Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.
Principal Issues: Request that subsection 110(2) be amended to include Buddhist monks, who (according to the correspondent) do not qualify for the deduction.
Position: Forward the request to the Minister of Finance.
Reasons: Question of tax policy and would require a change to the legislation.
April 21, 2011
XXXXXXXXXX
Dear XXXXXXXXXX :
Thank you for your correspondence received on March 14, 2011, written on behalf of your constituent, XXXXXXXXXX , concerning the threshold for the goods and services tax/harmonized sales tax (GST/HST) and the deduction from income for individuals who have taken a vow of perpetual poverty.
In your letter, you state that the deduction for a vow of perpetual poverty excludes Buddhists because their religious assumptions are different. You explain that
XXXXXXXXXX , like other Buddhist monks, works on a donation model and, therefore, does not qualify for the deduction. You suggest that the deduction be expanded to apply to non-Christian religions.
Under the Income Tax Act, individuals who are members of a religious order, have taken a vow of perpetual poverty, and have paid over to the order their entire earned income and superannuation or pension benefits for a tax year, can deduct all the amounts paid when they calculate their taxable income for the year. The deduction is not based on the individuals' particular religion, but on the fact that the individuals have given away all of their earned income and superannuation or pension benefits to a religious order and do not have any money for personal use.
You mention a donation model in your letter, but it is not clear what that is. It is also unclear what XXXXXXXXXX does with the money he receives. If he does not pay all of his earned income and superannuation or pension benefits to a religious order, the deduction for a vow of perpetual poverty does not apply to him. However, if he gives a portion of his income to a registered charity, he can generally claim a donation credit for the amount gifted.
You also suggest that the $30,000 small supplier threshold for registration to collect the GST/HST be increased to reflect inflation and the cost of living increases. Please note that the Canada Revenue Agency is responsible for administering the current tax legislation as passed by Parliament. Your suggestion relates to tax policy, which is the responsibility of the Department of Finance Canada. Any changes to the tax legislation must be proposed by the Minister of Finance and approved by Parliament. I am therefore forwarding a copy of our correspondence to the Honourable James M. Flaherty, Minister of Finance, for his consideration.
I trust that the information I have provided and this referral are helpful.
Yours sincerely,
Keith Ashfield
c.c.: The Honourable James M. Flaherty, P.C., M.P.
Minister of Finance
House of Commons
Ottawa ON K1A 0A6
Terry Young
613-948-5273
2011-039955
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