Evidence of meeting #45 for Finance in the 39th Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was poverty.
Conservative
Dean Del Mastro Conservative Peterborough, ON
Thank you.
Ms. Korgemets, you spoke a little bit on the GST, and these guys were leading you in directions...trying to get you to come down hard.... In fact, they've been practising politics with guests all day. They agree with everything. Everything's a good idea, except anything we came up with. But they agree with all of you today, just so you know.
Anyway, the GST had a very important effect on inflation, didn't it? According to the Bank of Canada last week—
Senior Management, Tax, PricewaterhouseCoopers LLP, Greater Kitchener Waterloo Chamber of Commerce
Did they link it?
Conservative
Dean Del Mastro Conservative Peterborough, ON
—inflation actually went down substantially, and they claimed that the GST reduction—
Senior Management, Tax, PricewaterhouseCoopers LLP, Greater Kitchener Waterloo Chamber of Commerce
I realize it did. I thought it had to do with my gas prices at the pump.
Conservative
Dean Del Mastro Conservative Peterborough, ON
Part of it did, but it was also the GST, because obviously the cost of goods was reduced when the GST went down.
When we contain inflation, we also control interest rates. Is that pretty important for business?
Senior Management, Tax, PricewaterhouseCoopers LLP, Greater Kitchener Waterloo Chamber of Commerce
Interest rates are absolutely important for business, and they're important for the government too.
Senior Management, Tax, PricewaterhouseCoopers LLP, Greater Kitchener Waterloo Chamber of Commerce
You're leading the witness.
Conservative
Dean Del Mastro Conservative Peterborough, ON
I'm not. I'm just asking if a good, sound financial practice by the government that leads to lower interest rates is very positive for business.
October 26th, 2006 / 2:20 p.m.
Senior Management, Tax, PricewaterhouseCoopers LLP, Greater Kitchener Waterloo Chamber of Commerce
Creating the right business climate is important, so controlling inflation is important.
Conservative
Senior Management, Tax, PricewaterhouseCoopers LLP, Greater Kitchener Waterloo Chamber of Commerce
Low interest rates are important. Is the GST rate reduction the way to do that? If you talk to our members who had to do whatever tweaking they had to do to their business systems to deal with the GST, they wouldn't be that enamoured of the cut.
Conservative
Dean Del Mastro Conservative Peterborough, ON
Just so you know, major members of the Chamber of Commerce are very positive on the GST reduction, including home builders, restaurants, and food associations, which are major members of your association. You may want to talk to them a little bit about GST reduction.
We also believe in broad-based tax relief, targeted tax relief, to actually direct where people are going, through things like the transportation tax credit to encourage people to ride public transit. We've seen transportation ridership go up. These things are working.
Mr. Seiling, I'm from Peterborough. We like to think it's the home of some pretty good hockey players, but we're also the capital city of the Kawartha Lakes. I personally agree with you that we need to make significant investments into tourism. If we took the $80 million from this change in the GST and invested it into marketing, where do you think we'd be?
President, Greater Toronto Hotel Association
You'd be robbing Peter to pay Paul. You need to do both. It is bad—
Conservative
Dean Del Mastro Conservative Peterborough, ON
If we offered you both, would you rather have the money spent on marketing or would you rather give it to people who were leaving the country?
President, Greater Toronto Hotel Association
I think we need to spend some time talking about it, but quite frankly, doing the GST rebate cancellation is bad policy. You're not saving any money; just moving it from one side to the other is not.... You're fooling yourself.
Conservative
Dean Del Mastro Conservative Peterborough, ON
But I personally have travelled to countries that charge you money to leave and it's never discouraged me from going back.
President, Greater Toronto Hotel Association
But what we're talking about is those people never coming here. What you're not understanding is that for meetings and travel, and tour and travel, there is an automatic exemption. That money never even comes into your books, and it far exceeds—far exceeds—what we're talking about in individual travel. The number that's been provided to you is simply for individual travel into Canada, and that's the smallest number of the three groupings of international travel here. What's happened, and is happening, is that our competitors are already using it. You've just increased the price of travel to this country by 6%.
Liberal
The Vice-Chair Liberal Massimo Pacetti
Thank you, Mr. Del Mastro.
We're going to end up with Ms. Diane Ablonczy for five minutes, please.
Conservative
Diane Ablonczy Conservative Calgary Nose Hill, AB
Thank you.
You had good presentations, and good points were made. I wish I could talk to all of you, but I want to start with Ms. Rossant.
You talked about the epidemic of obesity in children. As you know, one of the things we've done to try to address that is to bring in a children's fitness tax credit. The commission studying how that should be applied reported today; they earned $1 each for their efforts.
They recommended physical activity that contributes to cardiorespiratory endurance; that there had to be a minimum of one session per week for eight weeks; that it must include a minimum of thirty minutes of sustained moderate to vigorous physical activity for children under ten, and sixty minutes for those ten and over.
They had other recommendations too, but in general, do you think this will be helpful to kids in giving them something to encourage them to participate in activity?
Chief of Research, Hospital for Sick Children
There's no question that increasing physical activity in children—in fact, in all of us—is a good idea. But I think we need to know more about the differences between children; some children, and indeed adults, are more susceptible to obesity and more susceptible to cardiovascular disease and diabetes. So we not only need to be able to put in general measures, but we also need research to understand the specificity of this, so we can really produce targeted measures that go beyond increasing health fitness to really address the underlying problem.
Conservative
Diane Ablonczy Conservative Calgary Nose Hill, AB
Yes. I'm looking for when the gene that makes us overweight can be taken out of our bodies.
Chief of Research, Hospital for Sick Children
Well, there clearly are genetic components; they are not the only things, but in obesity, as with almost all our attributes, there is a genetic component.
Conservative
Diane Ablonczy Conservative Calgary Nose Hill, AB
I've read that. That's good.
We had the Governor of the Bank of Canada in front of the committee last week in Ottawa, and he was asked about the paydown of the debt when we have an unexpectedly large surplus. He said:
...in periods when revenues are a little stronger than anticipated, I think it's extraordinarily important to use that opportunity to pay down debt. That's how the system is supposed to work. Indeed the accounting rules mean that if you get more revenue, you don't spend it; you have to pay down debt.
It is important to take advantage of strong periods to do that. As I've said before, it's very important—important not only for the Government of Canada, but important in provinces where there is very large revenue growth—to take the opportunity to either pay down debt or put money aside for the future. That helps in the short run; it really helps in the long run.
Would you agree with the Governor of the Bank of Canada, Ms. Korgemets?