House of Commons Hansard #4 of the 37th Parliament, 3rd Session. (The original version is on Parliament's site.) The word of the day was municipalities.

Topics

Government Assistance
Oral Question Period

2:30 p.m.

Westmount—Ville-Marie
Québec

Liberal

Lucienne Robillard Minister of Industry and Minister responsible for the Economic Development Agency of Canada for the Regions of Quebec

Mr. Speaker, the Prime Minister is not in a conflict of interest right now. Stelco did not ask anything from our Prime Minister.

The contacts right now are with my department, with my deputy minister and with my assistant deputy minister. We will meet with our provincial colleagues to monitor the situation very closely. There is no problem about being there right now to help Stelco with the difficult situation it is having.

Canada Steamship Lines
Oral Question Period

2:30 p.m.

Bloc

Michel Gauthier Roberval, QC

Mr. Speaker, Bill C-28, which made it possible for the Prime Minister's company to save some $100 million in taxes, was his second attempt at avoiding taxes. On December 2, 1996, while he was the Minister of Finance, the Prime Minister introduced Bill C-69, with exactly the same objectives. It died on the Order Paper because of the subsequent general election.

Are not these two attempts by the Prime Minister proof that this was a wholly premeditated and planned act, and that he was fully aware of all of the consequences?

Canada Steamship Lines
Oral Question Period

2:30 p.m.

Wascana
Saskatchewan

Liberal

Ralph Goodale Minister of Finance

Mr. Speaker, the amendments proposed in Bill C-28 concerning international shipping clarify the rules designed to encourage foreign shipping to do business in Canada.

They do not apply to companies incorporated in Canada, or to foreign subsidiaries administered elsewhere.

Canada Steamship Lines
Oral Question Period

2:30 p.m.

Bloc

Michel Gauthier Roberval, QC

Mr. Speaker, let us be clear for the sake of everyone listening. Eight shipping companies benefited from this legislation, including the Prime Minister's, which was also the largest. Those are the facts. The Prime Minister missed his chance with Bill C-69, so he came back two years later with Bill C-28.

Is it not true that the Prime Minister did not want to lose one cent of the $100 million in tax savings, since he included a four-year retroactive period in Bill C-28? He wanted to be sure not to lose a single cent of that $100 million.

Canada Steamship Lines
Oral Question Period

2:30 p.m.

Wascana
Saskatchewan

Liberal

Ralph Goodale Minister of Finance

Mr. Speaker, repeating a falsehood does not make it true. What we have here is an incoherent babble of allegations from the Bloc members in an obvious attempt to try to smear the Prime Minister because they cannot lay a glove on him in any other manner.

Bill C-28 simply was not relevant to CSL and, even more important, the then finance minister had absolutely nothing to do with the shipping provisions contained in that piece of legislation.

Canada Steamship Lines
Oral Question Period

2:30 p.m.

Bloc

Gilles Duceppe Laurier—Sainte-Marie, QC

Mr. Speaker, what I would like to understand then is why CSL Vice-President Préfontaine tells us he moved to Barbados because of the changes to Canadian tax rules, while the spokesperson for Canada Steamship Lines tells us that Canada Steamship Lines International would never have made such profits in Canada. She described Canadian taxes as too high. “Subsidies and contracts are good, but the taxes are too high”, she said. According to the Prime Minister, they had to do the same as everybody else if they wanted to make any money.

So let him explain that to us, if it really made no difference.

Canada Steamship Lines
Oral Question Period

2:30 p.m.

Wascana
Saskatchewan

Liberal

Ralph Goodale Minister of Finance

Mr. Speaker, again this attack from the Bloc is absolutely ludicrous. The Government of Canada has not now nor during the last term of the government engaged in any conduct that was deliberately contrived to assist any particular company. Not at all. The allegations to the contrary are completely spurious.

Canada Steamship Lines
Oral Question Period

2:35 p.m.

Bloc

Gilles Duceppe Laurier—Sainte-Marie, QC

Mr. Speaker, that is absolutely incorrect. It is an attempt to shirk responsibility. Changing the rules for shipping companies means changing the rules for shipping companies.

When Canada Steamship Lines International, now headquartered in Barbados—where the tax rate is roughly 2.5% for the first few million, compared to 37% here—suddenly moves from Liberia to Barbados and then the legislation changes twice, what is that called? It is called taking care of one's own business by using one's position. That is what it is called.

Canada Steamship Lines
Oral Question Period

2:35 p.m.

Wascana
Saskatchewan

Liberal

Ralph Goodale Minister of Finance

Mr. Speaker, all these allegations were examined, both in the House and in committee. I refer the House to the records of February 17, 1998 that completely demonstrate the facts of this matter. The allegations are totally spurious. Bill C-28 had absolutely nothing to do with Canada Steamship Lines. Furthermore, the then finance minister had nothing to do with drafting the provisions in Bill C-28 that related to international shipping.

What we have here, if this were a hockey game, is the Prime Minister as the hockey star and those across the way trying to cross--

Canada Steamship Lines
Oral Question Period

2:35 p.m.

The Speaker

The hon. member for Fraser Valley.

Canada Steamship Lines
Oral Question Period

2:35 p.m.

Canadian Alliance

Chuck Strahl Fraser Valley, BC

Mr. Speaker, the Prime Minister, in a CBC interview, was quoted as saying, “To deal with the whole issue of tax havens, you can't cherry-pick. You have to deal with them all at once, otherwise people have many options and they'll just go to one or the other. Closing down one doesn't do any good”.

Why did the Prime Minister not close all the loopholes and why does his family's company still use the loopholes that allow it to escape paying Canadian tax?

Canada Steamship Lines
Oral Question Period

2:35 p.m.

Wascana
Saskatchewan

Liberal

Ralph Goodale Minister of Finance

Mr. Speaker, the Prime Minister launched a number of initiatives in the 1990s to try to deal with the issue of tax havens, as he has described both in this House and outside.

At the same time, the OECD launched an initiative that was aimed at trying to deal with this on a global basis. We had hoped that the OECD would be able to deal with it comprehensively. Unfortunately, it appears that the OECD initiative has faltered. Therefore, Canada and a number of other countries are looking at what we can do on a country by country basis to ensure that everybody pays their full fair share of tax.

Canada Steamship Lines
Oral Question Period

2:35 p.m.

Canadian Alliance

Chuck Strahl Fraser Valley, BC

Mr. Speaker, whether they are looking at it country by country or company by company, it is obviously a pretty sweet deal for those who can take advantage of it.

Again, the Prime Minister said, only a year ago, that we had to deal with all these tax havens at once, otherwise people would have many options and they would just go from one to the other. Closing down one does not do any good. That is pretty clear.

What has changed since April of last year? Why does the loophole stay open for the Prime Minister's shipping company?

Canada Steamship Lines
Oral Question Period

2:35 p.m.

Wascana
Saskatchewan

Liberal

Ralph Goodale Minister of Finance

Mr. Speaker, what is required here is an international consensus, which we had hoped the OECD would be able to achieve, following upon some of the initiatives that were launched by the Prime Minister when he was Minister of Finance. Unfortunately, the OECD was not successful in its initiative. It appears to have faltered.

Therefore, on a country by country basis, we need to look at this whole situation, which I said several days ago in this House that we were doing, to attempt to renegotiate, where appropriate, these tax treaties.

Canada Steamship Lines
Oral Question Period

2:35 p.m.

Canadian Alliance

Rahim Jaffer Edmonton—Strathcona, AB

Mr. Speaker, the average Canadian works half the year to pay off their taxes. Between income taxes, payroll taxes and the GST, up to 48% of income is eaten away by the tax man. By contrast, through the generous use of a Barbados tax haven the Prime Minister created while he was finance minister, his former company Canada Steamship Lines pays only 2% of its income toward taxes.

Will the Prime Minister please explain to the Canadian public why they should pay half of their income to taxes and his company can sail away, scot free?