Bill C-224 (Historical)

An Act to amend An Act to authorize the making of certain fiscal payments to provinces, and to authorize the entry into tax collection agreements with provinces

This enactment amends An Act to authorize the making of certain fiscal payments to provinces, and to authorize the entry into tax collection agreements with provinces to provide that the Minister of Finance may enter into an agreement with the government of a province under which the government of the province will collect the federal personal and corporation income taxes on behalf of the Government of Canada. It also requires that the Minister of Finance undertake discussions with the Government of Quebec in order to enter into such an agreement.

Federal-Provincial Fiscal Arrangements Act

[Jacques Gourde, Conservative, Lévis—Lotbinière, QC]

Mr. Speaker, I am pleased to rise to take part in today's debate on Bill C‑239, which deals with a promise that the Conservative Party itself proposed in the summer of 2018.

We also moved a motion on February 5, 2019, here in the House, on this clear and legitimate request from Quebeckers and the Quebec National Assembly, specifically to cut the paperwork burden on Quebeckers significantly by allowing them to file a single tax return.

On April 24, 2021, all of my Conservative Party colleagues voted for this measure in Bill C‑224. The single income tax return responds to a request that is dear to the hearts of the people of Lévis—Lotbinière and all Quebeckers. All Quebeckers are required to file two tax returns as soon as they start earning an income, even if they have not reached the age of majority. This noble and legitimate request will save a lot of time and money for Quebec families and all Quebeckers. It is important to note that Quebec is the only province in Canada that still has to take on this onerous task.

Whether it relates to this bill or any other measure that would be good for the Quebec nation and the entire Canadian population, nothing seems to make the Liberal government lift a finger since it came to power in 2015, because saving time and money is simply not one of its values and is not in its DNA.

Let me give a real-life example of when all my children were still living under the same roof at home. At the time, it meant 14 individual tax returns for one house, plus two returns for my small farm. Think about it, that is 16 tax returns under one roof. That is a lot of repetitive and counterproductive work forced on families, students and young workers, who are eager to be active in the workforce, which is in need of labour now more than ever.

True to their values, Conservatives have always been committed to simplifying the lives of Quebeckers, saving them time and money, and increasing their quality of life.

We cannot shy away from certain words. We are living under a coalition government, and this cronyism between the Liberals and the NDP is disastrous for all Quebeckers and Canadians across the country. This arrangement is damaging our democracy and prevents any good measures from being adopted. We saw proof of this when the NDP and the Liberals voted against Bill C‑224, sealing its fate.

We saw further proof recently with my private member's bill, Bill C‑215, which got a majority but may not be adopted at third reading because the Prime Minister and the Minister of Finance are still refusing to give it a royal recommendation. I would like to remind members that my bill would extend EI benefits for people with serious illness to 52 weeks, a fix for outdated legislation that has not been amended since 1971.

There are a lot of good bills here, including the one before us now, Bill C‑239, which is perfectly valid. However, we have a major problem in the House after eight years of Liberal incompetence that is now making itself felt across Canada and in every sector.

Our Canada is broken. It will never be like it was before. We are experiencing the repercussions of lack of leadership and political will to bring positive, long-lasting change to the lives of people in Canada.

Under the Liberals, life has become very expensive. Inflation, taxes, crime and drug deaths are on the rise. Honest citizens like hunters and farmers are being attacked and penalized by Bill C‑21. We have a Liberal government that will do anything to help its cronies get funding and contracts in exchange for a $500 ticket to a dinner. The Liberals managed to legalize marijuana and now want to decriminalize hard drugs. However, when it comes to helping honest people who work hard, day in and day out, people who are responsible, or people who are seriously ill and simply deserve our support, there is no danger of Liberal favouritism. There is no danger of giving these honest people a free ride. We hear more than a simple “no”. It is a resounding “no” to anyone with common sense and logic, and this is all currently endorsed by the NDP.

This government is really old, worn out and outdated, not to mention fundamentally incompetent.

I remember all too well the Liberal argument against adopting a single tax return in Quebec. I can already see the return of the stale rhetoric of the Minister of National Revenue—we just heard it. The House has already heard responses using the simplistic argument that having a single tax return would result in massive job losses, which is unfounded and, moreover, would happen at a time when there is a dire need for labour across Canada.

I would also like to remind the minister and my colleagues that the number of public service jobs has increased by 32% from 2015. My constituents write to me to tell me that they can no longer make ends meet, have no savings, are using food banks to feed themselves and their family, can no longer afford their rent, have to work when sick or, even worse, have to declare bankruptcy. Like them, I am very worried about our future and that of our children and future generations.

The aspirations of Quebeckers are eroding after eight years of Liberal incompetence. The single tax return that has been a Conservative election promise since 2018 will still not see the light of day, I am afraid. The NDP has to go back to being an opposition party and stop propping up the Liberal government. We all know that the 32 Bloc Québécois MPs are not the ones who can make the change that Canada really needs.

I am proud that the people in my riding, Lévis—Lotbinière, trust me and the leadership of the Conservative Party to put an end to the Liberal incompetence that we have seen for eight years now—eight years too many. The Conservatives are the best equipped to work for a more productive Quebec, a stronger Quebec, a richer Quebec, a Quebec that is a partner in Canada's success, a Quebec that is proud of its culture and heritage, a Quebec that is worthy of the French language, a Quebec that is respected by the Conservative Party of Canada for what it has achieved. The Conservative Party is a proud partner in the success of all Canadians from all provinces.

Historically, the Conservatives have said yes to Quebec's requests. We said yes to the construction of the new Champlain Bridge, yes to the future third link in Quebec City, yes to more power over immigration for Quebec and yes to a single tax return. That is more than a promise of change or lip service. It is a real commitment, a promise that I have been keeping every day in the House for 17 years now, along with my Conservative colleagues. I say yes for Lévis—Lotbinière and yes for Quebec.

[Soraya Martinez Ferrada, Liberal, Parliamentary Secretary to the Minister of Housing and Diversity and Inclusion (Housing)]

Mr. Speaker, today it is my privilege to take part in the debate at second reading of private member's Bill C‑239.

This bill is identical to private member's Bill C‑224, which was introduced and rejected in the previous parliamentary session. By now, hon. members should be quite familiar with the major flaws that resulted in its being rejected. Now that it is once again before us, I feel obligated to use my time to review those flaws.

The bill authorized Quebec or any other province to collect federal personal and corporate income tax on behalf of the Government of Canada. Our government has always recognized that the purpose of this bill, which is to find ways to simplify income tax returns and reduce the compliance burden on Quebec taxpayers, is appealing. We all share that goal.

However, the way the bill seeks to achieve that raises grave concerns about effectiveness, equity, efficiency and value for both taxpayers and governments, including those in Quebec.

At the forefront of these concerns are the serious negative impacts the bill would have on the employment situation of Canada Revenue Agency employees working in Quebec, as well as their communities as a whole.

At committee stage in the previous Parliament, we heard from expert witnesses and stakeholders such as a representative of the Union of Taxation Employees, who warned that “massive job losses will clearly ensue if this bill is passed and the federal government hands over administration of Quebec's federal taxes to the provincial government” and that “the vast majority of jobs that would be lost are held by people living in Quebec who pay taxes there and greatly contribute to the province's economic activity.” As the witness concluded, this “would be devastating, especially for the Saguenay—Lac-Saint-Jean and Mauricie regions. The CRA is the biggest employer in the Mauricie region and one of the biggest in the Saguenay—Lac-Saint-Jean region, along with the mining sector.”

These alarming findings are consistent with the CRA's projections, which show that the transfer of the federal administration of Quebec's income tax could jeopardize approximately 6,000 jobs in the 14 CRA offices in Quebec. The transfer would also affect employees in many offices outside of Quebec, such as the office in Summerside, Prince Edward Island, and offices in Ontario, which also process income tax returns.

We also learned in the previous Parliament that this bill would likely result in higher costs for taxpayers. The existing tax collection agreements produce efficiency gains that result in cost savings for taxpayers. The transfer of the administration of several provinces and territories to one tax administrator, namely the federal government, creates economies of scale and reduces the administrative burden on each taxpayer. Unfortunately, the bill we are discussing does the exact opposite.

This was confirmed by the testimony of a Canada Revenue Agency official when the bill was being studied in committee in the previous Parliament. As she noted, “The required integration between both organizations' processes and technology infrastructures would result in additional expenses. The fixed costs related to the functioning and significant investments in infrastructure by the agency to serve all Canadians will not decrease with such a transfer.” The CRA official confirmed that such a decision would increase costs. She stated, “At a minimum, our estimate at this time is around $800 million.”

This was corroborated by the testimony of a representative of The Professional Institute of the Public Service of Canada, who pointed out that “the numbers don't add up. There are no savings or efficiencies to be gained either for Quebec taxpayers or for those in the rest of Canada”, he added. This same union official then went on to point out that “the most efficient and cost-effective way for Quebeckers to have a single tax return would be for them to ask the CRA to administer all tax collection.” This opinion is shared by the representative for the Union of Taxation Employees. That is not to say that we want to go in that direction.

As the CRA official clearly indicated at committee, the question should not be whether Canada should be in charge of Quebec's taxes or whether Quebec should be in charge of Canada's taxes. The question should be: how can we simplify taxes for residents of Quebec?

Our government completely agrees. That is why we will continue to work and engage with Revenu Québec, with whom we have long had a productive and collaborative relationship, on finding ways to simplify the tax return and reduce the burden on Quebec taxpayers. We will continue to work with Quebec and the other provinces to make things more efficient.

Our concerns about the bill go even further. This bill also raises fears about Canada's ability to meet its obligations under international tax conventions and agreements in effect that state that the Minister of National Revenue is the competent authority in Canada.

Canada has more than a hundred tax conventions and agreements of this nature and renegotiating them could take years and considerable resources, with no guarantee of favourable results. Our international partners may, for example, not agree to change these provisions or be prepared to interact with two or more distinct tax administrations. This situation could in return have serious consequences on our capacity to fight tax evasion and tax avoidance, which relies on tax information exchange agreements and treaties.

Those are the important considerations, and Canadians expect us to take them into account. I want to commend my parliamentary colleagues for doing so when assessing this bill in the previous Parliament and for having rejected this bill.

As we clearly stated, our government is open to improving tax administration to ensure the best possible results for all Canadians in terms of fairness, efficiency and value for taxpayers and governments, including those of Quebec.

We will continue to work with Revenu Québec to find ways to simplify tax returns and reduce the compliance burden on Quebec taxpayers. This will ensure a better harmonization of our respective tax administrations and make it easier for Quebec taxpayers to complete their tax returns.

We are always willing to improve the situation. However, the preponderance of the evidence clearly shows that the bill before us will do the opposite.

Finance

[Wayne Easter, Liberal, Malpeque, PE]

Madam Speaker, I have the honour to present, in both official languages, the second report of the Standing Committee on Finance in relation to Bill C-224, an act to amend an act to authorize the making of certain fiscal payments to provinces, and to authorize the entry into tax collection agreements with provinces.

The committee has studied the bill and has decided to report the bill back to the House with amendments.

Federal-Provincial Fiscal Arrangements Act

[Gabriel Ste-Marie, Bloc, Joliette, QC]

moved for leave to introduce Bill C-224, an act to amend An Act to authorize the making of certain fiscal payments to provinces, and to authorize the entry into tax collection agreements with provinces.

Mr. Speaker, I am honoured to introduce in the House an act to amend an act to authorize the making of certain fiscal payments to provinces, and to authorize the entry into tax collection agreements with provinces. I thank the member from Montarville for seconding my bill.

Tax season is approaching, and citizens and businesses in Quebec will have to file two income tax returns, with two different types of statements, two types of net income and two types of schedules. Everything needs to be done twice. Is it possible to simplify the lives of citizens and businesses by having them file a single income tax return? That is what we are proposing. It would be administered by Quebec, since Revenu Québec is present in every region and already manages the collection of GST and QST. Quebec finance minister Yves Séguin, a Liberal, was the one who first proposed this approach, which now has the support of every member of every party in the Quebec National Assembly.

This law would also enable Quebec to fight more effectively against the use of tax havens, since Ottawa is dragging its feet in that regard. We want to ensure we can protect and maintain all regional jobs.

We believe it is entirely possible to secure those jobs by reclassifying the public servants and putting them in other jobs that are currently understaffed.

The Research Institute on Self-Determination of Peoples and National Independence conducted a study. A single income tax return would save $425 million for individuals, businesses and the public administration. Can we stop making citizens, businesses and the public administration do everything twice? I am confident that we can.

(Motions deemed adopted, bill read the first time and printed)