Thank you.
Thank you so much for holding these hearings. Many of the members of the committee have forest product mills in your ridings, and those of you who don't have them have spinoff jobs. There are 250,000 direct jobs, and then there are another 750,000 jobs, many of them in Toronto, Montreal, and Vancouver. We're talking here today about jobs and what it takes to keep jobs in Canada.
The bottom line is pretty simple: keeping jobs in Canada requires investment in Canadian facilities. Investment comes if two things are present. Investment comes if the industry is doing its job and becoming more productive and more efficient. We've been doing that year after year--more than the rest of Canadian manufacturing--and we've become more productive than the U.S. industry. We've been doing our part.
The second thing that draws investment into Canada to keep our mills operating is a competitive business climate. A key piece for a competitive business climate is not punishing investment. In Canada, we have a higher tax rate on investment in forestry than any of our competitors. No other forestry nation in the world taxes investment as high as Canada does. In fact, we tax investment in forestry more than we do mining and oil and gas.
If you want something, you shouldn't punish it. We are asking the government, and we're asking the committee to recommend to the government, that we change the tax regime to reward rather than punish investment.
We have three specific suggestions. The first, which we share with most manufacturers in Canada, is an accelerated capital cost allowance--two years, straight line. You have of course all the details in our submission. It's a beautiful measure because it doesn't cost you a penny, unless we invest. It's specific: you want to see investment, accelerate the write-off, and the investment will come. It doesn't cost anything unless you get the behaviour you want, which is investment in Canada.
The second suggestion is that we make the SR and ED tax credit for research refundable. Why refundable? Because when business is bad, companies should still invest in research. But when business is bad, the tax credit is eliminated. We're not allowed to have access to it because we have no profit. We want investment in research, year in and year out, at the bottom of the cycle, at the top of the cycle, so we can stay competitive. Let's not cut off companies that are not making a profit from the tax credit, let's make it refundable.
The third suggestion is to create a tax regime that encourages getting off fossil fuels and on to biomass. Biomass gives you zero Kyoto greenhouse gases and cleaner air; it reduces the mills' dependence on fossil fuels, allowing us to keep the mills open.
With those three things, we would have a more competitive business climate, there would be more investment in Canadian mills, and we'd keep more jobs in Canada.
Thank you.