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Results: 31 - 45 of 179
Mitch Davies
View Mitch Davies Profile
Mitch Davies
2020-06-18 16:09
Madam Chair, I would simply say that the law encompasses the national security review process and obviously a net benefit review. Of course, it's one statute. There are many statutes, as well as the Income Tax Act, which of course is directly aimed at the question of collecting the revenues that are due and payable to the Government of Canada. Any measures taken to contravene that are a matter under another law.
I guess that would be the most straightforward answer to the question of the member.
View Gabriel Ste-Marie Profile
BQ (QC)
Thank you, Mr. Chair.
My question is for the economists representing the Bay Street banks. We have four of the five with us today.
When we look at the financial results of the big banks, we see very significant profits, not to mention the substantial compensation their executives are receiving. I find an imbalance in tax justice when, on the one hand, the big banks use tax havens perfectly legally for tax optimization purposes and, on the other hand, we are experiencing a pandemic and we are introducing economic measures that cost a fortune, which will have to be paid back.
What argument could you have against a request from Parliament to stop using tax havens that allow you to pay less tax in Canada? This question is obviously for Mr. Porter of the Bank of Montreal, Mr. Shenfeld of CIBC, Ms. Cooper of Dominion Mortgage Centres and Mr. Perrault of Scotiabank.
Douglas Porter
View Douglas Porter Profile
Douglas Porter
2020-06-18 16:46
Thank you for letting me start.
I guess what I would say is that we have to take a step back and ask what caused this downturn and what we're dealing with. It's obviously a health issue. It's not a credit issue. I think we should be looking at solutions that help us get the economy to grow from this point. I don't believe a lack of credit is at all the issue that the Canadian economy is dealing with, or the global economy.
I think we have to remain focused on how best to recover, at this point. We shouldn't be casting around for villains when the villain is obviously the virus.
Avery Shenfeld
View Avery Shenfeld Profile
Avery Shenfeld
2020-06-18 16:47
The banks aren't making so much money this year, number one. Banks might like to tell you how well they did, excluding those provisions for potential future loan losses, but those provisions actually count against earnings. First of all, then, this is by no means a banner year for banks.
Someone talked about senior bank executive compensation. I'd like to be one of those senior executives. But all of us are at least compensated, in no small measure, in bank shares, which are down substantially this year. Compensation levels will not be as rosy as the numbers you looked at for last year; I can almost bet that.
Finally, it's not like taxpayer money has been poured into Canadian banks. Canadian banks have not come running to government for taxpayers' money. Obviously, the Bank of Canada has lowered interest rates, and OSFI has helpfully changed capital requirements a bit or loosened up some things, but that's creating lending room that the economy needed. These are measures designed to actually help our clients, which we're certainly happy about, because we want those clients to prosper.
I think the premise of the question is that there's been some magic gift. You need only go back to the recession of 2008 to see that the main program the government did was a program to purchase mortgages off the banks. It let the banks in effect raise money more cheaply than they could have in the market at the time, because the market was very concerned that banks [Technical difficulty—Editor] going under.
If you actually roll ahead and ask how the government did on those mortgage purchases, you see they did just fine. They made money. They contributed, actually, to the government. Not everything is a handout.
Sherry Cooper
View Sherry Cooper Profile
Sherry Cooper
2020-06-18 16:49
Oh, I can make it very tight, because I'm no longer a bank economist.
I can tell you, though, that having a strong banking system in Canada is a huge advantage for the country. The Canadian banking sector outperforms the rest of the world's banks and costs our government far, far less money than in other countries.
It isn't a good year for banks, but I do agree that there will be no tag days for the Canadian banks.
View Peter Julian Profile
NDP (BC)
Thank you very much, Mr. Chair.
I'm glad folks are proud of the banking system, but when we have a society where almost half the families are $200 from insolvency and families are in record levels of critical family debt, there's obviously a problem. I think the emphasis should be less on making sure we have a great banking system, a gold-plated banking system, and a lot more on actually helping the people who are struggling to get through this pandemic.
My question for you, Mr. Macdonald, is about coming through the pandemic and coming out of the pandemic. One of the big problems is the fact that we have mass abuse of overseas tax havens. I questioned CRA on Tuesday, and they admitted that they don't even have the tools to prosecute companies that are openly engaging in tax evasion through the use of tax havens. The Parliamentary Budget Officer, as you know, evaluates that we lose $25 billion a year, which could go into education, health care, affordable housing and all those things that make a society great.
You framed the issue of either cutting services or having a taxation system that actually responds to the needs of Canadians. How important is it to actually get a grip on these overseas tax havens? How important is it to do things like the wealth tax and make sure that we have a fair tax system in this country so that we're not getting to the point of cutting services but rather enhancing them, not only for a better quality of life but also because it makes smart economic sense?
David Macdonald
View David Macdonald Profile
David Macdonald
2020-06-18 16:52
Certainly in terms of international tax havens, they exist because we allow them to exist. We allow them to exist in the sense that we don't require corporate entities operating in Canada to disclose where they declare profits, where they make revenue or where they employ people in this country. As a result, we can't tax them appropriately.
If you are a Canadian organization in Canada, you can't play these sorts of games, because you're required by law to declare where you employ people and where you make your revenue. You pay your corporate income taxes in the jurisdiction where those two things happen; you can't just declare all of your money in the jurisdiction where the corporate tax rate is the lowest.
Internationally, you can; therefore, we allow that. I think one of the big pieces in terms of the closing these types of tax loopholes is fundamental transparency about where companies that operate in Canada make their money and who they employ.
Certainly, their closure is a potential source of government revenue in Canada. At present it's simply being shifted overseas, and no one is paying tax on it.
View Jagmeet Singh Profile
NDP (BC)
It's been over two months. Canadians with disabilities need that help right away.
It's a matter of the choices that this government is making in terms of who it's choosing to help and who it's not helping. We just learned today what we've known for awhile: that the wealthiest 1% of Canadians own as much as the bottom 40%.
Will the Prime Minister make a choice to make the super-wealthy pay their fair share?
View Justin Trudeau Profile
Lib. (QC)
Mr. Chair, since we came to office, we've moved forward on making the tax system fair, on ensuring that everyone pays their part. The first thing we did was raise taxes for the wealthiest 1% so that we could lower them for the middle class and for people working hard to join it. We will continue to focus on helping vulnerable Canadians in this pandemic and going forward.
View Jagmeet Singh Profile
NDP (BC)
Mr. Chair, the right wing is going to be talking about fiscal prudence. I think it's a great thing to talk about, but fiscal prudence doesn't mean cutting services to people: It means cutting giveaways to the wealthiest.
Will the Prime Minister commit today to closing offshore tax havens, to closing loopholes that allow the wealthiest to continue to concentrate wealth in their hands while working people suffer?
View Justin Trudeau Profile
Lib. (QC)
The Liberal Party has always been the party that has understood that fiscal responsibility goes hand in hand with helping the most vulnerable. We came into this COVID crisis with the best balance sheet in the G7. We put that to use to help Canadians get through this, and we will have an economy that will come roaring back because of the strength of all Canadians.
View Peter Julian Profile
NDP (BC)
That's wonderful.
Let's go into the issue of offshore tax havens. The Parliamentary Budget Officer, a year ago, evaluated the annual hemorrhage outside our country, in what should be tax dollars used in common, at $25 billion a year, which he said was a conservative estimate.
For the Bank of Canada, is that a concern? Do you have a position on this hemorrhaging of these tax dollars overseas? It doesn't create jobs in Canada, it doesn't provide the economic stimulus here that is needed.
Does the Bank of Canada have a position and have you made recommendations around that? Do you not feel that it, plus the complete absence of taxation of the web giants like Amazon, is something that government should be dealing with?
Tiff Macklem
View Tiff Macklem Profile
Tiff Macklem
2020-06-16 16:27
You've pretty much nailed it. These are issues for the government and parliamentarians. These are issues for the Minister of Finance, so they're not really in the purview of monetary policy.
View Matthew Green Profile
NDP (ON)
Thank you, Mr. Chair, but respecting the importance of having the Parliamentary Budget Officer here, particularly at this COVID time, I'm going to go ahead and reserve that privilege for the second half out of respect for my committee members.
Mr. Giroux, we know that once the financial supports in the emergency measures related to COVID-19 come to an end, there will be pressure on the government to bring the budget into balance and to reduce the national debt. This is often code for severe austerity measures because the financial situation is often seen as a spending problem rather than a revenue problem.
In June 2019, the Parliamentary Budget Officer issued a report on the preliminary findings on international taxation, which, if I understand correctly, identified that Canada is losing $25 billion or more a year in tax revenues from multinational corporations that are avoiding taxes through tax havens. Can you comment on the importance of our financial health to take action on the use of tax havens?
Yves Giroux
View Yves Giroux Profile
Yves Giroux
2020-05-29 11:31
It's clear that with temporary measures and an economy that's grinding to a screeching halt, spending has gone up, revenues have gone down, which leads to what we expect to be an unprecedented deficit. However, as the economy recovers and the measures that have been implemented as temporary are allowed to expire, we expect that, all other things being equal, the deficit should return to a much lower level, so a much smaller deficit. However, as we've seen in the past, there's always a deficit that subsides, there's never a return naturally to deficit, so there's going to be a need for government action if the government were to desire a return to balanced budgets. In that vein, tackling international tax evasion could be a very useful tool to return to balanced budgets or to improve the federal fiscal balance.
The big challenge with international tax evasion, however, is the access to information regarding the income that's hidden and the assets that are held offshore. International co-operation is essential, as well as ensuring that the tax authorities in Canada have the tools they need to tackle that tax evasion.
Results: 31 - 45 of 179 | Page: 3 of 12

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