Cardus Makes 29to42 Pre-Budget Submission

August 24, 2010
Cardus

On August 13, Cardus renewed the fight for the 29to42 charitable tax proposal. We made a submission to the Canadian federal government's Standing Committee on Finance.

Read Cardus' 29to42 2010 Pre-Budget Submission (PDF)

  1. The feedback we received regarding the absence of our proposal in the 2010 budget indicated a financial calculation at the root. The Finance Department estimated that 29to42 would result in a $900M loss in tax revenue. Although we believe their calculation was flawed, this is a structural long term tax obligation and we understand the concern in the present economic climate.
  2. From our direct interactions with the PMO, a variety of Cabinet Ministers and local Members of Parliament we know there continues to be significant support for the logic of our argument as a means to strengthen Canada's civic core through charitable giving.

Moving forward:

  1. Cardus will continue to maintain our argument for the upcoming budget, but will advance it less aggressively from a political front unless there are indications of an election budget.
  2. Building on the past 12 months, Cardus will continue to be very active advancing our 29to42 educational campaign. Recently, Cardus was invited to present our findings to the Rotary International's Permanent Fund, the Calgary United Way, and Big Brothers and Big Sisters in Southwest Ontario. We plan on continuing with these efforts.
  3. Taking what we have learned from last year, we have made adjustments to the 29to42 proposal. Adding an additional tax bracket at 42%, rather than just increasing the donations over $200 to 29%, will reduce the tax expenditure estimates from the original $900M to under $500M, using the Department of Finances' own calculations. Balance is required to ensure that the tax incentive is properly targeted to Canada's civic core and also limits the government's "spending".

What you will notice in this report is an acknowledgement of the limits of government tax policy. Simply put, the fact that most Canadians give an incidental percentage of their income to charity is a bigger social/cultural/spiritual problem than what tax measures alone can solve. For example, an average professional family where each spouse makes over $100,000 a year gives less annually than they would spend on dinner and an evening at the opera. This is a real life symbol of the challenge of Canada's civic core.

ABOUT CARDUS

Cardus is a non-partisan, not-for-profit public policy think tank focused on the following areas: education, family, work & economics, social cities, end-of-life care, and religious freedom. It conducts independent and original research, produces several periodicals, and regularly stages events with Senior Fellows and interested constituents across Canada and the U.S.