House of Commons Hansard #119 of the 36th Parliament, 2nd Session. (The original version is on Parliament's site.) The word of the day was tax.

Topics

Request For Emergency Debate
Routine Proceedings

10:10 a.m.

The Speaker

Of course the hon. member for South Shore raises a very important matter, not only for his area but for other areas of the country. He was good enough to give me notice as early as last night at 10.30 p.m.

I have had my officials monitor the matter throughout the night and early this morning and it is my opinion at this time that this request does not meet the criteria for an emergency debate.

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September 21st, 2000 / 10:10 a.m.

Reform

Jay Hill Prince George—Peace River, BC

moved:

That given the record increases in the price of gasoline and home and diesel fuel, severely hurting Canadian consumers, truck drivers and businesses, and given the recent promise by the Minister of Finance to reduce taxes, this House call upon the government to give relief on fuel taxes, including repealing the increase in gasoline excise tax introduced as a temporary deficit elimination measure in 1995 and implementing the 1998 recommendation of the Liberal Caucus committee on gasoline pricing in Canada to remove the double taxation of the GST.

Mr. Speaker, I will be splitting my time this morning with the hon. member for Calgary Southeast.

I am pleased to rise today to kick off this important debate in my new role as official opposition transportation critic.

I look forward to working with Canadians to address their needs in this important sector. In my brief tenure I have already met with several groups and individuals whose businesses and livelihoods are either hampered or threatened by the government's policies.

Today I will focus my remarks on the financial and transportation priorities of the Liberal government, the effect of these priorities on Canadians, the effect of these priorities on Canada's competitiveness and, as always, what the Canadian Alliance would do to rectify the situation.

The Canadian taxpayer is being taken advantage of. Canadians on the whole are law-abiding people who accept the fact that taxes must be paid to sustain a quality of life and to support the less fortunate. However the amount of taxes paid and the expenditure of tax dollars is where I would like to focus my remarks.

Yesterday the finance minister announced that the federal surplus for fiscal year 1999-2000 was $12 billion. That means that the federal government overcollected $12,000 million from Canadians, or approximately $400 from every man, woman and child in Canada.

We just spent the summer in our ridings. Many of us like our constituents took vacations with our families. For the average Canadian it is a struggle to save up to take a break from work and spend some quality time together. This year many Canadians had to cut back on their plans to compensate for the high cost of gasoline. I am fully aware that gasoline is a commodity and is subject to variances in the marketplace. We cannot control market prices, but we can control the level of taxation.

According to the Canadian Taxpayers Federation, the federal government collected over $4.7 billion in gas taxes in fiscal 1998-99 and returned a paltry 4.1%, or approximately $194 million back to provincial transfers for road and highway development. On average, Canadian motorists are paying between 36% and 45% in taxes with each fill up at the pumps depending on the province. For the current fiscal year 2000-01 the federal and provincial governments will collect over $13 billion in gas taxes from Canadians.

In 1995 the finance minister increased the fuel excise tax by 1.5 cents a litre to help eliminate the deficit. The deficit is gone. Canadians are experiencing record high gas prices and the federal government is experiencing record high surpluses. One would think it is time the finance minister relaxed his stranglehold on Canadian wallets and reversed the tax hike. The Liberals have made choices and set priorities, namely raising taxes to reduce the deficit and spending only on those projects that will garner political rewards.

How do these policies affect Canadian families? This winter many will have to scramble to decide whether to cut from their food budget or kids clothing budget to pay for the increase in heating fuel and gasoline. What we are calling for today is a first step, a small step, in liberating Canadians from overtaxation. We are looking for a little fairness.

World commodity markets have caused the price of petroleum products to skyrocket while the government is collecting record surpluses. Removing the GST and a reduction of 1.5 cents per litre is the least the government can do. It would be the most practical social spending endeavour of its mandate. In fact the Liberal caucus endorsed it in its own report.

With an election looming the only reason members of the cabinet are not interested in pursuing this responsible action is that the reward is not high enough. It is not enough to loosen the burden on cash strapped households and small businesses. It is not good enough to keep truckers on the roads and farmers in the fields. They want a big political reward.

In question period yesterday the finance minister said:

—the government has made it very clear that the impact of any tax cut must be one that is significant and felt.

If he is about to commit the mortal Liberal sin and cut a tax, he wants the most political bang for it. The finance minister prides himself as a shrewd businessman. Maybe it is time he used some of his corporate smarts for the benefit of Canadians. On the farm we realized long ago that we have to spend a dollar to make a dollar.

I ask the government to make a break from raking in the cash and shovelling out the patronage dollars and listen to some common sense. It is imperative to invest in our infrastructure, not only for the safety and well-being of our citizens but to strengthen and augment our ability to move goods and services both inside and outside our borders.

The government has made a priority of investing billions of dollars in the information highway while all but ignoring our national highways. The two are not mutually exclusive. I ask the House not to take my word for it. Terence Matthews, founder of Newbridge and Mitel, recently stated that Canada's “economic boom could be jeopardized if it does not invest in infrastructure”. The Liberal government's priority has been to maintain high taxes and spend only on projects contingent on political reward. These short-sighted priorities are threatening Canada's competitiveness.

This realization has not been lost on our chief competitor and largest trading partner. In 1998 the United States passed the transportation and equity act for the 21st century. That bill invests $217.9 billion over six years into infrastructure, a large portion of which is roads connecting its borders to Canada and Mexico. Legislatively the bill guarantees that a minimum of 90.5% of the federal fuel tax receipts from each state is returned to that state.

The Coalition to Renew Canada's Infrastructure has been advocating a national highway program and is calling on the government to dedicate one cent per litre of federal fuel tax, the equivalent of about $500 million annually, to highway renewal. This is not a lot of money when we consider that after the water fountains, canoe museums, hotels and the rest of the shovelgate the Liberals still had $12 billion left over last year. If viewers would like more information on the national highway initiative, they can go to www.highway1canada.com.

The Canadian Alliance and its predecessor, the Reform Party of Canada, have had a longstanding policy on dedicated revenues from fuel taxes. They believe that the way to effectively maintain Canada's infrastructure is to reinvest the proceeds of fuel taxes back into the sector from which it is collected.

This is contrary to the Liberal government's record. As I stated earlier, the federal government only invests about 4.1% of gas revenues back into the roads. What is even more appalling is when we look at its record in the other transportation sectors. In 1995, under the leadership of then transport minister Doug Young, the federal government began a divestiture program of its ports and airports. One by one the department handed over control and expense of these facilities to municipal boards across the country.

These authorities work on skeleton budgets to try to maintain their infrastructure to provide essential economic lifelines to their rural communities. In some cases, like the airport in my home town of Fort St. John, the authority is collecting an airport improvement fee from all travellers departing from Fort St. John. These user pay initiatives are fair in that only those who use the service are required to pay for it. However the revenues collected by the federal government for aviation fuel go into general revenues, with a pittance being returned to the airports through capital assistance programs. The port authorities are experiencing much the same. Where is the fairness in this taxation? Where is the return on our tax dollars?

In conclusion, I will reiterate a few points. The federal government increased fuel taxes by 1.5 cents a litre in 1995, five years ago, to fight the deficit. The deficit is gone. So should the tax hike be gone. The federal government is collecting a tax on a tax by collecting GST on top of fuel excise taxes. World fuel prices are at record highs and so too are government surpluses. The only ethical thing to do is to lower taxes on fuel.

The government's choices and priorities are clear and so too are the consequences. The Liberals mount huge surpluses by overtaxing cash strapped Canadian families. The Liberals collect billions of dollars in fuel tax revenues annually with little or no reinvestment in our infrastructure.

What are the consequences? Canadians are put under undue financial strain so the government can turn around and try to buy their votes with their money. Liberals have made a priority out of buying goodies for the Prime Minister's riding while ignoring our roads, ports and airports, thus jeopardizing road integrity, traveller safety and economic viability.

I call on members opposite, in particular those in cabinet, to support this motion, thereby reducing the financial burden on Canadians. I also call on the government to make a genuine reinvestment in the future competitiveness of Canada by improving our transportation infrastructure.

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10:25 a.m.

Liberal

Guy St-Julien Abitibi, QC

I have listened carefully to the words of the hon. member but I would like to know, having also carefully read the opposition motion, why he is attacking only the government. I do not understand why he is not attacking the fuel companies.

I would like the hon. member to tell us what, as of today's date, the breakdown of the price of a litre of gas is in his riding of Peace River, excluding the tax. That is what we want to know: the price of a litre without the taxes, in his riding.

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10:25 a.m.

Reform

Jay Hill Prince George—Peace River, BC

Mr. Speaker, approximately 40% of a litre of gasoline is made up of taxes. That is pretty general. It varies a bit from province to province across the country.

The hon. member asks why we should not blame the oil companies. That is the government's way of handling situations. It has been that way for the seven years it has been in power since 1993. Canadians are getting fed up with it.

It is easy for a government to stand up and point the finger elsewhere. Either it is the fault of the provinces because they are not willing to sign some joint declaration of tax reduction, or it is the fault of oil companies or maybe the way the sun came up this morning, instead of taking responsibility for what it can control.

That is what the motion is all about. Why do we not look at what we can do in the Chamber? What we can do is offer Canadians some real tax relief, Canadians who are hard pressed at the moment every time they stop at the pumps. Truckers are trying to do their jobs and make ends meet. Farmers are out in the field trying to get their crops off and face these high input costs.

We as a group, when the motion comes to a vote on Tuesday, can vote for it to bring down taxes just a bit. We are asking the federal government to give up just a bit. It does not have to slash and burn its tax base. Lord knows it would not be prepared to do that. All it has to do is give up a bit so that Canadians have a better day tomorrow.

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10:25 a.m.

Liberal

Mac Harb Ottawa Centre, ON

Mr. Speaker, I am puzzled by my colleague's grandstanding on an issue that is so important to consumers across the country.

What assurances could he give the House and Canadians, if any kind of a tax reduction is to take place on gasoline prices, that this money will go into the pockets of consumers rather than into the pockets of oil companies?

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10:25 a.m.

Reform

Jay Hill Prince George—Peace River, BC

Mr. Speaker, perhaps that is the attitude of the government. I think it is, by the way in which the finance minister has been addressing the questions many opposition parties and certainly our new leader have been putting to the government over the last few days. If that is its attitude, that only through some ironclad guarantee will it reduce taxes, obviously it does not ever intend to reduce taxes.

The government is so afraid if it gives up a bit of the money it has been raking in that perhaps somehow someone else will pick it up. The fact of the matter is that the hon. member is quite right. There are no ironclad assurances in life. The reality is that if the government reduces taxes I believe that we will have to monitor to make sure that oil companies do not simply tack it on the next day. That is the reality.

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10:25 a.m.

Liberal

Janko Peric Cambridge, ON

Mr. Speaker, I was part of the Liberal caucus investigating price gouging at the pumps. I am really surprised the hon. member for Prince George—Peace River is not blaming the companies but is just blaming the government. He is not blaming the companies for raising gas prices over long weekends, which has more of an effect on people with fixed incomes than anything else.

When the crude oil price was at $9 per barrel, the price of gasoline was 50—

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10:30 a.m.

The Acting Speaker (Mr. McClelland)

I am sorry but 30 seconds goes quickly when you are on a roll. The hon. member for Prince George—Peace River will have 30 seconds to respond.

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10:30 a.m.

Reform

Jay Hill Prince George—Peace River, BC

Mr. Speaker, 30 seconds is not adequate time obviously so I will simply say that I commend the hon. member who spoke for serving on that committee. I note that the Liberal committee that looked at this advised the government to reduce this tax. Therefore I am quite comfortable that the hon. member will be voting for our motion because that is in fact what the Liberals said they were going to do.

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10:30 a.m.

Reform

Jason Kenney Calgary Southeast, AB

Mr. Speaker, I commend my colleague for this thoughtful motion which draws on recommendations from government policy. I will read once again into the record the motion put by the member for Prince George—Peace River:

That given the record increases in the price of gasoline and home and diesel fuel, severely hurting Canadian consumers, truck drivers and businesses, and given the recent promise by the Minister of Finance to reduce taxes, this House call upon the government to give relief on fuel taxes, including repealing the increase in gasoline excise tax introduced as a temporary deficit elimination measure in 1995 and implementing the 1998 recommendation of the Liberal caucus committee on gasoline pricing in Canada to remove the double taxation of the GST.

That is the motion. We are asking the government to do two things that it has committed to doing.

The first is to eliminate a temporary deficit reduction measure. When I last checked, the deficit was history two years ago thanks to the hard work of Canadian taxpayers. Yesterday we booked a $12.3 billion tax overpayment for the last fiscal year. That is not a deficit. Let me explain the matter to my Liberal colleagues. That is a surplus. When we are in surplus territory, taxpayers should no longer be forced to pay deficit elimination taxes. That is simply a dishonest government policy, an approach to gouging people. It is a policy set for a certain time which has now passed.

That is the first thing we are asking the government to do, namely to keep its word. I know that is a high standard for the government to achieve given its failure to keep its word in so many matters: the elimination of the GST; its promise not to cut health care transfers and its failure to do so; and its promise to not raise taxes on Canadians. All of the basic Liberal electoral commitments from 1993 have not been kept. It is not surprising to see that the government has failed to do so in this regard.

The second thing we are proposing in the motion is that the government stop the double taxation of GST on the excise tax. Essentially the government now applies the 7% goods and services tax on top of not just the price of gas but also the excise tax on gas. It is taxing tax. That is so manifestly unfair that even the Liberal government caucus task force on this matter recommended two years ago that the double taxation of GST on excise tax on fuels be eliminated.

The motion simply asks the government to act on its own recommendations. I cannot understand why we are already hearing the typical resistance for government to simply keep its commitments.

Canadians are facing some of the highest fuel prices in our history when about 41% of fuel costs at the pumps for consumers is now federal and provincial taxes, excise taxes and sales taxes. Forty cents on the dollar of what people pay for gas at the pump go into the public treasury. That is up from about 30% of taxes on fuel in the early 1980s.

It is interesting, and I will add parenthetically, to hear our colleagues from the Progressive Conservative Party. We welcome their support for the motion and we are glad to see that they are new converts to the idea of moderation on fuel taxes given that it was their leader who proposed the single largest increase in fuel taxes in Canadian history in this place in 1979. It was their previous government that actually raised the excise tax on fuels from 1.5 cents to 8.5 cents during its term of government from 1984 to 1993. Even though the Conservatives are the world champions in increasing gas taxes, we are pleased to see that they have seen the light of day in this regard.

I have just seen some recent polling results which said that 85% of Canadians would like to see immediate reductions in the level of fuel taxes. That is as close as it gets to unanimity on any issue. Those Canadians know that we need to collect revenues to pay for our infrastructure, particularly our transportation infrastructure. They also know intuitively that the government fails to direct even a reasonable fraction of the revenues it collects from fuel taxes to the necessary transportation infrastructure, as my colleague the transport critic has demonstrated. Instead, the government takes those revenues and rather than direct them back to the roads used by those fuel consumers, it takes that money and adds it into its huge multibillion dollar taxpayer overpayment, an overpayment which in the first four months of this fiscal year already totals $11.4 billion. That, if extrapolated out to the balance for the fiscal year, implies a surplus of over $30 billion tax dollars.

The government at least so far has implied it cannot move on this because it needs the provinces to act first. The finance minister told us yesterday that he was willing to exercise leadership but he needed the provinces to go first. I took a first year logic course in college and that fails as a logical syllogism. That is not leadership, it is followership.

The federal government is the national government and the government always talks about national leadership. Maybe it should begin to exercise that because the very same finance minister certainly exercised leadership when it came to raising the excise tax on fuels in his 1995 budget by 1.5 cents a litre in his temporary deficit elimination tax. He did not consult the provinces. I rather suspect that none of the provincial finance ministers then had any shred of consultation about whether or not to raise the excise taxes yet he went ahead and did so. That is the same finance minister who failed to consult with the provinces before he cut their health care transfers by one-third in his 1995 budget. That is clearly a bogus argument.

Now we hear the Liberals trying to pass the buck to the oil companies and retailers. They shed crocodile tears in the fear that perhaps the corner gas station is not going to pass on the savings of a reduction in excise tax and GST to gas consumers.

This is the same Liberal attitude that says when we give working families broad based tax relief they will waste it on frivolous expenditures. Really what that says is the basic philosophy governing the Liberal Party—and I know as a recovering Liberal—is that government and politicians know better how to spend an extra buck or an extra 1.5 cents a litre than do the consumers. I have every confidence that given the profile on this issue, consumers would expect and demand of their retailers to see the full tax break delivered to them at the pump. There is no doubt in my mind whatsoever. The official opposition would certainly add its voice to those of other Canadians in insisting that happen. That is a bogus argument.

Provincial co-operation is a bogus argument. But lo and behold, today we see in the paper that the finance minister is considering a virage on this issue. He is considering an about-face on the question. Why? No doubt because he is receiving enormous pressure from his backbench. Those members know what the right thing is in this respect. They recommended the right approach in their 1998 caucus task force led by the member for Pickering—Ajax—Uxbridge, who continues to get credit from the finance minister for making recommendations the minister has failed to follow.

I have no doubt that the vast majority of Liberal backbenchers know what their constituents want and know what the right policy is and so they are trying to find a way to extricate themselves. We have presented that option in this motion. Next Tuesday when the deferred vote on the motion is taken, they will have an opportunity to stand and vote to relieve their constituents and gas consumers of the huge, unreasonable burden of double taxation and deficit elimination tax as well as to give the trucking industry and the transportation industry generally a tax break by cutting in half the diesel fuel taxes as we recommend, for the excise tax thereon from four cents to two cents. That is the option they have.

The Prime Minister has already suggested that the motion to adopt ostensibly government policy is a confidence motion and government members must vote against. Let us put members of the government on notice today that the official opposition, which has put forward the motion, does not regard it as a confidence motion. That is completely bogus. The passage of the motion would not be regarded by us as an indication of loss of confidence in the government or a need to call an election, as much as we would like to see one as soon as possible.

On all counts the way is clear for members opposite to vote in favour of their own recommendations and of their own government's policy and to do so freely. The failure to do so will once again be a victory for the whip and a defeat for ordinary working Canadians who are paying outrageously high taxes under the Liberal government.

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10:40 a.m.

The Acting Speaker (Mr. McClelland)

On questions and comments, we will go first to—

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10:40 a.m.

Reform

Jason Kenney Calgary Southeast, AB

Point of order.

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10:40 a.m.

The Acting Speaker (Mr. McClelland)

Excuse me, on a point of order, the hon. member for Calgary Southeast.

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10:40 a.m.

Reform

Jason Kenney Calgary Southeast, AB

Mr. Speaker, I move:

That the motion be amended by inserting after the word “give” the word “immediate”.

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10:40 a.m.

The Acting Speaker (Mr. McClelland)

Just for certainty I want to point out that while the amendment cannot be moved on a point of order, it was moved on debate. I was already watching for other people to rise with questions. That is the way it is folks. The amendment is in order. Debate is on the amendment.