Bill C-48 (Historical)

Technical Tax Amendments Act, 2012

An Act to amend the Income Tax Act, the Excise Tax Act, the Federal-Provincial Fiscal Arrangements Act, the First Nations Goods and Services Tax Act and related legislation

Part 1 of this enactment implements, in accordance with proposals announced in the March 4, 2010 Budget and released for comment on August 27, 2010, amendments to the provisions of the Income Tax Act governing the taxation of non-resident trusts and their beneficiaries and of Canadian taxpayers who hold interests in offshore investment fund property.
Parts 2 and 3 implement various technical amendments in respect of the Income Tax Act and the Income Tax Regulations relating to the taxation of Canadian multinational corporations with foreign affiliates. The amendments in Part 2 are based on draft proposals released on December 18, 2009. Among other things, Part 2 includes the amendments to the foreign affiliate surplus rules in the Income Tax Regulations that are consequential to the foreign affiliate changes to the Income Tax Act announced in the March 19, 2007 Budget. The amendments in Part 3 are based on draft proposals released on August 19, 2011. Among other things, Part 3 includes revisions to the measures proposed in a package of draft legislation released on February 27, 2004 dealing primarily with reorganizations of, and distributions from, foreign affiliates.
Part 4 deals with provisions of the Income Tax Act that are not amended in Parts 1, 2, 3 or 5 in which the following private law concepts are used: right and interest, real and personal property, life estate and remainder interest, tangible and intangible property and joint and several liability. It enacts amendments, released for comments on July 16, 2010, to ensure that those provisions are bijural, in other words, that they reflect both the common law and the civil law in both linguistic versions. Similar amendments are made in Parts 1, 2, 3 and 5 to ensure that any provision of the Act enacted or amended by those Parts are also bijural.
Part 5 implements a number of income tax measures proposed in the March 4, 2010 Budget and released for comment on May 7, 2010 and August 27, 2010. Most notably, it enacts amendments
(a) relating to specified leasing property;
(b) to provide that conversions of specified investment flow-through (SIFT) trusts and partnerships into corporations are subject to the same loss utilization restrictions as are transactions between corporations;
(c) to prevent foreign tax credit generators; and
(d) implementing a regime for information reporting of tax avoidance transactions.
Part 5 also implements certain income tax measures that were previously announced. Most notably, it enacts amendments announced
(a) on January 27, 2009, relating to the Apprenticeship Completion Grant;
(b) on May 3, 2010, to clarify that computers continue to be eligible for the Atlantic investment tax credit;
(c) on July 16, 2010, relating to technical changes to the Income Tax Act which include amendments relating to the income tax treatment of restrictive covenants;
(d) on August 27, 2010, relating to the introduction of the Fairness for the Self-Employed Act;
(e) on November 5, 2010 and October 31, 2011, relating to technical changes to the Income Tax Act;
(f) on December 16, 2010, relating to changes to the income tax rules concerning real estate investment trusts; and
(g) on March 16, 2011, relating to the deductibility of contingent amounts, withholding tax applicable to certain interest payments made to non-residents, and certain life insurance corporation reserves.
Finally, Part 5 implements certain further technical income tax measures. Most notably, it enacts amendments relating to
(a) labour-sponsored venture capital corporations;
(b) the allocation of income of airline corporations; and
(c) the tax treatment of shares owned by short-term residents.
Part 6 amends the Excise Tax Act to implement technical and housekeeping amendments that include relieving the goods and services tax and the harmonized sales tax on the administrative service of collecting and distributing the levy on blank media imposed under the Copyright Act announced on October 31, 2011.
Part 7 amends the Federal-Provincial Fiscal Arrangements Act to clarify, for greater certainty, the authority of the Minister of Finance and of the Minister of National Revenue to amend administration agreements if the change in question is explicitly contemplated by the language of the agreement and to confirm any amendments that may have been made to those agreements. Part 7 also amends the Federal-Provincial Fiscal Arrangements Act and the First Nations Goods and Services Tax Act to enable the First Nations goods and services tax, imposed under a tax administration agreement between the federal government and an Aboriginal government, to be administered through a provincial administration system, if the province also administers the federal goods and services tax.
Part 8 contains coordinating amendments in respect of those provisions of the Income Tax Act that are amended by this Act and also by the Jobs and Growth Act, 2012 or that need coordination with the Pooled Registered Pension Plans Act.

Technical Tax Amendments Act, 2012

[Jinny Sims, NDP, Newton—North Delta, BC]

Mr. Speaker, as my colleague has said, at the end of the day it is all about priorities. However, if we have a government that does not practise accountability and transparency in its own actions or the actions of its ministers, then it is very easy for it to put off these kinds of technical changes.

I absolutely agree that looking at closing loopholes for tax avoidance should be a priority, because every penny we collect should be used to provide services. However, how can we expect a government that does not want to be held accountable at any level to preach about accountability?

[The Deputy Speaker, NDP, Joe Comartin]

The hon. member for Drummond has less than two minutes for a brief question.

[François Choquette, NDP, Drummond, QC]

Mr. Speaker, I will indeed be very brief. I would first of all like to congratulate my colleague on her excellent speech.

I would like to ask her a question about some concerns already raised by the Auditor General with regard to the slow pace at which the government enacted technical changes.

As mentioned earlier, this bill is nearly 1,000 pages long. It is huge. It could be called an omnibus bill, even though it is very different from Bill C-38 and Bill C-45, which were terrible, horrible omnibus bills because they tackled a range of issues. This bill is quite technical.

What does the member think of the Auditor General’s advice that the government should move faster in order to avoid ending up with a bill so huge it is impossible to adequately address all the issues? The government should be more efficient.

[The Deputy Speaker, NDP, Joe Comartin]

The hon. member for Newton—North Delta has a little less than 30 seconds.

[Jinny Sims, NDP, Newton—North Delta, BC]

Mr. Speaker, what is very clear is that the government finds it very difficult to act on the recommendations of an Auditor General and, as a matter of fact, seemed to flagrantly disregard them.

At least in this legislation the government has tabled about 50% of the amendments that are necessary and are waiting to be implemented. However, the government seems to show very little regard for the Parliamentary Budget Officer, the Auditor General, and the recommendations that have come out, because of its arrogance in thinking that it knows it all.

[Raymond Côté, NDP, Beauport—Limoilou, QC]

Mr. Speaker, it is a great pleasure for me to speak in the House with regard to Bill C-48, a bill that I believe is important.

I am going to take the liberty of beginning my speech with some slightly monarchist comments, by showing how princely I can be and by giving the government credit for drafting this huge bill that at least allows us to deal with a major taxation backlog. This must be acknowledged. It will be a great pleasure for me to support this bill because I wish to serve all Canadian taxpayers, be they wage earners, pensioners or entrepreneurs. It is about time.

As we have heard over and over again, the government has made countless tax rulings, some of which were obvious while others were less so. The real problem is that unfortunately both this government and the preceding Liberal governments used some artistic license that was actually rather inelegant and left everyone in a state of confusion. Ultimately, all the experts and everyone else in Canada had to fly blind without solid legislative instruments or the necessary regulatory instruments for businesses to make informed decisions and move ahead.

I will remind hon. members that the massive immobilization of capital is one of the major problems we now face, one of the great economic challenges now confronting us. More than $500 billion are languishing in corporate coffers. I referred to this before the Holidays: it is a very clear symptom of a feeling of insecurity. It is something I was reminded of once again a scant few days ago when I had the pleasure of meeting business people in Quebec City, where my riding of Beauport—Limoilou is located.

Business people are very concerned, and have been for a number of years, about the failure to recognize entrepreneurship: people who have ideas and decide to take risks and make a real contribution to society in keeping with their talent and their ideas, and about a glaring problem with respect to the entrepreneurial succession. I refer to this because this government, for all its grand claims, is unfortunately producing very few results, and is even working directly against our common interest. I say this because after seven years in government, business people are still concerned, and companies remain cautious in their activities and in their efforts to invest and grow. So where does the problem lie? The problem is attributable to this government.

As my colleagues can see, I have stopped handing out compliments. I was happy to compliment the government on the bill it has introduced, but now we are going to take a few shots to make it truly clear that the emperor has no clothes.

I am going to take advantage of the opening of the hockey season to use an analogy from our splendid sport. Ultimately, Bill C-48 is an effort by the government in the middle of the third period to try to overcome a 10-nothing deficit. Mathematically, of course, the government may ultimately hope to emerge with a victory, but in reality, there is a huge deficit in terms of planning, vision and responsibility towards all the players on Team Canada and the spectators in the stands.

I am using this image to say “better late than never”, but there is nevertheless a limit.

The other problem, as my colleague from Rimouski-Neigette—Témiscouata—Les Basques has rightly pointed out, is that this corrects nothing. On the contrary, it increases the lack of transparency in the tax system due to its excessive complexity. Its great complexity is driven by, among other things, the government’s neglect and its very long-standing pork-barrel approach.

I first became active in politics in 2005. In 2011, I was in my third election campaign. I witnessed the blue wave in the greater Quebec City area. I was able to see the claims of the government, and the illusion it has maintained for years about its competence and capability. Unfortunately, those claims are utterly contradicted by the facts.

Getting back to the issue of the complexity of the tax system, I would like to state one very simple truth. Last week, sadly I was surprised to find out that the Canada Revenue Agency will no longer be producing a simplified tax return package. A great many people file a very simple tax return. Often people have only one source of income to declare and claim only a handful of credits. They do not need a detailed tax package that covers a wide range of areas, unlike the return I had to file in years past when I had several different sources of income. Several years ago, I was self-employed, among other things.

Doing away with the simplified income tax package represents a major, insurmountable obstacle for most taxpayers. As my colleague for Rimouski-Neigette—Témiscouata—Les Basques pointed out, over 60% of Canadian taxpayers required to file a return do not prepare their own tax return. They rely on someone close to them or a professional to do their taxes, which is quite understandable.

I would like to give you one example from the Province of Quebec. When it comes to housing and rental laws, my reference source is the Civil Code.

In addition to having a unique Civil Code, Quebec also follows its own special practices. One agency, the Régie du logement, acts as a safety net and also provides support to all tenants and landlords in the province. I am talking here about residential leases, not about commercial leases.

The standard lease is one basic tool that has been around for many decades. It is a standard document that is easy to understand. It sets out the rules governing residential leases. It is a contract between a landlord and a tenant.

In the course of my work both as a politician and as a volunteer in private life, I have had to dispel and fight many myths associated with the basic rules governing rental housing. Another thing that is unique to Quebec is that landlords currently send out notices to their tenants advising them of changes to their lease. These notices are governed by very specific rules. Tenants are required to respond to these notices. Many tenants, despite the fact that they have a lease and a clear document, are under the mistaken impression that simply because they received this notice, they will be forced to move if they refuse to accept the proposed changes to their lease.

It is truly a horrible situation. For starters, tenants are not exercising their fundamental right to negotiate in good faith and this unfortunately results indirectly in a certain amount of speculation.

I do not have an actual copy of a lease agreement with me, but given that most people cannot understand a simple document like the one I have just described, just imagine how they feel about the general income tax package.

I logged on to the Canada Revenue Agency’s website. In addition to the general income tax package which is at least 50 pages long, if not longer, there is also the tax package for Quebec residents. There are basic tax forms, tax calculators and 13 separate schedules, including one calculating federal tax in Quebec, one for calculating federal amounts transferred from one’s spouse or common-law partners, one for capital gains or losses, one for a statement of investment income and so on and so forth. A number of schedules apply to self-employed workers who do not automatically pay employment insurance premiums or make contributions to the Régie des rentes.

When you look at the amount of paper provided in the basic general income tax package—which incidentally will be the only paper package for people—I must say it is so incomprehensible for most people that they cannot be faulted for not understanding it. The public did not ask for a tax form or tax package this complex.

I have received letters from people in my constituency who are indignant that the short form has disappeared. It made filing an income tax return much easier. Imagine the problem for seniors and people with low literacy levels, who already have trouble reading and understanding written texts beyond a certain degree of complexity, not to mention a lot of people who find it very hard to do basic calculations.

In fact, the government is sending the clear message that taxation is reserved for an elite, for people who have the education, the ability or the financial resources to have their taxes done for them. Unfortunately, my basic principle is that taxation should be affordable and accessible enough so that people do not have to spend a penny. In our democratic system, this should be something comparable to exercising the right to vote.

The government has failed at this, and Bill C-48 unfortunately will not help matters, although we can be glad that we can add measures that were passed more than 10 years ago to the act and regulatory framework. That is wonderful.

I am going to talk about another issue. There are a lot of them, of course, but I am particularly concerned about this one because I spoke about it before the holidays, and that is the issue of tax evasion. Unfortunately, after complimenting the government for once, I must really offer it some heartfelt criticism. The government is saying one thing and doing another.

It is great that the measures in Bill C-48 to address tax evasion can be passed and added to the act. We agree on that. However, as I have previously said in the Standing Committee on Justice and Human Rights and in other forums, what is the point in having a written act if it is not enforced or if we do not provide the means to enforce it?

These are two very important issues. Basically, the act states an intention and gives us a tool, but we have to use it and pay the price to enforce it. Otherwise, these are just meaningless words.

Before the holidays, we had a debate on the adoption of a free trade agreement with the Republic of Panama, which is practically a kingdom, one of the five most attractive tax havens in the world. I criticized that treaty because the government could not be unaware of that state of affairs, despite the claims made by the Republic of Panama. Panama may have laudable intentions of improving, but before going any further we will await the results. We really need to have results we can see.

Intentions have led to a great deal of human suffering, in relationships and in many other areas. As the singer Dalida said, "words, words and words". She saw things clearly and rejected this flood of words, because she had nothing more tangible or solid to rely on in her dialogue in that famous song.

If Bill C-48 passes, then the government is making a mockery of these measures by signing an agreement with the Republic of Panama. In my speech in the House, I provided proof positive that Panama was still a very popular tax haven. There are very attractive and very up-to-date websites, particularly European sites, saying that Panama is a winner if you want to evade income taxes, and feel free to help yourself. What purpose is there, then, in the government’s pretences if it is then going to contradict them by establishing an ongoing relationship, by sanctifying and recognizing the Republic of Panama, when it does not fully deserve such recognition?

Apart from enacting the measures, there is another aspect. We are seeing a flood of massive, savage cuts. As the Parliamentary Budget Officer said, those cuts mainly affect direct services to the public, the public service, essentially: the resources available to the Canadian government for carrying out its various missions. The measures concerning tax evasion set out in Bill C-48 will ultimately be no more than pretences, with no resources and no returns, or diminishing returns.

If there are no truly motivated employees in the public service who are trained and numerous enough to meet the challenge of tax evasion, we can enact all the laws we like, and we will simply be a laughing stock. In fact, and let us not delude ourselves, this is already the case. I have heard enough harsh comments. Some of my constituents have even used a few words to describe this government that I cannot repeat in this House. It is true.

I have only a minute left. My goodness, how time flies. I could have used at least another 20 minutes, or 40 minutes, to talk about C-48. In closing, I want to stress this inconsistency, which will not stop my colleagues in the official opposition and myself from supporting Bill C-48, which is nonetheless important. My questions have informed my colleagues about my concerns regarding the fact that we are only catching up halfway and we will not give up until we see the end of this government.

Hope will return when we form the government, but as always, New Democrats will find we have a heavy workload. However, we are not afraid of hard work. It will be our pleasure to rise to this challenge and do justice for all citizens of this country.

[Sadia Groguhé, NDP, Saint-Lambert, QC]

Mr. Speaker, I congratulate my colleague on his speech.

He spoke about the complexity of tax regulations. According to him, the bill is limited in terms of all of the technical changes that will have to be made based on changes to the legislation.

What does my colleague think about this challenge? Could he speak to that?

[Raymond Côté, NDP, Beauport—Limoilou, QC]

Mr. Speaker, in light of the scope of this bill, there will no doubt be things that get through that we will unfortunately have to fix later. The government is a slacker in its approach. It procrastinates, tries to pull things together, quickly produces something at the last minute, submits it and ends up with a very flawed bill.

This is very concerning. The government does not take into account concerns from informed groups, from taxpayers and from the experts who must interpret and use the act. Since we will unfortunately not be able to find all of the mistakes and issues that could cause a problem, we will end up having to duplicate, or even triplicate our work after the fact. That is very disappointing.

[François Choquette, NDP, Drummond, QC]

Mr. Speaker, I congratulate the hon. member for Beauport—Limoilou on his excellent speech.

My colleague pointed out some of this government's shortcomings as far as taxation and the economy are concerned. I find that very interesting.

The riding of Drummond has many small and medium businesses that drive the economy. These businesses need a tax system that is simple, efficient, fair and equitable. Right now, the bill does not quite meet these criteria. Unfortunately, the Conservative government has failed.

Earlier, the hon. member mentioned that the bill is almost 1,000 pages long. It is a very thick document. It is huge. It is also very complex. A great deal of work should have been done before. As was pointed out, the last amendments were made in 2001. Since they took office, the Conservatives have been dragging their feet on this issue, just like the Liberals.

I want to mention that the Auditor General raised serious concerns regarding how slow the government was in enacting the technical amendments described in the Department of Finance's comfort letters. When we are dealing with a 1,000 page document, how can we properly analyze, read and understand all these amendments? How can we do a serious job as members of Parliament and then report to our fellow citizens? It is very difficult with a document like this one. We should have similar legislation every year to keep up to date, instead of waiting for years and take forever to understand the details of this legislation.

I would like to know what my colleague thinks of all this.

[Raymond Côté, NDP, Beauport—Limoilou, QC]

Mr. Speaker, I thank the hon. member for Drummond for raising several issues.

I am going to use a metaphor to illustrate how this government really does not know where it is going. Problems of all sorts have accumulated. The government is trying hard to polish its image in an attempt to get off the hook and to hide the reality. It is like a wolf that gets trapped and cuts its paw to get away. The government is trying to fool us by saying that the wolf was set free. However, the wolf now only has three legs. It is handicapped, which creates a huge problem.

I am going to provide a very simple example regarding employment insurance. One of my constituents in the riding of Beauport—Limoilou is a qualified worker in Quebec City. Unfortunately, he works in a seasonal job. Because of the new rules, he must meet the government's unsustainable requirements. Still, he looks for work and tries to find a job in his field of expertise. But he is offered jobs that pay much less. As he said, he does not work all year round, and the annual salary—which he will never have for a full year—is around $50,000 or $60,000. Should he take a job that pays $35,000 or $40,000 annually?

This is truly a downward spiral. For the majority of Canadians, it is the quintessence, the promotion of mediocrity. It is really shameful for the government to do that. Of course, the hon. member for Drummond also sees firsthand the impact in his riding. He did well to raise this issue. It is our role to do so.

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Mr. Speaker, aside from the initial statement by the parliamentary secretary, it does not appear that many people on the government benches are prepared to defend and explain Bill C-48. I have a question for my colleague.

Given that 400 notices have been issued by the Canada Revenue Agency and other similar bodies, and that 200 such notices still remain to be integrated into the Income Tax Act and other tax legislation, we can expect to see another bill. It may not be as massive as Bill C-48, but it will be relative weighty nonetheless. The bill will be needed to integrate these technical aspects. This matter has been dragging on since 2001. Technical notices that needed to be presented in the form of legislation had been piling up for over 10 years.

I would like to know what my colleague from Beauport—Limoilou thinks about the government bringing in over 10 years’ worth of these measures in an omnibus bill, rather than tabling updates and amendments on a regular if not yearly basis, to tax legislation such as the Income Tax Act? If no one from the government can explain why this is not done on a yearly basis, then I would like my colleague’s opinion on the government’s response.

[Raymond Côté, NDP, Beauport—Limoilou, QC]

Mr. Speaker, I thank my colleague from Rimouski-Neigette—Témiscouata—Les Basques for his very important question. I think that the government is showing contempt. Let me explain what I mean.

I will use another analogy, namely that of the White Birch Paper Stadacona mill in Beauport—Limoilou. Mill workers unfortunately lost part of their pension fund after a contribution shortfall on the part of management. In essence, premiums paid by workers were not deposited into the fund.

The situation we have here is somewhat similar. When spread over a number of years, whether or not contributions are made or obligations met may seem harmless. Tabling technical legislation should be an annual obligation. However, when we consider a period of 10 or 15 years, there is a great deal of ground to make up.

Let me make another analogy, because I love doing that. Imagine a bank putting up with a person not making mortgage payments over a 10-year period. You can be sure that if the bank decided it had cut the person enough slack, demanding all at once 10 years’ worth of outstanding payments, plus interest, would represent a fairly substantial sum of money.

This illustrates the extent to which the government has failed to assume its responsibilities and lacks perspective and consideration for Canadian taxpayers.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, it is with pleasure that I rise to speak to Bill C-48 this afternoon.

I would indicate right at the beginning that the Liberal Party does support the bill. We would like to see the bill ultimately go to committee. I do not think that comes as a surprise to members, because at the end of the day, we would argue that many, if not virtually all, of the amendments we are talking about should have been and could have been passed years ago. There is a cost to Canadians, because the government has been so lax in wanting to pass this necessary legislation.

Having said that, I think Canadians would likely recall that last year the Conservatives had two massive budget bills. In those budget bills they threw in all sorts of pieces of legislation. For some peculiar reason they felt it was necessary to bundle in so many pieces of legislation and pass them through the back door of the budget debate.

When I reflect on it, and I have had the opportunity to discuss the issue with many of my constituents, I think the general feeling is that it was just wrong and anti-democratic. So many things could be said about what the government did last year, which was inappropriate, undemocratic and just not worthy of passage through this House.

On the other hand, we have this massive bill. It is important to take note of it. The bill is in excess of 900 pages. Sometimes when legislation is overhauled, there is a need to bring in substantial changes that will dictate that we have to have literally hundreds of pages, thousands of words, to get through all the amendments necessary to change that legislation. That does not apply to this particular bill.

Over the years we have seen the need for numerous changes in our taxation laws. The number has dramatically increased over the last few years. This matter was before our Auditor General. It was before our public accounts committee. A couple of years back, our public accounts committee suggested that the government act on this issue and that the government bring in smaller pieces of legislation to enact the many technical changes that are required for our tax laws. The committee made those recommendations years ago.

There is no doubt whatsoever that the government has sat idly by and allowed the list to grow considerably, to the point at which today we have a document that is excessive in terms of the number of amendments that have to be made to modernize or update our taxation laws.

Those amendments are all technical. Many of them are very small in nature, but some of them are quite significant. In reading it through and being provided some information, I want to highlight two or possibly three of them to provide examples.

For example, self-employed individuals can now contribute to EI. Bill C-48 ensures that those contributions are deducted from the annual income for taxation purposes in the same manner that employees' contributions are deducted. It is a very important change.

Then we go to the labour-sponsored venture funds. In 2010, Ontario was phasing out the tax credits for these funds. There have been other issues surrounding labour venture capital funds. I could talk at great length on some of the problems we had in the province of Manitoba while I was an MLA. At the end of the day, changes will be made to our taxation laws that will help deal with some of those funds.

Regarding airlines, provinces and taxes, this clarifies the allocation of miles flown over certain territorial waters for the purpose of provincial taxation.

There is one change regarding our first nations with respect to GST, so that they might choose to levy a sales tax on a reserve by allowing the Canada Revenue Agency to collect an administrative tax. All money collected would be returned to the band council. Bill C-48 would allow Revenue Quebec to fulfill that same function.

Even though we talk about the hundreds of changes that are very technical in nature, it is important that we recognize that those changes are absolutely critical. In fact, what we will find quite often when we look at the taxation books that try to provide advice to consumers is that much of it is coded, whether with asterisks, different colours or faded colours. Generally speaking, that is in reference to the fact that there was a need to change the legislation, but it has not yet been changed; it is still pending. Because it is still pending they have to make a note of that. We have an industry out there of tax lawyers, accountants, all sorts of advocacy groups and others who assist individuals in preparing their taxes. They have to take note of the many different changes we are expecting because until they pass they are not the law. Therefore, it is a very important issue.

I question why it took the government so long. Taxation is of critical importance to our nation. I have had the privilege of being an elected member, whether it was here or in the province of Manitoba as an MLA, for 20-plus years. People are concerned about taxes and the many forms of taxation. They believe there is a need for change. They would like to see more progressive changes to the way government collects its taxes. We need to have that debate. We need to encourage reforming the system where we can, not only these minor technical changes but in some cases major technical changes. There is a lot more that we can actually do.

I am surprised that the government has taken as long as it has. I felt that it would have been in a good position two, three or four years ago to put together the legislation that would have made many of the changes that were proposed many years ago, as opposed to allowing them to accumulate. I say this now because we know that, as time continues on, there will be future changes. We are not suggesting that it has to be done on an annual basis or even every second year. It depends on the technical changes that are required, the number of changes and, in good part, the government's agenda. It could be a budget implementation coming forward, which would cause additional changes. It could be a wide variety of reasons for which one could ultimately justify holding off for three or four years. To wait for 10 years, to allow it to go that long, has done a disservice to all Canadians because we want certainty in our tax laws. We better serve all forums, whether business or individual, by ensuring our laws are fair and are updated on a regular basis.

I encourage the government not to wait as long and, ultimately even when we go into committee, to look at and be open to the possibility of having other changes. In that sense, we in the Liberal Party support the bill to go to committee. We are not here to hold up the debate on the bill. We would like to see it go to committee.

I want to take advantage of this opportunity to speak on this bill to expand on a couple of ideas or thoughts I have had. Yesterday there was a special event in Winnipeg North. It is kind of an annual perogy lunch that I host. We had about 140 to 160 people show up. It afforded me the opportunity to really have some good healthy discussions with many of them and to address the group.

There are some real concerns that need to be addressed. Some of those concerns deal with taxation and the potential of providing tax deductions. This applies to Canadians from coast to coast to coast, but I talked to one individual who said she is on a very limited income, as are many seniors. They own their home because they have maybe lived in it for 25 or 30 years. However, they are on a fixed, relatively small income. At times there is a need to improve or fix up their homes.

Quite often what these seniors are looking for is a tax deduction or something that would allow them the opportunity to improve the structure of their home or to make some improvement. It would ultimately improve our housing stock if we allowed more seniors to be able to do that. They have the equity.

At the end of the day, tax incentives or tax deductions may be able to assist a senior and possibly stimulate the economy. When home renovations are encouraged or promoted, as the Liberal Party has done over the last year or more, talking about the benefits of having home renovation programs, the money will be spent locally, which in turn creates more employment.

If tax dollars can be grown by $6, $7, $8, $9 or $10 because individuals are using some of their own money, it all helps out. These are the types of things that I would like to think we should be talking about more inside the House, not only during budget debates but also when the public accounts committee meets and when we have bills of this nature and are talking about the technicalities of taxation laws.

We should be talking about the importance of how taxation laws allow us to facilitate government programs through deductions or tax credits. Imagine the impact we have on charitable organizations.

Every province and territory has numerous charitable organizations that are very much dependent on those charitable tax numbers. Progressive government policies and good tax programs or incentives allow those charitable organizations to prosper and to be able to help Canadians from coast to coast to coast.

Again, it goes right back to the Canada Revenue Agency, our taxation laws and priorities for the government. That is why I am suggesting it is very important for us to add it to the debate.

I am very concerned about our middle class. The middle class in Canada could be doing so much better. To what degree are our taxation policies allowing the middle class to grow? I believe most economists would tell us that the middle class is actually shrinking in Canada, even though the vast majority of Canadians, 90% or more, would say they are a part of the middle class.

At the end of the day we know that the rich in Canada are getting richer and the poor are getting poorer, relatively speaking. We know that the middle class is not growing. There is a growing inequity that is taking place. Taxation laws are one of the tools that can be used to deal with that issue.

When we talk about taxation laws, I believe it is a very important subject in which members should participate and share their ideas on how we could be a better society if we deal with it.

I made reference to different forms of taxes. Over the years, Revenue Canada does just one component of taxes. Income, property and consumption taxes are likely the big three. These are issues with which the public have a great deal of concern. There is a feeling the government is not doing enough to justify collecting the taxes that are being collected.

At the end of the day, it is important that we recognize all forms of taxes when we talk about income tax because that is what the average Canadian does. When we talk about income tax and in particular Bill C-48, I would ask the question I posed to the parliamentary secretary. What is in the bill to make taxation that much simpler for the average Canadian to understand? How does the middle class benefit from it? Is it consumer friendly?

Today I had a discussion with an individual who indicated to me that people cannot get a printed version of the income tax booklet. At one time the post office had income tax booklets which contained all the basic tax laws and information required to complete the forms. It is my understanding the booklet is no longer available, or at the very least to the same degree that it was available in the past. People say that we can get the information from the Internet. I think it is a mistake for us to be so dependent on individuals having to use the Internet or purchase a computer program in order to file their income tax returns.

Are there ways in which we can make the system simpler? What about those individuals who have a difficult time filing the very basic income tax returns? That happens a great deal. There are some non-profit groups that have a fairly decent understanding of our taxation laws and offer services to a lot of people who are on low or fixed incomes. To what degree would the proposed changes make it simpler for those individuals to get their taxes done on an annual basis?

I have had the opportunity over the years to go through my own income tax and I have had assistance in dealing with it, primarily because of time constraints and so forth. However, the bottom line is that I believe it is becoming more and more complicated in many different ways.

There are issues relating to why one group would get a tax break over another group. The issue of tax fairness is what I am referring to there.

I have heard many members in the chamber talk about the importance of dealing with tax avoidance. There are many individuals across the country who get away with not having to pay their fair share of federal tax. That applies at the provincial level also where there are many who are escaping paying their fair share of taxes.

Taxation is an important policy issue. It is through taxation that we are able to provide the types of services that Canadians want, whether it is in connection with health care, Canadian Forces, or the many other services that we provide throughout the land. That is all based on our ability to collect taxes and having good, solid tax laws.

The government has the responsibility to maintain the integrity of our taxation laws. That is the reason I believe it is important to have this debate now and to take this to the next step and allow the bill to go to committee so that ultimately it can pass and Canadians can see better tax laws.

[Michelle Rempel, Conservative, Parliamentary Secretary to the Minister of the Environment]

Mr. Speaker, it gives me great pleasure to speak again in the House today after spending time in our constituencies.

The goal of this legislation, as we mentioned earlier today, is to provide clarity to certain components of the tax act. We consulted with professionals across the country. There are many things in the bill which we believe will help improve providing service with regard to the tax act. Many professionals have provided input over a long period of time.

Given that the member's speech was all over the place, does he acknowledge that these measures need to come into force and will he support the bill?

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, that is what I indicated. Obviously the member was not listening. The Liberal Party supports the bill. We want to see the bill go to committee.

The member talked about the government working with the stakeholders. The government has been working with those stakeholders for years now. The government has attempted to give the impression that it is acting on reforming our taxation laws and making that a priority, when in reality the opposite is true. The government has been negligent. The government has dropped the ball. It has not made taxation reform and bring legislation forward in a timely fashion a priority. That is the reality. Many if not most of the clauses that will be debated once the bill goes to committee should have been passed years ago. The government has to take responsibility for its negligence in not doing its job in a timely fashion.

I indicated earlier the important point that Canadians very much deserve to have a taxation system that is fair, up to date, modern and completely legal. The government should not just say that the change will be made whenever we pass the legislation. We have far too many pieces of tax law that are in place unofficially. That is because the government has been so negligent.