An Open Let­ter to the Prime Min­is­ter and the Min­is­ter of Fi­nance

Policy - - Before The Bell | Media - Don­ald K. John­son, O.C., LL.D.

The Right Honourable Justin Trudeau, P.C., M.P. Prime Min­is­ter of Canada

The Honourable Wil­liam Morneau, P.C., M.P. Min­is­ter of Fi­nance

Dear Prime Min­is­ter and Fi­nance Min­is­ter:

In my role as a vol­un­teer board mem­ber of four ma­jor vol­un­teer or­ga­ni­za­tions in health­care, ed­u­ca­tion, so­cial ser­vices and arts and cul­ture, I am well aware of the in­creas­ing needs of the bene­fac­tors of these or­ga­ni­za­tions and how the char­i­ta­ble sec­tor plays a vi­tal role in the well-be­ing of so­ci­ety gen­er­ally. The needs of the bene­fac­tors are grow­ing and gov­ern­ments can­not keep up with the in­creas­ing de­mands. To pro­vide much needed re­lief with the pri­vate sec­tor as a help­ing part­ner, I rec­om­mend that your gov­ern­ment re­move the cap­i­tal gains tax on char­i­ta­ble do­na­tions of pri­vate com­pany shares and real es­tate in the 2019 bud­get, the same pol­icy and leg­is­la­tion that presently ex­ists for listed se­cu­ri­ties. There are 84,000 reg­is­tered char­i­ties in Canada which em­ploy over 2.1 mil­lion peo­ple and serve a large pro­por­tion of the Cana­dian pop­u­la­tion from all walks of life.

The case for this pro­posal is com­pelling:

• It is not a “Tax Break for the Rich”. The real ben­e­fi­cia­ries of this pro­posal are the mil­lions of mid­dle class Cana­di­ans who are served by our reg­is­tered char­i­ta­ble or­ga­ni­za­tions. For ex­am­ple there are now 87 United Ways and Cen­traides in Canada and col­lec­tively, they pro­vide cru­cial fund­ing to over 3,000 com­mu­nity based agen­cies that de­liver more than 6,200 ser­vices and pro­grams to sup­port those in need.

• The fis­cal cost of the mea­sure is shared by our tax pay­ers and the donor, whereas the cost of di­rect gov­ern­ment spend­ing is borne 100 per cent by our tax pay­ers.

• The mea­sure re­moves a bar­rier to char­i­ta­ble giv­ing and en­ables suc­cess­ful en­trepreneurs to give back to the com­mu­ni­ties that have played an im­por­tant role in their suc­cess. These en­trepreneurs live in all parts of Canada, small towns and vil­lages in ru­ral ar­eas as well as our cities.

• The ex­emp­tion would put the Cana­dian char­i­ta­ble sec­tor on an equal foot­ing with their United States coun­ter­parts with whom we com­pete for the best ta­lent to help raise funds and ad­dress the chal­lenges of man­ag­ing the op­er­a­tions of char­i­ta­ble or­ga­ni­za­tions.

• Ex­tend­ing the cap­i­tal gains ex­emp­tion would gen­er­ate an es­ti­mated $200 mil­lion in new char­i­ta­ble do­na­tions ev­ery year go­ing for­ward.

As the pre­vi­ous Con­ser­va­tive gov­ern­ment in­cluded this mea­sure in its 2015 bud­get, it is rea­son­able to as­sume that the Con­ser­va­tives will in­clude this mea­sure in their 2019 Elec­tion Plat­form. There is a very high level of aware­ness and sup­port among all stake­hold­ers in the char­i­ta­ble sec­tor in­clud­ing the 2.1 Cana­di­ans whom the sec­tor em­ploys.

I urge you to in­clude this mea­sure in your 2019 bud­get. It will be a great legacy for your gov­ern­ment to leave for all Cana­di­ans for gen­er­a­tions to come. Thank you! Yours truly,

Heart and Stroke Foun­da­tion


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