André Caron

[The Budget, February 28th, 1995]

Madam Speaker, I welcome this opportunity to speak to the budget brought down yesterday by the Minister of Finance. I want to take this opportunity to inform the public that although the Minister of Finance promised to do something about the debt and tax reform when he brought down this budget, he failed to keep his promise.

Yesterday, the Minister of Finance started his budget speech by identifying Canada's two major problems. First, the Quebec referendum and second, the debt. Upon reading the budget I have to conclude that the Minister of Finance is only considering Canada's problems. Of course Quebec seems to be a problem for Canada. What is the Minister of Finance doing and what has the federal government been doing for the past 20 or 25 years? The federal government considered the problem, looked at it, examined it, thought about it, but did nothing to resolve it.

This is somewhat the case with the debt as well. For 25 years, finance ministers have been looking at the debt. Both Liberal and Conservative ministers, including Mr. Lalonde, Mr. Wilson and Mr. McEachen have had a look at it. Each one has said, "It is really too bad, we spend more in Canada than what we earn. It is too bad. We should reduce the deficit. We must reduce the debt". And if we take a look at the tables, we see that Canada's debt has been growing for the past 20 to 25 years. We looked at the tables produced by the Minister of Finance following his budget, and the debt continues to grow.

So Canada is looking at its debt problem as it is looking at the problem of Quebec, at what for it is the problem of Quebec. I think that one of Canada's greatest weaknesses is that it looks at its problems, but never resolves them.

There is another problem in Canada as well, which the minister has failed to identify. It is a problem he raised in many speeches during the elections-the problem of jobs, the problem of unemployment. During the elections, Liberal Party material spoke of jobs, jobs, jobs. Today, there is no more talk of jobs, the word is debt, debt, debt and cut, cut, cut. The problem of the unemployed is far from the mind of the Minister of Finance.

Looking at my own region, my city, my riding, an industrial area which has been under direct attack for about ten years, all the restructuring, modernization of businesses, new technology, have left unemployed people who had worked for big business for years, earning average or even above average salaries. These people have been unemployed for a year for a lack of specific policies to help them get retrained. Now they are turning to welfare.

This budget contains nothing for the unemployed. It contains absolutely nothing to give them hope for the future. There is indeed talk of possibly reforming unemployment insurance while at the same time cutting the program by 10 per cent. There is also talk of reform providing for the unemployed to train for new jobs.

This seems to be a roundabout way of presenting minister Axworthy's famous unemployment insurance reform, a two-tiered unemployment insurance system, what someone in my region described as generous UIC and miserly UIC. Some people in Canada will have to make do with the miserly version of UIC. When I look at the finance minister's budget, it is these people I think of. What is new in this budget for the unemployed, persons on welfare, fully trained young people trying to find jobs?

Training is not the issue for young people. For young people, it is a point of fact: they are trained in leading edge technologies. Take the young people trained in technical fields at the Jonquière CEGEP, for example, they have been trained in every advanced technical area. These people should not have any trouble finding jobs because they are competent and have all the necessary training. But they cannot find jobs. Why not? Because there are no jobs.

There is no work for people looking for it. Even to restore employment to levels we had before the economic crisis, we would have to create 400,000 jobs in Canada. With those jobs, we will find ourselves where we were three years ago, and furthermore, this does not include newcomers on the job market.

I was surprised when the Minister of Finance said that Canada's two biggest problems were Quebec and the debt and that he did not mention unemployment.

Now to the budget: what is the verdict? This morning's papers ran stories on people who are happy and who say the economy will finally have room to breathe. That was the title of an editorial from La Presse . Before the budget, people were saying that these were hard times, that Canada was on the road to bankruptcy and that its credit rating was going to be downgraded. After the budget, people are now saying that things have improved, and accounting associations have given the Minister of Finance a mark of 80 per cent. Therefore, all is well. But who is telling us that this is because of the budget?

Big business, banks and brokerage houses that sell Canadian bonds, in fact, all of the people who gain from the system. They are well paid and work in a sector where the economy is well developed: the financial sector. While this sector often does not generate much wealth, it plays with it, taking a cut from it in passing. Those people are happy.

Two insights into this comment. Firstly, these people are happy because they see that the budget contains a solution to the debt problem. Curiously, a budget that appears to close certain debt-related gaps is enough to make the other problem-that Quebec is one of Canada's major problems and may scare off potential investors-disappear. They are not saying that Canada has succeeded in solving the Quebec problem, but that Quebec is simply no longer a problem. That is something I have noted.

What do ordinary taxpayers think about the budget? I have the impression that they simply feel relieved because they avoided major cuts this time. Of course, they will pay a little more for gas. Dairy producers in Quebec will see their subsidies reduced, by $2,000 or $3,000 in some cases. It is still a significant amount. Some taxpayers may have to pay a little more in taxes but, in general, taxpayers feel that they have avoided the worst.

But what about all the others, those who have been forgotten, that I mentioned earlier, those looking for jobs or trying to improve their socio-economic status in Canada? Those people are not praising the budget in newspaper headlines. They are not heard. They are silent.

In the last few years, Canada's major newspapers, whether in Quebec or in English Canada, have been paying significantly less attention to those people than they did in the 1970s. Probably because owners have succeeded in selling a little more their philosophy that the state should intervene less and less and let the disadvantaged and less fortunate in society fend for themselves.

This philosophy has spread to the newspapers where everyone has good things to say about the budget. Where are the budgets that used to take care of the less fortunate without excessive spending? This is not done anywhere in this budget.

And there are other things that must not be forgotten. We must not forget that, according to the Minister of Finance, this budget was aimed in a way at restructuring Canada to a certain extent through decentralization. They said that Canada was too centralized, that it was too costly, that they wanted to shift some responsibilities to the provinces.

They are transferring certain things to the provinces. In the next two years, they will transfer $7 billion to the provinces for health, education and social assistance. We note, however, that they are not really decentralizing but rather transferring problems. This is not a transfer following negotiations in good faith on restructuring Canadian federalism.

More importantly, this budget will not bring about tax reform. RRSP provisions will be tightened a bit. The large corporations tax rate will rise from 0.2 per cent to 0.225 per cent, which amounts to only $145 million. The surtax on profits will go up from 3 per cent to 4 per cent, which represents $350 million over three years. There will be a temporary tax on banks.

A tax which will raise about $100 million total, from all banks, when the Royal Bank of Canada alone turned profits of $1.2 billion this past year. What is $100 million as compared to the aggregate of all bank profits? Peanuts.

Why does the Minister of Finance come up with such a measure, a proposal which is almost insulting to those who pay taxes? Actually, I think this may well have to do with the public perception of a shockingly low level of taxation. Next year, the banks will again turn huge profits. Given the current interest rates and the streamlining efforts of the past three or four years, banks stand to make huge profits. So, you can expect more hoopla in the press. What will the Minister of Finance have to say? He will be able to say: "But we did impose a temporary tax on them, a special tax to bring in $100 million". That is one hundred million dollars in taxes on profits perhaps as high as $10 billion.

That is a mere one per cent. It is somewhat insulting to those who often have to pay as much as 40 or 50 per cent of their incomes in taxes. Of course, they are probably among the wealthy.

The fact of the matter is that the budget before us has not put our fiscal house in order as it should have. The tax shelter issue remains unresolved, as do the ones raised on the French television network newscast Téléjournal , last week, where the situation of two individuals earning $100,000 was compared. One hundred thousand dollars is not peanuts. These are wealthy people. The salaried worker would pay $40,000 to $43,000 in taxes every year, while the self-employed person earning just slightly less, thanks to all kinds of tax loopholes and tricks, and with deductions for children, would end up paying $22,000 in taxes.

When Canadians see things like that-even though they often have little sympathy for those who earn $100,000-when they compare the two situations, they realize that there is something wrong with our tax system.

Consequently, we feel that this budget is unacceptable because it does not include a major tax reform.

Let us now turn to the debt. Again, it would be one thing if there were some concrete results, but such results are not obvious. The Minister of Finance, who is not making whimsical predictions, currently estimates that the debt will be somewhere around $500 billion this year, and that it will reach about $603 billion in three years. Therefore, regardless of what the minister does, the debt will increase by another $100 billion. The interests on that debt will increase from $42 to $50 billion. As well, the deficit will remain around $24 billion in 1996-97.

So, the government talks about reducing the debt, but Canadians who are watching, and who may be prepared to make sacrifices, cannot help but think: "Sure, but the debt is still there. It will still grow. We will still have to pay high interest rates on it". Where is the improvement?

Canadian taxpayers will be even more sceptical when they find out what these assumptions are based on. These forecasts are based on the prediction that the economy will continue to grow after 1997. Therefore, the debt will continue to rise even if the economy is doing well or continues to do well over the next three years.

The budget also forecasts interest rates. I am a little surprised to see the Minister of Finance forecast interest rates two years in advance when he often fails to forecast accurately two months in advance. Whatever. Nevertheless, the budget does have to contain some numbers to make it look scientific and serious.

There is another issue that is probably scandalous and that, in my opinion, will floor the average person who ponders the issue and that is that they predict a drop in the rate of job creation. This year, it will be about three per cent; next year, it will only be about two per cent.

They forecast an unemployment rate of around 9.4 per cent. That is no low rate. In fact, 9.4 per cent represents only the unemployed workers who are included in the survey, but many of them are not. This means that regions like mine will again face real unemployment rates of 15, 16 or 17 per cent.

The budget tabled by the Minister of Finance offers no comfort to those who want to work to support themselves and their families.

I have two last points to make. This budget does not offer solutions to the debt problem. Why not? Perhaps because the budget is based on a number of assumptions, which do not take into account the Bank of Canada's potential influence on the monetary policy.

Many financial players say that making the monetary policy more flexible would stimulate the economy by reducing interest rates so that people could invest in and revitalize the business sector. In an approach that I would describe as doctrinaire, the Minister of Finance refuses to make any change to the monetary policy, in spite of the fact that there is no inflation, so to speak, in Canada. So, it would be time to cut some slack in that area to give the economy a chance.

I will conclude on this. I suggest there is another solution that we, Quebec sovereignists, could bring about. We think Canada is in need of economic restructuring. I think that Quebec's achievement of sovereignty, which will no doubt happen within a few years, will provide a welcome opportunity to restructure the economy, start over based on new presuppositions, review our policies and build on new bases.

For all the foregoing reasons, I will be voting against the budget.

[Firearms Act, February 27th, 1995]

Mr. Speaker, I am pleased to speak on Bill C-68 respecting firearms. I am somewhat surprised with what I heard in this debate, which I have been following from the beginning. I noticed antagonistic positions. I noticed, coming perhaps a little more often from our colleagues from the Reform Party, arguments that seem disproportionate and highly questionable to me. I will get back to this in my remarks.

Let me tell you right away that I agree with the principle of the bill introduced by the Minister of Justice. I will start with a brief outline of the bill, and then move to the basis for my supporting it.

Bill C-68 establishes a licensing system for the carrying and use of firearms.

This bill also establishes a Canada-wide firearms registration system. I raise these two points immediately because, from what

I could see in the debate so far, these are two aspects of the bill that prompt people to oppose it, often fiercely.

Moreover, the bill calls for stricter controls on the import, trafficking and smuggling of firearms in Canada. It provides for stiffer sentences of imprisonment for individuals who commit serious crimes with firearms. The current minimum sentence of one year, under section 85 of the Criminal Code, would be increased to four years with this bill.

At last, certain types of handguns would now be prohibited in Canada. The bill prohibits the import or sale of handguns using .25 or .32 cartridges as well as handguns with a barrel equal or less than four inches in length. This provision applies to approximately 85 per cent of handguns in Canada.

Finally, the bill makes any violation of the provisions regarding licensing and registration a criminal offence.

There are perhaps seven million firearms in Canada today. This is an estimate, as any round figure, because no one knows for sure. Some people have had firearms for many, many years in their closets or basements. I personally have two: a small .22 calibre rifle and a 12 gauge shotgun. They are in a closet. I have not used either of these firearms in over ten years, but I think I have owned them for 20 years. No one knew that I owned firearms. Like many other Canadians, I fall in that statistical category.

It is also a fact that Canadians are in favour of firearms control. I will continue next time, Mr. Speaker.

[Income Tax Act, February 17th, 1995]

Mr. Speaker, I welcome this opportunity to speak on behalf of the Bloc Quebecois to the income tax bill before the House today. This legislation implements measures announced by the minister in his budget on February 22, 1994, almost a year ago.

The Bloc Quebecois was opposed to the bill on second reading and in committee, and its position has not changed. Granted, we did find a number of positive measures in the bill. These include, for instance, the decision to extend provisions allowing first-time homebuyers to use their RRSP funds; measures to increase the value of the charitable donations tax credit; and incentives for mining companies to engage in mine reclamation, although at this level, the government is not exactly applying the principle "the polluter pays".

The Bloc also welcomed the proposal to reduce the percentage of meal expenses recognized for tax purposes from 80 per cent to 50 per cent. As you know, companies may deduct meals as part of the cost of doing business, and reducing the percentage of such expenses from 80 per cent to 50 per cent is at least a first step. These are some of the positive aspects we see in the bill, but there are negative aspects the Bloc cannot accept.

This morning, I will focus on three specific points. The first one is the reduction in value of the age tax credit; the second concerns the reduction or elimination of tax credits for regional investment; and the third concerns the inadequacy of measures aimed at curtailing certain tax avoidance techniques.

As far as the age tax credit is concerned, the Bloc Quebecois presented an amendment that was defeated in the House, an amendment rejecting a provision in the bill that reduces the value of the age tax credit for persons 65 and over. The reduction concerns people with net incomes between $25,000 and $50,000. The age tax credit for these people will be reduced. For some people these amounts mean a lot, since it works out to a federal tax reduction of $610, while at the provincial level, it adds up to $950. That is a substantial reduction.

Of course, our friends across the way told us this would not affect seniors in need, those with an income of $25,000 or less. In fact, this hits the middle class. Once again, the government is hitting the middle class, and that is why the Bloc Quebecois objects to this provision.

So who is affected? People who worked all their lives and accumulated a pension fund and did everything they could to provide for decent incomes for their retirement. These people had a deduction. It was a form of recognition. It was like saying: You are people who helped to build Canada or Quebec, people who worked all their lives to enjoy decent incomes for their retirement. They were entitled to a tax credit of $3,482, and 17 per cent of that worked out to the amounts I mentioned earlier. As a result of the bill before the House today, this tax credit will be eliminated.

Certainly, in the case of people with incomes of perhaps $60,000, $70,000 or $80,000, we could understand abolishing the tax credit. However, in the case of people earning $28,000, $30,000, or $35,000, we do not believe it is right to reduce the benefits they enjoyed under the old legislation. Certainly the government is saving money with this measure. It is expected to save $170 million in 1995-96, but this is $170 million once again saved on the backs of the middle class. At some point, the Canadian middle class will have had enough of always paying taxes and not always getting the necessary benefit or the necessary recognition from society.

As we have already spoken at length on this matter, I am going now to deal primarily, in the second part of my remarks, with the disappearance of the regional investment tax credit. You know that Canada used to offer benefits in the form of tax credits to people who invested in certain parts of the country, primarily the Atlantic provinces, the Gaspé Peninsula, and certain northern regions.

There was a special investment tax credit. It was a 30 per cent tax credit for eligible investments in machinery, buildings, and new equipment for manufacturing and production purposes. This tax credit has been eliminated. Another tax credit is also affected. It is the Atlantic/Gaspé tax credit. It was a tax credit of 15 per cent, again for buildings, machinery, and equipment to be used in resource development. This tax credit has been reduced from 15 per cent to 10 per cent. The third tax credit affected is the scientific research and experimental development investment tax credit. It is a 30 per cent tax credit, again in the Atlantic region and the Gaspé, and has been reduced to 20 per cent, the level for all the other regions. This means that the Atlantic region and the Gaspé have lost the benefits they enjoyed under the last budget.

These measures affecting tax credits will mean a saving of $90 million for the government in 1995-96 and of $95 million in 1996-97. The most ironic part of all of this is the reason given by the finance minister in his budget plan of last February and in the budget document entitled "Tax measures: Supplementary Information". His budget plan indicates, and I quote, "These credits have not been effective in attracting new investments to designated regions or reducing economic disparity". The document entitled "Supplementary Information" states in regard to the budget: "Regional investment tax credits have not generally been considered to be cost effective".

Basically, it says that these tax credits did not have a very high level of effectiveness and are not an effective means of attracting investments. So we would have expected the minister to completely eliminate these tax credits because they are not effective, but this has not happened. One tax credit has been eliminated, the tax credit for investment in the Atlantic region, and the tax credit for investment in scientific research has simply been reduced. In other words, the minister admits that he will still offer tax credits in certain regions of Canada. The minister is aware of their lack of effectiveness, but goes ahead all the same.

The Bloc Quebecois has denounced this measure and has asked that moneys earmarked for regional investment be redistributed to the provinces instead as a tax percentage. Why? It is because in Quebec, we think that decision making and regional investments should be decentralized so that local decision makers and people in the regions can identify their needs and take measures suited to their regions.

The Canadian government does not do this. It refused to redistribute these amounts among the provinces and maintained national standards, giving the credit to everyone while admitting that all this is inefficient. This is yet another illustration of the Canadian problem, that is, putting everyone, every citizen and every province on the same footing and ensuring uniform distribution everywhere before realizing that this is very costly and inefficient but continuing to do so anyway. One does not have to look very far to see that this is the reason why Canada does not work.

The third reason why we oppose this bill is the measures designed to counteract some tax avoidance strategies. This bill proposes measures to ensure that some individuals and corporations can no longer avoid taxes. These measures are quite timid. There are measures intended to eliminate preferential tax rates for large corporations, to make corporate taxes more equitable, to provide special rules for taxing foreign corporation shareholders.

Looking at all this, we ask ourselves are they trying to catch those who do not pay taxes in Canada, who establish phoney companies abroad and who, through various tax schemes, manage to avoid taxes. Reading this, we might think that such is the case, but we would be mistaken. These measures do not affect family trusts or the use of tax havens and are not designed in any way to institute a minimum corporate tax.

A lot has been said about family trusts. What are they exactly? A family trust is a tax measure allowing great wealthy families to avoid paying taxes on capital gains on assets.

It is money on which no taxes are collected because it was put in a trust. And this remains the case for a long time. An amendment to that provision was proposed in 1992 by the Conservative government. Under that legislation, the money in a trust was exempt from taxes until the death of the last beneficiary of that trust. In some cases, that could take up to 80 years.

The Bloc Quebecois pledged to fight for the elimination of that provision, which allows tax avoidance. We discussed the issue at length in this House. We do not see, in the current budget, any step to abolish that tax loophole.

We are talking about hundreds of millions every year. We do not know exactly how much money is involved. To find that out, we would need a special bill to allow Revenue Canada officials to tell us exactly how much money is involved. What is the government waiting for to pass such legislation and to abolish that provision in the Income Tax Act?

Let us now look at tax havens. We have an idea of what goes on. The auditor general raised that issue in 1992. This is not a figment of the imagination of a demagogic opposition party. The auditor general himself told us that several major Canadian corporations somehow manage to avoid paying taxes in Canada. The losses in tax revenues are said to be in the hundreds of millions.

We know the process. Some companies establish or use subsidiaries in countries where tax rates are much lower than in Canada. They can do so because Canada signed tax conventions to avoid double taxation for corporations and individuals conducting business in those countries.

The auditor general is strongly opposed to such tax treaties. Currently, 16 such conventions are said to be in effect. There is nothing wrong with these countries, but we wonder why Canada signed such treaties, if not to promote the self-interests of people who want to avoid the payment of taxes. These countries include Cyprus, Malta and Papua New Guinea. It is not a foregone conclusion that Canada's trade with these countries justifies the signing of such conventions, but these treaties were concluded.

The auditor general also denounced another more subtle process. Some companies can deduct, from their payable taxes, the interest on loans contracted in Canada for foreign investment purposes. In other words, Revenue Canada is financing investments abroad. This is unbelievable.

Another provision regarding tax havens that must be revisited is tax avoidance. In 1992 the auditor general again asked the government to amend the act to prevent Canadian companies with subsidiaries abroad from using these subsidiaries' annual losses to reduce their taxable income in Canada. They lose money outside of Canada and can deduct these losses in Canada.

How could a Canadian company or a multinational that is in the slightest way on the ball not be tempted to create bogus companies outside of the country? How can these companies resist the temptation to reduce their Canadian taxes, to make foreign investments and to claim a deduction for the interest on those investments? It is an open invitation that the Bloc Quebecois decries. The Bloc denounces such things and would like to see all countries treated equally.

The Bloc Quebecois calls for an end to flags of convenience, to freebies for big business that allow them to avoid paying tax. Many large businesses pay no taxes. Indeed, a Liberal member, the member for Gander-Grand Falls, told us last October that according to his research, 77 companies with over $25 million in profits did not pay any tax in Canada.

They do not pay any tax because they can make deductions, they can make money out of the country, they can search for deductions. What do you think people over 65 years of age who earn $30,000 and are seeing their age credit taken from them have to say when they see big multinationals and prosperous companies that turn a profit get away without paying any tax?

They say that honest taxpayers are being picked on again, and that those with means, who are rich, who can make representations and can lobby have access to provisions in income tax laws which allow them to avoid paying their fair share. The Bloc will not stand for this.

I would like to add, before closing, not to take advantage of your kindness, that the budget and perhaps this bill should have contained other measures regarding the whole issue of business subsidies.

Everybody tells us that their economic effectiveness is debateable. The Bloc Quebecois has demanded that a good part of these business subsidies, which amount to approximately $3.3 billion in Canada, be cut. We asked for a reduction in defence spending totalling $3.2 billion over two years. We asked the government to stop investing in the Hibernia group in Newfoundland. We asked for a real minimum tax on the profits of large corporations, because the strategy of these corporations is to reduce their profits for the current fiscal year by subtracting any losses they may have incurred in previous years, so they do not have to pay taxes on those profits.

In fact, we asked Revenue Canada to do what it has to do to get the $6.6 billion owed to the federal treasury. The auditor general said in his report that a large percentage of this money could be recovered. In other words, before reducing the incomes of senior citizens and cutting social programs, the government should go out and get the money owed to the treasury. To put it bluntly, that is part of the mandate of the Minister of National Revenue.

For all these reasons, the Bloc Quebecois will vote against Bill C-59, because it contains measures that are inadequate and do not deal with the real problems of tax collection in Canada.

[Supply, February 15th, 1995]

Madam Speaker, I congratulate my colleague from Richelieu on his heartfelt speech in which he shared his past experience with the House. Of course, he raised points denouncing the behaviour of our Liberal friends opposite who, when they were in opposition, criticized the Tories on the issue of cuts to social programs and often on the tax system. He told us clearly that the Liberal Party was not the same after the election.

I wish to ask my colleague from Richelieu if, on the basis of his experience in federal politics, he could explain to us how a party like the federal Liberal Party, which initiated major social programs, which used to pay lip service to the need to defend the most disadvantaged in society, is now cutting UI benefits and transfer payments to the provinces for social assistance and education, while at the same time closing its eyes to the fact that some members of society do not pay the taxes they owe the government. The question I want to ask my colleague is this: Based on his experience, how did the federal Liberal Party reach this point?

[Foreign Policy, February 13th, 1995]

Mr. Speaker, that is why we are here, to make political points.

How can the Canadian government, which claims to be concerned about human rights, allow the Mexican authorities to deny access to the press in the areas of conflict and does it intend to intervene directly with the Mexican government in order to promote respect for human rights in Chiapas?

[Foreign Policy, February 13th, 1995]

Mr. Speaker, my question is for the Minister of Foreign Affairs. In its statement of policy last week, the government set human rights as a matter for priority action in its foreign policy. It is therefore not clear why Canada is not speaking out on the intensified intervention of the Mexican army in Chiapas.

How could the Canadian government close its eyes to what is happening in Mexico, one of its principal economic partners, as the army is bombarding civilian groups in an attempt to stop the Zapatista movement?

[Income Tax Act, February 13th, 1995]

Mr. Speaker, I welcome this opportunity to support the amendment standing in the name of the hon. member for Mercier, whose purpose is to eliminate one of the proposals in the bill before the House today which would involve a considerable reduction in the age credit, the tax credit for seniors. As you know, the citizens of this country are entitled to special tax relief on the basis of age. This age credit is currently set at $3,482, which works out to a reduction in federal income tax of about $610 annually for all tax-paying seniors. Combined with the credit allowed by most provinces, this adds up to about $950.

The proposal, which our amendment before the House today would eliminate, would apply an income test to the credit, so that seniors whose net income exceeds $25,921 would see the value of their tax credit go down and, in the case of seniors whose net income exceeds $49,134, disappear altogether in two years' time. Let me explain. The proposed amendment to the Income Tax Act will initially have no impact on seniors who are among the neediest in our society. Seniors with an income of less than $25,920 will not be affected. This will only have an impact on seniors with a net income between $25,000 and $50,000.

These people belong to the middle class. These are people who have worked all their lives, have saved money for their retirement and have a net income of about $30,000 or $40,000. These people are not wealthy. These are members of the middle class who have worked to enjoy a good life during their retirement. These are the people who will be hit, and that is why the Bloc Quebecois is opposed to this amendment. I heard members of other parties say: "Sure, but this tax credit also benefited people earning $200,000, $300,000 or $400,000". I think that is rather exaggerated, since the vast majority of those who will be affected are people in the middle class with average incomes.

The message this amendment sends to people, especially to seniors, is that our society does not appreciate them. The age credit provision was included in the Income Tax Act-at least, that was my understanding-to provide some recognition for people who worked so hard to build our country and who managed to save some money for their retirement, and I think the country, whether we are talking about Canada or Quebec, should recognize their contribution. I think the age credit was a way to tell them that society valued their contribution.

The other thing I see in all this is that those who want to reduce the credit believe that seniors have a fair amount of money, that there is not enough money to go around, that there is a deficit, and that everyone has to pay. But in fact not everyone in Canada pays. I think that, before we go after the incomes of seniors, we should really look elsewhere. Over the past year, and even during budget preparation, the Bloc Quebecois suggested places to the Minister of Finance where money could surely be found to replenish government coffers so that the people in the middle class and, particularly, those 65 and over in Canada could be left alone.

They talk about family trusts, a way for the very rich to shelter large amounts of capital from taxes. They could be a source of hundreds of millions of dollars.

There is the whole business of tax havens. You know, Canada has agreements with some 15 or 16 countries, which allow companies in Canada and other countries to spread out profits and therefore to avoid paying taxes. It is primarily in countries that welcome big multinationals where people with a knack for accounting arrange for these companies not to pay any taxes.

I think we should look at these agreements and get the money that is due to Revenue Canada-Taxation. Here again, hundreds of millions of dollars are involved. This is where we should be looking, instead of targeting people who have worked hard all their lives to enjoy decent retirements.

Furthermore, we should take another look at the real minimum tax that could be charged on the profits of major corporations. Do you know that, right now in Canada-and I think many people find it disgusting; it is a real sin-there are companies, big corporations, not paying any taxes. They make profits, but they do not pay any taxes.

Under a particular accounting policy, they can carry over losses incurred in previous years. So, in a year when they make a profit, they can carry over losses from preceding years to offset it and avoid having to pay taxes.

If individual taxpayers were allowed to do the same, I think that we might be surprised by the results. Some people earn a lot of money one year and considerably less the following year, for any number of reasons. I do not think it is that easy for individuals to carry losses over from one year to the next.

There is a great deal of money to be made with a minimum tax on corporations and at the same time this would put an end to an outrageous situation that people read about in the papers: large corporations not paying a cent in income tax while individual taxpayers are seeing $500, $600, $1,000 or $2,000 deductions taken away from them. I think there is something wrong in terms of tax fairness and, as a result, the public doubts that the Canadian tax collection process is fair and equitable.

Finally, I would like to remind you that the auditor general reported that there some $6.6 billion was currently owed to the federal treasury in Canada. For one reason or another, the tax man did not collect the amounts due. At least 80 per cent of these unpaid taxes could still be recovered. This adds up to several billion dollars.

I think that, with the assurance that all amounts due will be collected, the public would accept more readily that measures such as the one we proposed this morning, although debatable, be adopted.

But first, the federal government and the Minister of Finance must demonstrate that the Canadian tax system is really fair, that corporations pay their share, that the rich pay their share, that all those who owe back taxes pay them. I think that we must resist any further tax increase on the middle class. The middle class is large. Small amounts times millions of taxpayers amount to a lot of money in the end.

But when the most heavily-taxed middle class, whether retired or younger people, come to realize that the system is no longer equitable, this gives rise to situations where people protest and refuse to pay taxes, not because they think that it is not fair to pay taxes, but because they feel that not everyone is paying his fair share.

So, I hope that my hon. colleague's amendment will be passed and that plans to eliminate the age tax credit will be reconsidered as far as certain categories of seniors are concerned, in particular middle class seniors.

[Petitions, February 10th, 1995]

Mr. Speaker, I have the pleasure to present a petition signed by 732 senior citizens of my riding stating that they, naturally, feel powerless in the face of the technology of voice mail systems, that they have the right to suitable service, especially in regard to their income security applications, and who pray that Parliament will please ask the government to give up the plan to implement voice mail systems for seniors.

[Quebec Referendum, February 10th, 1995]

Mr. Speaker, the members of the official opposition were not in the least surprised this morning to learn that the office of the Prime Minister has set up a special referendum unit, just for referendum activities. History is repeating itself. In 1980, the Liberal government, as the great defender of Canadian unity, used its spending power to fight Quebec sovereignists.

As usual, the federal government is not playing by the rules. As it did in 1980, it is quietly pouring considerable financial and human resources into the Prime Minister's political machinery, away from prying eyes and embarrassing questions. However, in 1995, the people of Quebec will not be fooled by these typically Liberal tactics. We have seen this before; it does not bother us any more.

[Young Offenders Act, February 10th, 1995]

Mr. Speaker, I have been listening to what our friends in the Reform Party have been saying in the House, and I get the impression they are asking us to live in a world where the rich get richer and the poor go to jail.

What exactly does the Reform Party want? They say we need less government and fewer taxes. So what will that mean? It will

mean less government, fewer social programs to benefit the poor, the sick, the elderly and aboriginal people.

That is the kind of world they would have us live in. They say: cut spending, cut taxes. Sure, Canada may be spending too much and sure, we have to pay taxes, but today I read in the paper that Canada ranked fourteenth among industrialized countries in terms of the tax burden on its citizens. So there is a fallacy somewhere. They say we can no longer afford to spend, so let us look into this. They say we are overtaxed. Well, I am not crazy about taxes, but I wish they would stop and think before saying we should let the neediest in our society go hungry so we can reduce the tax burden on people who just want more money than they already have.

Today, we are talking about young offenders, and sadly, in most cases, people who go to jail are anything but wealthy. These are usually people from disadvantaged families who for all kinds of reasons became involved in crime, but the point is that we want to do something for these people and if we want to do something for our country in the process, we should try and prevent youth crime. We should try and give them some hope, and putting security people in our schools and having armed police officers controlling places where young people get together is not the answer.

In any case, I hope our friends in the Reform Party, especially as far as this legislation is concerned, will stop and think what it would be like if their children were in prison at the age of 15, 16 or 17, without much hope for the future and without much hope of being rehabilitated. I think they would change their tune. It is all very well to talk about these things and make certain suggestions and even go along with them here in the House, but out in the real world, in the schools and the prisons, when we see what young people are up against, I think the issues are far more fundamental than what we have heard today.