Cost of seniors fitness tax credit revealed thanks to Tory MP

Canadian taxpayers now know what it would cost the Harper government to extend a fitness tax credit to seniors, should it heed a recommendation from one of its backbench MPs.

Conservative MP Royal Galipeau asked the Parliamentary Budget Officer to analyze how much it would cost the federal government to extend the current Children’s Fitness Tax Credit to seniors.

On Wednesday, the office of the parliamentary budget officer released its findings following Galipeau's request.

The PBO found that a $75 tax credit to seniors for fitness programs would cost the government between $15 million and $47 million a year, up to a maximum cost of $268 million over five years, depending on whether the tax credit kicked in at 55, 60 or 65 years of age.

During the 2011 federal election campaign the Harper government promised to introduce a handful of tax goodies once it balanced the books in 2014-15, including a fitness tax credit for adults who enrol in eligible fitness programs.​

Harper promised all Canadian adults a 15 per cent tax credit on up to $500 in registration fees for fitness activities, bringing a maximum tax credit of $75 per year.

The Conservatives put the cost of the adult fitness tax credit at $275 million per year once it was fully implemented after 2015-16.​

Galipeau requested that the PBO look at what it would cost to narrow Harper's campaign pledge to adults over age 55.

Asked why he submitted the request, Galipeau said he was considering making a proposal to Finance Minister Jim Flaherty ahead of the next federal budget for a "fitness tax credit for seniors" and was looking for information that would bolster his recommendation.

He said seniors in his riding of Ottawa-Orleans have approached him about such a fitness tax credit, after seeing the federal government introduce the Children’s Fitness Tax Credit and the Children's Arts Tax Credit.

MP surprised request was public

Reached Wednesday at his office on Parliament Hill, Galipeau — who answered his own phone — said he was surprised to learn the PBO report had been made public.

The Conservative MP said he would not have made that request with the PBO had he known his request was not confidential.

"I would have found another way to get at the information," Galipeau said.

While the Library of Parliament can provide customized research and analysis to parliamentarians and their staff on a confidential basis, requests for independent analysis by the PBO are made public.

And the terms of reference for Galipeau's request, including the fact that it would be made public, are stated in the report.

"The final report would be presented and reviewed with the member and subsequently be posted on the PBO website," the PBO said in the terms of reference.

The PBO went on to say that "publication of the final report on the PBO’s web site would be performed with the concurrence of the Member."

Tax credit's effectiveness

The report found that 41.8 per cent of adults over 55 years of age eligible to claim such a credit would actually do so.

It also found that if a seniors fitness tax credit were implemented today, between $2.2 and $5.6 million of the total cost would go towards older adults who are not already doing some sort of fitness activity.

In other words, only 12 to 15 per cent of the total cost of implementing the tax credit would go to adults engaging in some fitness activity for the first time, or in increasing their current level of activity.

The rest of the total cost of implementing the tax credit would benefit taxpayers that are already currently engaged in some form of fitness program.

The report noted that the cost estimate doesn't include any incremental costs related to administering the programs.

Initial request withdrawn

Galipeau said this was not the first time he had asked the PBO to give him a cost estimate for introducing a fitness tax credit for seniors.

The Conservative MP said he made the same request in 2010 but said his request was denied by then parliamentary budget officer Kevin Page because it was not within his mandate.

But in an email to CBC News, Page said "with great respect to Mr. Galipeau, PBO did not turn down his request to cost an adult fitness tax credit."

Rather, Page said, Galipeau withdrew his request after the PBO told him how long it would take to complete the analysis.

"Mr. Galipeau did not like the timeline so he instructed PBO not to do this analysis. This is also okay, because PBO has limited resources. All the electronic exchanges to this effect are available at PBO," Page told CBC News.

Page's five-year mandate ended in March. Galipeau said he waited until Page left to resubmitted his request, resulting in Wednesday's report by the new budget watchdog, Jean-Denis Frechette.

Frechette was not available for comment.