other drugs used for medicinal purposes? These exceptions are proper. They should be allowed. They were approved by all

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parties in this house. But, Mr. Speaker, on what theory, by what justification, do we stop there? There are many other drugs that any physician will tell us are required in considerable quantity by chronic sufferers from various maladies, and expenditures by such sufferers in the course of necessary treatment can amount to a very considerable sum. And yet we deny any form of relief to those who require such drugs.

Mr. Benidickson:

What about the decrease in the floor from 5 per cent to 4 per cent? It was explained that that was for drugs.

Mr. Fleming:

Mr. Speaker, that decrease from 5 per cent to 4 per cent was made in 1944. The exception in favour of the five drugs was made in quite recent years. I think the parliamentary assistant has quite overlooked that fact. What he has said does not touch in the least the point I am making-that you deny in general any right to deduct expenditure on drugs, but you recognize the right with respect to five of them. Where is the sense or logic in that? If you admit the principle is sound of allowing a deduction from taxable income for tax purposes with respect to these five drugs, how can you maintain the principle that expenditures on other drugs properly prescribed should be denied?

Now, Mr. Speaker, there is another matter to which I have referred on previous occasions, and it relates to the method of prescription. In the case of the physician who does his own dispensing and includes the cost of medicines and drugs in the account he renders for his own services, the Department of National Revenue accepts the physician's account, including, in that case, the cost of drugs used. But in the case of an urban physician who does not do his own dispensing

a physician who writes his own prescription which is then taken to a pharmacist

any right to make a deduction in respect of those drugs and medicines is denied. Where is the logic there, sir? I do not think there is any. The whole matter is shot through with anomalies, and this government, though knowing of these anomalies, and having heard them discussed in this house, year by year, has done nothing to correct the situation in all the T2 years I have been a member.

If the government will not listen to reason in this matter, perhaps they will at least listen to the voices of the women of the Liberal party. Today's newspapers carry an account of some resolutions which were passed on Saturday the 16th of this month

at a meeting of the National Federation of Liberal Women of Canada held in the city of Toronto.

We read that among the resolutions passed by these worthy ladies was the following one, and I quote from today's Globe and Mail: It was also urged that the Income Tax Act be amended so that the cost of medical prescriptions required outside of hospital confinement be added to the list of exemptions for medical expenses allowed under the act.

I do hope due attention will be paid by the government to that expression of opinion on the part of these worthy Liberal women. If the government will not listen to reason, then at least let them listen to the voices of the Liberal women expressed in this resolution passed on the 16th day of this month.

The other matter, and it is not a new one, relates to the anomalies that arise with respect to certain aids that the act permits to be included within the scope of the deduction while denying inclusion to others. The provision with regard to the inclusion of certain aids for disabled persons was introduced into the act in recent years. The inclusion extends to an artificial limb, an iron lung, a spinal brace, a brace for a limb, an aid to hearing or a wheel chair for the taxpayer, his spouse or any dependent. These are all sound and proper expenditures to include within the scope of medical expenses which a taxpayer should be allowed to deduct.

But, sir, having recognized the principle in the form of the aids within that list, by what reason or logic are aids to sight excluded? If it is reasonable, and I think it is, that hearing aids should be included within the scope of medical expenses, on what basis of logic are aids to seeing excluded? The matter of expenditure on aids to sight is a very serious one in many families where children may have inherited certain visual defects from their parents. I have argued before and I assert again that aids to sight, whatever forms they take-glasses are the commonest form-should be included within the scope of permissible medical expenses.

Again I put it to the house and particularly to the government that if it is sound to include under medical expenses a hearing aid, an artificial limb or these other aids, then certainly there is no logic to sustain the exclusion of spectacles and other aids to sight.

From this partial review of the anomalies in the present section 27 of the Income Tax Act it is quite evident that what is urgently needed, what is long overdue, is a general review and revision of the whole subject matter of this section to eliminate anomalies and introduce good sense.

Then there is a final matter that should be mentioned. It is the subject of other

deductions. I am not going to attempt to take the debate afield, but 1 do say that this whole subject must be considered in relation to the other deductions that are permitted under section 27. In the case of blind and disabled persons I think we ought to be more generous than we have been in clause (d) of subsection 1 of section 27.

I come now to my conclusion. The burden of the cost of illness and accidents in this country is a very heavy one and it is growing. The cost of hospitalization, the cost of medical assistance, the cost of drugs and medicine, the cost of aids and all the things that enter into the expenditure that must be borne by those who are confronted with the misfortune of illness or accident, are all increasing, and we fail in our duty if we do not take into account this growing cost, this increasingly heavy burden.

Admittedly, if the resolution were passed and amendments to the Income Tax Act were introduced to give effect to the purpose of the resolution it would extend the administrative work within the Department of National Revenue. That is admitted. There would be a great many more medical receipts to be checked by those who do the preliminary checking of income tax returns. It would not involve any change in method. It would simply involve an increase in the number of receipts to be reviewed. Therefore it seems to me that the administrative difficulty is one simply not of method but of quantum.

Finally, I say that while the resolution is not the complete answer to the problem, while the problem has a good many other aspects to it, some of which I have attempted to sketch here, while the whole problem will need to be reviewed and re-examined if and when any scheme of hospital insurance comes into effect, nevertheless this is a resolution that should commend itself to the consideration of the house.

The principle that the Minister of Finance argued for when this matter was last under discussion is undeniably sound, that in extending the benefits of tax reduction and tax relief we should seek to spread them as far as possible and as equitably as possible. But, sir, that is a poor, hollow and shabby excuse for turning one's back upon proven inadequacies and anomalies in the act. This is not simply a matter of tax relief. This is a matter of seeking to redress a situation which as it stands today smacks of unfairness and certainly of serious anomalies.

Therefore, sir, thinking that the type of provision sought in the resolution will be of very wide benefit and will assist the taxpayers of the country, we consider the resolution to be one that fully qualifies within the

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general principle of taxing legislation which was supported by the Minister of Finance. We desire that any form of tax relief should be extended as widely as possible. This is one form of belated redress that will bring wide benefits and at the same time will correct serious anomalies and undeniable injustices that exist in the present act.

Mr. F. D. Shaw (Red Deer):

Mr. Speaker, resolution No. 1 simply asks the government to do a certain thing, namely, to give consideration to a certain proposition. Inasmuch as the resolution asks the government merely to give consideration to something, I find it very difficult to understand why the government would oppose it. I realize that the government assumes that simply because it is asked to give consideration to a certain proposition therefore everyone is suggesting that the government is committed to doing that thing. What is it that the resolution asks the government to do? It asks the government to give consideration to the advisability of introducing legislation amending the Income Tax Act so as to remove therefrom the 3 per cent floor in relation to the deductibility of medical expenses for income tax purposes.

The resolution is not new. We have had it in similar form before, prior to having it in almost identical form. About the only change there is is to 3 per cent. For example, when it was 4 per cent, it asked for 3 per cent and so on. We favour the principle of this resolution and I hope to be able to point out two or three reasons for it. It seems unnecessary to go into great detail. Those who preceded me in debate have advanced sufficient arguments, I believe, to warrant our favourable consideration of that proposition.

I may say to the hon. member for Winnipeg North Centre (Mr. Knowles) that, from the way things have been going, I think he can look for a solution to the problem which is brought forth in this resolution in just about eight years from now. I mean that is what he can look forward to at the rate things have been going. But of course in assuming that it will take eight years to solve the problem, I must proceed on the very fantastic assumption that the present government will be in office at that time.

It has been pointed out, Mr. Speaker, that back in 1944 the 5 per cent floor was reduced to 4 per cent. The year 1944 was close to an election year. After 1944 we find the motion being defeated in 1951, the motion being carried in 1952, debate being adjourned by the minister in 1953 but the budget reduced it from 4 per cent to 3 per cent in an election year. Working on the assumption that this is an election year, we can hope for a reduction from 3 per cent to 2 per cent. Then, of course,

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there will be resolution debates at the end of which maybe some motions will be carried and others will be defeated, but about 1961 you could hope that the percentage would be reduced from 2 per cent to 1 per cent and of course four years beyond that from one per cent to nothing.

Mr. Knowles:

The government will be

down to nothing then.

Mr. Shaw:

With the present government in office, that would be the picture. But I am sure no other government would take that long.

Reference has been made today to the fact that certain drugs are deductible under the Income Tax Act. I have before me the income tax form for the year 1956. I find it extremely hard to reconcile with fact what appears on that form. Not only do I find it difficult to do that but I find inconsistencies throughout it all. For example, I think it is under section 27 of the act-it is not mentioned by number here-these are the instructions given to the person filling out this form. The form states:

The following are the types of expenses you may claim:

2. Payments for injectible liver extract or vitamin B12 for pernicious anaemia, insulin, cortisone, ACTH, and oxygen, if prescribed by a medical practitioner, and payments for an artificial limb, spinal brace, brace for a limb, hearing aid, wheelchair, or iron lung.

The only one with which I am concerned at this moment is drugs. There is below a paragraph which states:

The following may not be claimed as medical expenses:

. . (d) Payments for drugs or medicines, other than as indicated above.

That is in the form from which I am now reading.

I am suggesting that that is wholly incorrect if not wholly false, and I am going to point out why. Here is a patient who may be at home; here is a patient who may be in a small hospital; and here is a patient who may be in one of the large hospitals having its own dispensary. What is the situation? For the patient at home-and that patient may be at home for very good reasons; the doctor may indicate that that patient is not a hospital patient and that it is far better for the patient to be at home-drug bills may run as high as $100 a month. There is a patient who in the course of say 12 months incurs $1,200 in expenses for drugs and who cannot count one single cent of it-unless it is one of those mentioned in the act, but I am talking about drugs other than that such as morphine et cetera-by way of deduction. Then here is the patient in the small hospital that does not have a dispensary, and this is the common practice. The hospital, learning

from the doctor the drug required, will order it from the local drug store or pharmacy where it is billed to the patient and paid by the patient as an account quite separate from that of the hospital. There is no deduction for that. We now come to the patient in a hospital where they have a dispensary. There may be hundreds of dollars involved as costs for not just drugs but salves, ointments, et cetera, but they are provided by the hospital through its own dispensary, and are billed through to the patient as part of the hospital cost and the whole thing is deductible.

Can anyone suggest to me that there is any fairness whatsoever to a situation of that kind? I can produce evidence to back up what is happening in that case. While I do not like to do these things, I do not have to go very far beyond personal experience.