Bill C-28 (Historical)

Budget and Economic Statement Implementation Act, 2007

An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007 and to implement certain provisions of the economic statement tabled in Parliament on October 30, 2007

Part 1 implements goods and services tax and harmonized sales tax (GST/HST) measures proposed in the March 19, 2007 Budget but not included in the Budget Implementation Act, 2007, which received Royal Assent on June 22, 2007. Specifically, the Excise Tax Act is amended to
(a) increase the percentage of available input tax credits for GST/HST paid on meal expenses of truck drivers from 50% to 80% over five years beginning with expenses incurred on or after March 19, 2007;
(b) increase the GST/HST annual filing threshold from $500,000 in taxable supplies to $1,500,000 and the annual remittance threshold from $1,500 to $3,000, both effective for fiscal years that begin after 2007;
(c) increase the GST/HST 48-hour travellers’ exemption from $200 to $400 effective in respect of travellers returning to Canada on or after March 20, 2007; and
(d) implement changes to the rules governing self-assessment under Division IV of Part IX of the Excise Tax Act to ensure that GST/HST applies appropriately in respect of intangible personal property acquired on a zero-rated basis and consumed in furthering domestic activities, applicable to supplies made after March 19, 2007.
Part 2 amends the non-GST portion of the Excise Tax Act to implement measures announced in the March 19, 2007 Budget. Specifically, the excise tax exemptions for renewable fuels, including ethanol and bio-diesel, are repealed, effective April 1, 2008.
Part 3 implements income tax measures proposed in the March 19, 2007 Budget but not included in the Budget Implementation Act, 2007, which received Royal Assent on June 22, 2007. In particular, it
(a) introduces a new Working Income Tax Benefit;
(b) eliminates income tax on elementary and secondary school scholarships;
(c) eliminates capital gains tax on donations of publicly-listed securities to private foundations;
(d) enhances the child fitness tax credit;
(e) expands the scope of the public transit tax credit;
(f) increases the lifetime capital gains exemption to $750,000;
(g) increases the deductible percentage of meal expenses for long-haul truck drivers;
(h) provides tax relief in respect of the 2010 Winter Olympic and Paralympic Games;
(i) allows for phased-retirement options for pension plans;
(j) extends the mineral exploration tax credit;
(k) enhances tax benefits for donations of medicine to the developing world;
(l) streamlines the process for prescribed stock exchanges;
(m) introduces an investment tax credit for child care spaces;
(n) introduces a new withholding tax exemption with respect to certain cross-border interest payments;
(o) prevents double deductions of interest expense on borrowed money used to finance foreign affiliates (the Anti-Tax-Haven Initiative);
(p) eases tax remittance and filing requirements for small business;
(q) introduces a mechanism to accommodate functional currency reporting;
(r) provides certain tobacco processors that do not manufacture tobacco products with relief from the Tobacco Manufacturers’ Surtax; and
(s) provides authority for regulations requiring the disclosure by publicly traded trusts and partnerships of information enabling investment managers to prepare the tax information slips that they are required to issue to investors on a timely basis.
Part 4 implements the disability savings measures proposed in the March 19, 2007 Budget. The measures are intended to support long-term savings through registered disability savings plans to provide for the financial security of persons with severe and prolonged impairments in physical or mental functions. Part 4 contains amendments to the Income Tax Act to allow for the creation of registered disability savings plans. It also enacts the Canada Disability Savings Act. That Act provides for the payment of Canada Disability Savings Grants in relation to contributions made to those plans. The amount of grant is increased for persons of lower and middle income. It also provides for the payment of Canada Disability Savings Bonds in respect of persons of low income.
Part 5 implements measures that provide for payments to be made to provinces as a financial incentive for them to eliminate taxes on capital under certain circumstances.
Part 6 enacts the Bank for International Settlements (Immunity) Act.
Part 7 amends the Pension Benefits Standards Act, 1985 to permit phased retirement arrangements in federally regulated pension plans by allowing an employer to simultaneously pay a partial pension to an employee and provide further pension benefit accruals to the employee. These amendments are consistent with amendments to the Income Tax Regulations to permit phased retirement.
Part 8 authorizes payments to be made out of the Consolidated Revenue Fund for the purpose of Canada’s contribution to the Advance Market Commitment.
Part 9 amends the Canada Oil and Gas Operations Act to authorize the National Energy Board to regulate traffic, tolls and tariffs in relation to oil and gas pipelines regulated under that Act.
Part 10 amends the Farm Income Protection Act to allow financial institutions to hold contributions under a net income stabilization account program.
Part 11 amends the Federal-Provincial Fiscal Arrangements Act to provide for an additional fiscal equalization payment that may be paid to Nova Scotia and Newfoundland and Labrador. This Part also specifies the time and manner in which the calculation of fiscal equalization payments will be made and it amends that Act’s regulation-making authority. In addition, this Part makes consequential amendments to other Acts.
Part 12 amends the Canada Education Savings Act to clarify the authority of the Minister of Human Resources and Social Development to collect, on behalf of the Canada Revenue Agency, any information that the Canada Revenue Agency requires for purposes of administering the registered education savings plan tax provisions.
Part 13 authorizes payments to be made out of the Consolidated Revenue Fund to an entity, designated by the Minister of Finance, to facilitate public-private partnership projects.
Part 14 implements tax measures proposed in the October 30, 2007 Economic Statement. With respect to income tax measures, it
(a) reduces the general corporate income tax rate;
(b) accelerates the tax reduction for small businesses;
(c) reduces the lowest personal income tax rate, which automatically reduces the rate used to calculate non-refundable tax credits and the alternative minimum tax; and
(d) increases the basic personal amount and the amount upon which the spouse or common-law partner and wholly dependent relative credits are calculated.
Part 14 also amends the Excise Tax Act to implement, effective January 1, 2008, the reduction in the goods and services tax (GST) and the federal component of the harmonized sales tax (HST) from 6% to 5%. That Act is amended to provide transitional rules for determining the GST/HST rate applicable to transactions that straddle the January 1, 2008, implementation date, including transitional rebates in respect of the sale of residential complexes where transfer of ownership and possession both take place on or after January 1, 2008, pursuant to a written agreement entered into on or before October 30, 2007. The Excise Act, 2001 is also amended to increase excise duties on tobacco products to offset the impact of the GST/HST rate reduction. The Air Travellers Security Charge Act is also amended to ensure that rates for domestic and transborder air travel reflect the impact of the GST/HST rate reduction. Those amendments generally apply as of January 1, 2008.

The House proceeded to the consideration of Bill C-28, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007 and to implement certain provisions of the economic statement tabled in Parliament on October 30, 2007, as reported (without amendment) from the committee.

Speaker's Ruling

[The Deputy Speaker, Bill Blaikie]

With respect to Bill C-28, I would like to inform the House that there is one motion in amendment standing on the notice paper for the report stage of Bill C-28. Motion No. 1 will be debated and voted upon.

Motions in Amendment

[Paul Dewar, NDP, Ottawa Centre, ON]

moved:

Motion No. 1

That Bill C-28 be amended by deleting Clause 181.

Mr. Speaker, today, I rise to speak to the amendment that I put have forward. I want to begin by thanking my colleague from Hamilton for seconding the motion.

In fact, it is a very short amendment to Bill C-28. It asks that we delete clause 181. I say that because Bill C-28 is quite a document. It is in fact a document that is hundreds of pages long and this one particular amendment to delete clause 181 would do something extremely important. It would delete the corporate tax cuts that are in this package.

Notwithstanding the brevity of the amendment, the impacts I think would be substantive and positive.

We have seen in this country unprecedented growth. We have seen prosperity for some, but not spread out and achieved by all.

It is my belief that when we are dealing with tax policy, it is important to look at the many and not just the few. In this case, clause 181 looks at the few; in other words, those who would benefit from corporate tax cuts.

Some would say that is well and good, that it actually would be a good tax policy because it would increase investment in the country.

It sounds good, in theory. However, we have to strike a balance in this country. When we have Canadians sitting around their kitchen tables, as we speak, looking at how they are going to make ends meet, they would not see the same benefits in Bill C-28 that are proposed for corporations. They would see less benefits, if we were to do a cost benefit analysis.

In fact, in the last number of years, we have seen a widening prosperity gap, and our party has been very clear on this issue. In fact, the affordability of things is increasing for many Canadians, such as health care, which I know, Mr. Speaker, has been a concern of yours in the past and remains a concern of yours.

In 1980, 80% of our health care system was publicly financed. We are at the level now where 70% of our health care system is publicly financed which means that 30% is financed through the private sector.

I say that because many Canadians cannot afford the drugs they need. Many Canadians are on waiting lists and are having to seek other forms of help in terms of getting health care when they need it.

There is nothing in this package that would help them. There is no affordable drug plan in this package. There is nothing that would help everyday Canadians who need affordable education. There is nothing in this package that would deal with the housing crisis. There is nothing in this package that would give hope to people who need help right now.

This amendment would eliminate the corporate tax giveaway. In fact, David Lewis once famously said it is corporate welfare.

I see it as corporate welfare because the party in power right now never ever campaigned on this corporate tax cut. Members will remember the Conservatives famously ran on five things. I can guarantee that corporate tax cuts was not in those five issues. They talked about the GST, certainly, but they did not talk about corporate tax cuts.

So, this is about holding the government to account. It is about equity. It is about the importance of investing to make our country more productive. In fact, a representative who spoke to committee on another bill recently said:

Investors will keep investing in Canada. Why? Because we have an educated, efficient workforce. We're marvellously endowed in resources. We have a good, though perhaps somewhat neglected, infrastructure.

He went on to say that corporate cuts are not what brings an educated and efficient workforce, it is not what protects our environment and natural resources, and it does not rebuild and strengthen our neglected infrastructure.

The point that we are endowed with resources and have a good, though perhaps somewhat neglected, infrastructure is key because when we look at the way these corporate tax cuts will be handed over, it is basically like throwing money into the wind and hoping it lands in the right place.

By the way, the person who I am quoting was actually a representative from the Canadian Chamber of Commerce. From my perspective certainly not someone who the government would usually ignore. However, in doing this act, in providing these kinds of corporate tax cuts, in fact it is.

I want to take a moment to speak to the opposition parties, both the Bloc Québécois and the Liberal Party. Recently, the leader of the Liberal Party spoke to his party's vision on economics and fair taxes. He said that the previous Liberal government reduced the federal corporate tax rate to 19% from 28% and that the Conservatives will reduce it to 18.5% by 2011. He said that he would go deeper than that and then went on to tell us why.

I would plead with the Liberal Party to take a look at where our corporate taxes are. The fact is that it gave the green light to this government with this speech in saying that it should go further. Indeed, it did.

Many have said that once the Conservatives heard that the Liberals were going to go deeper in corporate tax cuts, they raced to 15% when they were going to stay at 17%. I hope the Liberal Party takes a look at who benefits from these corporate tax cuts, particularly in the way they are ascribed.

I do not believe that at this point in our economy, when students have record debt, when we have an infrastructure deficit of $123 billion, and when people cannot afford the medicines they need, that we need to give corporations welfare.

This is a very simple, sanguine, smart amendment to a policy that is wrong. Further corporate tax cuts were never debated during the election. I have quoted spokespersons from the Chamber of Commerce who have said that the key thing to invest in is infrastructure.

There is absolutely no guarantee, when corporate tax cuts and gifts are handed over to corporations, that they will invest. We hope they would, but where is the guarantee? Indeed, where is the accountability?

It is interesting to note that we see on the front page of the Ottawa Citizen today that the government was able to forgive huge tax bills for a select few Canadians, 35 of them, that had been burned during the boom and bust of the high tech industry. It is sad for those people and I guess terrific for those few who are going to benefit, but where is the tax fairness for other Canadians?

Where is the fairness in this bill? This amendment would actually balance things off. It says now is not the time for deeper tax cuts for corporations. Now is the time for key strategic investments in people. That is what has been missing from the government. Where is the human face in its economic plan?

It throws out the idea that there is a GST cut. When we compare that to the deep cuts in corporate taxes and the minuscule crumbs that are being handed over to everyday people, there is a balance problem.

When we take a look at certain people being rewarded because of successfully lobbying the government for investments they made and were burned on in the case of JDS Uniphase, we have to wonder who the government is listening to.

The government is not listening to seniors. Recently, my colleague from Hamilton pointed out that seniors have been burned. Their pensions were not properly indexed. Is the government helping them out? No.

In summary, I hope that my friends from the Liberal Party will support this measure, will not stay with this corporate tax cut craze, and that my friends from the Bloc will support this amendment.

Indeed, I urge the government to look at this as a progressive thing that will help people and their communities. It will allow us to invest in people, our communities, our infrastructure, and cut off the corporate welfare that seems to exist today.

[Ken Epp, Conservative, Edmonton—Sherwood Park, AB]

Mr. Speaker, I cannot help but think back to an argument which I have made frequently since my days on the finance committee and a statement which I hear so often from the NDP members, one that I think I need to challenge. That is, when they use the phrase “tax cuts”, are they talking about the reduction of the tax rates or are they talking about the amount of money in absolute value that is collected?

In economics there is a thing called the Laffer curve, which I have read about, named after the Professor Laffer who discovered it. That is, there is a relationship, and I wish we could use graphs and props here, such that if one's tax rate is zero, one's income will be zero. If one's tax rate is 100%, one's income will be zero, because everybody is either going to do nothing or go to some other country to do it. Somewhere in between, there is a place where one can maximize the income.

In regard to a reduction of corporate taxes, the fact of the matter is, and I am convinced of it, that if we reduce the rate of taxation, if we add in all of the economic activity that it generates, the total amount of revenue gained by the government actually increases at a certain stage. The question is, of course, where is that particular point?

I believe that our tax rates in Canada are eminently fair for the most part, but in the case of tax cuts, when we talk about reducing the rates for businesses in this country, I think that we actually gain at the present level. In regard to reducing them from 21% to 19% to 17%, in that range a reduction of tax rates actually increases the total amount of revenue, which would of course give the government more money to spend on government programs and social programs, which I think the NDP and I would agree with. They are necessary things to do.

I would like the member's comment on what I have just said.

[Paul Dewar, NDP, Ottawa Centre, ON]

Mr. Speaker, I know of the Laffer curve, but we also have to keep in mind, and I think the member said it, that he believes the tax rate right now is more or less fair. I agree with that. Now is not the time for a further decrease. I call it a cut and the member may call it an adjustment, but at the end of the day there is less money required for corporations to pay in terms of the rate, the percentage.

I understand what the member is saying about the work that has been done on the Laffer curve. It is the idea that perhaps by reducing the amount of tax required, we actually will increase more investment, and therefore there will be more money in the coffers. I fully understand that.

There is also the law of diminishing returns. That is, if we lower the rate and money is not reinvested, if we do not attract more investment, we potentially will have less money in revenues as well. In other words, if we do not see reinvestment and if we do not attract more investment, then we will have less money in the treasury to redistribute or invest. I do not think there has been enough work done on this and certainly there has not been enough debate to suggest that we should go ahead with it at this point.

In fact, I remember what TD economist Don Drummond said back in 2005 when we got the then Liberal government to change the budget's $4.5 billion in corporate tax cuts. He said those corporate tax cuts would not go into reinvestment but in fact into excess profit. Now, the Laffer curve would deal with that as well and would say that if the money is going to go into excess profits then we should not make these kinds of reductions or what I call tax cuts.

I think it is a valid point. That is why I think this should be debated. That is why I think the clause should be deleted until we have the evidence and proof, which we have not had. All we have seen is a widening prosperity gap.

As I have mentioned, the investments we need to make right now are investments in people, in things such as an affordable drug plan and affordable education and, for goodness' sake, reinvesting in the infrastructure of the country before we hand over tax cuts in the way that is being proposed in the bill.

[Gordon O'Connor, Conservative, Minister of National Revenue]

Mr. Speaker, in the 2007 economic statement, the government announced broad-based tax relief that will help provide Canada with a tax system that rewards Canadians for realizing their full potential, encourages investment in Canada, fuels growth in the economy, creates more and better jobs, and improves standards of living.

Our bold, broad-based business tax reductions are a key part of this plan and will give Canada the most competitive business tax regime in the G-7. Internationally competitive business taxes are crucial to attracting investment to Canada, and many other countries are recognizing the value of lower tax rates.

A lower tax rate on business income encourages investment and entrepreneurship by both domestic and foreign firms. This investment in new capital increases productivity and economic growth, creates jobs, increases incomes and raises living standards.

Even the Liberal leader has admitted that our Conservative government is right for cutting corporate taxes, stating:

A low corporate tax rate is not a right wing policy or a left wing policy. It is a sound policy.

It is especially important during these times of economic uncertainty to reinforce the Canadian business environment. Adapting to changes in the global economy and dealing with the weakness of the U.S. economy are significant challenges for Canadian business.

The strong fiscal position of the Government of Canada provides an opportunity to put in place broad-based tax reductions that few other countries can afford. At this time of economic uncertainty, we are putting in place tax measures that bolster confidence, encourage investment and support job creation.

In the 2007 economic statement, we introduced a bold new tax reduction initiative that will lower federal corporate income tax rates to 15% by 2012. With this initiative, the federal corporate income tax rate in 2012 will be a remarkable 14 percentage points lower than its level in 2000. These broad-based tax reductions build on the measures announced in the 2006 and the 2007 budgets to strengthen Canada's tax advantage.

As a result of these tax reductions, businesses in Canada will meet the Advantage Canada goal of achieving the lowest tax rate on new business investment in the G-7 by 2011. Further, by 2012 we will have the lowest statutory corporate income tax rate in the G-7.

The tax reduction actions our government took in the 2007 economic statement are sustainable and durable. They make Canada a country of choice for investment, not just today but in the years to come. This will provide Canadians with more and better jobs and a higher standard of living.

[Dennis Bevington, NDP, Western Arctic, NT]

Mr. Speaker, I appreciate the minister's statement on this amendment. I am curious about what the minister said in regard to what attracts corporations to invest in this country.

I would say that right now corporations are attracted to investing in this country for our great resource base, one that is accelerating in value. Around the world, resources are at a premium. Many corporations are investing in energy in this country, once again because the energy is here.

Let us talk about the manufacturing sector. One of the largest incentives for manufacturing investment in Canada is our public health care system, which gives us a tremendous advantage over the United States and its private insurance system for employees of large companies.

What we see in Canada is that we have incentives for corporations that are built into, first, what we sell, our raw resources, which are in high demand, and, second, the services we provide to corporations. How are these tax cuts going to improve that situation? How are they going to make that any better?

[Gordon O'Connor, Conservative, Carleton—Mississippi Mills, ON]

Mr. Speaker, as we all know, the recent budgets addressed not only a reduction of corporate tax rates but a whole lot of other issues, such as infrastructure, transfers to the provinces, health care and all these other requirements of our society. The budgets of 2006 and 2007 and the update do not address only corporate tax cuts.

Yes, when investors decide to invest in Canada, they take into consideration a lot of those factors: our well-educated population, our health care, our infrastructure, our energy resources, et cetera. However, they also look at the tax rates. It is in our interest to reduce the tax rates for corporations to as low as possible to encourage investment, because it is corporations that provide most of the jobs. Other than the public services such as government, schools or hospitals, the rest of the economy is a corporate economy, which requires tax rates that are as low as possible.

[Dick Harris, Conservative, Cariboo—Prince George, BC]

Mr. Speaker, recently the Conservative government announced a bold new infrastructure program that is a $33 billion investment in infrastructure projects across Canada. This is following the disastrous infrastructure deficit that the Liberals left us over the last 13 years.

I have a question for the minister. What exactly does this $33 billion investment mean to municipalities, to seaports and to Canadians as a whole?

[Gordon O'Connor, Conservative, Carleton—Mississippi Mills, ON]

Mr. Speaker, through the building Canada plan, our government is making the largest investment in infrastructure in modern history, with $33 billion over the next seven years. This is new money to build roads and improve public transit, to rehabilitate bridges and water systems, and to upgrade our international gateways, ports and airports.

We believe that we are going to be able to leverage this $33 billion into $100 billion through cooperation with the provinces and with private investment. I think that as our plan is implemented over the next seven years, members are going to find substantial improvements in infrastructure that had been allowed to lie and decay in the last 13 years of the Liberal regime.

[Scott Brison, Liberal, Kings—Hants, NS]

Mr. Speaker, it is with pleasure that I speak today to Bill C-28, the budget implementation bill.

First, good governments make good, long term choices. They do not focus their policies on short term polls or on next week's polls. In fact, they focus on the challenges and opportunities in the coming century, which is why the Conservative government has made such a remarkable mistake in moving forward and cutting a consumption tax, the GST.

Cutting 1% on the GST represents a $6.5 billion loss to the federal treasury per year, and 2%, of course, is $13 billion per year, which is a lot of fiscal capacity that could have been used to invest in the priorities of Canadians, to invest in the social infrastructure of Canadians and to address the infrastructure deficit that is so critical in Canada today. It is also a lot of money that could have been used to reduce personal income taxes and help Canadians keep more of their hard-earned money, to reduce business taxes, to build a more competitive corporate tax environment and, ultimately, to build a richer, fairer and greener Canada.

Except for perhaps the Prime Minister, I do not think there is an economist in Canada who believes that cutting the GST is a good idea. In fact, if economists were a licensed body, the Prime Minister would probably lose his licence over the decision to cut the GST because it is such a bad economic policy.

Just 1% of the GST, that $6.5 billion per year, in terms of needed infrastructure, would mean approximately $20 million in every federal riding in Canada. Let us consider what that could mean in terms of green infrastructure, water and sewage treatment and recreational infrastructure across Canada, whether we are talking about arenas, pools or libraries, a great infrastructure deficit is going on.

When we look at it, there were two waves of federal government investment in infrastructure. One was the memorial infrastructure with memorial community centres across Canada, built, I believe, after the second world war. Further to that, there were the centennial projects after the great year of 1967, which was the year I was born. My mother was at Expo 67. I was there but I had not been born yet.

Beyond that, the fact that the government has made no investment in those kinds of infrastructure in a significant way ignores the facts. The facts are that Canadians need to live in healthy communities with up to date water and sewage treatment. They need investments in public transit, in green transit infrastructure. We recognize now the imperative of green investment in infrastructure. Canadians also need to live healthier lives and they cannot do that if they do not have recreational infrastructure for their children.

I will give some examples from my own riding of the kinds of infrastructure I am speaking of. The East Hants Sportsplex in Lantz, Hants county, which was built decades ago, has served the community well during its time. However, Lantz and Elmsdale, that whole area of East Hants, has doubled in population over the last 10 years. Its recreational infrastructures are strained and require significant investment.

When our government was in power, the Liberal government, those were the kinds of investment we made. In my riding, we invested in indoor soccer facilities, libraries, pools and community infrastructure, which can make a difference. Those kinds of infrastructures can make the lives of families better and can ensure we have healthier Canadians. In the long term, it would reduce the cost to the taxpayer by reducing the costs to the health care system over the long term.

We invested in transportation infrastructure, whether we are talking about the twinning of Highway 101 in my riding to the Annapolis Valley or we are talking about investments being made in conjunction with the provincial government at the time.

We invested in infrastructure on a community basis because we were part of a government that recognized the important role that municipal leaders have in building their communities. The fact is that municipal leaders have limited capacity to raise money. They have property taxes, which is a very blunt instrument.

The government of Jean Chrétien and the government of Paul Martin were the first Governments of Canada to recognize--

[The Deputy Speaker, Bill Blaikie]

Order, please. The hon. member knows that the immediately former prime minister is still a member of this House and, therefore, should be referred to as the hon. member for LaSalle—Émard.

[Scott Brison, Liberal, Kings—Hants, NS]

I regret the error, Mr. Speaker. The member for LaSalle—Émard's government was, for the first time in the history of Canada, a federal government that recognized the important role that municipal leaders have and the important need for them to have the kind of funding to address those needs.

I want to speak to the whole issue of the Atlantic accord because a large part of this legislation supposedly deals with the Atlantic accord. When we had a briefing session on this, a public servant told me that this new amendment would ensure that the budget respects the Atlantic accord. I read those same words in the budget just a few months ago.

However, if the original budget respected the Atlantic accord, why did the premiers of Newfoundland and Labrador and Nova Scotia, principled members of parliament from Newfoundland and Labrador and Nova Scotia, have to fight the federal Minister of Finance and the Prime Minister over the last several months to actually get a new amendment that would respect the accord?

If the original budget respected the accord, why did the federal government commit months of work in the Department of Finance to finding a new way to respect the accord? It is not credible. In fact, if we could not trust the Conservatives in the budget when they said that the budget respected the Atlantic accord, why should we trust them now when they say that this document respects the Atlantic accord?

It was only a few years ago when the Prime Minister referred to Atlantic Canada as “having a culture of defeat”. The only culture of defeat that will exist in the next federal election will be in Conservative campaign headquarters across Atlantic Canada, because Atlantic Canadians do not like being misled.

Atlantic Canadians know that if they cannot trust a government to honour a written accord, they cannot trust a prime minister on his verbal commitments. Atlantic Canadians want a fair deal to ensure that we have the opportunity as Atlantic Canadians to build our economy, to diversify our economy and to move forward.

Furthermore, the province of Nova Scotia's own figures show that Nova Scotia will lose $42 million next year and $306 million over the next four years as a result of the government's ripping up the Atlantic accord.

Mr. Speaker, I will be splitting my time today with the hon. member for Mississauga—Brampton South.

The government, on a wide range of issues, from failing to honour the Atlantic accord, to a misguided tax policy that will actually build a less competitive, less fair and a less green Canadian economy, is moving in multiple directions and in a way that Canadians do not share in terms of values or of sound economic policy.

Furthermore, the manufacturing sector, the forestry sector and agriculture are facing multiple crises in key sectors across our economy. The government has done nothing to address competitiveness and has done nothing to address the manufacturing sector crisis. For instance, the accelerated capital cost allowance should be offered on a permanent basis to Canadian manufacturers to allow them the time they need to invest in productivity enhancement.

The forestry sector is key to our economy. The government is doing nothing to invest--

[The Deputy Speaker, Bill Blaikie]

Order, please. I am sorry but the hon. member's time has expired. I would remind members that we are into 10 minute speeches and 10 minute speeches do not get split into 5 minute speeches, especially after you have spoken for 9 minutes.

The hon. member for Ottawa Centre.

[Paul Dewar, NDP, Ottawa Centre, ON]

Mr. Speaker, I listened carefully to the member's comments on the amendment that I put forward but I did not quite grasp where his party was or where he was on the amendment, notwithstanding some of his comments.

I mentioned in my comments that the Liberal Party supports deep corporate tax cuts. Indeed, I quoted from his leader who said that his party would go further and he encouraged the government to go further, giving it the green light to go to the level that his party had gone.

Notwithstanding the member's comments, will he be supporting these deep corporate tax cuts or will he support our amendment, because if he supports the deep corporate tax cuts, all of the things he mentioned will not happen? These are not strategic investments. These are right across the board tax cuts. We throw the money up in the air and hope it lands in the right place. We know that does not happen. They need to be strategic and this document does not provide that, which is why we asked for an amendment.

I know the Liberals did not want to vote on this but would you please tell us where you stand on it?