Bill C-62 (Historical)

Provincial Choice Tax Framework Act

An Act to amend the Excise Tax Act

This enactment amends the Excise Tax Act (the “Act”) to implement, effective July 1, 2010, the new fully harmonized value-added tax framework in Ontario and British Columbia. It also facilitates the new framework to accommodate any province’s decision to have the provincial component of the harmonized value-added tax under the Act apply in that province by achieving a common understanding with Canada in respect of such a new framework, including the provision of rules and mechanisms to ensure
(a) the proper imposition of the provincial component of the harmonized value-added tax in respect of that province;
(b) the proper application of any element of provincial tax policy flexibility contemplated under the common understanding, including rate flexibility for the provincial component of the harmonized value-added tax, rebate flexibility in respect of the provincial component of the harmonized value-added tax and the temporary recapture of certain input tax credits in respect of the provincial component of the harmonized value-added tax;
(c) the proper functioning and application of the Act in all respects, including provisions flowing from the provincial tax policy flexibility contemplated under the common understanding and the addition of every province that chooses to join the new framework; and
(d) the proper administration and enforcement of, and compliance with, the Act.

Provincial Choice Tax Framework Act

[The Deputy Speaker, Conservative, Andrew Scheer]

I will take this opportunity to remind the member for Vancouver Kingsway not to use proper names, but to use ridings or a title.

On questions and comments, the hon. member for Timmins--James Bay.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Mr. Speaker, I watched the Conservatives squirming in the back seats. In fact, they have been so bad that they are taking to cheering on their anemic friends in the Liberal Party, because both of them are facing the same issue: they do not want the debate. They do not want this issue coming home to roost because of the issue of senior citizens and because of the issue of first nations.

My hon. colleague would know that this party has crunched the numbers on what is going to happen on gas prices. We have done the number-crunching.We know the phenomenal cost that is going to hit people at the pumps.

Why does he think this party is trying to hide behind Dalton McGuinty and Gordon Campbell for something that they initiated? It is because they know that when they go home and people in Ontario find out about the extra billion-plus dollars they are going to be paying at the gas pumps, they are going to look to the Conservative Party and say that this is the party of Mulroney, who ripped us off with the GST, and this is now the party of the present Prime Minister and the HST and their little friends in the Liberal Party. Why will they not have the evidence brought forward? It is because they do not want the public--

[The Deputy Speaker, Conservative, Andrew Scheer]

Order. The hon. member for Vancouver Kingsway.

[Don Davies, NDP, Vancouver Kingsway, BC]

Mr. Speaker, I have a different proposition for the members opposite. Next election, let them come to the province of British Columbia, let us go onto the hustings, and let us debate in every gymnasium, every auditorium and every household about whether the people in British Columbia want the HST and whether they think it is good policy.

I do not remember anyone on that side of the House bringing up the HST during the last federal election. I do not remember that. I do not think it was in their platform. It was the same thing with respect to their Conservative cousins in the Liberal Party of British Columbia.

This tax has been introduced by stealth. The reason is that they know they have just put a tax increase on working- and middle-class Canadians and they do not have the courage to stand up before those people and acknowledge it--

[The Deputy Speaker, Conservative, Andrew Scheer]

Order. I am going to try to get one more 30-second question in. Hopefully it will have a 30-second response.

The hon. member for Brampton West.

[Andrew Kania, Liberal, Brampton West, ON]

Mr. Speaker, first I would like to state that I respect my friend greatly. I have had a chance to get to know him on the public safety committee.

He will agree with me on two points. The first is that this was instigated by the Conservative government. In the Ontario example, it agreed to pay $4.3 billion, and in British Columbia I believe it is $1.5 billion. Second, we are all suffering through the greatest economic crisis since the Great Depression. We have lost 500,000 full-time jobs across the country, thanks to the government.

The point is this: the provinces have the right to try to do something to try to create jobs. In Ontario the experts say that through this HST, approximately 600,000 new jobs will be created. I am going to ask--

[The Deputy Speaker, Conservative, Andrew Scheer]

Order. There is only a few seconds left for the member for Vancouver Kingsway.

[Don Davies, NDP, Vancouver Kingsway, BC]

Mr. Speaker, I think the idea that jobs are created by implementing a tax on working- and middle-class Canadians is not only untested but fallacious. I do not think that is the kind of job creation project that we want in this country, and that is not the kind of strategy that we should have.

[Jean Crowder, NDP, Nanaimo—Cowichan, BC]

Mr. Speaker, I will be splitting my time, if there is any left, with the member for Western Arctic.

It has been interesting to listen to the debate in this House, because what we have heard is a radical attempt by the Conservatives to distance themselves from this tax. Part of the challenge with this is that if there is no role for the federal government, why are we debating Bill C-62 in this House?

In addition, we have an agreement here entitled “Memorandum of Agreement Concerning a Canada-British Columbia Comprehensive Integrated Tax Co-ordination Agreement”. Throughout its text, this agreement defines the parties as the Government of Canada and the Government of British Columbia, so we have two parties involved in this agreement, and we need to have this debate in this House because Canada is party to this agreement. To say there is no federal role is simply false.

I want to touch on a couple of points here.

This one is still relevant, even though it occurred back on September 19, 2009. The Globe and Mail ran an article on the tax reform and HST. The headline in this article was:

HST's price tag revealed: consumers hit hardest. While businesses will save $6.9 billion, consumers will pay higher prices on wide range of goods and services, report shows

This was a report done by the TD Bank. They are hardly left-wing, anti-tax folks. The article says:

The TD report adds fresh fuel to accusations...that harmonization is little more than a tax grab aimed at benefiting businesses at the expense of consumers.

They go on to say:

Businesses will reap huge savings because they will be able to claim rebates. But consumers will end up paying the new tax on goods and services that are currently exempt from any tax.

It is no wonder that in the province of British Columbia, the sentiment is the same as in Ontario. Ipsos Reid's poll for Canwest and Global National last week indicated that 82% of British Columbians oppose the harmonized tax, and 56% of B.C. respondents said that they think the HST will hurt the provincial economy. We know that there has been an attempt to sell this as a job creation effort, yet 56% of British Columbians simply feel that it will impact on the provincial economy and on their jobs.

We fundamentally disagree with the idea that there is no federal role in this, and I want to point to the issue around first nations. First nations, both in Ontario and British Columbia, are opposed to the HST. That is clearly within the federal jurisdiction. In fact, an article by the Canadian Press in The Chronicle Journal in Thunder Bay on December 4 says that the Ontario aboriginal affairs minister stated that “the province supports demands for a point-of-sale exemption for first nations and is urging Ottawa to get behind the move. Premier Dalton McGuinty has written to Prime Minister Stephen Harper to ask him to grant the exemptions”.

We heard in this House previously that the province needs to look after it, but in fact what we have is the Ontario provincial government writing to the federal government, writing to the Prime Minister, to ask why they are not honouring this point-of-sale exemption that is in place in Ontario, and in British Columbia the first nations are saying the federal government has a duty to consult when it is looking at any additional taxes for first nations.

I want to turn to the jobs front for a moment. There have been a number of reports, and this is one that came out in the Victoria Times Colonist. It says:

The implementation of a 12 per cent harmonized sales tax in B.C. will cost the tourism industry as many as 5,174 jobs and see visitor spending drop by as much as $545 million annually...

This was done by the Council of Tourism Associations of British Columbia. I know people like Bob Wright from the Oak Bay Marine Group in Victoria have been loudly speaking out in opposition to this tax, which they see as directly impacting on the tourism business in British Columbia.

School districts have been calling. In British Columbia we already know that school districts have been particularly hard hit in these tough financial and economic times, and this is probably true in Ontario. What we have seen in British Columbia is that the school districts are looking at their budgets and recognizing that having to pay this additional tax, this HST, is going to impact on their ability to deliver education to students, which is the whole goal of a school board.

They are asking that the provincial government provide the same HST rebate that is available to municipalities so they can continue to provide quality education.

The Canadian Food and Restaurant Association ran some articles saying that it estimates that British Columbians would pay an additional $694 million on restaurant meals alone if the HST is introduced. It estimates that in 1991 its members lost 9.5% of their business when the GST was introduced.

The B.C. Care Providers Association wrote a letter to the B.C. members of Parliament. The care providers are very concerned about their ability to provide seniors' care. The letter states:

--It is estimated the HST will result in a negative economic impact on B.C. seniors' care providers of over $10 million/year. Furthermore, it will penalize care providers that have rightfully been encouraged by our provincial government to contract out certain services to maximize direct patient care dollars.

The bottom line is that without HST mitigation, care providers will be forced to lay-off staff and reduce service....

However, it is our strong belief that the Government of Canada should also play a more direct role in mitigating the negative impacts of the HST on seniors' care in BC - and Ontario....

More specifically, we are asking the federal government to include all providers of publically funded and regulated long term care services in the same HST rebate category as hospitals.

That is another role for the federal government.

I have received emails, phone calls, faxes and letters from my constituents and other people in British Colombia. As I noted earlier, overwhelmingly people in British Columbia are opposed to the HST. I have referred to it in the past as the hated sales tax, the HST.

This email came in from a concerned citizen:

The Government and Liberal position that the HST matter is totally the responsibility of the provinces is fallacious because the VOTERS in the two provinces have not had the opportunity to vote on the matter, therefore it is being imposed without the support of 82 percent of the provincial electors. The federal government is effectively conniving with the provincial governments to pass this without public support.

This is not democracy in action. It is equivalent to the proroguing of Parliament affair--underhand and manipulative....

Inga from Gabriola said, “I am on assisted income and I have no money”. We have heard from many of our constituents that those on fixed incomes and pensions will be adversely impacted by, as my colleague from Vancouver Kingsway pointed out, this regressive tax. Laura from Duncan said, “As an abandoned mother, I am barely getting by now, and I cannot afford a 7% tax hike. Thank you for opposing the harmonized sales tax”. Another constituent said, “It is outrageous that the Liberal and Conservative governments are again hitting the poor Canadians. Hopefully Canadians will be hit so severely that we will all protest. Keep fighting for all Canadians”.

Another constituent said, “As a business owner, I am disappointed to hear it will help us and ease our paper burden. In my case, two businesses we have do not have PST, so it will increase our taxes, no change to our paperwork and yet again, no increase in my bottom line income”.

Another constituent said, “This HST tax on middle and lower class earners is outrageous and a crime. Our standard of living is disappearing fast”. Another constituent said, “I never realized just how tight a fixed income could be, where every cent counts”. Another constituent said, “I do not see how increasing taxes during difficult economic times can help. There is more money in circulation when people feel confident and I bet they have more spare dollars to spend”.

There are more letters that I could read into the record. The bottom line is that they are all on one theme: this is the wrong tax at the wrong time. This is not a time, when Canadians are already struggling to make ends meet, when people are worried about their jobs and seniors and pensioners are worried about being able to make their payments on their rent, on their medications, on their food. This is just the wrong time to pass on an additional cost to them. This is simply a tax shift from businesses, but not from all businesses. We have heard that this will not help the service sector out at all. However, there is an overall tax shift from the business sector to consumers. This is not the time to pass on those costs to consumers in British Columbia and Ontario.

Mr. Speaker, I urge members of the House to reconsider their position, to vote against the HST, the hated sales tax, and oppose Bill C-62.

[Brent Rathgeber, Conservative, Edmonton—St. Albert, AB]

Mr. Speaker, I enjoyed listening to the hon. member's speech regarding her opposition. She spoke passionately about how she feels this tax will deal with people who are recently unemployed, seniors and people on fixed incomes. I am curious as to why the member, who has been a member of the House for a lot longer than I, voted against reducing the GST from 7% to 6% and then from 6% to 5%, if she is so concerned about individuals who are unemployed and on fixed incomes.

[Jean Crowder, NDP, Nanaimo—Cowichan, BC]

Mr. Speaker, of course it is always convenient when members of the government pick isolated line items out of a particular budget and ignore all of the other things that New Democrats and their constituents were adamantly opposed to. When the member talks about not supporting the reduction in the GST, he ignores all of the other aspects of the budget.

We in the House would love to pull out the parts of a budget that we could support. We would love to pull out those parts of the budget and deal with them, but that is not the way budgets are presented in the House. I would continue to vote the same way as I have in the past. Those budgets were wrong for Canadians.

[John Cannis, Liberal, Scarborough Centre, ON]

Mr. Speaker, I am not going to pick isolated comments. The member said in her speech, and I quote, “This is not democracy”. The NDP professes to be very democratic. The title of this bill is, and I will read it for the record, “Provincial Choice Tax Framework Act”. The key word is “Choice”. Why is the NDP today being so undemocratic in not allowing the provinces to choose? That is the question I want to ask.

[Jean Crowder, NDP, Nanaimo—Cowichan, BC]

Mr. Speaker, if the member wants to talk about undemocratic, we are in a House that put forward a motion to limit debate. I want to point out to the member that the debate is happening right here in the House in Ottawa. If the federal government has no role, I put the question back, why are we debating it in the House of Commons?

When we talk about democracy, if both the Conservatives and the Liberals were truly committed to a democratic process, they would allow a fulsome debate here. They would allow more than four hours for the committee to call witnesses from across this country.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Mr. Speaker, we see the Conservatives are getting increasingly agitated because they know that folks back home, senior citizens and people on fixed income who are trying to acquire savings, are calling on us to keep this going because they want scrutiny over this bill.

In terms of the credibility of the Conservative Party on taxes, I would use one word, “Mulroney”. Mulroney brought in the GST. Mulroney was the most hated prime minister in Canadian history. The entire party was booted out. The Canadian people forgot because they saw so much corruption by the Liberals.

Now what do we see? The first thing Conservatives do is go from the GST to the HST. They are trying to put across to Canadians that they are somehow their friends. They are not. We have seen the largest shift of taxation in Canadian history from corporations to senior citizens to people on fixed income. I would ask my hon. colleague, why does she think it is that they are afraid to hear from senior citizens, real estate agents and all the people who will be affected by this regressive Mulroney style—

[The Deputy Speaker, Conservative, Andrew Scheer]

Order. The hon. member for Nanaimo—Cowichan has 30 seconds remaining.