Thank you, Mr. Chair.
Thank you, panel, for appearing before us today.
I just wanted to establish a couple of things here. First of all, we, as the government, happen to agree with Mr. Martin and the panel. But we believe that corporate taxes are too high in Canada. We've signalled that the government is moving towards the lowest corporate tax rates in the G-7. That's in Advantage Canada. We've reduced corporate taxes to 18.5% by 2011. That's a commitment by the government. And there's a further commitment to reduce those to 17%.
I also wanted to make the comment that the government, the CRA specifically, made it very clear that it is working in partnership with countries like Australia, the United States, Germany, France, Great Britain, and others on the rules regarding low-tax jurisdictions or tax havens. So we are going to be going about this with a process that will level the playing field among G-7 nations and other OECD nations.
Mr. Poschmann, we've heard a couple of comments on double-dipping. We had a presentation by the CRA the other day on a case in which a Canadian company—this was an actual court case they took to court and lost—borrowed money from a tax haven. They borrowed $200 million at 10%. They claimed a $20-million interest expense against Canadian taxes. They then loaned that money to another tax haven and put it out into a subsidiary company in the United States. Both companies claimed the same interest deductibility of $20 million in both countries. The CRA lost that case, indicating that as far as they're concerned, according to current tax laws, that was a legitimate claim, even though they did not experience a taxable interest expense against their Canadian income. Do you think that's appropriate?