Thank you, Mr. Chairman. It's always a pleasure to come out to Portage la Prairie. I've always enjoyed the hospitality of the people here, and it's great to be here.
Actually, this is my first official function as the new chairman of the Winnipeg Chamber of Commerce, having been sworn in yesterday.
I'll tell you a bit about our organization. We were founded in 1873, so we have a long...[Technical difficulty--Editor]...history in Winnipeg. Our organization is the largest organization representing business in Winnipeg. We have more than 1,750 members, who employ over 80,000 people in the city of Winnipeg.
One of the things we've done on a reasonably regular basis over the last few years—and I know you've seen it in our brief—is conduct a survey of Manitoba business leaders to get an idea as to what these individuals are thinking, since they are key decision-makers. While I know you have all of the details in the brief, I want to point out a few things.
First, this survey was taken in 2005. There was still concern among business leaders that the federal government was not doing enough to contribute to creating a positive business climate in Canada. At that time, 22% felt that way. But with new initiatives, I'm hopeful those numbers will improve, because it's important for government to recognize that creating a positive business climate and creating competitiveness in our country are essential to the success of our nation.
When asked what types of initiatives the government could do to improve the business climate in Canada, 43% of business leaders pointed to taxation, which is an area of great concern to them. When we asked them specifically what types of taxes should be cut, it's interesting to note that after the provincial payroll tax here in Manitoba, the most cited case was the GST. So we would applaud the government for its recent initiatives in reducing the GST from 7% of 6%, and in future to 5%.
We see 2007's budget as a critical turning point for Canada. The initiatives in that budget need to focus on productivity and growth for our country. In terms of the types of changes we would look for in budget 2007, we feel we should be focusing on three areas: tax relief, program spending, and debt reduction.
In the area of tax relief, the Chamber of Commerce has put together a comprehensive policy book, focused on or guided by three principles: one is that our tax system should contribute to economic growth; the second is that our tax system should be transparent, so that it's clearly understood by taxpayers; and third is that our tax system should be accountable, and the government should be publicly accountable for the moneys raised.
In terms of specific tax areas, again we would applaud the government for eliminating the federal capital tax, which was a huge barrier to capital investment. We acknowledge the planned corporate tax reductions that are going to happen over the course of the next two to three years.
We still feel there's more work to be done on the tax relief side. Middle- and lower-income taxpayers should also benefit from personal income tax cuts, as the marginal tax rates for some individuals in those categories can be well in excess of 50% when clawbacks and other tax-related issues are factored in.
We also believe that cities are an important part to this. I know the Association of Manitoba Municipalities mentioned this. We agree that cities need to be given more powers, so they can share in growth taxes and address some of the infrastructure needs facing them today.
In the area of program spending, our primary comment would be that program spending should increase only at the rate the general economy increases. Again we applaud the government for its initiatives in the area of the reallocation of spending, in terms of recent announcements, where $1 billion was reallocated to other priorities. We would encourage the government to continue and enhance that activity.
In the area of debt repayment, we still believe there's a role to be played by the government in setting out a plan to reduce our national debt. We would caution that previous practice has been that governments have had very strong unanticipated surpluses, and we would encourage government to forecast their revenues more accurately, so as not to lead to a situation where Canadian taxpayers are overtaxed for the services they receive.
That's the nature of our brief, and thank you for the opportunity.