House of Commons Hansard #117 of the 35th Parliament, 2nd Session. (The original version is on Parliament's site.) The word of the day was rights.

Topics

Excise Tax Act
Government Orders

4:50 p.m.

Some hon. members

Oh, oh.

Excise Tax Act
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4:50 p.m.

Liberal

Barry Campbell St. Paul's, ON

Mr. Speaker, I must have struck a chord. The people of Atlantic Canada clearly know what is in their interest and are prepared to rise or fall as governments on that. Unfortunately the Reform Party does not represent that area of the country but thinks it knows best, knows better and knows what would help them. Reformers are prepared to stand here for two days to tell Atlantic Canada just what is good for it. That is some indication of the incredible arrogance and paternalism of the Reform Party with respect to other regions of the country.

With regard to the Bloc let us point out something else that is quite incredible about the spectacle of its interventions in the debate. Let us understand this clearly. Bloc members want to deny harmonization to Atlantic Canada, but they forgot to say in a single speech over two days that the Quebec sales tax is harmonized with the GST. They tell Atlantic Canada not to do it, that it is outrageous. By the way, they go on to say: "You are buying them off. You are doing this adjustment assistance".

I did not hear in one speech any rejection of the adjustment assistance for farmers when agricultural subsidies were removed. I did not hear a word from Reformers on the Crow rate subsidy of $1 billion plus. No one stood and said at that time: "Don't give this to us". They said: "Don't help us with an adjustment to this structural change. No, don't do that". They were silent, struck dumb.

When it comes to assistance to Atlantic Canada there is not a word from the Reform Party about the Crow rate subsidy of $1 billion plus. However it is no to Atlantic Canada, no adjustment assistance for them. From the Bloc there is no adjustment assistance for structural change but on agricultural subsidies the cheque can be written. It is really quite incredible and I do not think anybody will be fooled.

The hon. member opposite stands and says: "We are still waiting for the formula". Nonsense. The formula has been well known. It is compensation for a loss of revenue greater than 5 per cent of the sales tax base. He knows it. Hon. members know it. Anybody who has been unfortunate enough to watch the debate for two days knows it because we have said it several times. Quebec does not qualify. Nor would other provinces qualify that have not yet joined but will in due course.

The Atlantic provinces qualify. They are losing that revenue. What did Quebec do when it harmonized? It wanted to keep it secret but did not want the Atlantic provinces to have it. It ran two systems side by side and had an increase in revenue. There was not a decrease when Quebec harmonized. It did not qualify then and it does not qualify now.

I go back to the history of the last couple of years. I participated in the finance committee when it travelled across the country asking Canadians about the GST. Members opposite can invent what took place but I was there and so were some of their colleagues.

Canadians told us there was an incredible anomaly with two sales taxes in most provinces, some 10 sales taxes in total. Whatever else we do, they told us to harmonize. The following sounds like a quote from the Reform Party, but there is only one taxpayer so there should be only one tax administration, one tax. Canadians asked for simplification over and over again.

To listen to the parties opposite one would think they were not sitting at the table with us. They asked for tax inclusive pricing. They wanted the option of knowing what the tax was. That is why it is provided on the receipt as it is in most of the world. Canadians told us they wanted no more sticker shock, no more counter shock.

In closing, I will make another point about the incredible spectacle we heard from the Bloc. I wonder if the reason its members have not reminded Canadian people about harmonization in Quebec is that it is a competitive advantage vis-à-vis Atlantic Canada. They know that. They do not want Atlantic businesses and consumers to have the advantage available to Quebec businesses and consumers.

This change will result in input tax credits in Atlantic Canada, tremendous savings passed on to consumers, cheaper prices and no net increase in tax revenue. It is good for Atlantic Canada. That is why their governments want to do it, no matter what the Reform or the Bloc may have to say about it.

Excise Tax Act
Government Orders

December 10th, 1996 / 4:55 p.m.

Reform

Stephen Harper Calgary West, AB

Mr. Speaker, I am happy to follow the previous rant from the member for St. Paul's. It is the first we heard from the Liberals today on the issue and gives me an opportunity to address some of his comments.

It was interesting when he said this move was in the interest of Atlantic Canada. Yet few members on the government side from Atlantic Canada are willing to speak to the issue. Very few members are willing to speak to the issue of GST harmonization. Almost none from Atlantic Canada. One spoke earlier today, the hon. member for Gander-Grand Falls. We can check the blues, but I do not think he mentioned GST anywhere in his speech. He obviously was not too thrilled about the initiative.

The government makes the point that it must be governing for the benefit of the people of Atlantic Canada because the Liberal government in Atlantic Canada likes this initiative. The role of the Parliament of Canada, I would remind the parliamentary secretary, is to govern for the benefit of the people of Canada; not just the people of Atlantic Canada but all Canadians.

Interestingly enough we did not hear mention of the people of Atlantic Canada. Where are the petitions to Parliament demanding this harmonized GST? Where are the letters of endorsement from the business community and from consumers groups? We are not getting them in our offices. We are getting precisely the opposite.

The federal government should have a broader view of what is in the interest of the people of any region of the country than just what the party of the government thinks in a particular region.

We get the same line every time the Reform, the Bloc or any other party criticizes a Liberal government initiative directed at a specific region. Its members always say they are the guardians of the region. They ask where we were when they were giving something to our region or to somebody else. The great tragedy of the country is governments that do not govern for the entire country. Historically governments, particularly Liberal governments, have used policies to divide, conquer and pit one against another so they can act as the defender of one region at any point in history, depending on where they need to pick up some votes.

It is a terrible way of approaching government, but that is the history. I am addressing second reading of Bill C-70 on GST harmonization which, as has been pointed out by many speakers, is being implemented with time allocation.

It is important to point out that this bill was read for the first time in this House only on December 2, just over a week ago. This is only the third day we have had any debate at all on this piece of legislation.

The hon. member for Burlington, a Liberal member, had a tremendous argument. This one we need to get bronzed over here. It was that they would not need to move time allocation if the opposition would just support their bills. That would make it much easier.

There is a pattern here. We saw this pattern not just in this fall sitting but in previous sittings in the last three years. That has been that we have had a very slow legislative agenda for several months.

Just as the House is about to rise for a break, important legislation appears which must be passed immediately. In this sitting, the fall sitting, we passed only nine pieces of legislation, including some supply bills and housekeeping measures that were of fairly minor significance.

Last week three pieces of legislation were introduced which most analysts of Parliament would argue are the three most important bills introduced in the fall sitting, the harmonization of the GST, amendments to the Canadian Wheat Board, and the tobacco legislation. These are three of the most important bills.

Now they must all be passed according to some rushed schedule. I should add, just a couple of weeks before that, changes to the rules for the next election campaign. That is probably the fourth most important. It came in only three weeks before the end of the session.

Why does the government do it this way? I have tried to figure that out. Why are we rushing, for instance, an important debate on a GST package in order to have a prebudget debate, which the government will have no intention of listening to whatsoever? It is not on a substantive piece of legislation. Why are we doing this?

Some of it may be disorganization. Some of it may be unclear priorities. I fear the longer I am here the reason it does some of this is it really ultimately wants to rush committee stage of these bills.

Committee stage is where the public and affected interests get to express their views on the bill to indicate where amendments should be made and where parliamentarians and other expert witnesses are able to go over the clause by clause of a bill to suggest technical amendments.

That is the stage the government wants to rush. It has been increasingly rushing it, even on important legislation. The consequences of that have been very obvious in this Parliament to observers. Often we are passing legislation that is not well thought out, that is poorly drafted technically and that ends up being amended or delayed in the Senate.

I suspect we will see that happen again, if not on this bill at least on one of these three bills we are now rushing.

We have today the Liberal Party bringing in a bill to support and enhance the position of the GST across the country. I will not dwell too much on that. It is tremendously humourous to see the Liberal Party now being the one enacting the new version of the GST.

Perhaps even funnier than that was the appearance of the leader of the Progressive Conservative Party to vote against the GST. Of course, just his mere appearance in the House of Commons is funny enough, seeing how infrequently it seems to occur.

Let us go back to the original GST. The original GST was discussed in a white paper presented by the previous government in 1987 and implemented in the 1990-91 period. It is important for me to acknowledge, as I want to address a serious issue here, that many conservative people in the country, many business people, very conservatively oriented people, were very supportive of the thrust of the GST, at least initially. Some still are.

Why was this? It is important to understand why some supported it and why they do not today and why it is an error to support this tax.

They supported it because of the deficiencies of the existing manufacturer's sales tax. They supported it because it was a value added tax implemented in a multi-level way that ideally would not distort prices. On top of that it was a consumption based tax which therefore would not have strong incentives against investment.

However, these were very short term reasons for anybody to support this tax. They were very short term reasons because the real issue this country has been facing for the last 10 years and will face for the next few at least is the deficit and whether we will end the enormous deficits of this federal government by increasing taxes or whether we will end them by cutting spending; in other words, whether we will ultimately balance the budget in this country by having very big government or by having much smaller government. Of course, big government got us into this economic situation in the first place and we favour a solution that will bring us back to smaller government.

If we take a big picture look at the GST, the big problem with it is not the specifics of its construction. It is in the end a powerful revenue generator, one that works best if hidden. It makes it easy to raise rates, easy to broaden the base, and it brings the federal government into an area that is traditionally provincial authority. It leads to tax collusion rather than the phrase harmonization or rather than competition between governments.

That is what we see happening with this GST harmonization today. We see a deal that buys off the Liberal Party in the Atlantic provinces, that uses the term harmonization for essentially arranging a collusion scheme between governments to make it easier for them in the future to raise taxes. They can do it with a majority vote. But it makes it virtually impossible for them to ever lower the rates of taxation. It takes another step toward hiding and burying taxes in prices and it broadens the base of existing provincial sales taxes on Atlantic consumers.

The real agenda of the Liberal Party is to make sure the fiscal actions it takes, both on the spending and taxation sides, ultimately secure big government and high taxes in this country. I believe that in the end this is what has caused the slow economic growth in the past generation. This will ensure the country continues to slip.

We need another way. This harmonization of the GST, this tax collusion between provincial and federal Liberal governments, is not the way to reverse the economic decline of this country.

Excise Tax Act
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5:05 p.m.

Reform

Ken Epp Elk Island, AB

Mr. Speaker, I am glad to add to the debate today because of the implications for Canadians, the people from coast to coast we represent.

I reject the statement of the member opposite who said that we have not heard what the people of Atlantic Canada have said. We have indeed. We have heard of those business that are shutting down and laying off staff because they cannot compete under the rules being imposed on them by this new legislation.

I have something to say about the GST in a broad sense. We greatly underestimate the impact it has on our economy. There is a simple rule that if you want people to do something you make it easy for them. If you want people to stop doing something, then you make it more difficult. The taxation of cigarettes is an example. When taxes were reduced, consumption went up. When taxes were increased, consumption and the purchase of cigarettes went down. That is true in every sector.

I will use the example of my father. He is a senior citizen now, well on in years. He is one of those pioneers who helped to build this country out in the west. My dad purchased a new car every four to six years. That became a regular pattern for him. But in 1990 when they brought in the GST and he was ready for a new car he did not buy a new one. So his old car turned four years old and then five and then six.

One day I asked him if was going to buy a new car because he usually did. He said: "No. Between the provincial sales tax and the new federal sales tax, the GST, I am not going to buy a car because that is one tax which I can avoid paying just by making the choice not to purchase a new vehicle". As a result, my dad to this day is still driving his 1985 Oldsmobile. He says it will be his last car because he will not pay tax on a new one. We could multiply that situation over and over again. The people in the car business in Ontario have lost many important sales. If we multiplied it by the number of people who have responded in that manner, we would probably be surprised by the huge economic impact the GST has had right across the country.

As a member of Parliament I have the duty to represent my constituents and also to represent what is good for the country. It seems that in this Parliament the opposition parties are better able to do that than the governing party. I bring to the attention of the House evidence to support that statement.

I believe that the opposition has a very important role to play, so I went back to when the Liberals were in opposition. I read Hansard from that time. I went to the PubNet system and said let us see what the Liberals said about the GST when they were in opposition. I have quotes from several Liberal members who were in opposition who I think correctly represented Canadian thinking.

First I would like to cite quotes from the hon. member for Burin-St. George's. He is an eloquent speaker. He frequently speaks on these subjects. This is what he said on March 12, 1993. He was deriding the government's jamming through the GST at that time. This was on the debate when it was simplifying it. The Conservative government brought in 350 pages of simplification for the GST procedures and that is what the House was debating on this occasion. He said: "The government used every rule in the book and every perversion of most of the rules to get the GST-and that is what I am talking about in case my friends on the other side have forgotten so soon, the goods and services tax. It is called many other names by those 85 per cent of Canadians who vehemently and strongly oppose that tax measure". I believe that member when on this side of the House was correct. As far as we know, about 85 per cent of Canadians were opposed to the tax.

It is a violation of our trust if we bring into this place legislation and we jam it through, as this government is now doing, against the will of the people. How can we expect to have respect as parliamentarians if we go against the will of the people and impose on them what we know best, as opposed to what they are demanding from their government? How can we expect respect for our laws if the people of the country lose their willingness to be so governed?

Let me go back to the member for Burin-St. George's. He said: "I am talking of the bankruptcy of ideas and about the pain that has been inflicted on individuals, families and corporations out there, on people trying to do business, trying to run their homes and trying to maintain and manage their family budgets. I am talking about that kind of bankruptcy, that kind of pain". He was accurately expressing the huge pain of excessive taxation on our citizens.

I quote again: "Go out there and ask almost any Canadian how fair the GST has been for him or for her. Ask a person who is in university and who must buy some books how fair the goods and services tax is. Then remember that the goods and services tax was going to lower prices". Here we are in 1996 hearing exactly the same thing. Those same members, now on that side of the House, with the ability because of their numbers to do something about it, are refusing. When they were on this side of the House they represented the people. They said we should not tax books. What are they doing now? They are increasing the tax on books, effectively, for university students.

I quote again: "We have to understand the double talk of this government on many matters. When it says it is going to do something, then that is code for saying that it is really going to do the opposite. But for the record it has said it will do something else". That is a quotation from a Liberal member talking about the Conservatives and we know where they went.

Unfortunately my time is up. In conclusion, let me say this one sentence. I am here to do everything that I can to fulfil the Reform plan to reduce the GST in stages to zero until it is gone as we bring government spending under control and stop that excessive taxation demand on the taxpayers.

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5:10 p.m.

The Acting Speaker (Mr. Milliken)

Order. Pursuant to order made earlier this day it being 5.15 p.m., it is my duty to interrupt the proceedings and put forthwith every question necessary to dispose of the second reading stage of the bill now before the House.

The question is on the amendment.

Is it the pleasure of the House to adopt the amendment?

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5:10 p.m.

Some hon. members

Agreed.

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5:10 p.m.

Some hon. members

No.

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5:10 p.m.

The Acting Speaker (Mr. Milliken)

All those in favour will please say yea.

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5:10 p.m.

Some hon. members

Yea.

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5:10 p.m.

The Acting Speaker (Mr. Milliken)

All those opposed will please say nay.

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5:10 p.m.

Some hon. members

Nay.

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5:10 p.m.

The Acting Speaker (Mr. Milliken)

In my opinion the nays have it.

And more than five members having risen:

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5:10 p.m.

The Acting Speaker (Mr. Milliken)

Call in the members.

(The House divided on the motion, which was negatived on the following division:)

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5:45 p.m.

The Acting Speaker (Mr. Milliken)

I declare the amendment lost.

The next question is on the main motion.

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5:45 p.m.

Liberal

Bob Kilger Stormont—Dundas, ON

Mr. Speaker, you will find there is unanimous agreement for members who voted on the previous motion to be recorded as having voted on the motion now before the House, with Liberal members voting yes.