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View Joël Lightbound Profile
Lib. (QC)
View Joël Lightbound Profile
2019-06-05 17:10 [p.28599]
Mr. Speaker, I am very pleased to rise in the House today to speak to Bill C-97.
This bill will help implement major investments included in the 2019 budget. Most importantly, it will give the government new tools to help middle-class Canadians, reduce inequality and ensure that in Canada prosperity is truly inclusive.
I will stress that I am talking about new measures. Bill C-97 builds on our accomplishments and the progress we have made these last four years. We have to remember how we got here and how we achieved the results we see in Canada today. In 2015, the situation was very different. Economic growth was slow or even stagnant. Unemployment was up, and Canada was in a technical recession. Wages were not going up fast enough, but the cost of living, as we know, just keeps increasing.
Some families were having a tough time making ends meet, while saving for the future or for an emergency. In the fall of that same year, Canadians made a different choice. I think it was a very smart choice, in all impartiality. They chose a plan that would invest in the middle class, a plan that would make big investments in health, housing and the environment, while also staying fiscally responsible.
One of the first things Liberals did as a government was to ask the wealthiest 1% of Canadians to contribute a little more so that middle-class Canadians could have more money in their pockets. Today, over nine million Canadians are benefiting from the middle-class tax cut.
In 2016, we introduced the Canada child benefit. This measure has helped lift almost 300,000 children out of poverty. What is more, our government indexed the Canada child benefit payments two years ahead of schedule, so that benefits could keep pace with the rising cost of living. In July, benefits will increase with inflation to ensure that hard-working parents continue to have the support they need with the high cost of raising their kids.
With the CCB, nine out of 10 Canadian families with children are receiving more money than they received under the previous system of child benefits, where cheques were sent to families of millionaires, something that the Harper Conservatives and today's Conservatives fought to preserve while voting against the Canada child benefit.
For the 2019-20 year, on average, families benefiting from the CCB will receive around $7,000 to help with the high cost of raising kids, an amount that will continue to rise with the cost of living, as I have mentioned. According to the OECD, and I understand it is not the Fraser Institute, which the Conservatives like to quote, even though the studies they refer to often in the House have been debunked by just about anyone serious who has taken a look at it, precisely, because they fail to take into account the Canada child benefit.
However, according to the OECD, when the CCB is combined with the middle-class tax cut, a typical, middle-class family of four in Canada, on average, now has $2,000 more in their pockets than they did under the Harper Conservatives. This is significant progress.
We did not stop there. We replaced the old working income tax benefit with the more generous Canada workers benefit. The new benefit puts more money in the pockets of more than two million Canadian workers who are working hard to join the middle class.
In addition, to support Canada's hard-working entrepreneurs, we cut the small business tax rate twice, dropping it to 9% in January. It is now the lowest small business tax rate in the G7, and the fourth lowest of the 36 members of the OECD, the Organisation for Economic Co-operation and Development, which I just referred to.
The results of the measures adopted by our government since fall 2015 speak for themselves. More than one million jobs were created in the Canadian economy. Last year, all job gains were in full-time positions. The unemployment rate is at its lowest in more than 40 years, and salaries are increasing faster than the rate of inflation. In sum, the country is heading in the right direction and the Canadian economy is booming.
Moreover, employment gains have greatly benefited groups that are often under-represented in the labour market, such as new immigrants, single mothers, indigenous peoples living on reserve and young Canadians who do not have a high school diploma. This represents considerable progress, but a lot of work remains to be done to continue reducing inequality in this country and to ensure that the growth and prosperity we are enjoying benefit as many people as possible.
Some Canadians remain concerned about the future. They are worried about their job security because the nature of work is evolving. They are worried that they will not be able to buy a home because housing is too expensive. They are worried about their retirement and they wonder whether they will have enough savings. These are legitimate concerns, and we will leave no one behind.
Bill C-97 is the next step in our plan to invest in the middle class and grow the economy today and for years to come. I will take a moment to elaborate on this before getting into some of the details of Bill C-97. Over the past three years, the government's action was based on three main pillars. That is the plan we presented to Canadians and it is working very well.
One of these three main pillars is investment in infrastructure. We know there are infrastructure needs across the country, from coast to coast, and we know how serious they are. Our environment also demands investments in public transportation infrastructure, for example. We committed to investing $180 billion over 12 years in infrastructure. These investments are paying off across the country and are helping many municipalities and provinces carry out meaningful infrastructure projects. Sometimes these projects appeal to the imagination, as is the case with public transportation. Others are a bit less glamorous, but just as important. Take waste water for example. We lose a lot of drinking water to aging waste water treatment systems.
The second pillar involves reducing inequalities through the measures I mentioned. These measures have helped reduce poverty by 20% in Canada. Child poverty was reduced by 40% in just three years. That is huge.
The third pillar is competitiveness. We are making sure that Canada has access to foreign markets, whether through the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, CETA, the renegotiated NAFTA, reduced small-business tax rates or strategic investments, all of which were sorely needed in Canada during the decade that Stephen Harper and the Conservative Party of Canada were in power. They neglected the sciences and stopped investing in science. This undermines our country's competitiveness and prosperity over the long term.
Those are the three main pillars. In budget 2018, we reaffirmed the importance we place on science by making the largest investment in science in Canadian history, after a dark decade for scientists, science, research and innovation under Stephen Harper's Conservative government.
The budget and Bill C-97 are based on these three main pillars, which are working and have made Canada one of the G7's leading economies since we came to power three years ago.
Speaking of competitiveness, let us talk about skills.
That is something that I would like to talk about. In the first quarter of 2019, there were more Canadians employed than at any moment in Canada's history, including more women employed than at any moment in Canadian history. That is great news but we cannot take anything for granted. We know that not everyone has the right skills to take advantage of some of the new well-paying opportunities.
The nature of work is changing around the world and the challenge for workers, employers and governments is to find new ways to make sure that people have the skills they need to succeed in the changing work environment. For example, automation is on the rise. The OECD estimates that about one in 10 Canadian jobs are at high risk of automation within the next 10 to 20 years and that one out of three jobs is likely to experience significant changes.
Canada is not alone in this. Other countries will face the same challenge, as workers try to figure out how to get the training they need to keep their existing jobs or to prepare for new jobs.
We are determined to ensure that Canadian workers have the skills they need to succeed on the job market of tomorrow. To get there, Canadians must have access to appropriate training. That is why we introduced a new program, the Canada training benefit, in budget 2019. It is a personalized, portable benefit that will help Canadians get the time and money they need to learn new skills.
Bill C-97 will implement an important element of the benefit, namely a $250 annual credit for every worker to be put toward the cost of future training. This credit can add up to $5,000 over the course of a career. Eligible workers will receive their first credit this year, in 2019, and may start using it next year to register for a course they may need.
The Canada training benefit will open more doors for workers, which will help them contribute to the Canadian economy and benefit from its growth. This measure will be equally helpful for employers because it will give them access to a more skilled workforce, which will help them grow their businesses and create more well-paying jobs.
Clearly, if we want to prepare Canadians for the high-quality jobs of tomorrow, we must pay close attention to my generation and to young Canadians, something our government fully understands. When the Minister of Finance introduced budget 2019, he highlighted the steps we have taken to remove barriers to education and training.
With the measures in this budget implementation act, students would not have to start repaying their Canada student loans until six months after they graduated, and interest would not accumulate during that period on these loans. Paired with the budget's commitment to lower the interest rate on Canada student loans, the interest-free grace period is expected to save the average borrower approximately $2,000 over the lifetime of a loan.
We are taking these steps because young Canadians need our help. They are the most educated, connected and diverse generation this country has ever seen. They are changing our communities for the better and are taking the lead in building a fairer and more sustainable future.
At the same time, we are hearing from many young Canadians that they are still worried about what the future holds for them. Will they be able to afford college or university? Will there be good jobs ready for them when they graduate? Will they be able to afford a good place to live? We are taking action to answer more of these questions for young people and for all Canadians.
Let us take housing. Many young Canadians dream of owning their first home, a feeling shared by middle-class families. However, with rising house prices, it is getting increasingly harder for people to make that dream a reality. Our government believes that every Canadian should have a safe and affordable place to call home. That is why we are taking important steps to make housing more accessible and affordable, especially for first-time homebuyers.
The legislation we are debating proposes measures to help Canadians take their first step toward home ownership. It would amend the National Housing Act to allow the Canada Mortgage and Housing Corporation to offer shared equity mortgages to eligible first-time homebuyers. This important measure would be called the first-time homebuyer incentive. Through this new incentive, CMHC would provide 5% of the value of a home for a first-time homebuyer, helping to reduce the size of an insured mortgage and lowering monthly mortgage payments.
To encourage the construction of new housing, the incentive would increase to 10% for newly built homes. This could mean a lot for many young Canadians. For a middle-class family buying a new condo or new house worth $400,000, the savings could be about $225 a month. That could make a real difference. It is expected that this new incentive could help as many as 100,000 Canadian families buy their first home.
That is not all. The budget implementation bill also proposes to increase the limit on withdrawals from the home buyers' plan, or HBP. These amounts, which first-time homebuyers can withdraw tax-free, can help fund the down payment. As announced in budget 2019, the limit is being increased from $25,000 to $35,000 per person, or from $50,000 to $70,000 for a couple. The maximum withdrawal amount had not been adjusted in 10 years, so we thought it was time to do so. Modernizing the homebuyers' plan will help more people purchase their first home or first condo.
In addition, Bill C-97 will enact the new legislation for the national housing strategy. In concrete terms, it will require the federal government to give priority to the housing needs of the most vulnerable Canadians.
The government will also be required to report back to Parliament on the progress made in implementing the strategy and in achieving the desired results with respect to housing. These targets, such as cutting homelessness in half in this country and building 100,000 new units, as well as repairing and renovating another 300,000, will make a real difference in the lives of many Canadians.
I think these reinvestments in housing are all the more important in light of the federal withdrawal from housing investment, which, I should point out, began before the Conservative government took office and escalated during the 10 years that Stephen Harper was in power.
I think it is time for the federal government to take responsibility for housing and make a bold, ambitious comeback. That is what the national housing strategy does.
The bill also offers meaningful assistance for Canadian seniors, because all Canadians deserve a secure and dignified retirement, free of financial worries. Sadly, retirement can be a daunting prospect for some seniors, especially those living on low incomes.
Since 2015, the government has taken a number of steps to make retirement more affordable. For instance, it restored the age of eligibility for old age security and the guaranteed income supplement to 65. The previous government had moved it up to 67, plunging hundreds of thousands of the most vulnerable Canadians into poverty.
We increased the GIS top-up for single seniors, a measure that benefited 900,000 Canadians.
Our government also reached an historic agreement with the provinces to enhance the CPP, which will raise the maximum retirement benefit by up to 50% over time. This will help more than one million families who would have faced a drop in their standard of living when they retired.
Budget 2019 and this BIA propose a series of new measures to help even more Canadians age with confidence in their finances. To help low-income working seniors, Bill C-97 proposes to increase the earnings exemption for the guaranteed income supplement and to expand the exemption to self-employment income. This means that more low-income working seniors would be able to keep more of their pay and their benefits.
We are also taking steps to ensure that everyone who is eligible receives her or his retirement benefit from the CPP. While the standard age to receive CPP benefits is 65, some people choose to delay receiving their retirement benefits until age 70, at which time they will receive a bit more each month. A small number of people, however, are currently missing out on receiving their CPP benefits. This happens because some apply too late, and some do not apply at all. To ensure that all Canadian workers receive the full value of the benefits they deserve, this BIA proposes to proactively enrol, as of 2020, CPP contributors who are age 70 or older who have not yet applied to receive their retirement benefits. It is estimated that approximately 40,000 Canadians would begin to receive a retirement pension as a result. They deserve that money. Making sure that they get it is the right thing to do, and this legislation would make it happen.
Budget 2019 and Bill C-97 are about investing in people, and I have given plenty of examples in this speech. However, it is also about investing in communities. That is why budget 2019 proposes to support local infrastructure priorities by providing a one-time top-up of $2.2 billion, doubling the federal municipal infrastructure commitment in 2018-19. This $2.2 billion injection of cash this year would help cities and towns of all sizes, as well as indigenous communities. It would provide them with much-needed funds to address short-term priorities and crucial repairs and help them finance other important projects, such as recreational arenas, soccer facilities, new roads, public transit extensions, improvements to drinking water infrastructure and so on. Transferring funds to communities will get projects built. Supporting this BIA will get projects built.
In recent years, this funding has supported approximately 4,000 projects each year that have contributed to productivity and economic growth, a cleaner environment and stronger communities. We promised this help, and we are delivering in this BIA.
I could go on about what is in this budget, because when it comes to investing in the middle class, there is a lot of good news to share. However, I will conclude with this. Canadians have made a lot of progress since the fall of 2015. They should be proud of the strong communities and the strong economy they have helped build.
I think it is a source of pride for Canadians, or it should be, that in three short years, we managed to turn around the situation that the Stephen Harper government ineptly and regrettably got us into. During that decade, we saw the lowest growth in employment since the Second World War, the lowest growth in exports and a disastrous economic record.
They also managed to add $150 billion to the national debt.
We managed to turn around the country's fortunes with the best economy in the G7, the lowest unemployment rate in nearly 40 years, and a 20% reduction in poverty in 2017. It never occurred to them to reduce poverty and inequality. It was the right thing to do for the country. To us it is obvious that the more inclusive our prosperity is and the more we reduce inequality, the better off the entire Canadian economy will be.
That is what we have managed to do and that is what we will continue to do.
View Kevin Lamoureux Profile
Lib. (MB)
View Kevin Lamoureux Profile
2019-05-14 10:38 [p.27728]
Madam Speaker, there has been a great deal of effort by this government to talk about tax agreements and to deal with trade agreements and their impact on Canada's middle class, which has been overwhelmingly positive. I wonder if the member could provide his thoughts regarding the international approach we have taken as a government with moving forward on things such as tax treaties and trade agreements.
View Joël Lightbound Profile
Lib. (QC)
View Joël Lightbound Profile
2019-05-14 10:38 [p.27728]
Madam Speaker, that is a very important question. Our world is so interconnected that the simple solutions that some are presenting, which involve Canada acting unilaterally and ignoring our trade partners, are rarely as straightforward as they seem.
Obviously, we need to work with our partners to come up with collaborative approaches to tax treaties, just as we do when it comes to trade. The trade agreements that were signed are another issue, I know, but they have helped and continue to help many Canadian businesses to develop, prosper and grow. A number of examples come to mind. For instance, under CETA, some businesses saw their sales explode overnight because they had access to the European market.
While I am on my feet, I would like to commend the efforts of the Minister of Foreign Affairs and all members of the House who took the time to speak to European parliamentarians to get this agreement in place. Canada is now the only G7 country that has trade agreements with every other G7 country. Access to those markets is an incredible advantage that helps Canadian businesses succeed.
The goal of our government's ongoing efforts is to increase prosperity. However, as I mentioned in my speech, unlike the Conservatives, we feel that, in order to be sustainable, all prosperity must be inclusive.
View Tom Kmiec Profile
View Tom Kmiec Profile
2019-05-14 10:40 [p.27729]
Madam Speaker, I am glad to be joining this debate on the most exciting of subjects, tax and a tax treaty. For those constituents of ours who are tuning in on CPAC this early morning, or who have come to watch in the gallery, this is as exciting as this place is going to get, I think, until question period. I see the parliamentary secretary nodding his head, because he knows this too.
I am also glad his intervention covered so much subject matter beyond Bill S-6, because that now allows me to delve into the government's record on taxes, its management of different public policy issues like the Asian Infrastructure Investment Bank, consumer confidence in Canada and business confidence in Canada, as well as how the government has approached Bill S-6.
I will start with an observation about this tax treaty and some of the comments made by the parliamentary secretary. He seemed to be placing Bill S-6 within the confines of trying to achieve greater tax fairness and doing other great things with the Government of Madagascar. He said the bill would make sure that Canadian companies and Canadian taxpayers who may be doing business in Madagascar would not be double taxed, and that it would increase trade and do all of these wonderful things.
However, when I asked officials a question at the Standing Committee on Finance, we heard there was such a small number of tax filers with tax filings in Madagascar that each instance raises confidentiality concerns. Officials from Finance Canada responded to me that these concerns are such that, “consistent with the taxpayer confidentiality protections in the Income Tax Act, the department is precluded from releasing these data”.
This may be why Bill S-6 comes from the other place, the Senate side. The department told me in this official letter to the Standing Committee on Finance that there are so few tax filers impacted by this that the department would not be able to release the data. I had asked which sectors of the Canadian economy and which sectors of the Madagascar economy would be affected, and whether there were any good examples. I did a quick Google and DuckDuckGo search, and I was able to find that Sherritt International was one of the companies in question. It is mostly a mining consortium. There was very little else that I could find.
To the credit of the Department of Finance, it did a pretty thorough review. It reviewed sources including the T1134 information return on foreign affiliates of Canadian taxpayers, the T1135 information return that collects data on specified foreign property holdings, the T106 information return on non-arm's length transactions with related non-residents, and Schedule 21 to the T2 corporate tax return on foreign income tax credits. The department examined all of the years to 2011 and then the subsequent years.
For those still able to follow, either in the public gallery or at home, Finance Canada did a thorough search to double-check how many of these filings would include Madagascar in some way, and they are actually very, very few. Perhaps the tax treaty will enable more business to be conducted by Canadians in that particular country, and there are opportunities yet to be found for this tax treaty and the consolidation of some of the rules to make it simpler for individuals to do business in both. I was unable to find an instance through any international organization or online that showed that Madagascar was behaving like a tax haven. I think that assuages some of the concerns individuals may have had.
I am sure the government knows that I will be supporting this piece of legislation as well. There was no concern about curbing tax evasion through Bill S-6, or about a potential increase in tax evasion. In fact, this is a very small piece of legislation that does not do what the Parliamentary Secretary to the Minister of Finance said. It is not part of a broader approach. If there are so few tax filers that the information cannot be released, then the impact is negligible. Therefore, it cannot be counted as part of the government's broader plan.
I am pouring out my heart here on what I believe about Bill S-6 and its contents, having spent several meetings at committee looking at this particular piece of legislation. I am feeling lighter. As the Yiddish proverb goes, when one pours out one's heart, one feels lighter, so now that the parliamentary secretary has poured out his heart about the government and what he believes its achievements are, I am going to do the opposite. I am going to poke holes in a couple of things he said. I am going to poke holes in some of the Liberal government's achievements, including in some of the statistics it likes to use.
At committee we asked both Global Affairs and Finance Canada for information on the specifics of Bill S-6 and who it would impact. We were told the bill would impact the mining sector. We were also told that detailed information could not be released because it would compromise the privacy of certain tax filers.
That is unusual. In prior cases, when we have done these tax consolidation treaties or signed up to multilateral international instruments with respect to taxes, such as Bill C-82, which was the tax treaty of tax treaties, it was always tens or hundreds of thousands of Canadians who would be impacted. That included Canadian-controlled private corporations in Canada. There would be many of them, so it was easier for us to estimate the impact.
The parliamentary secretary mentioned base erosion and profit sharing, which is not a fixed section in this particular piece of legislation. We have already had legislation to cover that off.
When I mentioned to my kids, who are very young, with my oldest being 10, that I debated an obscure bill called the Canada-Madagascar tax treaty, the first thing they wanted to talk about was King Julien and Skipper, Kowalski, Rico and Private, the famed characters from Penguins of Madagascar and the other movies in the Madagascar series. My kids were thrilled to watch that series when they were younger, and they are still thrilled to watch it today.
However, this piece of legislation is not about that. I am sorry to burst their bubble but this, unfortunately, is not about King Julien or those four little penguins.
The parliamentary secretary went off on a tangent at one point. He mentioned that the tax treaty in Bill S-6 would increase consumer confidence, and that it was part of a slew of policy decisions the government has been making to increase both consumer and business confidence. If he had bothered to check the latest statistics posted by different economic analysis bodies online, or if he had bothered to check the Conference Board of Canada, he would have seen that consumer confidence is just as low as it was in 2015. It has not improved since then. We can see that in our communities. I can see it in cities and towns all over Alberta.
However, there is more consumer confidence in Alberta now that we have Premier Jason Kenney and the United Conservative Party in charge. A new cabinet has been sworn in, and on Tuesday of next week the members of the legislative assembly will be sworn in. I hope we will know the new plan for the province on Wednesday.
Some of that plan has already come out. The government of Alberta has already announced that it will get rid of the punishing provincial NDP carbon tax, which was far more punishing on Albertans and Alberta businesses than the federal backstop. That does not mean the backstop is any good. It does not mean the federal carbon tax is any better.
The Alberta government is basically proposing to return to the old system, which was working. It was the first system to put a price on carbon for the largest emitters, not directly on consumers. The system worked. It was lauded all across North America at the time. It did not punish consumers directly for their behaviour, but was specifically aimed at the largest emitters, who were making it part of their business plans. That is the difference. May 31 is the last day of the Alberta carbon tax.
We can really see consumer confidence returning in Alberta. People are more confident now that they have a government that is on their side and will back up the decisions of private businesses, everyday Albertans, the mom-and-pop convenience stores, the local dry cleaner and the small oil and gas servicing company that has somehow managed to just get by over the last few years.
Albertans are on the cusp. They know that prosperity might return with the right decisions being made by their government to get involved, not to make decisions for them but to support them in the decisions that will create new jobs, create more business investment and lead to higher returns in terms of corporate and personal income taxes.
That is how consumer confidence returns, not by having what we have seen from the federal Liberal government over the past four years. The Liberals created a situation here in Canada that made it impossible to build a pipeline. Energy east was cancelled because of regulatory red tape. Northern gateway was cancelled by cabinet order. There already is a functioning Trans Mountain pipeline, but the Liberals caused a situation in which Kinder Morgan saw no real means to get the expansion built. It was losing construction seasons to it, so the government expropriated it. The government bought it for $4.5 billion.
Now we know from the Parliamentary Budget Officer that the government not only overpaid for the pipeline project by $1 billion but will also need to extract another $8 billion to $9 billion from the taxpayer to build this pipeline.
There has been talk of legislation and there has been talk of an expedited process, but we are waiting until later in June to find out whether this pipeline will get perhaps half a construction season. We know that construction seasons in Canada are short. Basically, there is a construction season and then there is winter. These are essentially the two seasons we have in Canada. Most people who live in big cities know this, as they have experienced it. We are going to lose a second construction season, and this does nothing but reduce business confidence and reduce consumer confidence.
How can Canadians have faith in a government that purchases a pipeline, overpays for it, and loses money every single month operating it? When the interest being paid on the debt is subtracted from the tolls charged on the pipeline, Liberals are losing money every single month operating in the most profitable part of the energy sector, which is shipping.
As I hear constantly from the Minister of Natural Resources, who is from Edmonton and should know better, as once the oil gets to the west coast, 99.95% of the product shipped out of the port of Vancouver goes to California. Those are not my statistics; I am not making them up. I asked the Library of Parliament to confirm them for me. This is from the Greater Vancouver Board of Trade. The port itself has said that 99.95% of the product goes to California to feed the refineries there.
Therefore, this is not about reaching new markets on the current pipeline, and perhaps not even on the future pipeline. A series of public policy decisions led to a situation such that a private company felt unable to build a pipeline because of obstruction at the federal and provincial levels. Those obstructions are not gone; they have just become purely governmental. All the decision-making is on the government side.
When I knocked on doors in my communities and for my provincial counterparts, which I did during this past election in Alberta, I heard time and time again that people have no faith whatsoever in the Liberal government's ability to deliver on the construction of a pipeline and no faith in the government's ability to manage public finances.
The parliamentary secretary mentioned the Liberals' great plan to increase affordability for the middle class and that Liberals reduced the tax bracket from 22% to 20.5%. I remind the parliamentary secretary and all members of the House that the biggest tax break from those tax changes went to every single member of Parliament in this chamber. Those who were earning $45,000 or less got zero. They received no benefit whatsoever from that tax cut, but because of the way the progressive tax system works, every single member of Parliament in this chamber got over $800 off their taxes at the end of the day.
That is what the Liberal government did. Those of us in this chamber are not the middle class, but the Liberals did this and claimed it was for the benefit of the middle class. They gave themselves a bigger tax cut than they gave not so much to the working poor, but to people trying to get by and get ahead, people who are taking jobs that many people do not want to take. They work hard for the wages and salaries they earn.
Instead, they received higher payroll taxes. There has been a CPP increase as well, which is taking away from their income at the end of the day and taking away their ability to choose how they want to save.
The second part is that they have a carbon tax to pay. We heard the Parliamentary Secretary to the Minister of Finance speak to this, and in the scenarios he noted, he gave OECD numbers. A colleague of mine mentioned that a family on the lower income scale with two kids would not be getting back all of that money. The parliamentary secretary's numbers only make sense if we include the child benefit, which is just a re-badging of the old universal child care benefit. It is the original Conservative policy that was introduced when the government wanted to introduce a universal, one-size-fits-all, cradle-to-old-age welfare system. Whereas the government would take care of our children directly under this system, the UCCB was meant to empower parents, and that is how we should be looking at it.
The government claims that if we look at all government policy together, the carbon tax is not so bad. However, that does not help the kind of family my colleague mentioned, which is not seeing these rebates.
As well, if we look more closely at the GGPPA, which is the acronym for the government's carbon tax bill that is over 200 pages long, and then if we look at this latest budget document and some of the implementation portions of it, including the algebra formula that implements the rebate program for the federal carbon tax, we see that there is a provision that would allow the minister of finance to exclude any money he or she wishes from the rebate. A finance minister could give it to any other minister he or she wants, for any program, infrastructure or purpose. It is right there in the formula. There is no guarantee in the legislation that Canadians would receive any sort of rebate on the carbon tax, and it will never replace the full amount.
It is absolutely illogical and irrational to say that 100% of the collected tax will be returned to those who pay it. There always is and there always will be an administrative cost in collecting a tax, unless people think that public servants work for free and they think the lights and the heating in this place come for free, and they do not. It has to cost a certain amount of money, which is why we say the government is misleading them. The way the government presents the facts around the carbon rebate and the carbon tax is ingenious, but it is not an environmental plan; it is a tax plan. It is as simple as that.
To return to the point of consumer confidence and how we have not seen it return, some of the facts on LNG speak for themselves. In the case of LNG, 78 billion dollars' worth billion worth of projects in Canada have been cancelled since 2015. Those are LNG projects that have been completely abandoned by the companies that were proposing them. Tens of thousands of potential well-paying construction jobs, many of them unionized, are gone. They will not be created, because that $78 billion to put people to work has been removed from the private sector. That is an important fact to remember.
The only large-scale project that I am aware of that is going ahead is LNG Canada's project. LNG Canada is a consortium. Mitsubishi is involved and Petronas is involved. The only reason that the consortium went ahead with the project is that it has an exclusion and an exemption from the carbon tax. Of course a company will go ahead and build a large-scale industrial project, as LNG Canada is proposing to do, when it gets an exemption to a tax.
I cannot imagine any regular, everyday, hard-working taxpayers being told by the Liberal government that CRA is going to give them an exemption this year so that they do not have to pay taxes because they are doing so well in producing jobs and growing their business or are earning a higher salary because they work hard. Nobody gets that type of exclusion or exemption.
I will spend my last two minutes on my favourite subject, the Asian Infrastructure Investment Bank, because Madagascar, this country that we are signing a tax treaty with, is a member of this bank. As I said, the parliamentary secretary, by going on a tangent, has allowed me to go on a tangent here. Madagascar is a member of the Asian Infrastructure Investment Bank. As far as I know, it has not received any project yet. It has only spent $15 million to $20 million, which is a paltry sum compared to the nearly half a billion dollars that Canada has set aside. That same money is being used to build pipelines all over Asia, including in Azerbaijan, Bangladesh and the suburbs of Beijing.
I am pouring my heart out here. As my Yiddish proverb said, I am feeling lighter from being able to speak about the Asian Infrastructure Investment Bank. If we in Canada are unable to build pipelines, which are the safest way to move energy, it seems absolutely wrong to be giving a half a billion dollars to governments in Asia and to the China-controlled, Beijing-based Asian Infrastructure Investment Bank.
I support Bill S-6, a small piece of legislation coming to us from the Senate, but I do not support the government's agenda and its repeated failures to get large-scale energy infrastructure built in Canada. I do not support the government's policies that have undermined business confidence and the confidence of Canadians. October cannot come soon enough. The current Liberal government is not as advertised.
View Kevin Sorenson Profile
Madam Speaker, I am encouraged today that the NDP colleagues said that they would be supporting this legislation. Most parties in this House will be supporting it. We are getting quite used to seeing the New Democratic Party, in this Parliament and the last, oppose trade agreements. It is good to see that it understands the importance of tax treaties.
In the Conservative Party, we believe that if we are going to have a strong economy, we need to have good trade relationships around the world, fair trade relationships. We need to have tax treaties that provide confidence to investors in whichever country they may be investing, foreign investors here and our investors there. That is important.
Also, on the training side, Conservatives believe that for a strong economy we need to have innovation and trade here. Does the member have any suggestions? The tax treaty we are signing is very similar to a tax model put out by the OECD. What are the important parts of a treaty that would make him agree with me that these types of tax treaties that encourage investment are vital to our local national economy?
View Peter Julian Profile
View Peter Julian Profile
2019-05-14 11:38 [p.27737]
Madam Speaker, we are supporting Bill S-6 because we have read the bill and we know that the Madagascar taxation rate is roughly similar to Canada's. Other taxation agreements that the government has signed, or tax arrangements with overseas tax havens, we do not support. When the tax level is 0%, it is a tax haven. It is a way of legalizing tax evasion.
In the same way, it is why we often did not support Conservative trade agreements under the last Parliament. Conservative fair trade is an oxymoron. The Conservatives have never signed a fair trade agreement, ever.
What we would do is actually look at the trade agreement. We would do our due diligence. We would ask officials what kind of impact analysis was done on a trade agreement. Time after time, under the Harper government, they would say that no analysis was done. They wanted to do the ribbon-cutting but they had done no analysis.
That is why, systematically under the Harper government, trade agreement after trade agreement, our exports to those markets fell and the imports from those markets rose. That is why we had a record trade deficit under the Harper government. Conservatives did not read the fine print. They simply sold the farm every single time. Not once did they do an economic impact analysis. Not once did they have an understanding of how many jobs they would lose. On trade, Conservatives were absolutely irresponsible, and that is one of the reasons they are sitting in the opposition side of the House.
View Kevin Lamoureux Profile
Lib. (MB)
View Kevin Lamoureux Profile
2019-05-14 11:40 [p.27737]
Madam Speaker, I have listened to the debate on Bill S-6 this morning and I must say there are plenty of things that one can draw upon in order to shed more light and to be a bit more forthright with respect to the bill.
The Government of Canada and the Liberal Party of Canada recognize the important role that trade plays in the development of our nation. Having observed the NDP for many years now, it is my experience that as a general rule that party does not support trade agreements.
There have been dozens of trade agreements. On one occasion, the vote was not a recorded vote, so NDP members claimed not to have voted against the bill. They might have voted in favour of one other bill. A couple of MPs have indicated they have voted in favour of trade, but as a general rule the NDP does not support trade agreements between Canada and other countries, and that is somewhat unfortunate.
Bill S-6 is about a tax treaty with Madagascar. Madagascar has wonderful opportunities for Canadians, and individuals from that country have opportunities here in Canada. We have many tax treaties with countries around the world, and tax treaties provide significant benefits to both countries.
That is why it is with pleasure that I rise today to address this legislation and to add my comments on a wide variety of issues, all stemming from our economy, social justice and the tax laws that we currently have. I have a fairly wide spectrum to work from based on the debate I have heard so far today. Let me attempt to do it in the best way I can.
The number that comes to my mind, which ultimately demonstrates what this government has been able to accomplish by working with Canadians, is one million, and that is a fairly recent number that has come out relating to employment.
It is worth mentioning that since we took office in October 2015, we have seen the generation of over one million new jobs. That is historic, in the sense of the last 40 or 50 years. It is an incredible number of jobs, and it is due in good part to the policies that this government has put in place, budgetary measures and legislative measures, all with the idea of supporting Canada's middle class and those aspiring to be a part of it.
Day after day, for weeks, months and years, our government has taken Canada's middle class seriously. We have developed progressive measures to assist middle-class Canadians, bringing forward policies that will support them, policies such as the Canada child benefit program and the guaranteed income supplement for our seniors, which have added great value to our economy.
We hear a lot about taxation. People expect to pay their fair share. From day one, our government has taken this very seriously.
Members will recall that during the last election, today's Prime Minister made a commitment to Canadians that there would be a tax cut for the middle class. If members look at Bill C-2, which was our first piece of legislation, they will see that we delivered on that tax cut, which put hundreds of millions of dollars into the pockets of Canadians. I would argue that the money going into the pockets of Canadians enabled them to increase their disposable income, allowing them to spend more into the economy, and it is one of the reasons for the one million-plus jobs that have been generated. Working with Canadians, investing in Canadians, allowing Canadians to have more disposable income has allowed Canada's economy to perform that much better.
Taxation policy matters. The NDP and the most recent speaker talked about tax fairness and said that the rich need to pay more. That was an important part of the very first budget we brought forward, in which Canada's wealthiest 1% had to pay more. The millions raised through that one initiative supported giving Canada's middle class a tax break. The issue of tax fairness, much like the tax break, has been of the utmost importance to this government. It was one of the very first actions taken when we assumed office in 2015, recognizing some of the comments made today, whether it was the NDP talking about tax fairness or the Conservatives talking about the tax on Canada's middle class.
When the member for Calgary Shepard asked who benefits from the tax break that we gave to the middle class and then said it is members of Parliament who benefit, I think of the tens of thousands of teachers, the tens of thousands of nurses, the tens of thousands of factory workers or the tens of thousands of people who work for our financial institutions. Those individuals also benefited from that tax break.
I indicated that when I had the opportunity, I would put some facts on the record, and there is no disputing what I have said, because it is all factually correct. The government has consistently gone out of its way to develop policy through legislation and budgetary measures that has had a positive impact on Canada's middle class.
The tax treaty that we are debating today is all about international relationships and ways for these treaties to further advance Canadian interests. This is not the only tax treaty legislation that we have put forward in the last three years. Bill S-4 also dealt with tax treaties. It is not the first time we have had to deal with tax treaties, because we understand and appreciate the true value of having these types of treaties with countries. It allows us to have a better sense of taxes flowing, both here in Canada and in the country in question. It provides additional security, if I can put it that way, for investments flowing to countries with which we have tax treaties.
We recognize, as we do on the broader picture, trade and international relations. No government in recent history has done more with respect to trade agreements than this government. The previous government likes to say that it had 30-plus trade agreements, but that is just not true. Through this administration, we have been able to sign more trade agreements than any other government in the last 40 to 50 years. Since trade agreements have been tied into tax agreements or tax treaties, I would challenge any member in the House to list a government that has been able to accomplish so much in such a short period of time on that file.
An hon. member: Oh, oh!
View Kevin Lamoureux Profile
Lib. (MB)
View Kevin Lamoureux Profile
2019-05-14 11:51 [p.27738]
Madam Speaker, with respect to treaties and trade, the approach this government has taken in regard to international relations has supported our economy. By supporting our economy in many different ways, it has had a profoundly positive impact on the generation of jobs.
We can look at the province of Manitoba and at an industry I have cited in the past, which is the pork industry. It provides thousands of jobs in the province. In any given year, we have more pigs than people in Manitoba. Plants out toward Neepawa export 95%-plus of their production to Asia. However, the industry provides hundreds of direct jobs on the factory floor and hundreds of additional jobs outside the factory.
Those jobs would not exist if we did not have the international relations we have today. Whether it is cattle or pork, members will see significant increases in the last few years. I like to believe it is because of the approach, in part, and working with Canadians and other stakeholders, encouraging the development of those industries and taking advantage of the agreements on which we have signed off.
At times, the Conservatives will say that they brought it close to the goal line. As we know, it is not bringing it to the post that matters as much as it is getting it over the post. We have been very successful at doing that.
The CETA agreement is a great example. It involved a couple of dozen countries. It was completely off the rails and had it not been for our current Minister of Foreign Affairs, that deal never would have gotten over the goal line. We are still hopeful the European Union will get behind it 100%, as its respective legislative bodies continue to deal with the issue.
Whether it is recognizing the value of our tax treaties or the benefits of getting engaged with the countries, and we are talking about dozens of countries, Canada has been successful in negotiating these treaties, which provide assurances in progressing on the trade file. In a relatively short period of time, the government has been able to accomplish a great deal on both accounts.
We hear a lot from the opposition benches about tax avoidance. Again, we have seen the government not only talk about it but invest in it. For two consecutive years, the government invested additional monies, almost $1 billion, hundreds of millions in each of two separate budgets, in the Canada Revenue Agency to go after individuals who try to avoid paying taxes.
We have taken this very seriously, along with tax evasion. In three years, the government has done more to go after individuals for tax evasion than the previous government did in 10 years. The same applies to tax avoidance. We have recognized the importance of doing the follow up, of looking at ways to ensure that those who are supposed to be paying their fair share are doing so.
We do not need to take lessons from the opposition, in particular the Conservative opposition, on this because it has virtually ignored the problem by not investing. If anything, it divested. It took money away from the CRA. Cuts were brought by the Conservative administration.
When I put forward a question for the member for New Westminster—Burnaby, he talked about taxation policy. He implied that we needed to go after corporations and make them pay more. I give the NDP an A-plus for consistency on it while it is in opposition, but that is it. I underline the words “while in opposition”.
I have witnessed first-hand an NDP government in my home province of Manitoba. What I hear from the NDP in opposition is in contrast to what I hear from the NDP in government. It is like night and day. When the NDP was in government in Manitoba, it cut corporate taxes seven times, as I pointed out in my question.
We can look at the record and the many comments today by my colleague and friend from the NDP. He has tried to shape the debate as if the NDP is the strong advocate for tax fairness. In the last three years, we have seen a national government not only come up with tax treaties to ensure there is a stronger sense of tax fairness at the international level, but also it has invested hundreds of millions of dollars in Revenue Canada to go after individuals who avoid or evade paying their taxes. Those are significant sums of money.
All of this together is what we have been able to do in the last three and a half years. I look forward to the next six months. There is a lot more we want to do to continue to support Canada's middle class, those aspiring to be a part of it and those who need to be ensured that there is a sense of social justice.
View Kevin Sorenson Profile
Mr. Speaker, it is always good to rise in the House, and as I have announced I will not be running in the next election, every time I rise in the House, I am still overwhelmed with not just the beauty of the chamber, but also the great responsibility I have had from the people of Battle River—Crowfoot in being entrusted with bringing their voices to Ottawa.
Today we rise to support Bill S-6, an act to implement a convention between Canada and the Republic of Madagascar that has the objective of eliminating double taxation and preventing tax evasion. Tax treaties of this nature meet this objective through the sharing of information between signatory countries.
We know that for governments to build strong economies at home, it is important that they look at a number of very important subjects. All three or four of the points that I want to make today deal with having a strong economy at home. They deal with making sure that jobs stay here at home, making sure that our young people are not travelling overseas necessarily to work but can find jobs here so that we can prosper here at home, and making sure that Canadians who invest abroad or find work abroad will have a better opportunity to prosper there.
There are some very important conditions that have to be laid out in order to find that prosperity and allow those jobs to be created. We know in the Conservative Party know that one of the vitally important aspects of securing a strong economy and creating jobs is trade. We are an exporting country. Canada, whether it is resources or agriculture, exports more than what we use at home. We are a vast country. Our geography and land mass make us a country of amazing opportunity. It is one of the largest countries in land mass in the world.
However, compared to many other countries, our population base is fairly small. We have only 35 or 36 million people. How do we guarantee that we will be able to prosper in spite of having a small population base? One way is through trade, through making sure that our resources and our agriculture can be sold and marketed around the world.
I live in a fairly rural riding in Alberta, a province whose economy has been hurt over the last four or five or six years in a remarkable way. In my riding, we have many different industries and many different sectors of the economy: gas and oil, resources, coal. We are rich in resources in Alberta, and my riding is also very strong in agriculture.
With all of these, we have a high level of exportation of our products. In order to have a free trade agreement in South America, we realized that people there had a desire to secure a safe food supply and were looking to Canada to provide grains, oilseeds, pulse crops, and other agricultural products, including beef and pork. Much of the food stock for the world is created in Canada, and much of it in Alberta.
We realized that we want to have free trade agreements with many countries, and if we do not have a free trade agreement with a country, we still want to have some kind of opportunity to trade with that country.
We do not have a free trade agreement with China, but we still carry on a great amount of trade with China. However, always, agreements enhance our trade. Likewise, agreements on taxes will enhance it as well.
Regarding our agricultural products, right now we are really feeling the pinch with canola. We are feeling the pinch, with one of our largest markets, China, basically stopping our canola from coming into that country. We believe that this is unfair and ungrounded. We have no doubt that this is not about food safety. It is not about the product. As I have said, we have the safest, best product in the world. However, we do not have a free trade agreement with China. Maybe when we see what is happening, we understand why we do not have a free trade agreement with China.
Right now, our canola farmers are really feeling the pinch. Indeed, at this time of year, in the spring, when our crops are being planted, I am getting calls to my office asking me if I am expecting the market to open up. They are asking whether they should be planting canola or cutting way back, although their rotation does not allow them to do that. We are hearing all the concerns coming from agriculture with regard to trade.
The Conservative government had a free trade agreement with Europe. We were pretty well ready to sign onto the TPP. It was not ratified, but everything was laid out. We wanted to get our product into these countries so that we could prosper at home.
However, it is not all about trade. If we want a strong economy, we also have to recognize that we have to have training. We have to have a skilled workforce. We have to be able to invest so that when times get tough, if we cannot compete with Mexico on wages to manufacture, we can compete with the skill sets we have here in Canada. Therefore, we invested greatly in training young people and enhancing the skill sets our workforce had already. This was a driving force in our Conservative government in the last 10 years we governed. We put money into innovation and training.
It was trade, training and red tape. How are we going to have job creation? How are we going to enhance it? How are we going to attract businesses to start up in Alberta, or wherever in Canada, if the red tape to get that business going is a mile long?
We brought forward a red tape reduction strategy to make it easier for businesses, investors and job creators to create those jobs right here at home. That job is unending. With more government and more bureaucracy, the tendency is to see red tape grow. One of the strong things we brought forward was making sure that we were able to cut red tape, and we still need to do it. Therefore, I am pleased that Premier Kenney is committed to the reduction of red tape. There is a level of optimism we have not seen in Alberta for many years. I would also say that our government has always and would continue to look at ways to enhance job creation through the cutting of the red tape burden.
The fourth and final aspect, besides trade, training and red tape, is taxes. If we are not a country that can attract manufacturing and investment because our tax regime is so out of whack, then we cannot expect to see our economy grow. We cannot expect that people will have confidence in investing their capital here in Canada. In Alberta, because of regulation, red tape and high taxes, including the carbon tax, we saw between $80 billion and $100 billion in foreign investment capital flee, and with that went jobs and hope for a lot of young Canadians and Albertans.
To have a strong economy, we have to make sure that we have a strong tax system that has integrity but is also not overly burdensome. When the Conservatives came to power, and when the world fell into a global recession, we moved our corporate rate from 22% to 15%, because we knew that business and manufacturing would flee to the United States or Mexico, predominantly, and other places if we did not compete with a tax structure or a tax rate that would attract investors to Canada.
A lot is about taxes. A lot of what we want to do in building a strong economy is in regard to the tax structure. Tax levels make a large impact on investment, and we have seen that.
Canada not only mines and extracts resources around the world, it invests around the world. We have people who prosper and earn an income from foreign investment. We want to be sure that if we are allowing that, we avoid double taxation. If taxation is important, who, as an investor, would want double taxation, where a country, Madagascar, in this case, would tax us, and then Canada would when we came back home? How much investment do members think would take place in those countries, and here, if we allowed double taxation?
Predominantly where we have massive investment, we have double taxation treaties. A tax treaty contains rules regarding the circumstances under which a signatory country may collect certain taxes on income so that when investors invest, they are aware. They look at the treaty and say that this is what we have to pay, this is what we do not have to pay and this is what we will pay back home. It is a single tax base. In the absence of a tax treaty, the income of a Canadian citizen abroad would be hit on both sides, and investors would flee.
For that reason, we come to this today. This debate, I would say, is the meat and potatoes of what is going on here in Parliament. This is not a day when we are talking about the issues that are really important to Canadians. I do not know if I have had a call to my office in Camrose about Madagascar. My constituents expect that we are taking care of business so that they can prosper, whether on the farm, in investing or in the oil patch.
Most of the tax treaties to which Canada is partnered follow the Model Tax Convention. This is a tax treaty or convention that is given as a model by the OECD, the Organisation for Economic Co-operation and Development. This was done in 1963, and subsequent to that, there have been a number of occasions when it has been revised. Currently, Canada is signatory to 93 agreements. This is not something new. We are not stepping out into uncharted territory. This is common.
As I said at the outset, I fully support the intent of Bill S-6, but I am particularly concerned about the tax evasion side. We have heard much from all parties today about tax evasion and the ability of the Canada Revenue Agency to consistently enforce compliance rules and collect taxes.
I do not like high taxes. I look for ways to cut taxes. I formerly served as the minister of state for finance. We looked at every opportunity we could to drive this economy by lowering taxes and keeping more money in the pockets of Canadians. However, tax evasion is different. I think every Canadian expects that there is a certain level of taxes that they are required and willing to pay, not just by law but in order to have the services we have here in Canada.
From report 7 of the 2018 fall reports of the Auditor General of Canada, on compliance activities of the Canada Revenue Agency, the public accounts committee, which I have had the privilege of chairing, learned the following: “Most taxpayers are individuals with Canadian employment income. We found that the Agency requested information from these taxpayers more quickly,” and this is the important part, “and gave less time to respond, than it did with other taxpayers, such as international and large businesses, and taxpayers with offshore transactions.”
The Auditor General went on:
For example, if the Agency asked an individual to provide a receipt to support a claimed expense and the taxpayer did not provide the receipt within 90 days, the Agency would automatically disallow the expense as an eligible income tax deduction. The Agency would assess the taxpayer’s income tax return on the basis of the information it had available and would notify the taxpayer of the taxes due.
In other words, average middle-income Canadians are not cut much slack when it comes to their domestic income here in Canada.
Comparatively, the Auditor General's report states:
For other taxpayers, such as those with offshore transactions, we found that the time frame to provide information was sometimes extended for months or even years. For example, banks and foreign countries could take months to provide information on the taxpayer’s offshore transactions to the Agency or the taxpayer.
It continues, and this is important:
Sometimes the Agency did not obtain information at all, and the file was closed without any taxes assessed.
We can see that these agreements are vital. These agreements enhance what the CRA is given. If people understand the treaty, they know what to claim, they know what to put forward and they know what to show CRA. They feel less vulnerable to the Canada Revenue Agency and can also invest with greater confidence.
The Auditor General's office said that “over the past five years...the Agency took, on average, more than a year and a half to complete audits of offshore transactions.”
These agreements speed that up. The fall 2018 report was not the first time the Auditor General noted how long it took the agency to enforce compliance. The Auditor General further stated:
As we noted in the 2013 Spring Report of the Auditor General of Canada, Chapter 3, Status Report on Collecting Tax Debts—Canada Revenue Agency, the longer it took the Agency to enforce compliance, the less likely it could collect the taxes due. This was especially true for taxpayers with offshore assets, who may have been inclined to liquidate assets or transfer funds to make it more difficult for the Agency to obtain information and collect taxes due. On the other hand, for individuals and domestic businesses, the Agency had a better likelihood of collection by garnishing wages and seizing assets.
To add insult to injury, the Auditor General found that the Canada Revenue Agency did not proactively consider waiving penalties and interest consistently for all taxpayers. Again, the Auditor General stated:
We found that the Agency offered to waive interest and penalties for taxpayers in some compliance activities but not others—even when the Agency had caused the delays.
The inconsistent application of relief for taxpayers contradicts the Taxpayer Bill of Rights, according to the Auditor General. The report states:
[The] Taxpayer Bill of Rights gives all taxpayers the right to have the law applied consistently. It also gives all taxpayers the right to receive entitlements, such as benefits, credits, and refunds, and to pay no more and no less than what is required by law.
Although it may not quite be unanimous, I am pleased that most in this House, as far as I can see, see the importance of these kinds of meat and potatoes regulations and bills. Coming into compliance and making sure that Canadian investors are not vulnerable or put on an uneven playing field is imperative if we are going to increase foreign investment coming to our country and our investment in those countries, all of which will help build the economy, help Canada prosper and help us create jobs.
View Bardish Chagger Profile
Lib. (ON)
View Bardish Chagger Profile
2019-02-08 10:05 [p.25439]
moved that the bill be read the third time and passed.
She said: Mr. Speaker, today I rise on behalf of my colleague, the Minister of International Trade Diversification, to speak to Bill C-85. The bill calls on the government to take all necessary legislative steps to ratify the modernized Canada-Israel Free Trade Agreement, or CIFTA, something I encourage all members to support.
CIFTA is now a modern, forward-looking trade agreement that would better serve the sophisticated Canada-Israel trade relationship, while providing a framework to ensure the benefits of trade are more widely shared. Our government has said from day one that trade and open markets are vital for Canada's economic prosperity. Canada is a trading nation. We know that increased trade creates more and better-paying jobs. In fact, Canada is one of the most open G7 countries, rating second for trade and first for foreign direct investment as shares of GDP. Canadian exports of goods and services were equivalent to just over one-third of our GDP.
On trade diversification, the government is pursuing an ambitious trade diversification agenda, one that will make Canada the most globally connected economy in the world. Allow me to provide a few examples of this.
In October, Canada ratified the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, or CPTPP, with a speed reflecting the importance of this deal to farmers, ranchers, entrepreneurs and workers in all industries across Canada. This historic trade agreement came into force on December 30, 2018, and now Canadian businesses will have preferential access to over 500 million consumers, resulting in long-term gains for Canada in excess of $4.2 billion.
In September, we marked the one-year milestone of provisional application of the trade agreement with the European Union, the Comprehensive Economic and Trade Agreement or CETA. In this past year, Canadians added $1.6 billion in increased export to Europe and saw a 20% growth in container traffic at the Port of Montreal. We can just imagine the opportunities for Montrealers, Quebeckers and Canadians once this agreement is also passed.
We are also updating existing trade agreements with important partners to better match the realities of the 21st-century economy. We have a new agreement with Ukraine in place since 2017 and on Tuesday, a modernized and inclusive agreement with Chile came into force. The Canada-Chile Free Trade Agreement distinguishes Canada as the first G20 country to adopt a gender chapter in a free trade agreement.
We are modernizing the Canada-Israel Free Trade Agreement in the legislation before us today to enhance our relationship with this historical ally.
Finally, the government is actively pursuing opportunities in other important and fast-growing markets and making inroads. Canada is in FTA negotiations with its partners in the Americas, namely the Pacific Alliance and Mercosur, and is exploring possible FTA negotiations with ASEAN. Taken together, Canada has 14 FTAs in force covering 51 countries, connecting our businesses to 1.5 billion of the world's consumers.
While market access is vital, it alone does not create jobs and prosperity for Canadians. Our businesses need the right tools to actively pursue international opportunities, especially in markets covered by our trade agreements. That is why the fall economic statement proposed an export diversification strategy to grow Canada's overseas exports by 50% by 2025, with more assistance for small and medium-sized businesses to help them explore new export opportunities.
The trade diversification strategy will focus on three key priorities: first, investing in infrastructure to support trade; second, providing Canadian businesses with the resources to execute their export plans; and finally, enhancing trade services for Canadian exporters. We know that when we diversify our markets abroad we create well-paying jobs at home for the middle class and those working hard to join it.
Our efforts signal to the world that trade matters, that rules matter and that we will not be drawn into a world of protectionism. We firmly believe our international trade relationships are mutually beneficial. This is demonstrated in the modernized CIFTA, the Canada-Israel Free Trade Agreement before us today.
Since CIFTA first came into force over two decades ago, two-way merchandise trade between Canada and Israel has more than tripled, totalling $1.7 billion last year. This is a testament to how FTAs help advance trade, yet there is room to grow and deepen the commercial relationship. Israel's economy has significant potential and offers diverse commercial opportunities for Canadian businesses given its well-educated population, solid industrial and scientific base and productive natural resource sectors, in particular agriculture and agri-tech.
By providing expanded market access and more predictable trading conditions, the modernized CIFTA would enable Canadian companies to take meaningful advantage of these opportunities. That is why Bill C-85 before us today is so important. Allow me to elaborate further on this point by turning to how this tangibly translates into real benefits for Canadian businesses.
Canada and Israel agreed in 2014 to modernize CIFTA, which, at the time, was a goods-only trade agreement. The result of those negotiations is an agreement that updates four of the original chapters, including dispute settlement to bring CIFTA up to the standard of a more recent trade agreement. It adds nine new chapters, including intellectual property and e-commerce. We have negotiated rules that are designed to help address non-tariff barriers, contribute to facilitating trade and reduce some of the costs to companies for doing business.
We also have improved the terms of market access for Canadian companies. Once enforced, close to 100% of all current Canadian agriculture, agri-food and seafood exports to Israel will benefit from some form of preferential tariff treatment, up from the current level of 90%. Meaningful market access for Canada's agriculture and agri-food processors was a key interest in these negotiations and the government delivered, including unlimited duty-free access on sweetened and dried cranberries, baked goods and pet food.
These important tariff outcomes for the agriculture and agri-food sector place Canada on a more level playing field with exporters from the United States and the European Union, which are our key competitors in this sector. They also give Canadian companies a leg-up on competitors in other countries that do not have a free trade agreement with Israel. In exchange, Canada agreed to eliminate tariffs on certain targeted Israeli agriculture and agri-food imports, such as certain fish and nuts, some tropical fruit and certain oils.
I want to reassure all hon. members and all Canadians that a modernized Canada-Israel Free Trade Agreement, like its predecessor, fully respects Canada's supply management system. I am pleased that the negotiated outcome has the support of key Canadian agriculture stakeholders, including Pulse Canada, the Canola Council of Canada, the Canadian Vintners Association and companies including the processing of potatoes, cranberries, soybeans and pet food. These are only a few of the opportunities the modernized CIFTA provides.
I would like to now speak to an important aspect of the government's trade agenda that aims to ensure these opportunities are more widely shared among Canadians.
An important aspect of the modernized CIFTA is its forward-looking framework that includes new chapters on trade and gender, small and medium-sized enterprises, labour and environment, as well as a new provision on corporate social responsibility. This modernized agreement also provides institutional mechanisms to monitor or address human rights-related matters in the context of the trade agreement, including references and provisions relating to workers' rights and working conditions, responsible business conduct, transparency and anti-corruption. In this regard, this modernized agreement is a new forward-thinking partnership that reflects who we are as vibrant, diverse, open and democratic societies and as in the original CIFTA, just as with all Canada's FTAs, this modernized CIFTA can be terminated by either party unilaterally at any time for any reason.
Some inclusive trade highlights are the new chapters on trade and gender and on small and medium-sized enterprises. Both provide a framework for parties to work together to help ensure women and small and medium-sized enterprises can more fully benefit from the opportunities created by this modernized CIFTA. Each chapter establishes a bilateral committee to oversee activities, including co-operation and promotion activities that provide information and enhance the ability of women and small and medium-sized enterprises to benefit from the opportunities created by this modernized CIFTA.
The new gender chapter acknowledges the importance of incorporating a gender perspective in economic and trade issues to ensure that economic growth can benefit everyone. This chapter has it. This chapter builds on the work accomplished in Canada's first gender chapter, which was negotiated through the modernized Canada-Chile Free Trade Agreement. Only the third chapter of its kind, it is also the first such chapter negotiated by Israel. CIFTA's gender chapter, for the first time ever, will include a measure of enforceability through dispute resolution.
The new corporate social responsibility article affirms Canada and Israel's commitment to encourage the use of voluntary CSR standards by enterprises, with specific reference to the government-backed OECD Guidelines for Multinational Enterprises, to which Israel and Canada are both parties.
The modernized agreement contains a new chapter on labour that commits both parties to enforce their laws in this area, which must respect the International Labour Organization Declaration on Fundamental Principles and Rights at Work. The new labour chapter provides protections for occupational health and safety, acceptable minimum employment standards and non-discrimination for migrant workers.
Allow me to draw to the attention of all hon. members that the successful negotiation of a high-quality labour chapter with Israel was a significant step in modernizing CIFTA. It is the first such chapter negotiated by Israel in a free trade agreement. The United States-Israel Free Trade Agreement does not include labour provisions. The EU-Israel association agreement, the legal basis for EU trade relations with Israel, makes only a few references to labour, with no enforceable obligations.
The modernized CIFTA is also the first time Israel has negotiated a chapter on the environment in a free trade agreement. The new environment chapter contains robust commitments, including to maintain high levels of environmental protection as we intensify our trade relationship. Importantly, both Canada and Israel commit to not lowering our levels of protection in order to attract trade or investment.
Our two countries, Canada and Israel, have a deep history. Canada's strong friendship and partnership with Israel spans more than 70 years and stretches back even further to the arrival of the earliest Jewish settlers in Canada more than 250 years ago, the first of successive waves of immigrants who would leave lasting and indelible impressions on the fabric of our Canadian society, economy and political landscape.
Today there are more than 350,000 Canadians of Jewish faith and heritage in Canada who are an important source of information and support in the political and commercial spheres for both Canada and Israel. There are also approximately 20,000 Canadians currently living and working in Israel. The Minister of International Trade Diversification had the opportunity to meet with some of these individuals during his visit to Israel last year.
For those in the House today who may not know, Israel has a long-standing reputation for technological prowess and a well-developed scientific and educational base. We know this very well in the riding of Waterloo. We see room to expand and build partnerships in these sectors and in many other areas.
When our Minister of International Trade Diversification was in Tel Aviv last September, he announced a pilot program to facilitate new cybersecurity solutions for the energy sector that will consider Israeli options to address the needs of Canadian natural gas delivery companies.
There are also great prospects for forging increased partnerships in the areas of joint research and development. Canadian and Israeli firms have joined forces to develop an ultraviolet water monitoring system that would ensure the safety of drinking water, and there are even more possibilities on the horizon that will change countless lives in communities around the world. Our government firmly believes that these kinds of global partnerships are needed now more than ever.
In conclusion, Canada represents just 0.5% of the world's population, but we account for five times more in global trade. Our continued competitiveness depends on businesses, including small and medium enterprises, pursuing trade opportunities and that we support them in doing so.
Successful trade provides for good employment opportunities. With one in six Canadian jobs linked directly to exports, our government is deeply committed to growing trade and expanding opportunities for all Canadians.
I therefore urge all hon. members to support Bill C-85 to enable Canada to do its part to bring the modernized Canada-Israel Free Trade Agreement into force on a timely basis and to support Canadian companies as they seek to benefit from the opportunities it offers.
This legislation should be passed today so that the Senate can also do its due diligence. I thank members for their work in helping this legislation move forward rapidly.
View David Sweet Profile
View David Sweet Profile
2019-02-08 10:21 [p.25441]
Mr. Speaker, the member is talking about this trade agreement and the relationship with Israel. For the last couple of years, the Liberal government has had the opportunity to participate with the Jordanians, the Palestinians and the Israelis on a critical project, the Red Sea to Dead Sea project, which will bring all those sides together and be one more road to peace. It is an environmental project that will bring fresh water to the Palestinian Authority and will also stem the tide of an environmental disaster that is happening in the Dead Sea. I wonder if she could speak to that.
View Bardish Chagger Profile
Lib. (ON)
View Bardish Chagger Profile
2019-02-08 10:21 [p.25441]
Mr. Speaker, as the member knows, we believe that it is important that we build upon this important relationship between Canada and Israel. We recognize the importance of doing more work. I acknowledged that in my speech.
Bill C-85 is really about providing Canadian businesses with opportunities to grow and expand, creating more better-paying middle-class jobs and helping those fighting hard to join the middle class. We will continue to work hard for them.
We believe that trade is mutually beneficial for both countries, and that is why we believe that this modernized CIFTA should move forward rapidly. I agree with the member that we can always do more work, and I hope we can do that work together.
View Alexandre Boulerice Profile
Mr. Speaker, I want to thank the Leader of the Government in the House of Commons for her speech.
I would like to remind the House that in December 2016, the United Nations Security Council adopted resolution 2334, which condemns:
...all measures aimed at altering the demographic composition, character and status of the Palestinian Territory occupied since 1967, including East Jerusalem, including, inter alia, the construction and expansion of settlements, transfer of Israeli settlers, confiscation of land, demolition of homes and displacement of Palestinian civilians, in violation of international humanitarian law and relevant resolutions...
This is a resolution adopted by the United Nations Security Council, so Canada obviously needs to abide by it.
With regard to the free trade agreement, why did the Liberal government reject the NDP amendment about labelling products originating from illegal Israeli settlements in order to distinguish between companies on the territory of the State of Israel and companies on the Palestinian territory that has been illegally occupied since 1967?
View Bardish Chagger Profile
Lib. (ON)
View Bardish Chagger Profile
2019-02-08 10:23 [p.25442]
Mr. Speaker, Bill C-85 modernizes that agreement.
This agreement has been in place for over two decades. This is an opportunity for us to modernize this agreement. That is why we see chapters in this agreement that other countries have not put forward.
We see for the first time in the Canada-Israel Free Trade Agreement that Israel has brought forward a chapter on gender. We see a chapter on the environment. It is important that we have trade that works for all Canadians and all Israelis. We will continue to ensure that this modernized agreement benefits more Canadians and more businesses so that more Canadian businesses can grow and succeed.
View Darrell Samson Profile
Lib. (NS)
Mr. Speaker, I want to thank my colleague for her exceptional speech. She shared so many great points with the House this morning. Canadians can see how the economy is prospering because of our government's hard work in establishing strong trade deals.
These are great opportunities for businesses in our communities. I sent a letter to all the businesses in Sackville—Preston—Chezzetcook sharing with them some of the key points in the last three trade deals signed and the one today, which is an expansion. I am communicating with businesses to see how I can work with them to help them scale up and increase global investment.
I would like my colleague to share how some businesses in her community could take advantage of some of these exceptional additions to this Canada-Israel trade deal.
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