News & Events
Highlights
Government of Canada - Budget 2007
The Federal Government’s Budget 2007 was released March 19, 2007.
The nonprofit/voluntary sector was included in the budget, spread out under arts, sports, and donations. The sector needs to continue to collectively raise the awareness of the federally elected leaders of the importance of nonprofit/voluntary sector organizations and the powerful social investment volunteers contribute every day.
Budget 2007 outlines the intent of the federal government for the next fiscal year and beyond. Two important pieces of information in it are:
- Celebrating Our Culture – including support for local arts & heritage festivals, interns working in museums, youth participation in Canadian heritage sports
- Eliminating the capital gains tax for charitable donations of publicly-listed securities to private foundations
Excerpts from Budget 2007.
Celebrating Our Culture
As Canadians, we are proud of our history and culture and the things that make us unique. Canada is home to natural and historic treasures that are precious to Canadians and a part of who we are. That’s why Budget 2007 strengthens Canada by:
- Providing $30 million per year in support for local arts and heritage festivals that engage Canadians in their communities through the expression, celebration and preservation of local culture.
- Providing $5 million per year to hire qualified summer interns to work in Canadian museums.
- Encouraging youth participation in Canadian heritage sports like Canadian three-down football and lacrosse with an investment of $1.5 million over the next two years in the new Canadian Heritage Sport Fund
Knowledge Advantage
- Providing $510 million to the Canada Foundation for Innovation to undertake another major competition before 2010. This will support the modernization of research infrastructure at Canadian universities, colleges, research hospitals and other non-profit research institutions.
Eliminating Capital Gains Tax on Charitable Donations to Private Foundations
Charities play an invaluable role in Canadian society. They provide support for a wide variety of activities from health services to education, museum exhibits, places of worship, protection of the environment and diverse programs for disabled children.
To better encourage charitable giving, Budget 2006 eliminated capital gains tax on donations of publicly-listed securities to public charities. This measure has been welcomed widely by Canadians and has encouraged a significant increase in donations to charities since it took effect last May.
Donations of publicly-listed securities to public charities have surpassed $300 million in the 10 months since Budget 2006. This includes at least $150 million for hospitals and health care, more than $50 million for education, about $20 million for the arts and $80 million for a wide range of other charitable purposes.
Private foundations also support a wide range of charitable activities in Canada, including some of the most innovative charitable programs. To date, donations of publicly-listed securities to private foundations have not been eligible for a reduced inclusion rate on capital gains. This has been due to concerns regarding the adequacy of current legislative provisions to safeguard against potential conflicts of interest, or "self-dealing," which could arise when individuals with significant holdings in a corporation also have influence over the management of a foundation’s holdings of the same corporation.
In Budget 2006, Canada’s New Government committed to consult with private foundations and other interested parties to develop appropriate self-dealing rules. As a result of these discussions, Budget 2007 proposes to introduce excess business holdings rules which will provide private foundations with clear rules to minimize potential conflicts of interest. With this framework in place, Budget 2007 proposes to exempt donations of publicly-listed securities to private foundations from capital gains tax.
These measures will be effective as of March 19, 2007. Taken together with the measures in Budget 2006, these measures provide Canadians with significant new incentives to donate to the whole range of Canadian charities.
These measures are expected to reduce federal income tax revenues by about $75 million in each of 2007–08 and 2008–09.
Fairness for Single-Earner Families
The proposed increase to the credits for low-income spouses and dependants of single individuals will provide significant benefits for families.
- Marc volunteers in the community and has no income. His partner, Natalie, can now claim a spousal amount of $8,929 for Marc on her taxes. Before Budget 2007, the total value of the credit would have been $1,175; it will now be $1,384, an increase of $209.
For more information, please view www.budget.gc.ca.