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37th Parliament, 1st Session
EDITED HANSARD • NUMBER 025
Friday, March 2, 2001
|SALES TAX AND EXCISE TAX AMENDMENTS ACT, 2001|
|Bill C-13. Second reading|
|Hon. Lucienne Robillard|
|Mr. Roy Cullen|
|Mr. Jason Kenney|
|Mr. Ken Epp|
|STATEMENTS BY MEMBERS|
|INTERNATIONAL WOMEN'S DAY|
|Ms. Sarmite Bulte|
|Mr. Richard Harris|
|Mr. Marcel Proulx|
|Mr. Eugène Bellemare|
|Mr. John Cummins|
|INTERNATIONAL WOMEN'S DAY|
|Ms. Monique Guay|
|MEMBER FOR FREDERICTON|
|Hon. Andy Scott|
|TREVOR AND LINDA DAVIES|
|Mr. Kevin Sorenson|
|NATIONAL CHILD DAY|
|Mr. Mac Harb|
|Mr. Geoff Regan|
|INTERNATIONAL WOMEN'S WEEK|
|Ms. Wendy Lill|
|SUMMIT OF THE AMERICAS|
|Mr. Antoine Dubé|
|Mr. Mauril Bélanger|
|Mr. Gerald Keddy|
|MEMBER FOR ETOBICOKE—LAKESHORE|
|Ms. Carolyn Bennett|
|HEATING FUEL REBATE|
|Mrs. Betty Hinton|
|LANDMINE AWARENESS WEEK|
|Mr. Pat Martin|
|ORAL QUESTION PERIOD|
|Ms. Val Meredith|
|Hon. Herb Gray|
|Ms. Val Meredith|
|Hon. Herb Gray|
|Ms. Val Meredith|
|Hon. Herb Gray|
|CUSTOMS AND REVENUE AGENCY|
|Mr. John Reynolds|
|Hon. Martin Cauchon|
|Mr. John Reynolds|
|Hon. Martin Cauchon|
|Ms. Caroline St-Hilaire|
|Mr. Pat O'Brien|
|Ms. Caroline St-Hilaire|
|Mr. Pat O'Brien|
|Mr. Yvan Loubier|
|Mr. Pat O'Brien|
|Mr. Yvan Loubier|
|Mr. Pat O'Brien|
|Hon. Lorne Nystrom|
|Hon. Lyle Vanclief|
|Hon. Lorne Nystrom|
|Hon. Lyle Vanclief|
|Mr. Gerald Keddy|
|Mr. Lawrence O'Brien|
|Mr. Loyola Hearn|
|Mr. Lawrence O'Brien|
|Mr. Grant McNally|
|Mr. Mark Assad|
|Mr. Grant McNally|
|Mr. Mark Assad|
|CANADA CUSTOMS AND REVENUE AGENCY|
|Ms. Jocelyne Girard-Bujold|
|Hon. Martin Cauchon|
|Ms. Jocelyne Girard-Bujold|
|Hon. Martin Cauchon|
|Mr. Rob Merrifield|
|Hon. Brian Tobin|
|Mr. Rob Merrifield|
|Hon. Brian Tobin|
|FREE TRADE AREA OF THE AMERICAS|
|Ms. Francine Lalonde|
|Hon. Stéphane Dion|
|Ms. Francine Lalonde|
|Hon. Herb Gray|
|Mr. James Lunney|
|Hon. Brian Tobin|
|Mr. James Lunney|
|Hon. Brian Tobin|
|Mr. Wayne Easter|
|Mr. Pat O'Brien|
|Mrs. Bev Desjarlais|
|Hon. Paul Martin|
|Mrs. Bev Desjarlais|
|Hon. Paul Martin|
|GRANTS AND CONTRIBUTIONS|
|Right Hon. Joe Clark|
|Hon. Herb Gray|
|Mr. Loyola Hearn|
|Hon. Paul Martin|
|Mr. John Duncan|
|Hon. David Collenette|
|Mr. John Duncan|
|Hon. David Collenette|
|Ms. Madeleine Dalphond-Guiral|
|Mr. Paul Szabo|
|Ms. Madeleine Dalphond-Guiral|
|Mr. Paul Szabo|
|GRANTS AND CONTRIBUTIONS|
|Mr. Gurmant Grewal|
|Ms. Sarmite Bulte|
|Mr. Gurmant Grewal|
|Hon. Herb Gray|
|Mrs. Marlene Jennings|
|Mr. John O'Reilly|
|Mr. David Anderson|
|Hon. Lyle Vanclief|
|Mr. David Anderson|
|Hon. Lyle Vanclief|
|Hon. David Collenette|
|Mr. David Pratt|
|Hon. Brian Tobin|
|Mr. Jean-Yves Roy|
|Mr. Lawrence O'Brien|
|Mr. Gerald Keddy|
|Hon. Paul Martin|
|GOVERNMENT RESPONSE TO PETITIONS|
|Mr. Paul Szabo|
|Bill C-291. Introduction and first reading|
|Mr. Art Hanger|
|Bill C-292. Introduction and first reading|
|Ms. Val Meredith|
|Mr. Geoff Regan|
|Mr. Art Hanger|
|Mr. Richard Harris|
|Ms. Val Meredith|
|QUESTIONS ON THE ORDER PAPER|
|Mr. Paul Szabo|
|SALES TAX AND EXCISE TAX AMENDMENTS ACT, 2001|
|Bill C-13. Second reading|
|Mr. Ken Epp|
|Mr. Yvan Loubier|
|Hon. Lorne Nystrom|
|Mr. Ken Epp|
|Mr. Darrel Stinson|
|Mr. Greg Thompson|
|PRIVATE MEMBERS' BUSINESS|
|RIGHT OF LANDING FEE|
|Mr. Pat Martin|
|Mr. Mark Assad|
|Mr. Deepak Obhrai|
|Ms. Madeleine Dalphond-Guiral|
|Mr. Gerald Keddy|
|Mr. Gurmant Grewal|
|Mr. Pat Martin|
EDITED HANSARD • NUMBER 025
HOUSE OF COMMONS
Friday, March 2, 2001
The House met at 10 a.m.
SALES TAX AND EXCISE TAX AMENDMENTS ACT, 2001
Hon. Lucienne Robillard (for the Minister of Finance) moved that Bill C-13, an act to amend the Excise Tax Act, be read the second time and referred to a committee.
Mr. Roy Cullen (Parliamentary Secretary to Minister of Finance, Lib.): Mr. Speaker, I welcome the opportunity to introduce second reading of Bill C-13.
Bill C-13 reaffirms the government's commitment to making our tax system simpler and fairer, not only for individual Canadians but for Canadian businesses as well.
Before I begin setting out the measures in the bill, I would like to mention that the consultative process leading to its introduction is an excellent example of co-operation between the government and the business and tax communities to achieve the shared objective of improving our tax system.
On behalf of the government, allow me to take this opportunity to thank those interested parties that brought forward their views on the many issues addressed in the legislation.
Bill C-13 implements measures relating to the goods and services tax, the GST, and harmonized sales tax, HST, that were proposed in budget 2000, as well as additional sales tax measures proposed in a notice of ways and means motion tabled in parliament on October 4, 2000. These measures are aimed at improving the operation of the GST-HST in the affected areas and ensuring that the legislation accords with the policy intent.
The bill also implements two amendments to the excise tax provisions of the Excise Tax Act.
The first clarifies provisions relating to the deferral of excise taxes on automobile air conditioners installed in new automobiles and on heavy automobiles at the time of importation by or sale to a licensed manufacturer.
The second provides discretion for the Minister of National Revenue to waive or cancel interest, or a penalty calculated in the same manner as interest, under the excise tax system.
First, I will set out the proposals of the bill as contained in the 2000 budget.
The GST-HST is designed to ensure Canadian businesses and goods are competitive in the export markets. Some of the measures proposed in the 2000 budget and contained in C-13 are intended to achieve these objectives. These measures concern, more particularly, the following:
The GST-HST treatment of export distribution activities; the provision of warranty services by Canadian businesses to non-resident companies; the provision of storage and distribution services by Canadian service providers in relation to goods imported on behalf of non-residents; and finally, sales of railway rolling stock to non-residents.
Let me take a few moments to briefly summarize each of these measures.
Registrants engaged in export distribution activities involving the limited processing of goods for export face a cashflow cost that may be significant in relation to the level of value added to the goods. This can be the case where goods are imported for minor processing and subsequent export.
The cashflow issue arises because tax is paid on the importation of the goods but no offsetting tax is collected on their export. As a result, the business must finance the tax until the receipt of a refund from the Canada Customs and Revenue Agency.
The proposal for an export distribution centre program contained in the bill addresses the cashflow issue faced by low value added export oriented businesses by allowing them an export distribution centre certificate to purchase or import inventory, or to import customers' goods on a tax-free basis.
This measure will help ensure that the GST-HST does not present an impediment to the establishment of North American distribution centres in Canada.
I would note that a national consultative process took place on this issue that involved many interested parties from all regions of the country, including constituents in my area near Pearson airport. We think the prospects for this are very exciting.
With respect to Canadian businesses supplying warranty repair or replacement services, Bill C-13 contains a measure that would help protect the competitive position of these Canadian businesses relative to their foreign, particularly U.S., counterparts.
At the moment, import duty relief is accorded in the case of goods imported into Canada for repairs under guarantee, provided the goods are exported once the work is done. However, when the good imported is replaced rather than repaired, the import duty relief does not apply.
The bill proposes to extend the relieving rules to cover situations where a replacement good is provided under warranty and is exported in place of the original imported defective good, for example, where the original good is destroyed.
This proposal would ensure that the GST-HST does not make Canadian suppliers of warranty repair or replacement services less competitive relative to foreign suppliers when these services are provided to non-residents.
Bill C-13 also expands on a program known as the exporters of processing services program. This program allows the tax-free importation of goods by a Canadian processor for the purpose of processing the goods in Canada and subsequent export.
The program ensures that the GST-HST does not impose prohibitive cashflow costs on Canadian service providers by their having to pay tax on their customers' goods at the time of importation.
However, the program does not apply where a Canadian processor only provides storage or distribution services.
The bill proposes to expand the program to allow access to businesses that provide only storage or distribution services for non-residents.
Another proposal relating to cross border transactions contained in the bill concerns sales of goods delivered in Canada to non-residents who intend to export the goods.
Special rules under the GST-HST system allow an unregistered non-resident person to acquire goods, and most services in respect of goods, in Canada without paying GST-HST, where the goods are bound for export and remain in the possession of registered Canadian service providers before being exported.
Bill C-13 proposes amendments in order to ensure that this objective is met.
Specifically, an amendment is proposed relating to the sale of railway rolling stock to non-resident businesses. The current rules do not permit the sale of the rolling stock to be tax free if there is to be any use in Canada of the rolling stock prior to its export. This restriction does not reflect current industry practice because rolling stock is rarely shipped empty to its U.S. destinations.
The bill proposes an amendment so that the use of railway rolling stock to move goods outside the country in the context of the exported rolling stock does not of itself result in the stock not being exempt.
Consultations on the proposed amendments I have just mentioned were conducted with a number of businesses operating in the transportation of goods from and to Canada.
The fruit of these discussions is in the proposals contained in the bill which will improve the operation of the tax system in these important export sectors.
I would like to turn to an important sales tax initiative that budget 2000 proposed for the rental housing sector which is likewise contained in Bill C-13. The bill contains a measure of significant benefit to builders and purchasers of new residential rental accommodation.
Under the existing sales tax system, tax applies to new residential rental property when the property is acquired by a landlord from a builder or on a self assessed basis when the builder is the landlord. For purchaser landlords, the tax becomes payable upon purchase of the residential complex. For builder landlords, the tax becomes payable as soon as the first unit in the residential complex is rented. As a result, both purchaser landlords and builder landlords finance the tax liability up front and recover the tax over time.
The bill implements the new residential rental property rebate which is a partial rebate of the GST paid in respect of newly constructed substantially renovated or converted long term residential rental accommodation. The rebate is payable to the builder landlord or purchaser landlord who paid the tax. This will help increase the stock of rental accommodation in Canada.
In fact, the new rebate will reduce by 2.5 percentage points the effective rate of tax on new residential rental property, which is the same as the federal tax reduction that applies to new owner occupied homes under the existing new home rebate program.
I mentioned earlier that in addition to the measures proposed in the 2000 budget, Bill C-13 contains other sales tax measures designed to improve the operation of the GST-HST. Three of these measures are also in the area of real property.
First, the bill proposes a refinement to the existing new housing rebate program which reduces the cost to consumers of building or purchasing a mew home. Refinements are proposed to allow new homes to qualify where they are used primarily as a place of residence, as well as to provide short term accommodation to the public in certain circumstances as the case is with many bed and breakfast establishments.
Second, Bill C-13 would address a problem that arises when a consumer who has purchased real property from a vendor and has paid GST or HST subsequently returns the property to the original vendor without having used it. Currently there is no mechanism by which the consumer can recover the tax paid on the initial purchase.
The proposed amendment contained in the bill would allow a consumer in this circumstance to recover the tax paid on the purchase of the property if it is returned to the original vendor within one year and pursuant to the original contract. This would place a consumer returning real property in a similar position to a person who returns new goods to a vendor and receives a credit or refund for the GST or HST that was originally paid on the goods.
The third real property measure contained in the bill relates to the sale of land by individuals. Hon. members may know that sales of real property by individuals or personal trusts are generally exempt from the GST-HST, provided the individual or trust has not used the property in a taxable business. The bill proposes to ensure that a sale of real property cannot be treated as exempt from sales tax if the seller was previously leasing it to other persons on a taxable basis.
All of these amendments relating to real property transactions reflect the government's commitment to ensure that our tax system is fair and efficient.
As members will recall, last year's budget contained proposals that reflect the government's commitment to continue to work toward improving the quality of life for all Canadians. Quality of life has many dimensions, including access to quality health care and education. Bill C-13 builds on the spirit of that commitment.
In the area of health care, the bill proposes an amendment to continue in force an existing GST-HST exemption for speech therapy services that are billed by individual practitioners and that are not covered by the applicable provincial health care plan.
With respect to education, Bill C-13 contains a measure that will extend the sales tax exemption for vocational training to more situations, including cases where the training is supplied by a government department or agency rather than a vocational school. Specially, the amendment will do away with existing conditions on the exemption that required that the training or the resulting certifications be subject to certain government regulation or that the school be run on a non-profit basis.
The proposed change will ensure that vocational training provided in different provinces receives the same GST-HST treatment regardless of the regulatory regime that exists in each province with respect to vocational schools.
A further amendment would add the flexibility for providers of vocational training to elect to treat their services as taxable where their clients are commercial businesses that would prefer to pay the tax and recover it by way of input tax credits.
As for charities, our government is also taking into account the major role played by these agencies, which Canadians by enriching the lives of our communities.
This bill proposes amendments so that the GST-HST legislation accurately reflects the government's intention to generally exempt charities from having to pay tax on rent and related goods.
As I stated at the outset, Bill C-13 also contains amendments relating to the non-GST-HST parts of the Excise Tax Act which deal with excise taxes on specific products. Among those specific taxes are excise taxes on automobile air conditioners and on heavy automobiles which have been imposed since the mid-1970s.
Since 1984, these taxes have been payable by the manufacturer at the time of delivery to an automobile dealer. Payment of the tax is effectively deferred at the time of importation and on immediate transactions between licensees until the sale to an automobile dealer in Canada.
Several manufacturers have recently challenged the longstanding interpretation and application of these provisions with respect to automobile air conditioners installed in imported new motor vehicles and are seeking substantial refunds of tax. They argue that the relief provided on importations by licensed manufacturers does not simply defer payment of the tax but permanently exempts these goods from tax.
This is clearly contrary to the well understood policy intent and longstanding interpretation and administration of these legislative provisions. Bill C-13 therefore proposes clarifying amendments to ensure that there could be no misinterpretation of these provisions with respect to importations as well as intermediate transactions.
The retroactive application of these amendments is consistent with the criteria that were laid out by the government in 1995 in the response to the seventh report of the Standing Committee on Public Accounts. For nearly 20 years these provisions have been interpreted and administered by both Revenue Canada, now the CCRA, and manufacturers and importers in a manner consistent with the underlying policy intent. The tax charged on automobile air conditioners has routinely been included in the price charged to consumers.
Finally, the amount of government revenue at risk is substantial.
Practical measures must therefore be taken so that there can be no doubt as to the application of these provisions to both future and past operations.
Bill C-13 contains one other amendment relating to the excise tax system. The bill provides authority for the Minister of National Revenue to waive interest otherwise payable under the non-GST-HST parts of the Excise Tax Act. This amendment will achieve greater harmonization of the administrative rules under the excise tax system with those under the income tax and sales tax systems which already provide for this waiver.
The amendment will further help ensure fair administration of the excise tax system.
Consistent with the manner in which this discretionary power has been used under the income tax and sales tax system, the Minister of National Revenue would have the ability to waive interest in circumstances such as where, despite a taxpayer's very best efforts and as a result of extraordinary circumstances beyond their control, the taxpayer has been prevented from meeting certain deadlines and thus has incurred the interest.
Bill C-13 contains another improvement regarding the application of the tax system. Hon. members may remember that the Prime Minister recently announced a federal on-line initiative, which is a key component of the government strategy called Connecting Canadians, which is designed to make Canada the most connected nation in the world.
This initiative provides Canadians with another way to access the information and services they receive in person and by telephone. Members may know that businesses can now file GST-HST returns and remittance information electronically. However, under the existing legislation a person who wishes to do so is required to apply to the Minister of National Revenue for authorization. This procedure is cumbersome and more onerous than the procedure for filing income tax returns electronically.
Bill C-13 proposes amendments to streamline the administrative procedures and harmonize them with those under the Income Tax Act, thereby facilitating the electronic filing of GST-HST returns.
In closing, the measures contained in Bill C-13 that I have outlined here today propose to refine, streamline and clarify the application of the tax system.
They also reflect the commitment made by our government to ensure that our tax system is fair.
I therefore urge hon. members to support the bill. I know it is complex and technical but I would hope the members here would support it.
Mr. Jason Kenney (Calgary Southeast, Canadian Alliance): Mr. Speaker, at the outset I would seek consent of the House to split the balance of my time with my colleague, the member for Elk Island.
The Deputy Speaker: Does the hon. member for Calgary Southeast have the consent of the House to split his time?
Some hon. members: Agreed.
Mr. Jason Kenney: Mr. Speaker, with respect to Bill C-13, amendments to the Excise Tax Act which is, as the hon. the Parliamentary Secretary to the Minister of Finance has indicated, essentially a series of technical amendments to the GST, its collection and its administration.
At the outset I would like to set down some principles from which the official opposition judges all tax related legislation. First, we believe that government should take not one penny more in taxes from Canadians through any source than is absolutely and strictly necessary for the efficient operation of necessary programs. That is to say, programs that are necessary to provide core services which are the exclusive jurisdictional responsibility of the federal government and, in a sense, to help those who cannot help themselves.
From that basic point, the one test with which I approach all fiscal matters is this: I ask myself if an extra dollar spent, collected by us through parliament and spent by politicians and bureaucrats in Ottawa, will do more good than that dollar left in the hand of a resident of my constituency who owns and operates a small business.
Generally, the answer to that question is a resounding no. The dollars we collect, including the approximately $20 billion net which we collect through the goods and services tax, is money which would be more powerfully used for social good if left in the hands of the creative men and women who earn that money and create that wealth in the first place. That is the first premise by which we judge all of these matters.
We then ask ourselves, if we are going to have taxes to finance necessary limited government programs within federal jurisdiction, how can we raise those taxes in a manner which is least destructive to the economy and which has a minimal distortional effect on the choices made by people freely in our economy every day.
I remind the House of the dictum that the power to tax is the power to destroy. All through history we see this lesson. There is a brilliant book about the history of taxation and its destructive power called For Good and Evil by Canadian author Charles Adams. In the book he relates through the centuries, beginning in ancient Egypt, how governments, monarchs, parliaments, congresses have imposed taxes which have had enormous unintended consequences, and how governments frequently do not understand that the power to tax will distort human behaviour, often for the worse.
Let me provide one interesting and humorous example. In the 16th century the British crown decided to bring forward something called the window tax. This was during the Tudor era of architecture. All of a sudden, one of the new luxuries which indicated social status was the capacity to install glass windows in one's residence.
Hon. Lorne Nystrom: Windows 98.
Mr. Jason Kenney: Yes, 1598. The government was looking for another way to collect more money for the crown or for the treasury, because even in 1601 it had the same insatiable appetite for revenue as it does in 2001. It imposed a window tax. It had assessors go across the land to count the number of windows people had in their domiciles.
Lo and behold, if we go to small English towns today and look at some of the Tudor homes, we will see over and over again these very clear window shaped spaces that have been plastered over and filled in or bricked in. Why? It was because 500 years ago people understood that they could protect their economic best interest by avoiding taxes legally and so they bricked in those beautiful glass windows all across England.
It is just one example which demonstrates how the unintended consequences of bad tax policy can shut out the light and leave people in darkness. That is the kind of tax policy we too frequently see from the Liberal government. We look from a historical perspective at trying to construct a minimal tax regime which allows for maximum human freedom and creativity and does not distort the marketplace.
In that respect we, like many Canadians, have many grave concerns about the whole range of taxes imposed by this place, in particular today with respect to the goods and services tax. We all recall back in 1990-91 when the then Progressive Conservative government imposed what at that time was, and probably still is, the most despised tax in Canadian history. It did so over the overwhelming opposition of the majority of Canadians.
I know you will remember this, Mr. Speaker, because I believe you were a member of this place. If so, you were certainly sitting in these benches vigorously opposing the tax. You ran in the election campaign in 1993 where the central promise was not just to amend the tax through technical amendments such as those before this place today, not just to tinker with its administration and collection, but to kill, eliminate, abolish, get rid of and scrap the GST.
However here I am in the House in the year 2001, eight years after those solemn promises were made and those undertakings were given, and I have in my hand a bill to continue and amend the goods and services tax. It is like Alice in Wonderland. The bill comes forward from the same government which said that the tax, which it is now amending, would no longer exist.
At the outset I will put on the record the dismay of so many Canadians that the government thinks it can get away with, and continues to get away with, perpetuating a tax which it promised to kill, slash, abolish and eliminate.
The third point I will make with respect to constructing taxes of maximum efficiency is that we must have a tax system which allows for accountability on the part of government because, as I said, the taxing power is such an awesome destructive power. Arguably, next to the criminal law power exercised by parliament, the taxing power is the single most weighty and onerous power that it wields. It really can destroy people's economic well-being.
Often that power can be wielded in a reckless fashion by tax collection bureaucrats. I have in my files literally hundreds of cases where law-abiding, well meaning, well intentioned citizens have acted in good faith to try to comply with tax laws like the one before us today and have found themselves harassed, audited, chased down, investigated, abused, and have had their assets frozen by the agents of revenue Canada, now the revenue agency.
That is why my colleagues and I have brought forward a taxpayer bill of rights that would seek to enshrine in legislation, in a very clear way, definitive rights of recourse and appeal and protection for taxpayers in the assessment and collection process.
The parliamentary secretary says that it is already there but it is not. There is a preambular statement with no sanction and no statutory power which is a goodwill statement. We propose to legislate specific standards of performance on the part of the CCRA and its employees and clear items of recourse so that people do not need to go to court to enforce their common law rights for fair consideration under the application of the tax laws.
I will turn to the specifics of the bill. We strenuously object to the fact that the government continues to reject its 1993 election promise. We believe the GST itself collects too much revenue as the government does overall. In fact, we are now looking at very substantial taxpayer overpayments.
The government likes to call them surpluses and pat itself on the back. The only people who deserve credit for these surpluses are hardworking men and women. Notwithstanding the highest personal income tax burden in the G-7; notwithstanding that we have the highest corporate tax burden in the G-7, according to a recent study by KPMG; notwithstanding the fact that the government and its predecessor have burdened them with the second highest level of public indebtedness in the OECD; notwithstanding that we have seen our standard of living, our per capita GDP, fall relative to our major competitors for the past two decades; and notwithstanding the enormous burden of red tape and all of the anti-growth policies of the government; notwithstanding those substantial facts, hardworking men and women of Canada have managed to produce growth. The government by raising taxes has benefited from that hard work, wealth creation and growth, and of course it shamelessly takes credit for it.
That constitutes a huge amount of overtaxation, well over $120 billion of overtaxation, that should be refunded to the people who earned it and overpaid it.
While we recognize that the government has failed to accept its commitment with respect to the GST, that it continues to overtax and that it still fails to bring in something like a taxpayer bill of rights which enumerates taxpayer rights in the assessment and collection procedures, nevertheless there are some technical improvements to the GST in the bill, to which I now turn my attention.
On the first point, the bill's primary goal is to correct some administrative oversights in the February 2000 budget. With the thousands of bureaucrats in the Department of Finance and the 40,000-some in the Department of National Revenue, why do we have significant administrative “oversights” in key tax legislation? That is part of the problem.
When we speak about administrative oversights, I want to comment on the manner by which the bill comes to us. We in the official opposition got notice of the bill about 48 hours ago. It is a detailed technical bill. We have very limited resources at our disposal. It is absurd for the government to expect the opposition properly to execute its oversight function of legislation with 48 hours notice on a major technical bill.
That is one of the reasons we end up with administrative oversights. It is one of the reasons the government always brings in legislation like this one to correct the mistakes it made. It does not give parliamentarians the benefit of time to become properly acquainted with the legislation it proposes.
If we had more time to analyze this, and if the government were more generous in accepting and considering opposition amendments, we would not find ourselves again and again wasting parliamentary time correcting mistakes the government has already made.
Some of the mistakes the Liberals have made, which they now propose to correct, consist of, among other things, implementing new rules to ensure the GST does not impede North American distribution centres in Canada. When businesses import goods from the United States or from any other country, rather than taxing the goods when they are imported and then applying for a GST rebate, they can go through tax free. That is sensible. It should have happened a long time ago. It is something industries have been asking for many years.
Second, the bill ensures that no tax is payable on the importation of defective goods imported solely to be replaced under warranty. If somebody here buys an alarm clock from a Japanese manufacturer and it does not work and they return it, the new clock can be shipped back into Canada without GST applying on it again. That is a sensible administrative efficiency which should have been in the act a long time ago. I see the secretary of state is once again congratulating himself. I am not surprised.
It also seeks to implement the new residential rental property rebate, which is a partial rebate of GST paid in respect of newly constructed or substantially renovated long term residential rental accommodation. This is a measure, which my hon. colleague, the learned and distinguished member for Wild Rose, has long sought to obtain in the legislation. He has fought for it on behalf of constituents for some time, so this section we can call the Myron section. This is a victory for the constituents of the member of parliament for Wild Rose. Let the record show that he is getting spontaneous applause even in his absence.
The bill also continues to enforce the existing GST exemption for speech therapy services that are billed by individual practitioners and not covered by the applicable provincial health care plan. This is also a sensible improvement which should have happened a long time ago under the minister's watch.
The secretary of state who applauds sat without acting for I do not know how many years while this measure was not in place. He should not applaud his tardiness.
The bill also seeks, with respect to education, to ensure that vocational training across the country is provided the same exempt treatment regardless of how vocational schools are regulated in each province. This is an incremental improvement in the tax treatment of vocational schools. I hope the government will also use its authority to bring the provinces to the table to ensure that credentials provided by such schools are recognized from coast to coast. That is one useful role the federal government could play.
With respect to electronic filing, the bill removes the requirement to apply to the Minister of National Revenue for permission to file GST returns electronically and therefore allows anyone to do so provided they meet the criteria set out by the minister. This would streamline the ability of people to file electronically. That again is something that should have happened long ago. There are also miscellaneous administrative amendments clarifying interpretations of the act.
Let me say on that point that far too often the government makes tax policy by news release. The primary power of this place, based on the long history of parliamentary government, is to approve the taxation, the ways and means of the crown. However, over and over again very significant amendments are made to tax law by news releases coming out from either the Department of Finance or the Canada Customs and Revenue Agency.
For instance, we will see in this section a number of administrative interpretations being clarified but which were given the effective force of law by mandate of news releases from bureaucrats months if not years ago.
I want to say on the record that it is time we ended this usurpation of parliamentary authority and brought it back to this place through those kinds of amendments. All in all, we in the opposition have a tendency to be opposed to any amendments to the GST on the clear premise that the government promised to abolish it, not tinker with it.
Having said that, we do support some of the incremental improvements in the bill but we believe it could go a lot further in improving the administration of the GST.
On behalf of the opposition I want to say that until the government finally begins to truly understand—and not just mouth platitudes about it—the negative impact that its tax policies have on our economy, our families and our small businesses, this opposition will continue to be a clarion voice for tax relief and tax reform. While we support elements of legislation like this, we will not support the continuation of an overly onerous, burdensome and destructive tax regime which the government uses to finance its overspending and its wasteful and inefficient practices.
Mr. Ken Epp (Elk Island, Canadian Alliance): Mr. Speaker, I am delighted to stand in the House on a Friday morning and enter into this debate on the GST.
It was the GST that brought me here. I do not know whether that is widely known. The most common statement I heard while knocking on doors in 1993 was “we are going to get rid of those Conservatives who brought us the GST”. A bunch of people asked me why they should vote for Brian O'Kurley when he did not vote for them. Brian O'Kurley was the Conservative predecessor in my riding. It was Brian Mulroney and Brian O'Kurley who campaigned for me in 1993 and undoubtedly delivered more votes for me than I could possibly have got by myself. The GST has a history.
I had a very interesting experience the other day. I was preparing to speak on the fact that the government was invoking closure in its motion in order to reduce the ability of the opposition parties to do their work in the House. My staff and I did a bit of research at the Library of Parliament. Among other things, we looked at some of the newspapers circa 1989 and 1990, in that era when the GST was being debated. It was absolutely incredible to read some of the newspaper reports of the day. I was amazed by the outrage expressed by the present Minister of Industry at that time. He was on this side of the House then. The outrage he expressed toward the Conservative government that was proposing the GST was absolutely amazing. Also, the present Prime Minister was then travelling around the country telling people that his government would kill the GST.
Just as I got here because of the GST, I wonder how many Liberals got elected on that same hatred of the goods and services tax, sometimes called, in our part of the world—I am going to say this real quickly, Mr. Speaker, and then you can stop me afterwards—the gouge and screw tax. That is what it was called out west. The amount of animosity generated by that particular tax was absolutely incredible.
I was not aware until last week that the finance critic from this side of the House took a number of Liberal MPs with petitions out to the Sparks Street mall. It was recorded in the newspapers in 1990. Those MPs asked citizens to sign a petition to stop the GST. The newspapers had huge headlines about all of the overt opposition to the GST.
We know the history of it. The Conservatives finally were persuaded to reduce the rate from 9% to 7%. That, they claimed, was a victory for the people because they listened to the people. I guess they listened like these Liberals listen when it comes to tax policy and other issues. They reduced the rate and then proceeded to put it through the House.
At that time I was researching the use of tactics to prolong debate in the House. Members would not believe what the Liberals did on that side of the House in order to try to stop that legislation. They did not introduce 4,000 amendments—I guess they were not bright enough to think of that as a tactic—but they did all sorts of other things. Finally it was pushed through in a whipped vote.
By the way, our own member of parliament for Elk Island at that time, my predecessor for whom I have a great deal of respect, was a real gentleman in the campaign. I have talked to him several times since then. He is a nice guy, but sitting on the government side he had no choice about representing the wishes of his constituents in that vote, because it was a whipped vote just like pretty well every vote on the government side of the House is a whipped vote. That does not give members of parliament the opportunity to represent their constituents. He was an honourable guy, but he was pushed into the system and I suppose had no choice.
What happened in 1993? I told my friend—and I will call him my friend—Brian O'Kurley that he went down with the ship but that he as an individual did not take down the ship. It was the whole crew that took down the ship. Ten years later we now have a group of Progressive Conservatives represented over on that side of the House in a double file along the wall, five deep on two sides. People just did not ever come back to the PCs. In the last election, the PCs lost some 86% of their vote in Quebec. They have very little market share, whereas there is a great attraction to formerly the Reform and now the Canadian Alliance because we have explicitly as one of our policies that it is our primary duty to represent our constituents.
I like to think that had we had a Canadian Alliance type of government in 1989 and 1990, that tax either would not have been implemented or would have been greatly improved before it was implemented. It would not have been implemented until we had the consent of the people. As it was, the tax was jammed through by an arrogant government, with 85% of Canadians opposed to it. That was an error.
I really commend my hon. colleague from Calgary for his speech. We must be geniuses who think alike because I was going to use the Tudor example as well. The only difference in the story that I remember was that they did not count the windows, they measured the windows. They measured the area. That was why the windows were so small.
If I had a dream that could be fulfilled, because we know there are some private members' bills that commemorate this day or that day, I would like to have a private member's bill passed in the House such that every time people saw a Tudor style small window they would be encouraged, not forced, to incant these words “I hate huge taxes”. If every time we saw one of those buildings we were to say “that is the result of an arrogant government that overtaxes the people”, then perhaps we would start putting pressure on the government to reduce taxes.
Since we are talking about the GST and taxes in general, I should also say that I have little doubt in my mind that it is the presence of the Canadian Alliance on this side that has actually made reduction of taxes an issue of debate and has made it respectable to talk about.
Until we came along, it seemed to make no difference whether it was the Liberals or the Conservatives on whatever side of the House. Each of those governments increased records of the number of times they increased taxes and the amounts by which they increased taxes.
I like to think that we on this side had some considerable influence on the direction the government is now taking in gingerly starting to reduce tax rates. The government knows that the public is starting to hear our message and it knows that the public will vote for us if the government does not do what we are promising to do.
I look at some of the issues the federal government has approached, especially in the major campaign document it introduced four days before the election was called, namely the Minister of Finance's mini statement, and I note that the reason those issues were in there was that the Liberals realized without them we would make huge gains, and so we would have if they would not have stolen from us. I suppose I should commend them for stealing our ideas and tell them to steal more because that is the way to go.
There is another example of how taxation policy affects human behaviour. One of my favourite stories is that of my own father who is now in his 90th year. My dad was a hard-working farmer. He taught us to work hard when we were kids growing up on the farm in Saskatchewan. These days he sees that farmers are farming so well and so efficiently, including my brother, who has taken over the family farm and expanded it.
My dad is deeply distressed and concerned about the fact that these farmers farming so well with big equipment on a large scale and getting good crops, basically four times as much per acre as he was able to raise with his boys when he was a farmer, are now struggling for their very existence, with many losing their farms. It is absolutely despicable. My father has been a farmer all his life and still loves to get out there at harvest time and watch that grain come roaring out of the chute on the combine. He is one who is very practically minded, I can assure members.
I remember the GST coming in and my dad breaking the pattern he had had for a number of years. After I left home, my Dad's financial situation somehow seemed to improve. I wonder whether there was a correlation there. We were very poor when I was young growing up on the farm in Saskatchewan, exceptionally poor. When I graduated from high school, went on to university, got my own job and ceased being dependent on him, somehow at that stage my father's financial fortunes seemed to take a little turn for the better and on more occasions he would buy a new car.
For many years he bought a car every three or four years. In 1991 when the tax came in, my dad had a car that was four years old and was ready to be traded. He went to look at the new ones and the dealer hit him with the GST. He walked away from the dealership. He said to my mom “we are going to keep the car”.
Mr. Speaker, if you are going to interrupt me may I continue later?
The Deputy Speaker: I want to assure the hon. member for Elk Island and all his colleagues on either side of the House that in fact he will be able to continue after question period. He has approximately eight minutes remaining.
STATEMENTS BY MEMBERS
INTERNATIONAL WOMEN'S DAY
Ms. Sarmite Bulte (Parkdale—High Park, Lib.): Mr. Speaker, March 8 is International Women's Day and the theme for this year's celebrations is “Canadian Women: Raising our Diverse Voices for Positive Change”.
To commemorate the day next Thursday I will be hosting my annual breakfast to acknowledge the accomplishments of six outstanding women in my riding.
My special guests will include: Allison Bain, associate managing director of the Toronto International Film Festival; Pia Bouman, of the Pia Bouman School for Ballet and Creative Movement; Marilyn Bruner, president of St. Joseph's Health Centre; Diane Jermyn, entrepreneur, owner of Blues on Bellair; Linda Leblanc, volunteer and community activist; and Olha Zawerucha-Swyntuch, president of the Ukrainian Canadian Social Services.
This is an occasion to reflect on the progress made to advance women's equality, to assess the challenges facing women in the new millennium, to consider future steps to enhance women's quality of life and of course to celebrate their achievements. More important, it is a day to celebrate the lives of ordinary women as makers of history.
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Mr. Richard Harris (Prince George—Bulkley Valley, Canadian Alliance): Mr. Speaker, on June 29, in the second session of the 36th parliament, the House passed Bill C-18, which provides for a sentence of life imprisonment for the crime of impaired driving causing death where aggravating factors are present.
Yet today, over seven months later, the bill has still not been put into force by the Liberal government.
Bill C-18 is a very important step in the fight against impaired driving.
I speak not only for the victims of this senseless crime but for all Canadians in demanding that the Minister of Justice get this bill into law to help deter impaired driving, to ensure that the penalty fits the crime where death is a result, and to help save the lives of thousands of innocent Canadians.
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Mr. Marcel Proulx (Hull—Aylmer, Lib.): Mr. Speaker, the 2001 edition of the Canadian National Division of the Philip C. Jessup International Law Moot Court Competition took place from February 15 to 17 at the University of New Brunswick's Faculty of Law.
Some sixty entrants representing the elite of Canadian law faculties took part in this prestigious event. Today, I would like to pay tribute to the performance of Guy Régimbald, an Aylmer resident, who represented the University of Ottawa and who won the title of best French language litigator.
This is a fine reward for Mr. Régimbald, who put in long hours of preparation, doing research into this year's theme “The Seabed Mining Facility”.
Once again, congratulations to Mr. Régimbald. I hope that this honour will be the first of many in a successful law career.
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Mr. Eugène Bellemare (Ottawa—Orléans, Lib.): Mr. Speaker, more than 400 movers and shakers from various francophone communities in Canada are now in Ottawa taking part in “Live Dialogue”, an event organized by the Fédération des communautés francophones et acadiennes.
This meeting is a follow up to the “Parlons-nous/Let's Talk” report, which was the result of cross Canada consultations. Members of francophone, anglophone, native and ethnocultural communities are meeting this weekend in order to discuss their vision of intercultural relations and also to strengthen the links between the various components of the francophonie in Canada.
I am sure that their discussions will help increase the numbers of francophiles in Canada.
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Mr. John Cummins (Delta—South Richmond, Canadian Alliance): Mr. Speaker, yesterday in parliament the defence minister suggested that if there were an earthquake in the lower mainland of B.C. the Canadian military would be able to respond just as it did during the ice storm in Quebec or during the Saguenay or Red River floods. What nonsense.
The defence minister should talk to the Prime Minister who knows from his many overflights of B.C. on his way to China that much of the province is mountainous. There is only one highway into the lower mainland. It and the two rail lines are vulnerable to slides and slumping, which could close them indefinitely during a major quake.
The lower Fraser valley and the Fraser delta are dissected not only by the Fraser River and its many arms but by several other rivers as well, giving rise to a large number of bridges, all of which would be at risk during a quake.
We needed the special skills of the army engineers who were based in Chilliwack. Now that they are gone we can only thank God for our generous American neighbours and give the infamous Trudeau finger to Liberals everywhere.
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INTERNATIONAL WOMEN'S DAY
Ms. Monique Guay (Laurentides, BQ): Mr. Speaker, International Women's Day will be celebrated on March 8. This is a special time to take a moment to look at what women have achieved and what they have still before them.
Women are contributors to the history of Quebec and the history of Canada. They have contributed to the advancement and the influence of these two countries, which have carved an important niche for themselves among the world's powers.
Through volunteer or paid work, whether at home, in a family business, in industry, in the service industry or in one of the social institutions, women have helped build Quebec and Canadian society.
Today, my colleagues of the Bloc Quebecois join with me to pay special tribute to all these women.
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MEMBER FOR FREDERICTON
Hon. Andy Scott (Fredericton, Lib.): Mr. Speaker, I would like to bring to the attention of the House, not that it will be a surprise to most members, the fact that the reform alliance is just the same old, same old.
I read a letter to the editor of the newspaper in my riding whose headline reads “Employment Insurance: Today's version of buying votes with liquor”. It was written by none other than Jordi Morgan, the reform alliance candidate from Dartmouth in the last federal election.
It comes as no surprise that these boorish comments continue to be made by members of the reform alliance. After all, before the federal election even began, John Mykytyshyn, a key Alliance strategist, summed up their feelings about our part of Canada saying that “Atlantic Canadians are simply lazy”.
The reform alliance was rejected by Atlantic Canada during the last election because it indicated to us that it cares nothing for our region, our people or our communities.
Shame on the Alliance for not giving Atlantic Canadians—
The Deputy Speaker: The hon. member for Crowfoot.
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TREVOR AND LINDA DAVIES
Mr. Kevin Sorenson (Crowfoot, Canadian Alliance): Mr. Speaker, I rise today to commend Mr. Trevor and Mrs. Linda Davies of Camrose, Alberta for their volunteer efforts in Honduras.
On behalf of the Canadian Executive Service Organization, Trevor and Linda went on assignment to Honduras to assist an organization that provides financial services to Afro-Honduran communities and other ethnic groups that have difficulty accessing credit from conventional sources.
Trevor wrote a comprehensive report that covered the past and present micro credit situation, management and personnel and projected lending. He made a series of recommendations for change.
Linda provided recommendations for immediate and long term health and sanitation improvements for a village project the organization sponsored. She left medications and other supplies donated by Canadians at the village clinic and donated materials to the village school.
The outstanding and selfless efforts of these two individuals helped stimulate development in the disadvantaged economy of Honduras.
In this year of volunteers, I salute the work of these highly skilled volunteers, Trevor and Linda Davies.
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NATIONAL CHILD DAY
Mr. Mac Harb (Ottawa Centre, Lib.): Mr. Speaker, in November 1996 I held a roundtable discussion for youth and youth service providers here on Parliament Hill.
This discussion was designed to help celebrate National Child Day by bringing together youth with service providers to help address the issues faced by our youth today.
Five years later this roundtable is still going strong. The third Monday of every month, youth and youth service providers meet at the new city hall to share information and to plan their annual youth forum.
I want to commend all the staff and the volunteers of these organizations and congratulate them and all others involved on their excellent dedication as they continue to address youth issues in our communities.
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Mr. Geoff Regan (Halifax West, Lib.): Mr. Speaker, at 8.45 a.m., December 6, 1917, at the height of World War I, the Belgian relief vessel Imo collided with the French munitions carrier Mont Blanc in the narrowest part of Halifax harbour.
Out of a population of less than 50,000 people, over 1,600 died and 9,000 were injured, including 200 blinded by flying glass.
Today there are only nine pensionable survivors still living.
The federal government promised to support the survivors, but their benefits have dwindled over the years to the point where they no longer reflect the cost of living.
I want them and their families to know that I will be lobbying the Minister of Veterans Affairs to ensure they receive the benefits to which they are entitled.
I will work not for only this group but for all the merchant mariners who are owed benefits for their service and contribution to our country.
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INTERNATIONAL WOMEN'S WEEK
Ms. Wendy Lill (Dartmouth, NDP): Mr. Speaker, International Women's Week kicks off this weekend. The theme of this year's celebration here is “Canadian Women: Raising Our Diverse Voices for Positive Change”.
We have come a long way since International Women's Day was first proclaimed by women across the world struggling for equality, justice and better working conditions. Women achieved the right to vote here, became recognized as persons and began the steep climb up the ladder in society, in the workplace and in the corridors of political power.
Last year in the World March of Women 2000, women across the world once again united to effect change in the fight against poverty and violence.
This week and in particular on International Women's Day, March 8, Canadian women and their sisters across the world will celebrate their immense achievements and demonstrate their will to continue to struggle for women's rights and equality. I invite all men, women and children to take part in this important week of reflection and action.
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SUMMIT OF THE AMERICAS
Mr. Antoine Dubé (Lévis-et-Chutes-de-la-Chaudière, BQ): Mr. Speaker, over the past five weeks, the federal government has shown it lacks transparency and treats democracy with disdain.
For example, in the case of the summit of the Americas, for which the federal government has refused to make public the documents to be used in the negotiation of a free trade area of the Americas even though the public wants to know what is being negotiated, the government is turning a deaf ear.
Another example is that of the young offenders. Despite Quebec's unanimous opposition to this bill, the federal steam roller rolls on. Not only is the government refusing to hear what people are saying, but it has no hesitation in muzzling their representatives.
After invoking closure during its first seven years in power more than any other government has ever done before, the Liberal government wants to systematically paralyze the work of the opposition with its Government Business Motion No. 2.
Members will agree that it is time for Quebecers to withdraw from this system, which no longer respects who they are, and even less what they want. I will be glad when Quebec is sovereign.
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Mr. Mauril Bélanger (Ottawa—Vanier, Lib.): Mr. Speaker, the Taliban, the ruling Islamic regime of Afghanistan, has decreed that all non-Islamic statues in Afghanistan be destroyed. This includes two Buddha statues carved from sandstone cliffs centuries ago, the tallest one being over 50 metres.
We in Canada have great difficulty understanding the state of mind that would drive the rulers of a nation to such behaviour.
Despite protests from many countries, including Canada, and despite representations from UNESCO and the United Nations, the ruling regime intends to continue to remove all these statutes. The Taliban persists on its course of cultural destruction.
It will forever be a sad day when religious intolerance or intolerance of any sort causes the wilful destruction of items of world cultural heritage.
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Mr. Gerald Keddy (South Shore, PC): Mr. Speaker, I would like to congratulate two special Nova Scotians on their recent accomplishments: Eric Mackie on his recent assignment with the Canadian Executive Service Organization in Peru, and Colleen Jones on her third consecutive win at the Canadian Women's Curling Championships.
While in Peru, Mr. Mackie helped establish a network security process for the central bank. Mr. Mackie is one of 4,000 volunteers who work with this non-governmental agency as volunteer advisers helping developing nations by sharing technical, professional and managerial expertise.
Colleen Jones recently led the Nova Scotia women's curling team to her third women's title at the Scott Tournament of Hearts. It was Ms. Jones' 15th time competing at the Canadian national final, the first time being in 1980. Ms. Jones and her team are now looking ahead to the world championship in Lausanne, Switzerland and we wish them all the best.
Congratulations to these two very deserving Nova Scotians on their recent accomplishments.
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MEMBER FOR ETOBICOKE—LAKESHORE
Ms. Carolyn Bennett (St. Paul's, Lib.): Mr. Speaker, I rise today to recognize the achievements of one of our very own parliamentarians. Last weekend the hon. member for Etobicoke—Lakeshore was honoured with three distinct awards for her outstanding contributions to her community and her country.
She, along with our colleague the hon. member for Parkdale—High Park, was the recipient of the Canada-Estonia Gold Order of Merit, which was awarded to mark the 83rd anniversary of the independence of Estonia.
The hon. member for Etobicoke—Lakeshore was also recognized by the Canadian Association of Black Lawyers with their community award. This award honours her work in advancing human rights in the law and recognizes her role in mentoring and supporting others.
Finally, she was awarded the special Citizens Thank You Award at the National Archives of Canada. This award gives national recognition to Black History Month.
At the end of Black History Month, it is appropriate that we all take this opportunity to thank the hon. member for Etobicoke—Lakeshore for all her tremendous efforts in advancing the causes of minority groups in our society. As a former chair of the national women's caucus, she has also been instrumental in bringing to the fore issues that affect women all across Canada.
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HEATING FUEL REBATE
Mrs. Betty Hinton (Kamloops, Thompson and Highland Valleys, Canadian Alliance): Mr. Speaker, I rise in the House today on behalf of my constituents who continue to ask me to enlighten the government about the wrongheaded gas rebate scheme. In the past month I have received hundreds of letters, e-mails, faxes and phone calls about this cruel billion dollar joke.
I could go on about this myself, but instead I will use my own constituents' words.
Leandra, who lives in Kamloops, is upset that prisoners got rebate cheques a month ago while she, who actually pays a gas bill, still has not received a cheque.
Ellen, who lives in my riding, writes that she is upset with the incompetence of the Liberals and really wants to know how this government came up with such a scheme.
There is Stephanie from Kamloops. She is a hard-working single mother who pays a gas bill of $125 a month. She resents being penalized for having a job and contributing to society while the government buys her vote with her own tax dollars.
My constituents want more than vague platitudes from the government. They know when they are being bought and they want this gas rebate scheme fixed.
* * *
LANDMINE AWARENESS WEEK
Mr. Pat Martin (Winnipeg Centre, NDP): Mr. Speaker, this week is Canadian Landmine Awareness Week. In conjunction with their many partners, Mines Action Canada is promoting awareness of the global landmine crisis.
Today marks the second anniversary of the coming into force of the international mine ban treaty, the Ottawa treaty. This treaty prohibits the use, stockpiling, production and transfer of anti-personnel mines and represents a great step forward in reducing the human tragedy and suffering resulting from their use.
It is on their behalf that I ask all members to support the efforts of Mines Action Canada and of those organizations around the world in encouraging countries, like the United States and China, to accede to the Ottawa treaty so that one day we can achieve the goal of creating a world free of landmines.
ORAL QUESTION PERIOD
Ms. Val Meredith (South Surrey—White Rock—Langley, Canadian Alliance): Mr. Speaker, yesterday the Prime Minister claimed that he had followed all of the conflict of interest rules and turned everything over to his trustee.
However, on January 27, 1996, it was not the trustee who contacted the ethics counsellor, as it should have been, it was the Prime Minister himself.
Under the terms of the blind trust agreement, the Prime Minister should not even have known about the problem with his shares.
Why was the Prime Minister involving himself with his blind trust, in direct violation of the conflict of interest code?
Hon. Herb Gray (Deputy Prime Minister, Lib.): Mr. Speaker, I think that the premise of the hon. member's question is not correct. If that is the case, her whole question flounders.
The ethics counsellor was very clear in what he told the Globe and Mail yesterday. He said:
I don't want there to be a sense that the Prime Minister, in our view, was not in full compliance with his obligations.
Ms. Val Meredith (South Surrey—White Rock—Langley, Canadian Alliance): Mr. Speaker, we can read the conflict of interest code. It is quite clear to us. Let me quote from it. The conflict of interest code states:
The public office holder cannot—participate in any discussion—that may particularly or significantly affect the assets that are subject to the agreement.
How is it possible that the Prime Minister even knew that the shares in his golf course had reverted back to him if he had not participated in a discussion about them?
Hon. Herb Gray (Deputy Prime Minister, Lib.): Mr. Speaker, I think we have to assess the premise of the hon. member's question for its factualness and its context. Generally when we check these things we find something missing in terms of language and in terms of context.
It is very important to repeat what that the ethics counsellor told the Globe and Mail yesterday. He said:
I don't want there to be a sense that the Prime Minister, in our view, was not in full compliance with his obligations.
That is a very important statement.
Ms. Val Meredith (South Surrey—White Rock—Langley, Canadian Alliance): Mr. Speaker, I think the problem is that we ask harder questions than the lapdog of the Prime Minister.
It is interesting how things have changed over the last 15 years. Fifteen years ago members of this cabinet were jumping and leaping over tables to enforce the conflict of interest rules. Now they think it is okay to ignore them.
The Prime Minister obviously involved himself in discussions about his blind trust, which is a clear violation of the code. The Liberals over there think that is just fine.
I would ask the Deputy Prime Minister—
The Deputy Speaker: I regret but time has elapsed.
Hon. Herb Gray (Deputy Prime Minister, Lib.): Mr. Speaker, last fall during the election the leader of the Alliance and the leader of the Conservatives wrote the ethics counsellor asking him to investigate an alleged breach of the rules on this matter. It was only after the ethics counsellor looked into the matter and found there were no breaches of rules that the leaders of the two parties began attacking him.
Rather than him being a lapdog of the Prime Minister, which he is not, they are unhappy because the ethics counsellor refuses to be a lapdog of the leaders of the Alliance and the Conservative parties.
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CUSTOMS AND REVENUE AGENCY
Mr. John Reynolds (West Vancouver—Sunshine Coast, Canadian Alliance): Mr. Speaker, my question is for the Minister of National Revenue.
The minister is allowing his customs officers and immigration officers to not only open the mail but to also photocopy and enter information into a secret database, much like the secret database we had in last year's human resources scandal.
Given that, for example, mail between a lawyer and a client is privileged, what assurances do Canadians have that the civil rights of law-abiding individuals are not being infringed by this questionable practice? Also, are lawyers being advised when their clients' mail is photocopied and retained?
Hon. Martin Cauchon (Minister of National Revenue and Secretary of State (Economic Development Agency of Canada for the Regions of Quebec), Lib.): Mr. Speaker, Canadians understand that the Canada Customs and Revenue Agency, on the customs side, has a dual mandate. Part of this mandate is to make sure that we keep the communities we serve safe. As well, part of this mandate is to make sure that all goods coming into Canada respect Canadian law.
Customs, as we all know, does perform risk assessments. It also performs random checks. When we are referring here to mail and goods crossing the border, we are also talking about international mail and goods. However, we are talking about mail more than 30 grams. Personal letters are not touched at all.
Mr. John Reynolds (West Vancouver—Sunshine Coast, Canadian Alliance): Mr. Speaker, when we want a wiretap we have to go to a judge to get it. We have mail coming to lawyers in this country that is being opened by Canada customs.
What Canadians want to know is, if Canada customs retains that mail and makes copies of it, are the lawyers, to whom the letters are being written, informed that their mail has been opened and copied before it is forwarded to them? We want to know if our civil rights are being violated.
Hon. Martin Cauchon (Minister of National Revenue and Secretary of State (Economic Development Agency of Canada for the Regions of Quebec), Lib.): Mr. Speaker, here we are talking about mail and parcels weighing 30 grams or more. Each and every time that we proceed on a random check basis there is a question of risk assessment. After we open something, a box for example, we put a stamp on it making sure that the recipient is aware that that box has been opened by Canada Customs and Revenue Agency.
When we talk about personal letters, we cannot open a personal letter weighing under 30 grams without the consent of the sender or the recipient. I must tell the House that our attitude with regard to random checks has been very profitable to the Canadian—
The Deputy Speaker: The hon. member for Longueuil.
* * *
Ms. Caroline St-Hilaire (Longueuil, BQ): Mr. Speaker, yesterday, 51 U.S. senators asked the president of the United States to maintain export quotas on Canadian lumber and have even threatened to use retaliatory measures against Canada.
The minister keeps saying that Canada's lumber file is iron clad. Moreover, he constantly refers to the international rulings that all support Canada's position.
Therefore, how does the minister explain his inability to effectively defend Canada's point of view?
Mr. Pat O'Brien (Parliamentary Secretary to Minister for International Trade, Lib.): Mr. Speaker, it is incredible for me to hear that the minister has not expressed the point of view of Canada adequately. The minister has been eloquent and consistent in making clear that Canada's position on this is that we want free trade.
The problem lies south of the border. It does not lie on this side of the border. The Unites States has never won a countervail duty action against Canada, and our opinion is that it never will.
Ms. Caroline St-Hilaire (Longueuil, BQ): Mr. Speaker, the minister claims to be discouraged and, indeed, his attitude is rather discouraging.
Why does the minister attach so much importance to the comments by these 51 senators when he could have shown transparency and got the support here in this House of 300 parliamentarians?
Does the minister realize that by going it alone, as he has been doing since the beginning on this issue, all Quebecers and Canadians may well lose out on this issue?
Mr. Pat O'Brien (Parliamentary Secretary to Minister for International Trade, Lib.): Mr. Speaker, the premise of the member's question is just incredibly wrong. The Minister for International Trade has consulted widely with all provinces, all trade ministers, including the trade minister of Quebec, and all the sectoral groups involved in the lumber industry.
The fact of the matter is that the Canadian position is very clear. There is a clear consensus in this country, from coast to coast to coast, not to have a quota based system. I would remind the hon. member that includes her own province of Quebec.
Mr. Yvan Loubier (Saint-Hyacinthe—Bagot, BQ): Mr. Speaker, up to now, the Minister for International Trade has not taken a firm stand on the immediate return of free trade in the lumber sector, preferring to speak of a long term transition to free trade.
More recently, in his meeting with the American secretary of trade, he expressed his discouragement at the attitude of the U.S.
Will the minister acknowledge that his attitude and his remarks are not putting Canada in a strong position, which is crucial at the start of negotiations with the Americans over lumber?
Mr. Pat O'Brien (Parliamentary Secretary to Minister for International Trade, Lib.): Mr. Speaker, quite the contrary. The minister simply expressed the frustration that ought to be shared by all members on both sides of the House, which is certainly shared by the people in the lumber business from coast to coast to coast, that we are interested in a free trade arrangement in softwood lumber with the United States, which claims to be a free trading nation.
Despite three attempts at a countervailing duty action, the United States has never succeeded. That is the kind of frustration the minister has expressed. We have consistently been shown to be correct and we will be again, if necessary.
Mr. Yvan Loubier (Saint-Hyacinthe—Bagot, BQ): Mr. Speaker, beyond personalities, beyond the frustrations expressed, one very important thing stands out and that is the future of the lumber industry and of the thousands of jobs it provides.
Instead of bragging in this matter, as all the members of the government are doing, why does the minister not join the Prime Minister right now and approach the American president in order to pave the way to real negotiations, with the attitude of the Americans, which will not be more intransigent in the coming weeks, so as to reach an agreement that will benefit the industry as a whole and keep the thousands of jobs? Why does he not act immediately, because this is serious?
Mr. Pat O'Brien (Parliamentary Secretary to Minister for International Trade, Lib.): Mr. Speaker, I am not quite sure where my hon. colleague has been, but this issue was raised by the Prime Minister of Canada personally with President George Bush when he met with him.
On Monday of this week, this was one of the very first issues raised by our Minister for International Trade with U.S. trade representative Mr. Zoellick.
One minute the member is describing the minister as expressing frustration, then he says that he is making light of the issue. Quite frankly, it is the member who is playing politics with this and it is not constructive.
* * *
Hon. Lorne Nystrom (Regina—Qu'Appelle, NDP): Mr. Speaker, my question is for the Minister of Agriculture and Agri-Food.
As the minister knows, the farmers are furious and very disappointed with the announcement made yesterday on the farm aid program. He also knows the government has a budgetary surplus. It is a matter now of priorities for the government.
Can he explain to us why the federal government is ignoring the biggest farm crisis in the history of Canada, at least since the 1930s? The government has the money. Why is there not more money for farmers when they are going bankrupt and being forced to leave the land?
Hon. Lyle Vanclief (Minister of Agriculture and Agri-Food, Lib.): Mr. Speaker, the government's contribution is half a billion dollars, and along with the provincial contribution, that is $830 million. I do not think that is ignoring any issue at all. That is a considerable amount of support to Canadian farmers.
I would ask the hon. member why the province he is from does not want to participate.
Hon. Lorne Nystrom (Regina—Qu'Appelle, NDP): Mr. Speaker, Saskatchewan grain and oilseed farmers have seen a drop in their income by $500 million over the last five year average. Yet under this new program they only get $100 million from the federal government, $2.38 an acre.
Why does the minister not face the reality and inject more money into the western economy for the farmers of this country? Saskatchewan has 60% of the arable acres and a small tax base. Why is there not more federal money, which is where the money should be coming from?
Hon. Lyle Vanclief (Minister of Agriculture and Agri-Food, Lib.): Mr. Speaker, when an hon. member stands up and says that it is only $100 million, I do not think he has a very good appreciation of what $100 million is. It is a substantial sum of money. I just find it absolutely disappointing that the NDP government in Saskatchewan does not want to support the farmers like the federal government does.
* * *
Mr. Gerald Keddy (South Shore, PC): Mr. Speaker, Chief Lawrence Paul and others in Nova Scotia have stated that federal negotiators are considering dividing bays in Atlantic Canada between aboriginal and non-aboriginal fishermen. This is clearly a wrongheaded policy and goes against the spirit of sharing the fishery under one set of rules.
Will the Minister of Fisheries and Oceans state clearly that no such plan is being considered?
Mr. Lawrence O'Brien (Parliamentary Secretary to Minister of Fisheries and Oceans, Lib.): Mr. Speaker, the Marshall issue is one that is well known to the House. As the hon. member well knows, we have been consulting with the industry through our associate federal representative. We will continue to consult with the industry.
I can tell the hon. member that the issue, as it relates to the Marshall judgment, is one of hunting, fishing and gathering, and we have been following suit. We already have a number of agreements in place, 88% with the first nations.
Mr. Loyola Hearn (St. John's West, PC): Mr. Speaker, my question is also to the Minister of Fisheries and Oceans.
The minister will remember quite well last year's shrimp fiasco. He now has a request from Quebec for an allocation of 6,000 tonnes of northern shrimp.
In light of the fact that the stocks could be in danger, in light of the fact that many of the adjacent fleets do not have enough quota to maintain a viable operation and in light of the fact that Newfoundland and Labrador entrants are denied access to the resource, will the minister categorically deny the request? Is it not time that the minister either fished or cut bait?
Mr. Lawrence O'Brien (Parliamentary Secretary to Minister of Fisheries and Oceans, Lib.): Mr. Speaker, the northern shrimp issue has been debated and has taken on a lot of profile. It is basically off the riding of Labrador which I represent.
The minister has had a number of requests relating to northern shrimp, not only for this year but for previous years. We are looking at the shrimp industry. We are reviewing with industry. At a future date we will make a decision on shrimp conducive to the way we have done policy in the past.
* * *
Mr. Grant McNally (Dewdney—Alouette, Canadian Alliance): Mr. Speaker, a known Nazi war criminal, Helmut Oberlander, who lied to enter Canada in 1954, has been allowed to remain here for over a year due to the immigration minister's inaction.
How is the minister, who so freely smears the reputation of others with her name calling, able to defend her refusal to deport this known Nazi war criminal?
Mr. Mark Assad (Parliamentary Secretary to Minister of Citizenship and Immigration, Lib.): Mr. Speaker, as the hon. member knows, it is not the policy to discuss details of individual cases in public.
If a person misrepresents himself or herself in citizenship or immigration proceedings, he or she may be subject to revocation proceedings under the Citizenship Act. There is a process for revocation and this process must follow its course.
Mr. Grant McNally (Dewdney—Alouette, Canadian Alliance): Mr. Speaker, the process has already occurred and it is sitting on the cabinet table waiting for a decision. It has gone through the federal court and the federal court has says that he is cleared for deportation.
Now that it is clearly in the minister's lap, why is she refusing to deport this known Nazi war criminal?
Mr. Mark Assad (Parliamentary Secretary to Minister of Citizenship and Immigration, Lib.): Mr. Speaker, I have to repeat for the hon. member that we cannot discuss individual cases. It is very simple. The process for revocation is quite clear and it is following its course.
* * *
CANADA CUSTOMS AND REVENUE AGENCY
Ms. Jocelyne Girard-Bujold (Jonquière, BQ): Mr. Speaker, this morning, we learned that the Canada Customs and Revenue Agency randomly opens citizens' mail, although the law states that officials may open mail only if they have serious grounds to believe that Canadian laws have been broken.
My question is for the Minister of National Revenue. Will the minister make public the criteria the agency uses when deciding whether or not to open private mail?
Hon. Martin Cauchon (Minister of National Revenue and Secretary of State (Economic Development Agency of Canada for the Regions of Quebec), Lib.): Mr. Speaker, as I said earlier, the customs component of the Canada Customs and Revenue Agency is responsible for the safety of all our communities. We must ensure that all goods entering Canada comply with Canadian laws.
We also know that customs officials proceed by evaluating risk. They also do a random check. They are authorized to do what they do by section 99 of the Customs Act, which is very clear. Their results now show that they deserve praise.
Ms. Jocelyne Girard-Bujold (Jonquière, BQ): Mr. Speaker, it seems that the Canada Customs and Revenue Agency is passing on personal information gathered when mail is opened to other federal government departments, and that this information has been put in a file.
Will the Minister of Citizenship and Immigration tell us whether this file contains personal information and whether she has sought the advice of the Privacy Commissioner in order to avoid a repetition of the HRDC megafile fiasco?
Hon. Martin Cauchon (Minister of National Revenue and Secretary of State (Economic Development Agency of Canada for the Regions of Quebec), Lib.): Mr. Speaker, first, let us get this straight. We are talking about letters and parcels weighing more than 30 grams, which customs officials are permitted to open. Personal mail weighing less than 30 grams may not be opened without the consent of the person who sent it or the person to whom it is addressed.
In any event, the results speak for themselves: 293 drug seizures in 2000, for a total value of $23.3 million. At Canada Customs, we are doing our job.
* * *
Mr. Rob Merrifield (Yellowhead, Canadian Alliance): Mr. Speaker, on Wednesday the Minister of Industry threw an additional $140 million into genetic research. Canadians would expect the expenditure of millions of dollars to accompany clear guidelines of accountability measures. We remember HRDC.
Canada currently lacks a regulatory framework in reproductive genetic technologies. Why would the government sink millions of dollars into Genome research in the absence of such a regulatory framework?
Hon. Brian Tobin (Minister of Industry, Lib.): Mr. Speaker, the mapping of the human genetic code is one of the great achievements of humanity. Canadians have been responsible for advances that will lead to amelioration or assistance in dealing with diseases which affect our communities.
If the member is suggesting and believes on behalf of the Alliance Party that the rest of the western world and scientific community should not be involved in this exciting new endeavour but that Canada should put its head in the sand and say no to our scientific community, we do not share that kind of vision of Canada's future.
Mr. Rob Merrifield (Yellowhead, Canadian Alliance): Mr. Speaker, that was really interesting. We have no problem with the funding going there, but this is purely and clearly an example of cart before the horse mentality.
Genomics is a highly complex activity and one that raises pressing ethical issues about animal and human cloning, about reproductive technology, and about using human embryos for research.
Canadians want assurances that genetic research and its applications do not get out of hand. What accountability measures are in place to ensure that federal funding of genetic research respects the concerns of Canadians?
Hon. Brian Tobin (Minister of Industry, Lib.): Mr. Speaker, having this kind of lecture coming from the Jurassic movement within parliament is indeed interesting, but I want to assure the member that a part of every contribution being made to the five regional science centres across Canada is for the social sciences and the humanities. Part of the money is being provided for ethical studies as well.
We will ensure that the sensitivities of Canada and of Canadians are being taken into account as we proceed to participate in this exciting worldwide venture to understand better the makeup of the human genetic code.
* * *
FREE TRADE AREA OF THE AMERICAS
Ms. Francine Lalonde (Mercier, BQ): Madam Speaker, the Canadian government attaches great importance, and deservedly so, to its participation in international negotiations, including the WTO and now the various free trade agreements.
Quebec has the same attitude toward international negotiations that affect its jurisdictions, including education, health and culture, but Canada refuses to let Quebec sit at international tables.
How can something, which is fundamental for the Canadian government in federal jurisdictions, not be just as fundamental for the Quebec government in exclusively provincial jurisdictions?
Hon. Stéphane Dion (President of the Queen's Privy Council for Canada and Minister of Intergovernmental Affairs, Lib.): Mr. Speaker, in this very decentralized federation, Canada must speak as one if there is to be an effective foreign policy.
This is why the Canadian government is empowered, under the Constitution, to sign treaties in all areas of jurisdiction.
This being said, if a province does not like the content of a treaty, it does not have to implement it in its jurisdictions. But to avoid that, we must consult extensively, and this is what the Minister for International Trade is doing in relation to the Quebec City summit.
Ms. Francine Lalonde (Mercier, BQ): Mr. Speaker, the champion of plan B has a hard time understanding that things can function in ways other than the current way.
Whenever Quebec asks to sit at international negotiating tables, the federal government says that things do not work that way, that they cannot work that way because of what the minister just said.
Why is it that things work very well for the German Länder and the Belgian communities? If it is good and if it works for the Belgian communities and the German Länder—and this has not always been the case in these countries—why could it not work for Quebec?
Hon. Herb Gray (Deputy Prime Minister, Lib.): Mr. Speaker, I think all Canadians truly appreciate the support given by the Bloc Quebecois to our great and wonderful constitution.
It is interesting to see that Bloc Quebecois members are now affirming every day their support for the Canadian constitution. We thank them for that.
* * *
Mr. James Lunney (Nanaimo—Alberni, Canadian Alliance): Mr. Speaker, the Royal Society of Canada report in January warned about an inherent conflict of interest caused by giving regulatory agencies a mandate to both promote and regulate genetic research.
Regulations have been promised ever since the royal commission on reproductive technologies was tabled in 1993. Why is the minister committing large dollars to establish Genome centres before adequate safeguards or guidelines are in place?
Hon. Brian Tobin (Minister of Industry, Lib.): Mr. Speaker, I would like to be very certain of the position of the Alliance Party. As he knows there is currently in place, as of May 2000, $160 million to allow Canada to participate in the research that is occurring all around the world. The $140 million brings the sum to $300 million.
Is it the position of the Alliance Party that all of this funding and all of these research centres, including the movement toward a proper regulatory environment, be shut down and that Canada and Canada alone in the western world turn its back on this exciting new field of endeavour in science?
Mr. James Lunney (Nanaimo—Alberni, Canadian Alliance): Mr. Speaker, it is apparent that the minister does not understand the question.
It now appears that each big budget Genome centre is to do its own research into ethics, environment, legal and social concerns. It sounds a lot like appointing an ethics counsellor to oversee the Prime Minister and his government without providing any rules.
Why has the government reneged on its longstanding promise to provide a regulatory framework for genetic research?
Hon. Brian Tobin (Minister of Industry, Lib.): Mr. Speaker, coming from a party whose belief and creation is akin to the making of the movie Jurassic Park, this line of questioning is indeed frightening.
Canada is providing a proper regulatory framework. Canada is mindful of community standards and the concerns of Canadians. The Canadian scientific community is a responsible community. We should be proud of that community and the fact that we have the ability to participate in this important worldwide scientific endeavour.
* * *
Mr. Wayne Easter (Malpeque, Lib.): Mr. Speaker, it will soon be a week since the Minister for International Trade met with his U.S. counterpart about the illegal and unfair trade action against P.E.I. potatoes.
Could the minister or his parliamentary secretary inform us what, if any, progress is being made to open the border? Or, is it time to show the U.S. that enough is enough and start turning back some truckloads of its agricultural exports at the border on an equivalency basis as it has done to us?
Mr. Pat O'Brien (Parliamentary Secretary to Minister for International Trade, Lib.): Mr. Speaker, I thank my colleague, who has been very persistent on this important file, for his question.
I want to inform the House that the Prime Minister raised this important file in his meeting with the president. It was one of the first issues raised by the Minister for International Trade last Monday with U.S. trade representative Zoellick.
Mr. Zoellick undertook to speak with the secretary of agriculture Veneman this week and ask her to deal with this issue expeditiously. Mr. Zoellick also agreed that any action has to be based on better science. We are pursuing this as a priority item.
* * *
Mrs. Bev Desjarlais (Churchill, NDP): Mr. Speaker, my question is for the finance minister. According to the auditor general, the Liberal government is hoarding $35 billion in the employment insurance fund. Hardworking Canadians pay into EI expecting it to be there when they need it, but because the Liberal government has taken $35 billion from the fund most unemployed Canadians who paid into EI while they were working now cannot get a dime of it back.
In the real world this would be called an insurance scam. What does the finance minister call it?
Hon. Paul Martin (Minister of Finance, Lib.): Mr. Speaker, the finance minister calls it a very important program to sustain Canadians through downturns in the economy. It has in fact done that.
We have substantially improved its benefits. Parental benefits, as an example, are only the most recent indication of what the government has done. The bill before the House is another. I would also say that the accounting treatment of the employment insurance fund is exactly that recommended by the auditor general in 1986.
Mrs. Bev Desjarlais (Churchill, NDP): Mr. Speaker, the Liberal government is not fooling anyone. Some $35 billion were grabbed from the EI fund to make the finance minister's surplus look good. One million unemployed Canadians who paid into EI cannot get benefits. Many who do qualify still cannot make ends meet because the benefits are so low. Bill C-2 will not address this issue.
The finance minister is like the princess with the pea. No matter how thick his cushion is he wants more, more, more. The auditor general says this sort of financial mismanagement causes waste and inefficiency. How much more does the finance minister plan to take from the EI fund. If $35 billion is not enough, how much is?
Hon. Paul Martin (Minister of Finance, Lib.): Mr. Speaker, the hon. member ought to simply take a look at the treatment of the fund. We treat it the way the auditor general recommended in 1986. There has never been a separate fund of cash since its beginning. The hon. member ought to know that.
If the hon. member wants to know what has happened as a result of our treatment of the fund, she should look at the fact there have been two million jobs created since we took office. The unemployment rate has dropped from 11.5% to 6.8%. That is what is happening with the Canadian economy.
If the hon. member is sincere in her wishes, I hope she will support the government and the changes to the Employment Insurance Act.
* * *
GRANTS AND CONTRIBUTIONS
Right Hon. Joe Clark (Calgary Centre, PC): Mr. Speaker, my question is for the Deputy Prime Minister. The Akimbo deal fell through. The Prime Minister asked his trustee to negotiate a settlement. That settlement involved a further sale of the shares to Louis Michaud.
Is the government really asking Canadians to believe that a loan which increased the value of the golf course had no impact on the negotiations being pursued on the Prime Minister's behalf to sell shares in that very golf course?
Hon. Herb Gray (Deputy Prime Minister, Lib.): Mr. Speaker, the ethics counsellor testified before the standing committee of industry of the House of Commons as follows:
—the Prime Minister doesn't own the shares and has not owned the shares since November 1, 1993, which—is the only important issue.
* * *
Mr. Loyola Hearn (St. John's West, PC): Mr. Speaker, the Minister of Finance recently rejected requests from Atlantic Canada to revisit the equalization process. One of the contributing partners to the equalization process is Alberta.
Alberta in the thirties began its economic transformation because it was allowed to hold on to a lot of its royalties while receiving equalization.
Will the minister follow that already established precedent and let Newfoundland and Nova Scotia hold on to more of their royalties while receiving equalization until they also can be contributing partners in this great confederation?
Hon. Paul Martin (Minister of Finance, Lib.): Mr. Speaker, the hon. member is not correct. What I said when I met with the Atlantic finance ministers is that equalization is under review. Our officials are meeting and it is continuously under review. We are very open, as we always have been, to looking at equalization. I would point out to him that equalization has reached an all time high under this government.
The hon. member is also wrong in his assessment of what happened historically. When equalization was brought in and then amended in 1962, 1963 and 1964, it was at that point that Alberta no longer—
The Deputy Speaker: The hon. member for Vancouver Island North.
* * *
Mr. John Duncan (Vancouver Island North, Canadian Alliance): Mr. Speaker, the minister had a weak response to Canadians' concerns about emissions from the proposed Washington State Sumas 2 power plant near Abbotsford, B.C.
To deflect attention the minister criticized the province of British Columbia for proposed emissions from the newly completed, much smaller and environmentally sound co-generation plant in Campbell River.
Why did the minister criticize the province when as part of a thorough environmental review his officials were part of the project approval for the Campbell River project?
Hon. David Collenette (Minister of Transport, Lib.): Mr. Speaker, I regret I cannot give a detailed answer to the hon. member today. I will take it as notice and give it to my colleague when he returns on Monday.
Mr. John Duncan (Vancouver Island North, Canadian Alliance): Mr. Speaker, this is becoming a habit with the government on Friday. The $220 million Campbell River plant was approved in 1998, construction is now complete, and it is scheduled to go operational this month. Now the minister is criticizing it.
The plant is important for power sufficiency, for business confidence and for reducing pulp mill emissions. The minister is unfairly smearing it as a dirty plant when his officials clearly see the overall benefits and emission reductions. Why?
Hon. David Collenette (Minister of Transport, Lib.): Mr. Speaker, I assure the member that the Minister of the Environment and his officials are certainly working hard on all these environmental questions. They certainly sing from the same page, unlike the member from the Alliance Party.
* * *
Ms. Madeleine Dalphond-Guiral (Laval Centre, BQ): Mr. Speaker, since 1983, Revenue Canada's address in Laval has been 3131 Saint-Martin Blvd. It seems that this address is soon going to change.
Further to a call for tenders concerning the lease for these offices, will the Minister for Public Works and Government Services confirm that the lowest bidder, the present landlord of the building, the Fiducie des chauffeurs d'autobus et de retraités of the Société de Transport de Laval, was not selected?
Mr. Paul Szabo (Parliamentary Secretary to Minister of Public Works and Government Services, Lib.): Mr. Speaker, the government wants to collocate all Quebec based Canada Customs and Revenue Agency activities in Montreal to one location to better serve Canadians. In the end we will be able to deliver better services more efficiently and at less cost.
Bids are currently being evaluated and a decision will be announced in due course.
Ms. Madeleine Dalphond-Guiral (Laval Centre, BQ): Mr. Speaker, the apparently successful bid from Garadex Inc. and First National Funding Corp. is $7 million higher, and does not include the major investment of $1 million for computer wiring done by the Canada Customs and Revenue Agency in the present building and the major costs associated with a move to a virtual building in the middle of an industrial park.
What were the reasons for the minister's decision? Is this another brilliant example of this government's management skill?
Mr. Paul Szabo (Parliamentary Secretary to Minister of Public Works and Government Services, Lib.): Mr. Speaker, as I indicated to the member, the bids are currently being evaluated and a decision will be coming shortly.
The federal government is committed to ensuring the best value for Canadian taxpayer dollars through a contractual process based on open and fair competition.
* * *
GRANTS AND CONTRIBUTIONS
Mr. Gurmant Grewal (Surrey Central, Canadian Alliance): Mr. Speaker, three years ago the auditor general reported that the multicultural minister's spending on grants and contributions had unclear objectives, lacked due diligence in assessments and approval, and lacked sufficient information on budgets.
Three weeks ago he said that the minister still did not meet the minimum standard of due diligence. Why has this boondoggle been increased by 13% in the estimates this week when there is already absolutely no accountability?
Ms. Sarmite Bulte (Parliamentary Secretary to Minister of Canadian Heritage, Lib.): Mr. Speaker, let me say that the programs offered and administered by the multiculturalism department are programs that Canadians want to reflect our multiculturalism and diversity.
With respect to the member's direct question, the minister has implemented the auditor general's report. Actually the auditor general has found that she has been exceeding the expectations of her department.
Mr. Gurmant Grewal (Surrey Central, Canadian Alliance): Mr. Speaker, it is a boondoggle. Before 1999 the Liberals published a list of recipients and the amounts, but for the last three years they have been hiding these grants and contributions.
Canadians know that these grants and contributions are being used as a Liberal slush fund. Why will this weak, arrogant and unscrupulous government not at least come clean by publishing these numbers?
Hon. Herb Gray (Deputy Prime Minister, Lib.): Mr. Speaker, it is now on the record that the Alliance Party thinks that multiculturalism and support for it by the government is a boondoggle. That is a shameful attack on one of the foundations of Canadian society. It is enshrined in our constitution.
This is on the record and members of the Alliance Party have been unmasked and exposed. They ought to be ashamed of themselves. They ought to get up and apologize.
* * *
Mrs. Marlene Jennings (Notre-Dame-de-Grâce—Lachine, Lib.): Mr. Speaker, recently Canadians had the pleasure to learn that the government will inject an additional $624 million into the defence budget. We on this side of the House know just how much this infusion of new money is welcome.
Could the Minister of National Defence or his parliamentary secretary explain to the House and to Canadians just how this money will be used and will further improve the lives of men and women in our military?
Mr. John O'Reilly (Parliamentary Secretary to Minister of National Defence, Lib.): Mr. Speaker, I thank the member for the question. The government puts the needs of Canadian forces members first. That is why the money is being spent in the following manner.
Forty per cent of this money or $250 million is earmarked for increases in pay and benefits for Canadian forces members. Another $214 million will toward clothing, vehicles and other tools our men and women need to do their jobs.
This money, plus the $2.5 billion received by DND in the last two budgets, proves the government's commitment to the needs of the Canadian forces.
* * *
Mr. David Anderson (Cypress Hills—Grasslands, Canadian Alliance): Mr. Speaker, this year's budget estimates for agriculture are $470 million less than last year's. The minister said that it was because of some unusual accounting in the supplementary estimates.
However the answer hides the basic facts. Has the minister overstated what the government delivered last year to farmers by $470 million, or has he made $470 million less available this year?
Hon. Lyle Vanclief (Minister of Agriculture and Agri-Food, Lib.): Mr. Speaker, with the announcement yesterday we will be spending $1.6 billion this year to support Canadian farmers. Last year we spent $1.1 billion.
As I have outlined to hon. members on the other side several times this week, if they want a briefing to explain how the booking of that is done in the estimates, I would be pleased to arrange it. I would ask them to approach the treasury board and its staff. They would be more than pleased to explain it to them.
Mr. David Anderson (Cypress Hills—Grasslands, Canadian Alliance): Mr. Speaker, from the outset the government's farm initiatives and programs have failed to solve the farm crisis in Canada.
The 1998 AIDA applications are finally being completed. With the 1999 applications now being processed, farmers are being told that not only will they not receive assistance for 1999, they will also have to pay back portions of their 1998 payment. This money will then return to the AIDA fund and be reused as farm aid.
Why does the government have more creative accounting practices than it has solutions for farm families in Canada?
Hon. Lyle Vanclief (Minister of Agriculture and Agri-Food, Lib.): Mr. Speaker, the hon. member is a member of a party that for a number of months in the House wanted to make sure the proper amounts went to those who triggered criteria for government assistance, whether they be farmers or other groups. That is what we do to make sure the criteria are met accurately and the proper amounts go there.
When he talks about farm aid, about what the government is doing to help farmers and about spending money to help farmers and other people, he might want to speak to his colleague from St. Albert who asked “Will the spending madness ever end?”
* * *
Mr. Michel Guimond (Beauport—Montmorency—Côte-de-Beaupré—Île-d'Orléans, BQ): Mr. Speaker, the Quebec Port Authority has released its final land use plan.
Amazingly, it is still determined to extend its piers toward Beauport, ignoring the opposition of various regional stakeholders, and of the three Liberal MPs from Quebec, regarding the future of the Beauport Bay.
Since the Quebec Port Authority is refusing to listen and intends to plow ahead regardless of what the public thinks, will the Minister of Public Works and Government Services take action and turn over the property bordering on Beauport Bay to a non-profit organization that will develop its recreational and tourism potential?
Hon. David Collenette (Minister of Transport, Lib.): Mr. Speaker, I am quite surprised the hon. member would ask that kind of question. He was the transport critic for the Bloc when we passed the Canada Marine Act in 1998. He is fully aware of the provisions in that piece of legislation that allow directors to be appointed on the nomination of port users and to reflect the views, the attitudes and the aspirations of the surrounding community.
I am surprised that he makes this kind of accusation, knowing the very competent job now done by the Quebec port authority that represents the local people in the city of Quebec.
* * *
Mr. David Pratt (Nepean—Carleton, Lib.): Mr. Speaker, my question is for the Minister of Industry. Earlier this morning I had the pleasure of speaking to a grade 10 class at John McCrae High School in Barrhaven. One of the messages I sought to convey to the students was the importance of staying in school.
Since today marks the beginning of National Engineering Week, could the minister tell the House what we are doing to encourage students and young people to pursue careers in science and engineering?
Hon. Brian Tobin (Minister of Industry, Lib.): Mr. Speaker, I thank the member for his question. The Government of Canada has been making investments in the last little while. Investment intentions have been known.
I want to join with all members of the House in commending the Minister of Finance for his excellent stewardship of the country, and hence our ability to make additional investments in universities, in science and technology, and in R and D, and to take the first steps to double R and D spending in Canada.
Those kinds of investments will lead to future bright young women and men taking up the sciences and a role in engineering across the country.
* * *
Mr. Jean-Yves Roy (Matapédia-Matane, BQ): Mr. Speaker, Quebec has created the Société de recherche et développement en aquaculture, investing $300,000 in it specifically for research into freshwater aquaculture.
This research should lead to new avenues for the groundfishers hit by the loss of certain species and the negligence of Fisheries and Oceans Canada.
Could the minister of fisheries confirm in the House his intention to respond affirmatively to the request by the Quebec minister of fisheries that he invest an equivalent sum in this research fund, that—
The Deputy Speaker: The Parliamentary Secretary to the Minister of Fisheries and Oceans.
Mr. Lawrence O'Brien (Parliamentary Secretary to Minister of Fisheries and Oceans, Lib.): Mr. Speaker, I would like to say to the hon. member that the question of aquaculture is an important issue for Canada and certainly for all Canadians.
I reiterate that I will give a longer response next week. We will take this under advisement and report next week to the member.
* * *
Mr. Gerald Keddy (South Shore, PC): Mr. Speaker, the Minister of Finance stated in the House that he is willing to consider revisiting the equalization formula.
The Minister of Industry used a new deal on equalization as a major promise during the past election and that influenced many Atlantic Canadian votes.
Will the Minister of Finance now revisit the equalization formula?
Hon. Paul Martin (Minister of Finance, Lib.): Mr. Speaker, what the Minister of Industry did during the election campaign was to state, what has been stated in the House on many occasions, that in fact equalization is one of the principal foundations of supporting our growing economy. It is a way in which individual regions of the country are able to help one another.
It is also, which is what the Minister of Industry has said, under constant review. It is under review by our officials now. We will continue to look at it. We will continue to support the equalization program as an essential foundation, despite the fact that the official opposition has consistently attacked it in its programs. We will not allow that party to prevail.
GOVERNMENT RESPONSE TO PETITIONS
Mr. Paul Szabo (Parliamentary Secretary to Minister of Public Works and Government Services, Lib.): Madam Speaker, pursuant to Standing Order 36(8) I have the honour to table, in both official languages, the government's response to four petitions.
* * *
Mr. Art Hanger (Calgary Northeast, Canadian Alliance) moved for leave to introduce Bill C-291, an act to amend the Criminal Code (violent crimes).
He said: Madam Speaker, I am pleased to be able to reintroduce this private member's bill. It amends certain provisions of the criminal code relating to life imprisonment.
The bill can be properly characterized as two violent strikes legislation. Anyone who is convicted for the second time of a violent offence shall be sentenced to life imprisonment.
For those who wish to rape, maim, conspire, corrupt and commit all manner of violent acts, this private member's initiative is bad news. For victims and their families, the bill represents a return to the principles of fundamental justice. It means those who repeatedly hurt and prey on the young, the innocent and the law-abiding will spend the rest of their lives in prison.
Let there be no mistake about the intent of the bill: Two violent strikes and the criminal is out for life.
(Motions deemed adopted, bill read the first time and printed)
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Ms. Val Meredith (South Surrey—White Rock—Langley, Canadian Alliance) moved for leave to introduce Bill C-292, an act to amend the Criminal Code (selling wildlife).
She said: Madam Speaker, this bill is an attempt to make the killing or capturing of wildlife and wildlife parts an offence under the Criminal Code of Canada.
I want to make it clear that the bill would not apply to acts carried out with a licence, permit or exemption order. The bill is not meant to replace provincial wildlife laws but rather to complement them.
I see the bill as dealing only with the most serious offences in the same manner that the criminal code is used for the most serious driving offences. It has become apparent that provincial laws are not a sufficient deterrent to deal with the multimillion dollar illegal trade in animal parts.
The bill would give provincial wildlife authorities and crown counsel the option to proceed by way of provincial wildlife legislation or the new section of the criminal code. Anyone who is convicted of an offence under this section would be guilty of an indictable offence and subject to a maximum two year sentence for a first offence and three years of incarceration for a subsequent offence. If the animal in question is a threatened or endangered species, the maximum sentence is four years for a first offence and eight years for subsequent offences.
The legislation would include such activity as an enterprise crime so it would be subject to the proceeds of crime section of the code.
It is very important that we make every effort to protect endangered species and animals from the misuse and abuse of hunting and fishing as we know it. People are making extremely large amounts of money by poaching and by illegally killing or capturing species that are sometimes endangered. We need to do more to see that it stops.
(Motions deemed adopted, bill read the first time and printed)
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Mr. Geoff Regan (Halifax West, Lib.): Madam Speaker, I rise to present a petition on behalf of 300 residents of my riding who are calling on the government to de-link economic from military sanctions against Iraq.
Mr. Art Hanger (Calgary Northeast, Canadian Alliance): Madam Speaker, I rise to present a petition signed by rural route mail couriers. They often earn less than minimum wage and have working conditions reminiscent of another era. They seek the right to bargain collectively to improve their wages and working conditions.
The petitioners call upon parliament to repeal section 13(5) of the Canada Post Corporation Act that prohibits them from doing so.
Mr. Richard Harris (Prince George—Bulkley Valley, Canadian Alliance): Madam Speaker, I have a petition to present containing several hundred names of residents of Prince George—Bulkley Valley.
They urge the Government of Canada to enact legislation explicitly recognizing the freedom of conscience of health care workers and prohibiting coercion and unjust discrimination against them because of their refusal to participate in matters contrary to the dictates of their consciences. They ask the government to establish penalties for such discrimination and coercion. I support this petition 100%.
Ms. Val Meredith (South Surrey—White Rock—Langley, Canadian Alliance): Madam Speaker, it is my pleasure to present a petition on behalf of over 600 parents from across Canada who are concerned with the extreme violence and sexual content that is on television.
The petitioners are asking parliament to urge the media and CRTC to act the same as parents and representatives of parents to reduce the sexual and violent content contained in the media.
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QUESTIONS ON THE ORDER PAPER
Mr. Paul Szabo (Parliamentary Secretary to Minister of Public Works and Government Services, Lib.): Madam Speaker, I ask that all questions be allowed to stand.
The Acting Speaker (Ms. Bakopanos): Is that agreed?
Some hon. members: Agreed.
SALES TAX AND EXCISE TAX AMENDMENTS ACT, 2001
The House resumed consideration of the motion that Bill C-13, an act to amend the Excise Tax Act, be read the second time and referred to a committee.
Mr. Ken Epp (Elk Island, Canadian Alliance): Madam Speaker, I was in the middle of an exciting discourse when we were interrupted for members' statements and questions and all that other exciting part of the day. I was in the middle of telling the story about how taxation policy affects behaviour.
My colleague from Calgary spoke about the fact that rich people being taxed on the size of their windows put very small windows in their houses in order to reduce taxation. The tudor type of architecture with the small windows was the result of a taxation policy many years ago.
I was in the middle of relating the fact that my father, who bought a new car every three or four years, thought about buying a new car in 1991 when the GST came in. He went to the dealer and found one he liked. He was ready to buy it until he looked at the bill. It had a huge amount for GST. My dad said that he had already paid income tax on the money he had earned and that the government now wanted him to pay what was left on the GST. He decided not to buy the car. He walked away from the dealership. He did not close the deal. He said that he would keep his old car.
The local dealership lost business, the salesman lost his commission and the owner did not make a profit on the sale of the car. The result of that, I believe, ripples down through the whole economy. My dad, being a frugal person who spent his money wisely over the years, made that decision because of the GST. I believe hundreds and probably thousands more Canadians postponed purchasing decisions based on the GST. The GST thereby has had a huge effect on the economy of the country. Taxation has a huge effect on the economy.
We are here today discussing the GST. We are making small changes to it in order to improve it. I believe to this very day that there is a lot of anger out there about this most hated tax.
There are businesses in Edmonton close to where I live that advertise sales in the papers that are called GST events. They do this today, 10 years after the tax was imposed. Just about every week one of the furniture companies or car dealerships will have a GST sale. In smaller letters, the ads say that the company will pick up the GST.
Companies could simply say that they will give buyers a 7% discount. Some people will show up and pay attention to it. However, when a great big sign says “We will pay the GST”, even though it is only 7%, people will go to the sales. It makes them feel good when they do not have to pay that hated tax.
I come from the province of Alberta where we had no sales tax until the GST. It was wonderful. If an item was marked $4.99, we would pay with a five dollar bill and get a penny back. It was very healthy for our economy. Why is it that Alberta is a province which is so well off compared to some of the others? I contend that one of the reasons is that over the years Alberta has had a much more rational and less offensive tax policy.
It affects me to this day as I spend approximately half of my time in Ottawa as a member of parliament and the other half in other parts of the country, most of it back home in Alberta. Perhaps I should not say this, but whenever I need to buy something I buy it in Alberta and bring it back here.
I do not usually have time during the day to go to the stores around here, but even if I did I would postpone it. Not long ago I needed some videotapes in my office to record one of my colleagues giving a speech in the House. I bought them in Alberta because I did not have to pay a provincial sales tax. The provincial government may look at all the money it gets from this tax, but we should look at all the money it avoided.
A number of years ago the provincial government of Saskatchewan imposed a tax on fuel. It then made a rule that every farmer and every businessman who submitted their receipts at the end of the year could get a rebate of that tax. In other words, the purpose of the tax was simply to tax people from out of the province.
I and hundreds of other people responded to that. My family still lives in Saskatchewan. I go to visit them. What did I do? I used to drive from my home to Swift Current where my family lives. I would visit with them, fill up and drive home again. After this tax was brought in I drove to the last gas station at the Alberta border. I filled up, drove to Saskatchewan to visit my family, drove back to that town in Alberta and filled up there in order to avoid this tax.
Introducing that tax did nothing for Saskatchewan. The numbers show that its revenue went down as a result. Meanwhile it had a huge administrative boondoggle, taking money and giving it back. How am I relating this to the GST? Let me just finish the Saskatchewan example.
Its revenue went down and its local businesses lost business. A local business used to sell me a tank of fuel every time I went down there. After the tax was brought in, and in fact I do not know if it still has this tax, I got into the habit of filling up in the last town in Alberta, whether it was Wainwright or Provost; driving to Saskatchewan; and making sure to get back there before I was out of fuel.
I did not give them the business any more so they lost the profit. They could have made some profit from me, but they lost it because of their government's tax policy.
The GST does the same. I do not know whether Canadians are aware that the GST brings in approximately $50 billion a year of gross revenue. Members will be amazed when I tell them that approximately $25 billion of it is sent back in refunds and rebates. That is absurd. Why have a system where the money just spins in circles in a huge centrifuge? The only thing we are supporting by it is a huge army of government bureaucrats whose only job is to process the payments of people who have put money into a pot when in fact they will get it back.
Not long ago a lady in my riding phoned me and said that her small business was in trouble. It had a couple of gravel trucks to haul snow in the winter and to help with road construction projects in the summer. Its old trucks were just about worn out.
If that small business were to buy a new truck, the value of the truck could be depreciated over time, but when it is purchased the GST must be paid in full upfront, even though it was entitled to some of it back in terms of the way this money goes swishing around. It is a terribly silly, useless, ill conceived and badly administered tax. It was then and it is now.
I am sorry that I have to end my remarks. Maybe I should ask for unanimous consent since no one else seems eager to speak. May I have another five minutes? I would love that.
The Acting Speaker (Ms. Bakopanos): Is there unanimous consent for the hon. member to have five more minutes?
Some hon. members: Agreed.
Some hon. members: No.
Mr. Yvan Loubier (Saint-Hyacinthe—Bagot, BQ): Madam Speaker, with all due respect for my colleague from the Alliance, I must say that he had enough time to express his point of view. If he wanted more time he should not have shared his time with his colleague.
I am pleased to have the opportunity to speak to Bill C-13, concerning changes to the excise tax and to the payment of GST-HST refunds.
We would have appreciated it if the Minister of Finance had used this reform of the excise tax to abolish, at least on a temporary basis, the gas tax, in order to give a break to independent truckers, in particular, and everyone working in industries that rely heavily on gas.
Way before the last election, we urged the Minister of Finance and the Liberal government to take this measure to help those who are being badly hurt by the ups and downs, but mostly the increase in the price of gas, natural gas and heating oil. Since the minister was tinkering with the excise tax, we would have expected him to suspend on a temporary basis the excise tax on gas.
We are disappointed by this omission given how serious the situation is for some taxpayers, particularly, as I mentioned, the independent truckers who have been having a lot of trouble these last two years to make ends meet.
Second, we would have liked to see—and it is sad to say that we would have liked to find certain things in Bill C-13 that are not there—the Minister of Finance, in this harmonization exercise between the tax provisions on GST and harmonized sales taxes or the provincial sales taxes like the Quebec sales tax, remember that the GST and the Quebec sales tax were harmonized several years ago.
The Quebec government footed the bill for the harmonization of the GST and the QST. It was never compensated for the subsequent tax revenue losses. It was a disappointment to us, three and a half years ago, when the Minister of Finance signed agreements with three of the maritime provinces for harmonization of the provincial sales taxes and the GST and, moreover, gave these provinces $900 million in compensation.
Quebec has been demanding the same compensation since the federal government, that is to say the Minister of Finance, announced this $900 million compensation package for the three maritime provinces for the harmonization of their sales taxes and the GST. We are entitled to such compensation. According to calculations made by us and by the Government of Quebec, the amount of the compensation could be in excess of $2 billion, if we use the same figures the Minister of Finance used when three of the maritime provinces accepted to harmonize their provincial sales tax with the GST.
We find nothing about this in the bill, even if it deals with harmonization of the GST and of harmonized or provincial sales taxes. This is great disappointment.
Since our arrival here in 1993, we have been asking the federal government for real tax reform. This is not to say that the harmonization provisions contained in the bill are not valid; quite the contrary. The bill contains very good provisions, and I will come back to them later. The bill deals with issues which should have been dealt with years ago, namely the harmonization of federal and provincial sales taxes.
However, we have asked the minister for real tax reform. We did not ask for this on a partisan basis. Since 1996 we have bein conducting studies and making serious proposals to the finance minister regarding an indepth reform of personal and corporate taxes.
Our proposals were so devoid of partisan thinking that when we, in the Bloc Quebecois, tabled our analysis reports, the government was delighted and considered them as serious proposals for tax reform. Unfortunately, since 1996, apart from having congratulated us for our excellent work, the Minister of Finance has not undertaken any real tax reform.
Year after year, in all his reports and more recently again, the Auditor General of Canada, Mr. Desautels—whom I congratulate, by the way, on his excellent work over the past 10 years—spoke of the need for a real tax reform. In his 1992, 1996 and 1998 reports, he also mentioned the disastrous effects of certain federal tax provisions and of the tax agreements between Canada and other countries throughout the world, the result of which could be to erode the federal tax base.
This means certain provisions could decrease the tax revenues the federal government could collect if the Income Tax Act were properly enforced and if fiscal co-operation accords, or tax treaties, were signed with countries whose tax rates were similar to Canada.
This is very important. It is so important that in his final report, which was a sort of legacy, Mr. Desautels, the auditor general, said, and I quote:
One of the biggest threats to the tax base lies in the international activities of Canadian taxpayers, particularly the use of tax havens. This is not unique to Canada; many nations are working individually and together to find solutions.
In report after report since 1992, the auditor general has spoken about the danger to the tax base of Canadian taxpayers' international activities, which are based on tax agreements signed with countries not considered to have a normal tax system.
They are seen as tax havens, countries whose rates of taxation are so minimal and their tax treatments so preferential compared to what we have here and in the United States, that these provisions, which are permitted under the tax agreements between Canada and these countries, lead to a substantial amount of tax avoidance. It means that, because of investments made elsewhere throughout the world in these tax havens, the federal government has been losing tax revenues at an alarming rate, particularly over the past 10 years.
I will quote some figures to give members an idea of the size of this phenomenon. In 1999, the last year for which this kind of data is available, money invested by Canadians abroad totalled $257 billion.
Nearly $28 billion of the $257 billion were invested in three countries considered as ideal tax havens, that is countries where the corporate tax rate, for example, is nil in some cases. It is 0% in some countries, and 2% to 3% in others. Three as the countries at the top of the list as ideal tax havens have received nearly $28 billion in Canadian investments abroad.
This means that 10% or so of direct Canadian investments abroad have gone to three countries considered as tax havens, with tax rates that are ridiculously low or non-existent. They are Barbados, the Bahamas and Bermuda.
Canadian investments in these three tax havens are larger than all the Canadian investments in the whole of Asia. Barbados, in particular, accounts for $17 billion in direct investments, and these investments are larger than those made by Canadians in Japan, France and Mexico taken together.
Is it normal that a country like Barbados, with a very small population, can account for that much direct investment by Canadian taxpayers? As I mentioned, Canadian citizens have invested $17 billion in this small country.
With regard to investments in tax havens, they have been growing considerably over the last 10 years. I will give some revealing figures. I think the finance minister should have dealt with tax reform long ago, and he had a good opportunity to do so, and should have reviewed the tax conventions Canada has signed, particularly with countries considered as tax havens.
There are 28,000 companies, subsidiaries of Canadian, British and other corporations, operating in the Cayman Islands, the population of which is only 30,000. Members will admit that there is something odd about the way the Cayman Islands attracts businesses in view of its population.
In the Turks and Caicos Islands, a British colony north of Haiti, there are 7,000 people living in the whole of the Turks archipelago—not to be confused with the country of Turkey—but there are 16,000 companies, Canadian for the most part.
There is something odd about the way these countries attract billions of dollars in Canadian investments. The federal government's inaction on this issue has been condemned not only by the Bloc Quebecois and sovereignists, but also by the OECD, the Organisation for Economic Co-operation and Development, which published a report a few months ago.
The report says that OECD countries that have relations with countries that are considered as the worst tax havens, the worst contributors to tax evasion—the money that does not go into federal coffers, but rather into investments made by the wealthiest Canadian taxpayers in these countries—should denounce or cancel tax conventions signed with these countries.
The three worst countries mentioned in the OECD report—we have nothing against the people of these countries, but it is the OECD that says this—were Barbados, the Bahamas and Bermuda. It is Canadians who are making these foreign investments in the Bahamas.
The OECD condemns these countries as being the worst in terms of tax evasion and as being ideal tax havens. The OECD is asking its members—Canada is a prominent member—to cancel tax conventions that might exist between Canada and other OECD countries and tax haven countries. Far from abolishing them, Canada is promoting these countries that are considered as tax havens and promoting Canadian investment there.
To make a long story short, a tax convention is an agreement between Canada and another country to avoid double taxation of the profits of branches of Canadian corporations abroad, in other words, to avoid the profits being taxed in the country where the branch is located and taxed again by federal tax authorities when they are brought home.
Normally tax conventions are very useful and perfectly justified. A corporation cannot be taxed in the United States on the profits its branch generates there and taxed again when these profits are brought back in Canada. It would be absurd.
Since tax levels in Canada, in the United States and in most OECD countries are more or less the same, give or take a few percentage points, we can justify the existence of and need for tax conventions. Profits generated by Canadian branches abroad, in Europe, for example, cannot be taxed at 30% in Europe and then taxed again at the same level here. It would not make any sense.
When it comes to countries that are considered tax havens, with tax levels of 0% on corporate income—in the Bahamas—or 2.5%—in the Bermudas, we have to ask why Canada should sign tax conventions with them, especially since the OECD has just condemned this practice, which the Bloc Quebecois has been criticizing since 1993. It does not make any sense to sign tax treaties with countries where the tax levels are so totally different from ours that they are considered tax havens.
We must bear in mind that what is invested in these countries is not taxed in Canada and that Canadian taxpayers must therefore make up for this loss in tax revenues.
It is not because we now have a budget surplus that we should let go of some of our tax revenues by signing tax treaties with countries identified as tax havens, let go of hundreds of millions, if not billions of dollars, in current and future taxes on investments.
We have nothing against wealth or against the wealthy, but there is a limit to being the laughing stock of the world, when our taxpayers have to compensate for the inaction of the Minister of Finance in the area of tax reform.
I said it before and will say it again, the Bloc is no longer the only one to urge the government to terminate the tax treaties signed with some 30 countries that are considered the worst tax havens in the world. Since the release of its recent report, the OECD is going after governments that are unfairly attracting investments and are hurting most member states of the OECD with their tax provisions, which are much too lax.
Furthermore, it is rather strange—and I will be able to ask the Finance Minister about this later—that we still have a tax convention with the Bahamas, for example, while the OECD financial action task force on money laundering, or FATF, in a report tabled on June 22, 2000, points the finger at countries that are not co-operating in the fight against money laundering.
Among these are two countries with which Canada has tax conventions and where Canadian investments are astronomical, not to say unbelievable. I am talking about the Bahamas and Bermuda, the two countries Canadian investors like best.
How can it be explained that, the OECD having condemned these countries as being rather lenient with regard to money laundering, Canada still has a tax convention with them, especially the Bahamas?
Somewhere in all of this there is a problem bordering on the ethical. If it were the Bloc Quebecois saying so, one could say that these are partisan comments, despite the fact that we have tried since 1993 to act in a non-partisan way to propose real measures and to speak for Quebec and Canadian taxpayers on tax reform.
However, now the OECD has just released a report that points the finger at 35 countries meeting the criteria of tax haven. The finger points as well at countries which do not co-operate in the area of money laundering. Yet we continue with our tax conventions with these countries. There is a serious problem in this regard.
Not only do we retain the tax conventions but we encourage Canadian investors to use these tax havens to swell Canadians' savings. The government is encouraging this tax evasion.
On July 16, 1999, for example, the Canadian Departments of Foreign Affairs and International Trade published their calendar of special events for 1999-2000 in CanadExport, the departments' major trade publication. Included was the title of a conference, a seminar given by the Departments of Foreign Affairs and International Trade “Demystifying Tax Havens”.
The federal departments and the Government of Canada promote tax evasion, promote the outflow of capital to tax havens. These are the topics covered, in broad terms, in this seminar organized by the federal government. They discussed the origin of tax havens and their use as a financial strategy imagine that. They encourage the use of tax havens to avoid federal tax abroad. Great morality, this government.
They also discussed the criteria for selecting a good tax haven. Not only was the use of tax havens being promoted but they also said “Listen, the best one is probably the Bahamas. There is no corporate tax. You can do whatever you want. There are no labour laws and no environmental laws to speak of. Use the best tax haven”. This is the message that was conveyed.
The fourth theme of the conference—and this is shameful—was “Tax havens and Canada's tax laws and how to get the most out of your tax havens”. Unbelievable. A seminar organized by the federal Department of Foreign Affairs and International Trade teaches investors how to save as much federal taxes as possible. They are told to take their money abroad, to the best rated tax havens, while the taxpayers who are here and who cannot afford to pay for financial planners and to invest in tax havens continue to pay, continue to be choked by the tax system in spite of the tax reductions recently announced by the government. These reductions are totally inadequate, given the margin available to the government to lower taxes. The middle income taxpayers, middle income families, are the ones paying, not millionaires.
Millionaires and billionaires use the federal government's services to send money abroad without having to pay any taxes to the federal government. The result is that we, the majority of low and middle income taxpayers, continue to pay taxes and to be choked by the tax system. This is unbelievable.
It is not just the OECD report that provides a picture of the 35 countries considered to be tax havens. There is also a report from the task force on money laundering, which says that Bermuda and the Bahamas are among the countries that do not co-operate in the fight against money laundering.
Those two countries are considered by Canadians as tax havens par excellence. Not only do they choose them themselves, but the federal Department of Foreign Affairs and International Trade tells them how to use them. One day we will have to wake up. The members will have to wake up, put on the brakes and say that this is enough.
The tax system has to be changed. We have to make sure that there will be no tax treaties with countries considered as tax havens in the future.
I once read a statement made by David Dodge, the former deputy minister of finance and now governor of the Bank of Canada. He said that we have to maintain our tax treaties with the underdeveloped countries because they help to create jobs and wealth in those countries. Fat chance. They have nothing to do with job creation or economic growth.
The only thing that tax treaties with those tax havens do is give millionaires and billionaires a chance to get even richer. Those who already have money manage to escape taxation here and to make even more money because they pay very little, if anything, in income tax in the host country. That makes absolutely no sense.
Since 1993 we have been denouncing the existence of tax treaties between Canada and the worst tax havens in the world. Despite our criticism and despite recent criticism by the OECD, which is not a branch of the Bloc Quebecois, or the Parti Quebecois calling for the elimination of tax treaties with countries that favour tax avoidance, we are here dealing with bills aimed at rectifying certain situations or harmonizing certain taxes. Obviously, we support this type of measure, but there is a fundamental problem with regard to our tax system and tax treaties that needs to be dealt with.
Before the election, considering the fact that the fight against the deficit had turned into a surplus accumulation exercise by the finance minister, I expected a little more decency, a little more serenity with regard to tax reform. I expected the government to announce a thorough reform of our tax system and a review of problematic tax treaties.
Instead of that, we heard statements of intention and statements based on the government's past actions. It says that it has indeed brought in tax reform but that there is always room for improvement.
I am not known for being mean but there is a great sense of urgency here. When we know that it is not only the opposition parties that are calling for a thorough reform of our tax system and a review of tax treaties but also the OECD, it means that the whole industrialized world unanimously agrees that we need to review our tax practices.
I am amazed that this has not been done earlier because all the evidence is there. Since 1993, use of these tax havens has climbed sharply. However the example has to come from the top down and, in this regard, the Minister of Finance is not setting a very shining example. He himself has companies in countries considered to be the worst tax havens.
He has companies in Liberia, the Bahamas and Bermuda. How can someone have any political will to reform the tax system, to review tax agreements between Canada and Bermuda or the Bahamas, for instance, when he himself is involved in these countries and benefits from the tax agreements between Canada and these tax havens? It seems to me that such a person does not have a very strong political will to reform and to review tax agreements. That is the result.
The members opposite should stop looking so shocked every time we raise this problem. This is directly related to what the Minister of Finance is. He is a shipowner. He owns companies. He has 13 subsidiaries in other countries considered to be tax havens and identified as such in an OECD report. He is taking advantage of this tax avoidance. How could he be expected to be interested in reviewing all this?
He cannot review it because he is both judge and judged. That is why, given what we know, we should be asking questions. Is it urgent to review tax agreements? The answer is yes.
First, we should review all tax conventions Canada has signed in recent years and, in particular, conventions with countries which are on the OECD list and are considered the worst tax havens.
Second, talking about the preservation of the tax base, the auditor general has made it crystal clear. He said that one of the biggest threats to the tax base lies in the international activities of Canadian taxpayers, particularly the use of tax havens. The situation is critical.
We have a problem if we do not act immediately to review and, if need be, cancel tax conventions with countries which make tax avoidance easier, something rich Canadian taxpayers take full advantage of, and with countries which do not co-operate adequately in the fight against money laundering.
Third, if the finance minister feels he is both judge and party to the case because of his companies and subsidiaries located in countries considered to be the worst as far as tax havens and tax avoidance go, he should step aside and let somebody else do what has to be done.
It is however doubtful that the Minister of Finance will start a movement to reform tax conventions and taxes which could enable us to ensure that the most serious threats to the tax base, as criticized in 1992, 1996, 1998 and recently in the auditor general's report, which covers the past 10 years, are countered. Until they are, I do not think this objective will be met.
I challenge the government to truly reform taxation.
Bill C-13 deserves some praise. Taxation is harmonized, especially the GST and the HST, which have some value and which were long expected. However, the minister and the government must do more than that. That is important but reform of the tax conventions and of taxation is vital and fundamental.
The surpluses are piling up in government coffers. It is a simple arrangement. Everyone is cut off and it piles up. Do the people not entitled to employment insurance, who call for more money for health care and are cut off by the government, the students wanting more money for education and who are cut off by the federal government, realize that there need not have been cuts, if we had had responsible government and a Minister of Finance who was not both judge and jury in recent years?
They would have kept their tax base. We could have built up surpluses, but ones paid for by those with the means to pay and to fund and not have them accumulated through savage, drastic and inhuman cuts to employment insurance, savage cuts to health care and savage cuts to education.
We must realize that every time a billionaire invests money in the Bahamas with the help of the federal government and of the Department of Foreign Affairs and International Trade, that money is no longer in the federal treasury. The Minister of Finance then gets new money from the poor, from the unemployed, from students who have a hard time making ends meet and from the sick. Is it not indecent to maintain the status quo because the Minister of Finance is both judge and jury here?
In the coming weeks, we will continue to harass the government regarding this important issue since the future of the federal tax base is at stake. It is an unbelievable injustice that this government is promoting when it uses tax havens to tell millionaires and billionaires “Such is the Canadian tax system; here is what our tax treaties with the Bahamas, Bermuda or Liberia provide and what you should do to take advantage of these tax havens to the fullest”.
The government is telling rich taxpayers how to avoid paying taxes in Canada by using tax havens that are being condemned by the OECD and that often do not co-operate in the fight against money laundering. This is serious stuff.
While we support Bill C-13 because some provisions are worth supporting, we are sending a wake up call to the public and asking the Minister of Finance to stop looking after his own interests, to stop being judge and jury and to let someone else undertake a true tax reform, a comprehensive review of all the tax treaties signed by Canada with countries that are considered to be tax havens. We will fight tooth and nail for that.
Hon. Lorne Nystrom (Regina—Qu'Appelle, NDP): Madam Speaker, I want to say a few words on Bill C-13 which is before the House today. It deals with a whole number of taxation issues. I only want to make about three different points to facilitate this bill going before the committee.
First, the tax bill deals with the GST. It is rather ironic that between 1990 and 1992 the party across the way, and I remember it so well, promised to get rid of the GST. I remember the Minister of Canadian Heritage even resigned her seat to go back and get a mandate from the people in Hamilton East because of the promise to scrap the GST, the goods and services tax. Now we have a government that is bringing in amendments to the GST and a taxation regime that includes the GST. No wonder people are cynical of this institution.
If elected, the Liberal Party promised to get rid of the GST. I notice almost every Liberal has left the Chamber in shame. There is only one Liberal left in the House and he is hanging his head because of the embarrassment.
The Acting Speaker (Ms. Bakopanos): I am sure the hon. member, who has been in the House longer than I have, knows full well we should not talk about the presence or absence of other hon. members of the House.
Hon. Lorne Nystrom: Madam Speaker, you are absolutely accurate. The rules of the House say we should not do that. I just wanted to point out the truth to the Canadian people. I am sorry that is a violation of the House rules.
I can say that the only member in the House is hanging his head in shame because the promise on the GST was broken by his party. I remember that so well. There is a second Liberal over there and she is hanging her head in shame as well over the broken promise on the GST.
That is a promise they made. It was a solemn commitment to the Canadian people. I remember the leader of the opposition at the time, who is now the Prime Minister, getting up in the House and talking about getting rid of the GST.
He would say that it was is time to get rid of the GST, that it was not a fair tax at all and that if Canadians elected the Liberal Party the GST would disappear”. The GST is still here for Canadians.
The GST is still here. It is a very unfair tax. It is a tax that is really like a flat tax. No matter what one's wealth is one has to pay the same 7%. When we buy some hardware goods, or a car, or get a haircut or buy a new tie, there is a 7% tax that everybody pays. Even a really wealthy member like the member across the way from near Toronto has to pay 7%, the same as some poor guy in Kamsack, Saskatchewan. It is a very unfair and unjust tax.
Our party has said that we should start reducing the GST, starting with 1%, and take it off books and necessities. Eventually we should eliminate the GST because it is a very unfair tax. That used to be the position of the Liberal Party before it was influenced and terrified by the Alliance and the Reform, so it moved to the political right. That is the first point.
The second point I want to mention deals with the comments made by the finance critic from the Canadian Alliance. He stated that taxes are horrible, that taxation is an awesome power in the hands of parliament, said that taxes are much too high and that taxes should be reduced.
In some cases taxes are too high, and the GST is a good example of that, but instead of talking about a general across the board tax cut, we should be talking about a progressive tax system that is based on the ability to pay. It use to be that way but it was changed a number of years ago by the Mulroney government and continued on by the Liberal Party across the way.
A recent CBC poll released a few days ago asked Canadians what they felt was the most important issue in the country. Over 40% of them said that investment in social programs, in particular, health care, was the most important issue, whereas only 7% said lowering taxes was the most important issue.
Members of the Canadian Alliance have said time and time again that there should be a radical reduction in taxes across the board. Canadians do not want that.
The Alliance Party is really an anti-government party. It does not believe in government nor in public institutions. It wants to privatize almost everything. It probably even wants to privatize the post office and go to pony express or whatever. It does not believe in the Canadian Wheat Board, the CBC or a public one tier health system that is supported by the tax system of all Canadians. That is where the Canadian Alliance stands but it is not where the Canadian people stand.
It is important to point out in the debate today that we need a taxation system that is progressive and based on the ability to pay. We need a taxation system where wealthy people pay more taxes and ordinary people pay less taxes and get a decent tax break. The position of the New Democratic Party and an overwhelming majority of Canadians is that we should have a taxation system where the wealthy and the large corporations pay their fair share.
The Canadian Alliance stands up for the very wealthy and the large corporations. It is getting more and more of its money from those large corporations. It is no longer grassroots party of ordinary Canadians. People should realize that as we talk about this issue today.
The last point I want to make is in regard to household debt. Household debt is at an all time high. When big tax cuts are made they mainly go to the wealthy people not to the ordinary people who have huge household debts. The Vanier Institute recently stated that during the decade of the 1990s, the wealthiest 20% of Canadians saw their incomes go up by about 6.6% and the poorest 20% of Canadians saw their incomes shrink by some 5.2%.
For a number of years, throughout the fifties, sixties and into the seventies, there was a gradual reduction in the gap between the rich and the poor. In the 1990s, at the end of the Mulroney years and into the years of this government, the gap between the rich and poor has widened once again. The rich are getting richer and the poor are getting poorer. The Canadian Alliance wants to spread it even wider by having a flat tax where everybody would pay the same rate. This would mean that the rich would get richer and the poor would get poorer. That is exactly the way the Alliance Party wants to go.
We need a progressive tax system with five or six different tax brackets based on the ability to pay. We have to eliminate flat taxes like the GST. We have to phase them out because it discriminates against the poor. That is exactly what Canadians want.
Canadians want a progressive tax system based on the ability to pay. They also want to make sure that there are enough taxes in the country in order to invest in infrastructure, social programs and into the institutions that are important to them. They want enough money raised through taxes to make sure that we have not just $500 million for farmers but a couple of billion dollars to help farmers. That is what taxes are all about.
However, we get the Alliance Party saying that there is spending madness going on by the Government of Canada. What is that? Is it too much money for the old age pensioners, the poor, the farmers, the fishermen and the health care system?
Mr. Pat Martin: Squandering money on the poor.
Hon. Lorne Nystrom: As my friend from Winnipeg said, squandering money on the poor. That is the position of the Alliance Party. My goodness, the Liberal Party is not too far behind in its shift to the right.
We need a tax system that is fair and just. We need a tax system that raises enough money to support public institutions and the infrastructure of the country. Infrastructure has been cut back over the last number of years, particularly in the 1995 budget, and it is time to reinvest in ordinary people. That is what the debate is all about.
Mr. Ken Epp (Elk Island, Canadian Alliance): Madam Speaker, I welcome the opportunity to respond to the member's speech.
Usually I rise on points of order when members do not get the name of our party right, but I will simply say that member from the CCF has really misrepresented our position. When he talks about our party not being concerned about those who are less wealthy, he is misrepresenting what we actually believe.
We believe that it is best for people to have a job. We have a tax policy that would reduce taxes according to our actual numbers. If he were to be intellectually honest enough and actually look at them, instead of just spewing about them, he would see that the greatest tax reductions in our plan are for exactly the people he is talking about. In other words, when some of the rich people get a tax reduction, those who are in the lower brackets get a 100% tax reduction. That is not good enough for him. I do not know what he is asking for.
With respect to the tax for the rich, we believe that those who are well off should not be punished for their successes. Those are exactly the people we need to drive our industries, to produce jobs, to hire people and to take poor people, give them employment and get them off the welfare rolls.
Our view is that the measure of the effectiveness of our economy is not how many people we have on welfare but rather how many people we get off welfare. That is what our position is and frankly I do not care whether the member from the CCF has a response to that or not.
Hon. Lorne Nystrom: Madam Speaker, the member over there is the author of the hidden agenda.
During the election campaign, do members not remember when he made the great statement about privatizing old age security and the Canada pension plan? He said that if the Alliance Party was elected it would privatize those things, that people would have monster RRSPs. He said that would be the panacea to get the government off the backs of Canadians, that everyone would be in the private sector investing in the stock market. Do members remember that in the campaign?
I remember picking up the Globe and Mail and reading a big headline about privatizing pensions and getting rid of old age security and the CPP. The member for Elk Island was the author of that hidden agenda. He even took his own leader by surprise.
That is the kind of member we are dealing with here. When he talks about these kinds of issues he fails once again to mention the tax policy of the Alliance Party. It is a flat tax policy. It wants a single tax rate. With a single tax rate, someone who is making $300,000 or $400,000 a year will get a bigger break then the ordinary citizen who is making $30,000 or $40,000 a year teaching at an elementary school in Churchill, Manitoba. Those are the facts.
That is exactly where that party stands. It wants a big break for the wealthy. It believes that the free market will look after the poor. It believes in what is called the trickle down theory of economics, that if we feed enough oats to the horse, eventually enough will trickle through the horse to feed the sparrows. That is exactly the philosophy of the Alliance Party of Canada.
Mr. Ken Epp: Madam Speaker, how grateful I am for the opportunity that the member from the CCF has given me to say that during the campaign I too was grossly misrepresented in that case. I bear part of the responsibility. By giving an interview to a member of the press, I made the gross error of forgetting that I was not in a debate in the House of Commons. I got into a debate with the interviewer and I probably said some of the things that were reported about me. I greatly regret having given him the interview because it gave him, during the time of the debate, the two or three quotes that he needed.
My apologies to you, Madam Speaker, the Canadian people and to everybody for that. It was a misrepresentation of what we really want to do. We want to fix things and improve things for Canadians.
With respect to the hon. member's statement on taxes for the rich, it just is not true. Let us say, for example, that I was walking along with my little grandson and we were carrying some stuff. Let us say that I had a load of 100 pounds on my back and my little grandson was carrying five pounds. Somebody else comes along, maybe my grandson's dad, my son, and says that he will help carry that. He takes half of my load and he takes all of his son's load. My grandson had a 100% reduction in his load, from five to zero, and I had a reduction in my load of 100 to 50. Sure I got a bigger reduction but it equalizes it out.
It is just totally intellectually dishonest for that member and the members opposite to so misrepresent our tax policy because it just is not on.
Hon. Lorne Nystrom: Madam Speaker, I wish to respond to the hon. member from the time warp who was talking about the CCF. That was about 40 years ago. However, I realize he is a bit behind the times.
It is the policy of the Alliance Party to have a flat tax, a single tax rate. The former Reform Party and now the Alliance Party both have this idea of a flat tax. Even the great socialist in the United States, George W. Bush, has rejected that as being unfair and unjust and yet the Alliance Party is advocating a single tax rate so that a wealthy person making $300,000, $400,000 or $500,000 a year or a millionaire making over $1 million a year would pay the same tax rate as a high school teacher making $40,000 or $50,000 a year. That is not fair and it is not just. It is not equality of condition.
I am glad that party is saying that because I now know where that party stands. It is a party of the past. It is a throwback to the forties and fifties when the rich would get richer and the poor would get poorer and be grateful for it. That is the Alliance philosophy. Thank God about 90% of Canadians reject that philosophy and that attitude.
I am sure that the more Canadians hear about it, the smaller and smaller the Alliance Party will get because it represents a very small point of view. Even the leader of the Alliance Party has put that member so far back on the backbenches that he is always hiding behind the curtain because of his points of view.
I am glad this issue has been raised today. I am glad the people are now seeing where the Alliance Party stands. It stands for wealthy people. It stands against public institutions such as the wheat board. It stands against a one tier health care system. It wants two tier health. It wants private clinics. It wants whatever is good for capital and whatever is good for the wealthy people. It does not want pensions for senior citizens. It wants to get rid of the Canada pension plan. It wants big RRSPs, which will help the wealthy, and to hell with the poor, the ordinary citizen of Canada. That is exactly where it stands. Before long, it will become an historic artifact in the history of Canadian parliamentary annals, just like the Social Credit Party so many years ago. Its hero was Bill Vander Zalm in British Columbia. We can see what has happened to Mr. Vander Zalm and the Social Credit Party.
Now the member from Vernon is getting up on his feet. He was a member of the Social Credit Party. He is a worshipper of Bill Vander Zalm. That is the kind of politics that was rejected by the people of B.C., and it will be rejected by the people of Canada.
Mr. Darrel Stinson (Okanagan—Shuswap, Canadian Alliance): Madam Speaker, I cannot just sit and listen to the ramblings and the ravings of the hon. member from down on the far reaches of the opposition benches.
Maybe I should explain a little bit that there is a big difference. I know it is hard for the member to comprehend so I will say it very slowly so that maybe he will really understand. The difference between a single rate and a flat rate tax is deductions.
In a single rate tax standard deductions are allowed. That is the policy. Those making over $100,000 are taxed more. It is unfortunate to say but it is the truth.
Let us go into the history of the NDP. We are all well aware of how the NDP got ahead in British Columbia and how it stole from the blind and from charities through bingo hall services. That is common knowledge. We have also seen its socialistic attitude: the more people work, the more will be taken away from them. We are well aware of that attitude in British Columbia under the NDP regime in place there now.
We do not have far to look to see what NDP members think about private medicine. Their own leader uses private medical services in Canada. The hon. member knows that, yet he will stand here and tell the world that NDP members do not do that. That is their policy. What is good for them is good for them, and the rest of Canada can do without.
Mr. Greg Thompson (New Brunswick Southwest, PC): Madam Speaker, thank goodness there is no question attached to that statement. My colleague from the NDP would be on his feet until at least supper hour.
This is an interesting debate today. We are talking about Bill C-13 which proposes technical adjustments to the GST. As my colleague from the NDP mentioned, it is probably a debate that under normal circumstances we would not be having. Witness red book one.
I am not sure whether or not red book one brought you to this place, Madam Speaker, but it certainly brought a number of Liberal MPs to the House of Commons. The election of 1993, among other things, was based on the promise to eliminate the hated GST.
The government received dividends from the GST in more ways than one. It obviously received political dividends, because it brought a lot of its members to the House under what in the real world are called false pretences. It is probably unparliamentary to say that, but I am being more generous than I should be. Obviously it worked.
The government has been in power now for over seven years and we are still saddled with the hated GST. Just by way of comment, I should mention that we supporting the technical changes to the GST. We will not hold them up. At least one person is applauding over there. I did not hear the parliamentary secretary applauding yet but I am sure he will before the day is out.
Talk about fooling the Canadian public. During the 1993 election I fought the issue as a government member, as a Conservative. It was the last year of the manufacturers' sales tax. Before the 7% GST we paid a hidden 13.5% federal sales tax on automobiles and other goods. It was hidden in the cost of automobiles and every other commodity.
We paid a price for our intellectual honesty. We said that we would eliminate the hidden tax and that from then on Canadians would see it at the point of purchase. In other words, if they bought a $10,000 car, 7% of it would be GST. Seven hundred dollars would be seen upfront. Someone buying a $20,000 car in 1991 would pay $1,400 in tax upfront. They would see it.
Many Canadians were surprised. They did not believe we had a hidden federal sales tax, which we did, but the old sales tax restricted our capacity as an exporting country. It was all part of the parcel.
We also brought in the free trade agreement, but that alone was not enough. We wanted to restructure how we did business in the country. We revised the tax rules. We brought the number of tax divisions down from a high of nine to around five in one fell swoop.
We then brought in the GST which levelled the playing field for exporters. It made us competitive in the international world, which we were not under the old system. The last year we had the manufacturers' sales tax was 1989-90. In that year that tax brought in $17.8 billion, which is quite a bit of money.
This year the GST will bring in $55 billion compared to the old system that brought in $17.8 billion. It is interesting that we will take $32 billion of that and pay it out in GST rebates to Canadians outside the higher income levels that the NDP sometimes mentions in terms of unfairness. It is a fair tax policy because a lot of the money is distributed to Canadians who need it via the GST rebate.
That is an astounding figure. When we do our research we find that the government talks about a $22.8 billion revenue from the GST. It excludes the gross. It only talks about the net. The gross income for the government under the GST is $55 billion and $32 billion of it is distributed to Canadians who need it. That is a lot of money.
Another point is that taxation must be fair. It must be perceived as being fair. My NDP colleague talks about it being unfair because the 7% applies to everyone. It is true that a millionaire or someone at the poverty line pays the 7% GST, but lower income Canadians get the benefit of the GST rebate which makes up for the lack of fairness. That was not present under the old system when the tax was actually hidden. That is a major improvement.
Another point is that we can never lose sight of fairness in taxation and what has to be taxed to make the system fair for everyone. A fair system must tax consumption. It must tax capital and incomes. We cannot simply take a tax and cover one base. Some people would argue that we should do away with the GST and just tax incomes, which would be completely unfair and unacceptable and would not work. It has never worked in any jurisdiction that has tried it and it certainly would not work in Canada.
We must spread out the way in which we collect taxes because if the government is smart and considerate in how it spends the taxes it takes in, at the end of the day it will benefit all Canadians.
When we are talking about tax bills as we are today we should point out that the government should consider bringing in a budget. It is March 2 and we do not have a budget. We are still working with a mini-budget from last fall, which was very convenient because it was brought in on the eve of an election.
I suggest the Prime Minister was smart enough to call the election knowing full well that some of the danger signals were out there, that we may be heading into a recession come early winter, late winter or possibly early spring. That was one of the things that motivated the Prime Minister to call an early election. Much to his credit he won it. We were right in terms of what might be happening in the economy. Some of the danger signals are out there.
On that point I will read into the record a comment from Don Drummond, the former assistant deputy minister to the Minister of Finance. He now works as an economist for TD Bank. Just last week in his article entitled Using the Federal Budget Surplus: Is there any left? he wrote:
Confused about the fiscal prospects of the federal government? If so, you are not alone. The October 2000 Economic Statement and Budget Update provided fiscal projections to 2005-06. However, those projections do not reflect the tax cuts promised in the Statement, nor the spending commitments made subsequently in the Red Book III and the January 30, 2001 Speech from the Throne. In addition, the economic assumptions underpinning the October Update now seem decidedly optimistic for the short term. To date, no attempt has been made by either public or private bodies to cut through the confusion.
Things have changed dramatically in the last 90 days. It was only 90 days ago that we stopped knocking on doors in an attempt to get elected. A lot has changed. We see some of the biggest and best corporations in Canada and in North America laying people off.
I see you signalling me, Madam Speaker. If I am getting the government in trouble in terms of time, I am sure you will rise and I will sit down. We want the legislation to pass. We do not want to delay it.
The government should bring in a budget to reflect today's reality because we are in the midst of layoffs. As we speak, the new president of the United States, George W. Bush, is proposing huge tax cuts which will put pressure on Canada to do the same.
We must attract business to Canada. We must do what it takes to keep the economy moving. It appears the U.S. wants to do that, but we are in a period of suspended animation: the world is good, why worry? It is not so. There are troubling signs on the horizon and we must move to do something about it.
In closing, I hope the government will at least take that into consideration in the next few days. We must do something. We cannot stand still. We must move to reflect times as they now are. Times have changed dramatically in the last 90 days since the last election.
The Acting Speaker (Ms. Bakopanos): When we resume debate on the bill, the hon. member will have eight minutes and thirty seconds left in debate.
It being 1.30 p.m. the House will now proceed to the consideration of private members' business as listed in today's order paper.
PRIVATE MEMBERS' BUSINESS
RIGHT OF LANDING FEE
That, in the opinion of this House, the government should eliminate the Right of Landing Fee (ROLF) on all classes of immigrants to Canada.
He said: Madam Speaker, I am very pleased to be able to debate this important issue of national interest. A growing group of Canadians is calling on the government to eliminate the right of landing fee on all classes of immigrants. To the government's credit, about a year ago it eliminated the right of landing fee for all refugees. The same reasons why that was a good idea apply to all new Canadians and all immigrants. We believe it should be done away with altogether.
This marks the sixth anniversary of the right of landing fee. It was introduced on February 28, 1995. At that time we were in a deficit situation, the government was in a cutback mode where all programs were being reviewed and a great deal of effort was being made to enter into cost recovery mechanisms. When it introduced the right of landing fee the idea was that it would help offset the costs of some of the services new Canadians use, whether language training or settlement services. In actual fact, that money was never considered a dedicated fee for service. The money went into general revenues. It never really did get directly connected to the services it was meant to fund. In fact, during that period, program spending was being cut, hacked and slashed in the immigration department. Therefore, there was no direct correlation.
This is frankly why many critics of the right of landing fee call it a tax. The term that is being used is a head tax. The government does not like to hear that but this has become the same as the much loathed head tax of recent history. I remind the House that from 1885 to 1923 the government imposed a head tax on all Chinese immigrants to Canada. It started at $50 and rose to $500, specifically to bar entry to Chinese people coming to this country.
Many people view the head tax in the same way. It is a racist head tax because it is selective by nature. In other words, the $975 fee that is charged to every landed immigrant does not seem like an insurmountable barrier for a person coming from western Europe, Australia or the United States. However, for a person from the Sudan, the Philippines or Southeast Asia, that could be two years' salary. Therefore, it is an actual barrier to immigration. This is why we feel not only is it a financial burden on people who might choose to make Canada their home, it is a real blow to their morale.
New Canadians are wondering what kind of message we are trying to send out. The Minister of Citizenship and Immigration says they want to open the door wider and invite more new Canadians to this country. At the same time they put financial barriers that are true obstacles to many people, especially from certain parts of the world. In other words, the door is open if one can afford this fee for the privilege of coming here. The door is not so open for people who come from some parts of the world, such as the developing nations. These people need the refuge and the sanctuary that Canada offers arguably more than people from developed countries.
As I pointed out, there is a growing movement around the country of people who feel very strongly that the government should eliminate the head tax on all new Canadians, like the Ad Hoc Coalition Against the Head Tax. In fact, there is an organization of organizations that formed specifically around what it felt to be an unjust head tax.
The Canadian Ethnocultural Council has been working very aggressively on this issue. The Canadian Council of Refugees has made representation to the Canadian government demanding or strongly advocating the elimination of the head tax. The national Filipino association is on the record. The Maytree Foundation, the Canadian Labour Congress, the getting landed project and the Caledon Institute of Social Policy are on record. In fact, the Liberal Party of Canada, at its 1996 federal convention, passed a resolution for a review which would lead to the elimination of what we call the head tax. A lot of ethnic minorities within the Liberal Party were horrified when their government sent the message to the world that it was not as open a door policy as was thought.
The United States has a fee for service type charge associated with becoming an immigrant to that country. However, for a family of four in the United States, the total fees and charges would be about $1,580. In this country it would be about $3,150 for a family of four.
Let us look at the revenue. If immigration is supposed to be some kind of revenue generating service that we are offering here, let us be honest about that and say it. If the money is not going into settlement services and into actual language training or whatever it might be but is going into the coffers of the government to do with whatever it pleases, then it is another tax. As a matter of fact it is a lot of money. The government gets about $200 million per year from this head tax. Over six years, that is $1.2 billion.
When the Minister of Finance crows about getting out of the deficit situation and showing a surplus, let us look at where he is looking to find the revenue. There is $8 billion a year from unemployed Canadians with the EI fund surplus and $1.2 billion over this period of time from the poorest of the poor, those struggling new Canadians who might seek to make Canada their home.
I firmly believe the time has come for the government to act unilaterally. We do not need a change in legislation to eliminate the head tax. In fact, the minister has the right to implement, to raise, to lower or to eliminate any service charge or fee under the Finances Administration Act, I believe, section 19. The minister can simply act unilaterally because it is the right thing to do. She does not have to wait for the House of Commons to direct her that way. Enough Canadians have spoken.
I am going to cut my remarks short in a moment or two in the hopes that members from other parties will add their voices to emphasize the overwhelming support for the idea of eliminating this right of landing fee.
As I mentioned when it was first introduced, the idea was that it would directly offset the cost of running the immigration department. Now we have seen that there is no direct connection to the fee being charged and the service being rendered. It is not a fee for service as such, it is in fact a tax and an imposition.
Perhaps the most damaging thing about this head tax is not the financial burden it places on those who might seek to make Canada their home, it is the blow to the morale of recent newcomers to this country and those who would seek to reunite other family members and bring them here. They are having this hurdle thrown in their way, this unnecessary and I believe unwarranted obstacle to something that the government claims it is very interested in. It is always saying that family reunification is one of the three pillars of the immigration policy of the country.
The government has made it far more difficult since 1995 for any family to hope to bring other family members here, especially if they are struggling in a financial way.
I am going to end my remarks now. I hope to have some minutes at the end of the one hour and at that time I would be happy to conclude.
Mr. John Bryden: Madam Speaker, I rise on a point of order. Being that this is private members' hour, I would like to seek unanimous consent to make Bill C-234 votable.
This is a bill that would amend the Supreme Court of Canada Act and require the supreme court to consult parliament in the context of its deliberations on charter challenges.
I have numerous representations from all sides of the House, from MPs who would like to speak to this bill. If I could get unanimous consent, I would be deeply grateful.
The Acting Speaker (Ms. Bakopanos): Does the hon. member have the unanimous consent of the House to make Bill C-234 votable?
Some hon. members: Yes.
Some hon. members: No.
Mr. Mark Assad (Parliamentary Secretary to Minister of Citizenship and Immigration, Lib.): Madam Speaker, I welcome this opportunity to speak on Motion No. 231 from the hon. member for Winnipeg Centre on the right of landing fee.
This past week the Minister of Citizenship and Immigration introduced Bill C-11 in the House. The bill does not change the right of landing fee provisions and the reasons are rather simple. It is meeting the legitimate policy goal that the government has set for it and other fees for a range of federal services. There is no meaningful evidence that it has harmed Canada's ability to attract immigrants. Moreover when it comes to questions of how best to use money for our immigration program, dropping this fee is far less important than putting funds into better and faster processing.
First, let us be clear on what we are talking about and where this fee comes from. Back in 1995 the government made a series of important decisions that were necessary to get Canada's public finances back into shape. One of the most fundamental was that we decided that we needed to do more so that people who clearly and directly benefit from programs and services pay a portion of the costs associated with those services.
That is how the right of landing fee was introduced and set at the reasonable rate of $975. It was decided that fee would be paid by newcomers to Canada aged 19 and over.
It is charged to people coming to this country as qualified workers, entrepreneurs, business people, investors or members of the family class, regardless of the country of origin and the province of destination. If for some reason someone who paid the required fee does not get permanent residency in Canada, that amount is reimbursed.
The government decided to introduce the fee because the direct beneficiaries of immigration are those who come to Canada themselves. These people benefit from efficient immigration programs and services. They certainly benefit from the opportunity to prosper in Canada.
In the early 1990s, the immigration program was subjected to the same budget cuts as the whole of government. Then, in the consultations the government undertook in 1994 about what improvements should be made to immigration, it asked Canadians what they thought about the idea of introducing a fee that would help support immigration programs and services. According to a poll conducted on the subject in 1996, at least 72% of the respondents were of the opinion that this was a good idea and that the amount was reasonable.
The government examined the costs of providing these services and came to the conclusion that an amount of $975 was fair and reasonable. Therefore, in the 1995 budget the Minister of Finance announced the creation of the right of landing fees. Under this initiative, a loan program was introduced to help those who were unable to pay the fees immediately but could repay it later.
I believe that was a very important element. It was not considered as a burden for the newcomers. They could take their time to pay back this amount, as they were now living in a much more prosperous country than the one they had left.
For example, not everyone gets admitted, while others decide not to continue their application for different reasons. Citizenship and Immigration Canada had to manage a substantial refund process. It had to work with fluctuating currency rates and similar difficulties. From April 1997 we allowed clients to pay the fee at any time up until they received their visa. That has made financial arrangements simpler for everyone concerned.
The second major change came in the 2000 budget. That was when the government lifted the right of landing fee requirement from refugees. Effective February 28, 2000, the government recognized that these people have faced enormous difficulties and hardships. It knew that lifting the fee would help their resettlement and yet mean just a reduction of about $15 million a year in revenue from the fee.
The member for Winnipeg Centre thinks we should go further. He wants Canadian taxpayers to pick up the whole tab for services to immigrants. He would be happier to take away the $131 million a year from settlement programming to implement his proposal. He is quite happy to see the people who directly benefit from these services, most of whom are skilled workers, entrepreneurs or business immigrants, not paying any kind of fee.
Obviously we cannot agree. The facts tell us there is no compelling argument to change a system that works. Has the right of landing fee reduced Canada's attractiveness to potential immigrants? Far from it. There is no evidence that the fee has had any impact on application levels at all. If anything, the application levels are rising. There is no evidence that potential applicants are ignoring Canada as a possible destination in favour of places that might have lower fees.
Let us recognize that there are many fees being charged by other major immigrant receiving countries, much higher than those in Canada.
The Canadian public still strongly supports these fees, which ensure that those who benefit from a very important service help to pay part of the costs involved.
If we decide to eliminate an entire source of revenue in one area, there are in fact only two options left if we do not want to modify the general financial balance. We can compensate by digging a little further in somebody else's pockets, or we can reduce the services that this revenue is supposed to support.
During the consultations on immigration carried out recently by the government, the following question was asked: “If we had more money for immigration, what would you like to be done?”
Three suggestions came out: to reduce or eliminate the landing fee; to direct spending on faster processing of the immigration applications submitted by the men, women and children who want to settle in Canada; or to sustain higher levels of immigration.
The top priority by far was to accelerate the processing of the immigration applications, which speaks for itself.
As members of parliament, most of us hear complaints from constituents and can see just how long it can take sometimes to process an application.
We know that the people on the front line of our immigration system work real hard but there are often delays due to the background checks, health information and security assessments that are required. It is not surprising that reducing processing delays is a top priority. In fact, the delays are mainly due to the great number of applications. Those who travel around the world know that Canada is the best country in which to live.
The Minister of Citizenship and Immigration has said that the new bill and some associated changes will lead to the system working better. Of that we are convinced.
Several client service improvements are already being tested. This will lead to faster processing and is entirely consistent with what the minister has learned from Canadians, including people who deal with immigration issues on a daily basis, like most of the members in the House.
Quite simply, there is no reason to accept this motion. Let me summarize some of the reasons. The right of landing fee applies to people who receive the direct benefit of immigration to Canada. That in itself is a tremendous benefit.
It does not apply to refugees who come from badly stricken areas of the world. It has no impact on immigration levels, far from it, and where necessary people can take out loans to cover the immediate cost of the fees, loans that are repaid. Canadians agree strongly with the principle of ensuring that immigrants pay at least some of the direct costs of their programs and services.
Finally, people have recognized that we would gain far more important impacts and benefits from any new money for immigration by putting it into a faster processing system.
I know this has been a concern for many people, but I would like to point out that in the last few years we have seen people coming to Canada under incredible conditions, in the bilge of boats. We know that real criminals brought these people here by boat. These people paid $8,000, $10,000 or $15,000 to come here under extremely terrible conditions. This shows that $975 is very little compared to these amounts.
Mr. Deepak Obhrai (Calgary East, Canadian Alliance): Madam Speaker, excuse me. I am honestly laughing at the last remarks of the parliamentary secretary. He compares criminals, human smuggling, and says that is more expensive, and the $975 the government is charging is justifiable. I cannot believe he is tying these things together.
Mr. Mark Assad: Madam Speaker, I rise on a point of order. I object to the hon. member taking my words out of context. That is not what I said.
Mr. Deepak Obhrai: Madam Speaker, he can read Hansard to find out what he said.
I would like to congratulate my colleague from the NDP, whom I personally know. I know of his compassion for this issue. I would like to congratulate him for bringing forward this motion. He can count on my full support. He very eloquently stated his reasons for bringing forward the motion.
However, when I listened to the parliamentary secretary I started shaking my head. What he fails to realize is that I also happen to be an immigrant who came to this country, so I can relate to what he is trying to talk about.
Let me first make one thing very clear, one thing the parliamentary secretary neglected to say, and that is that every potential immigrant pays over $500 as a processing fee. The government is already charging every immigrant a processing fee of approximately $545, so when he says that this fee is for speeding up the system, he is wrong. It is not. It is a head tax. It is a tax that goes into general revenue.
Second, the parliamentary secretary said that this tax has not harmed people coming into this country. I would like to remind him of something. When a country has a law and a system that starts discriminating one way or another, is that right just because other people are taking advantage of it? It is not right.
Let me tell the House why I say the system discriminates against others. I will speak about a family of four who have to pay $975 each. That is close to over $3,000 for that family to immigrate to Canada. Add the $575 processing fee to that amount and each individual is paying approximately $1,500 to get into this country, and the parliamentary secretary wants to tell me that those who arrive with their family cannot afford to pay.
There are good people from all parts of world who want to immigrate to this country. Do they need to have money to be good people, to be skilled people? No, they do not. They can come from any part of the world, but if they do not have money, how will they come here?
The government of course says it has a loan program. Yahoo. So before people arrive here they are in debt. They can come to Canada but they will be in debt. The government will say it is giving them money. Perhaps the parliamentary secretary should tell us how much interest the government is charging and how much money it makes out of this.
When the government introduced the bill in 1995, I think, it was for everybody, including refugees. In 1997 I brought forward a private member's bill asking for this tax to be removed for refugees. Now the member stands up very proudly and says that the government removed the tax.
Let me tell members what compelled them to remove it, because I happened to be here in the House. The tax was removed because of the 5,000 Kosovo refugees who were brought to Canada. I am glad they were brought here. Five thousand refugees suddenly came into the country and suddenly the government knew this was the wrong system. The government could not charge 5,000 people who were refugee war victims the right of landing fee. All of a sudden a bright light went on, and the government said it couldn't charge it. That is when it was abolished. It was not abolished out of compassion but because the right of landing fee could not be implemented.
The parliamentary secretary has stated that the government has listened to Canadians. This surprises me. How has it listened? By a poll. What that means to me is that the government is run by polls. It is interesting how the government is run by polls. The government takes a poll and justifies its actions by saying that Canadians have said this, so it applies a fee.
The parliamentary secretary says the government is assisting immigrants. I would like to ask him a question based on my own experience when I came to this country and on the experience of thousands of others who have come here. How many people who come to this country actually use the so-called settlement services he is talking about? I did not when I came here and I can tell the House that the majority of immigrants who come to Canada do not use settlement services. Why is it, then, that the money is going into general revenues?
Something is wrong when the government wants to justify this by saying that this is a service provided to every immigrant. That is absolutely wrong. Does the parliamentary secretary have the figures? I would love to have figures from the department to see what percentage of the total number of immigrants uses the settlement services for which the government is justifying this right of landing fee.
The argument the government has made in justifying this does not hold water. Every immigrant group in the country has stated that this is a discriminatory tax. It is a head tax, despite what the government says. It is hated. The fact of the matter is that it is a tax because immigrants are already being charged a processing fee. We are not talking about a processing fee. We are talking about a head tax.
This head tax is wrong. It gives money to the government for general revenue. There are thousands of applications coming in and despite the member's claim that the government wants to improve and speed up the processing system with this extra money it is getting, that has not happened. I can tell the House that any member of parliament here who deals with immigration is seeing longer and longer delays. The government's argument for having this tax does not hold water.
In conclusion, I would like to thank my colleague in the NDP for bringing out this issue. Although this is non-votable, it has given us an opportunity to show the weakness of the government's argument as to why it has this head tax.
Ms. Madeleine Dalphond-Guiral (Laval Centre, BQ): Madam Speaker, I rise today on Motion No. 231 tabled by my colleague from Winnipeg Centre, which reads as follows:
That, in the opinion of the House, the government should eliminate the Right of Landing Fee (ROLF) on all classes of immigrants to Canada.
We all know in this House that Quebec and Canada are the number one destination for many immigrants. Thousands of immigrants choose Canada or Quebec as their adopted country to improve their lives and reach their full potential.
As we know, Quebec and Canada both need immigration to at least maintain their current population. Therefore, the government regularly sets targets regarding the number of immigrants to be received. Last year Canada received 226,837 immigrants and refugees.
For 2001 we should be receiving 200,000 to 225,000 immigrants and refugees and these numbers will increase by 10,000 for 2002.
However these people must pay certain fees which we think limit the possibility of immigrating to Canada and constitute an undisguised form of discrimination for some.
We also think that the right of landing fee, or ROLF, also known as head tax, is an unacceptable constraint.
It is interesting to note that the term head tax comes from a tax imposed on Chinese immigrants by the Canadian government at the end of the 19th century.
Starting in 1880, many Chinese workers took part in the building of the CPR. Once the railroad was built, the Chinese Exclusion Act was passed. Between 1885 and 1923, Chinese immigrants, unlike European immigrants, had to pay quite a substantial head tax to come to Canada. From $50 per person in 1885, the head tax increased to $100 to finally reach the astronomical amount of $500 by 1903.
To say it was a staggering amount of money at that time is an understatement. In fact, it is estimated that by 1923 that awful tax had generated $23 million for the Canadian government, which would translate into about $1 billion nowadays.
The current landing fee of $975 per adult immigrant coming to Canada was set by the current Liberal government in 1995. At the time, the fee applied to both immigrants and refugees. Public outcry prompted the government to stop collecting that fee from refugees in February 2000.
However it still applies to other immigrants who have other expenses to pay when they come to Canada. Besides the landing fee set at $975 per immigrant over 19 years of age, the permanent residence application costs $500 per immigrant over 19 years of age and $100 for anyone younger.
Everyone agrees that this tax is clearly unfair and prohibitive. While the government is raking in surplus after surplus by diverting the surplus of the employment insurance fund, it is still collecting a landing fee from immigrants. Two thousand immigrants at $975 each make for a lot of money. It comes to about $200 million a year.
These actions by the government show once again its insensitivity toward the poor in our society. Indeed, many people want to immigrate here but do not necessarily have much money. This tax does not at all take into account the economic resources of individuals or the economic conditions in their country of origin. In the end, the door is wide open but only for those who have the means to pay.
While the federal Liberal government is accumulating surplus upon surplus, Quebec is welcoming some 12,000 refugees annually. The slowness in the processing of claims by the federal government results in staggering costs for Quebec. It is estimated that it costs about $100 million annually to take charge of people waiting for a ruling by the Immigration and Refugee Board and the federal government will not consider reimbursing Quebec for these costs. It is too poor. Clearly, the only reason for this landing fee is to put money in the federal treasury.
Another worrisome thing about this tax is that it is an impediment to what the Minister of Citizenship and Immigration considers one of her priorities: the reunification of families.
We know that many immigrants are not necessarily rolling in money. For those who apply to sponsor a member of their family, this tax is a major obstacle.
It is clear that Bill C-11, which is now before the committee, would allow us to examine this tax and the government's real objectives. It is essential that the federal government significantly lower this tax or, better yet, abolish it.
Mr. Gerald Keddy (South Shore, PC): Madam Speaker, I am pleased to rise today to speak to Motion No. 231, which suggests that the government should remove the right of landing fee for all classes of immigrants. I am more than happy to support the motion brought forward by the member for Winnipeg Centre and to speak on behalf of our member for Fundy—Royal, our immigration critic, who also supports the motion.
A number of issues have been discussed today, but a couple of more statements need to be made. It would behoove us all to realize that we are all immigrants to this land. Some of us have been here for a few hundred years and some of us have been here for a few days, but all of us came from another place at one time or another to make our home and to try to raise our families in Canada. Whether one is first generation, fifteenth generation or one thousandth generation, it really does not make any difference. We are all equal before the law. We all stand to benefit from good government and to continue to live here and enjoy the freedoms Canada offers.
There is a bit of background to the head tax that should be mentioned. The previous speaker started to go into that background, but she did not get into the details. The head tax and the Chinese Exclusion Act remain two of the worst examples of legalized racism in Canadian history. I do not think we can move forward unless we are willing to look at our history, understand the mistakes that were made in the past, and hopefully try not to make the same mistakes again.
The original head tax was introduced in 1885 and finally repealed in 1923. It was only levied on Chinese immigrants. When it was repealed in 1923 it was replaced by the Chinese Exclusion Act which remained in place until 1947. That act prohibited Chinese from immigrating to Canada.
Can we imagine today picking one race or one group of people and saying they cannot immigrate to this country? It is quite unheard of. The original head tax was also an entrance fee. It was set at $50 per person in 1885. It rose to $100 in 1900 and was raised to $500 in 1905. The Chinese community continues today to seek redress for these acts.
While not to be confused with the original head tax of 1885, many immigrant communities refer to Canada's $975 entrance fee as a head tax, and rightfully so. It was introduced in the 1995 budget of the Minister of Finance and remains in place today. Additional to this fee, which was mentioned by the Canadian Alliance member who spoke previously, is a $500 per person processing fee. The $975 is not for processing the paperwork or looking after the fees associated with immigration. The $500 supposedly looks after that and the $975 is a tax on immigrants who quite often can least afford to pay it. We are looking at $1,500.
As the Alliance member mentioned earlier, it starts to add up for a family of four, five, or six. It is a considerable amount of money that could be well spent to allow new Canadians to become accustomed to the country, perhaps to learn the language or to give them a bit of a cushion as they integrate into the community.
It is important to look at some of the statements made on the government side of the House in the past. The Minister of Citizenship and Immigration made a clear commitment to a fair, affordable and well enforced immigration policy. Therefore, a form of financial guarantee would ensure that sponsors of immigrants met their obligations. In addition, a $975 fee would be charged all adults immigrating to Canada to offset the costs of immigrant services, said the Minister of Finance, as reported in Hansard of February 27, 1995. It could not be any further from reality. As reported in Hansard of March 13, 1995, Mary Clancy said that the cost of programs was $271 million a year.
Even though the statements by the immigration department would imply otherwise, that the $975 would offset fees, that is not the case. The $975 goes directly into general revenue. The general revenue is kind of nefarious: the money goes in there but we are not quite certain what happens to it after. Even the auditor general has a very difficult job to trace the money through all the loops and the rabbit warren of general revenue. It is like Alice in Wonderland.
To help handle criticism of the fee the same government provided for loans to be made available to help pay the costs. The fee is set out in typical Liberal fashion as a so-called caring and compassionate government to ensure that no one is turned away as a result. Loan programs and other ways of assisting are also included in the process, according to the hon. member for Etobicoke—Lakeshore on March 2, 1995.
Now comes the kicker. On April 3, 1995, Anna Terrana indicated that the loan option was said to be based on one's ability to repay the loan within a certain time period. She asked how these individuals could, without the necessary tools to acquire meaningful employment, be realistically expected to repay the loans within a three year period. They contradicted one another.
Everyone in the House is aware that the government has since abolished the head tax on convention refugees. It has kind of come part way. What we need is a commitment from the government to come the rest of the way. It needs to take a look at what it has done in the past and say that it does not work, that it interferes with immigration, and that it is really a penalty against future Canadians and immigrants to the country. The government should say that enough is enough and simply get rid of it. What a novel idea.
Perhaps the day has come when as parliamentarians we should look at the things that work and applaud them. We should look at the things that do not work and ask how they could be changed. Let us get rid of them and put them on the chopping block.
An hon. member: It is common sense.
Mr. Gerald Keddy: I agree with the member who just said “It is common sense”. A little common sense goes a long way. I would like to do an overview of the PC stance on immigration. We recognize that immigration in Canada will continue. We certainly support it. We also recognize further that it is an economic necessity. We need to have more confidence in and respect for human diversity so that we do not get sucked into the debate.
I will quote the words of our immigration critic, the member for Fundy Royal, “so that we do not get sucked into the debate of always having to add the word criminal in a statement related to immigration. That is a very slippery slope”.
In conclusion, the PC Party supports the bill. We support the abolition of the $975 head tax and the $500 tax that is added on top of that. In other words, we support the abolition of the $1,475 tax that immigrants are forced to pay when they come into Canada.
We would like to see the bill made votable. Perhaps in the future it will become votable. In the meantime, it is through the continuation of efforts like this that hopefully some day we will see the abolition of the tax.
In summary, I would ask for the unanimous consent of the House to make the motion votable.
The Acting Speaker (Ms. Bakopanos): Is there unanimous consent?
Some hon. members: Agreed.
Some hon. members: No.
Mr. Gurmant Grewal (Surrey Central, Canadian Alliance): Madam Speaker, I am pleased to rise and speak in support of Motion No. 231, that the government should eliminate the right of landing fee on all classes of immigrants to Canada.
I congratulate the hon. member for Winnipeg Centre for moving the motion. I would point out that in 1998 I moved a similar motion in the immigration committee, which would have eliminated the head tax, but the Liberal members on the committee unanimously opposed it. Today, when the hon. member from the PC Party asked for unanimous consent, it was again the Liberal members, not opposition party members, including the Canadian Alliance, who were opposed to making the motion votable.
I am convinced that the right of landing fee is a cash cow for the Liberal government. The government is hungry to increase taxes whenever it gets the opportunity to balance its budget on the backs of taxpayers. In this case, it is raising taxes on the backs of refugees and prospective new immigrants. The tax has been in place for six years. The government has raked in about $1.2 billion from new immigrants. That is about $1,000 per immigrant per year.
Where does all the money go? It does not go for resettlement purposes or into the departmental budget. It goes to the general revenues of the government, this big, bulky government.
The head tax is not based on need. It is not based on the income of the people or the educational level. For example, people teaching English or French in another country may still have to pay for English as a second language when they come to Canada. The tax does not take into consideration the ability to settle in Canada. It is a very unfair head tax on prospective immigrants.
When we speak about the historical perspective, the head tax has connotations of the discriminatory past of our country. The government imposed a head tax on Chinese immigrants to Canada from 1885 to 1923 to discourage them from coming here.
It started at $50 per head and then rose to $500 per head. This head tax, which continues into the 21st century, reminds us of the Chinese exclusion act. It also reminds us of the discriminatory practices with respect to the Komagata Maru ship which came to Canada. Based on race and country of origin, the passengers of that ship, most of whom were refugees, were not allowed to land on this great land. After many days, the ship was forced out of Canadian waters. When it arrived back in India, many of the passengers were gunned down by the government at that time.
It also reminds us of the discriminatory practices followed in the old age security benefits, commonly called a pension for seniors. It is discriminatory because it is not needs based.
This head tax discriminates against the poor and people of colour from Third World countries. Those prospective immigrants who come from developed countries have to pay that fee which is equivalent to about 15 days of wages in developed countries. Fifteen hundred dollars is about 15 days wages. For many of the developing countries, it takes about 15 months to save that $1,500. Then we translate or convert that currency into the local currency of that country.
In the underdeveloped countries, or the backward countries I should say, like Zaire, it takes 15 years for people to save $1,500 Canadian per person. When a family of four or more people plan to come to Canada, this head tax acts as a deterrent for those individuals.
In many other countries, the immigration visa fee is adjusted according to the cost of living in those countries. For example, if one applies for a British visa, the fee depends on from which country one is applying. In certain countries, the fees are lowered because the cost of living is lower and the cost of processing that application is lower.
I also want to make it very clear that I talked to many immigrants in my constituency and all over the country. Immigrants want to pay a fee, but a reasonable fee, whether it is a processing fee or whatever name we give it. However this fee becomes unreasonable and acts as a deterrent, particularly so when the minister wants to open the front door, as I have been saying for a long time, and close the back door. When the fees are discriminatory, it does not encourage the immigrants to come through the front door but probably through the revolving door.
There are many individuals and groups who oppose this head tax. Among them are the Canadian Human Rights Commission and the Canadian Council for Refugees. They came up with a document called “Impact of the Right of Landing Fee” in 1997. The National Action Committee on the Status of Women noted that it has a disproportionate impact on women. The Caledon Institute of Social Policy, the Canadian Ethnocultural Council and the Canadian Labour Congress and many more oppose this head tax. They oppose it because it is too much. It is double the fee in the U.S.A., for instance, for a family of four entering that country.
Originally in 1995 when the right of landing fee was imposed, the finance minister proposed a fee of $1,700 to $1,800. Due to some good negotiations probably, it came down to $975, even though the former immigration minister wanted it less than $300.
I would also like to mention that the Liberal Party at its 1996 convention passed a resolution for the government to review the head tax. I believe the government has come up with all kinds of lame excuses. If it was a grassroots party, it would have listened to its members.
In conclusion, even though the government eliminated the head tax for refugees in the year 2000, for five years it had been milking those people who were forced to leave their homes. With the deficit having turned into a surplus, the government should lower taxes in general and eliminate the head tax. The minister has the authority to eliminate the service charge because it is not a designated tax. The right of landing fee should be based on equity so that we give new immigrants a chance to settle into their new lives.
Therefore I support this motion and I would ask the other members of the House to support it.
Mr. Pat Martin (Winnipeg Centre, NDP): Madam Speaker, let the record show, and I hope all the people who are watching this back home are fully aware of this, that there is only one party in the House of Commons that refuses to allow this motion to go to a vote and that is the Liberal Party. The Liberal MPs are the only ones who are afraid to put this issue to a vote.
I can tell the House why they are afraid. They would lose that vote. There are members of the Liberal backbench to whom I have spoken who feel very passionately about this issue as well, because they represent ridings where there is a strong population of new Canadians who feel abandoned and cheated by their own government by the imposition of this unfair tax.
I know of one Liberal cabinet minister who has spoken very plainly and openly about it and who strongly believes this should be eliminated.
The Liberal Party knows it would lose the vote.
The Liberals had a window of opportunity. I used my very rare opportunity of getting one of my bills or motions put forward. Of all the pieces of private member's business I have, I chose this one in order to give them a graceful exit so that they could get out of a bad situation. They chose not to take advantage or avail themselves of that. I hope they wear that right across the country.
We heard the member for South Shore say that this is not just a head tax but a penalty on new Canadians. They are being penalized for choosing to make Canada their home. What kind of welcoming message does that send around the world as we try to attract the best and the brightest to our country? I should add that we are in competition with other countries. There are a lot of countries people can choose to go to. We want them to come to Canada, yet we throw barriers and roadblocks like this racist head tax in their way.
This head tax is an insult to new Canadians. I have spoken confidentially with people in my riding and they are offended. Their feelings are hurt by the imposition of this tax. The Filipino Association of Manitoba, as my hon. colleague across the way knows very well because he is a former president of that association, has made very public demands. Its members have let their feelings be known very publicly about how offended they are that the government chose to look to them as some kind of a cash cow or revenue generator when all they are trying to do is reunite their families in this country.
Perhaps the most damaging thing about this head tax is not even the financial burden that it puts on families trying to bring family members here. It is the moral indignation they feel. It is in the assault on the morale of new Canadians that this head tax does really almost permanent damage.
The Liberal Party had an opportunity to live up to the resolution it passed at its own convention and to do the honourable thing. The Liberals do not need a legislative directive to change this head tax. They can do it unilaterally by order in council. The minister has the right to impose, raise, lower or eliminate a fee of this nature and it could happen tomorrow.
It would have sent a welcoming message to new Canadians. It would have satisfied the many social justice groups and advocates for immigration who have been saying loud and clear how unfair the imposition of this tax is.
The Liberals missed the opportunity. They did it voluntarily. I see them all looking down at their books. They are hanging their heads in shame, as well they should, because the country is watching, and even for those people who may have missed this little fiasco we are going to remind them. We are going to publish it far and wide that the Liberals willingly and knowingly missed this opportunity. Not only did they miss the opportunity to oppose the head tax, they decided to keep it and keep milking new Canadians like they are some revenue generating cash cow. Even though the government has a $100 billion surplus that it is always crowing about, it decided not to change the practice of picking the pockets of new Canadians.
The NDP caucus believes that immigration is an engine for economic growth. The NDP caucus believes that new Canadians begin contributing to the economy the very day they set foot on our shores and buy their first meals or first articles of clothing or rent their first home and, I might add, start paying taxes for the rest of their lives. They pay ad nauseam. That is how new Canadians make a contribution. We do not have to pick their pockets as soon as they express an interest in coming to our country.
We have missed a window of opportunity to send a valuable message to the rest of the world today. I am sorry in my own heart that members did not see fit to exhibit the kind of compassion and humanitarian reputation Canada is known for.
I am very disappointed and I am sure most new Canadians are as well. As I say, if they do not remember who the architects of this problem were, we will be there to remind them.
The Acting Speaker (Ms. Bakopanos): The hour provided for the consideration of private members' business has now expired. As the motion has not been designated as a votable item, the order is dropped from the order paper.
It being 2.31 p.m., the House stands adjourned until Monday, March 12 at 11 a.m. pursuant to Standing Orders 28(2) and 24(1).