Evidence of meeting #19 for Finance in the 39th Parliament, 2nd session. (The original version is on Parliament’s site, as are the minutes.) The winning word was let's.
A recording is available from Parliament.
Conservative
The Chair Conservative Rob Merrifield
Okay. Mr. Dykstra is detained for about 15 minutes, so if we deal with his motion when he comes, that would be fair.
In the meantime, Mr. Turner, I'm not asking you to, but if you wish to, we would entertain the motion you've given notice of motion on.
January 28th, 2008 / 3:40 p.m.
Liberal
Garth Turner Liberal Halton, ON
Thank you, Mr. Chairman.
This motion is pretty simple, and it goes to the heart of—
Liberal
Garth Turner Liberal Halton, ON
I'm talking about the motion relating to income trusts.
The issue is reasonably simple, as I said, because the government, when it was campaigning, obviously, adopted a very solemn promise to Canadians that income trusts would not be taxed. The Minister of Finance changed his mind. He based that decision upon his assertion that there was tax leakage taking place because of the existing status of income trusts.
Now more than a year has passed--in fact almost a year and a half has now passed--since that particular assertion was made. There is a body of evidence, a body of fact, that now exists in the marketplace and in financial markets. We have some evidence now of the repercussions of that decision. I think it is time this committee had a look at whether the assertion of a tax leakage is reasonable or not. Can it be proven or not?
The gravity of the promise that was broken I think really underscores our need to have a look at whether the Minister of Finance was correct in his assumptions about the marketplace, because there is conflicting evidence. I think because the lives of so many individual Canadians were impacted, and we've seen as well a hollowing-out of the income trust sector, particularly as related to energy trusts by non-Canadian entities who are non-taxpayers, it really behooves us to look objectively, impartially, non-politically at the whole issue of whether—
Liberal
Garth Turner Liberal Halton, ON
--the Minister of Finance was right in his statements to Canadians or whether he in fact had his own political agenda.
That's it, Mr. Chairman. I would ask my esteemed colleagues to support this, because there are many Canadians who really would like to have answers to these quite simple but compelling questions.
Conservative
The Chair Conservative Rob Merrifield
Thank you, Mr. Turner.
We have a motion, and you are moving that motion, I understand. You didn't say so, but I want to make sure that's clear.
Conservative
The Chair Conservative Rob Merrifield
All right. We have another motion on the floor. Does anyone want to speak to that?
I see Mr. Menzies.
Conservative
Ted Menzies Conservative Macleod, AB
Please let me continue in the spirit of non-partisan debate. I shall try my best.
This is an issue that has been debated at length, both in committee and in the House of Commons, and if I'm not mistaken, it was voted on and approved in the House of Commons, where every member of the House had the opportunity to state their constituents' views. Those views have been expressed.
We have moved far beyond that. As Mr. Crête just mentioned, we have moved to issues of immediate impact--jobs in the forestry sector and the manufacturing sector. That's why we supported Mr. Crête's motion: it is important. To go back and re-plough this old ground does not make any sense to us whatsoever. In fact, I would be embarrassed to tell my constituents that we were going back to deal with an issue that was voted on and approved in the House of Commons instead of talking about how we can help constituents who have lost their jobs, how we can help to grow sectors that are in difficult times right now.
We are looking at extremely volatile markets. We would be better discussing whether or not this government is doing the right things. Let's have an open debate about that. Let's see what we can do better to help our constituents, rather than going back and talking about an old issue that only two people in the House of Commons seem to be concerned about. Unfortunately, the two of them are sitting in this committee right now.
Let's talk about the future. Let's talk about how we can make Canada better instead of backtracking.
Liberal
Massimo Pacetti Liberal Saint-Léonard—Saint-Michel, QC
Thank you, Mr. Chairman.
Just to correct Mr. Menzies' comments, during the pre-budget consultations, as little as a month ago, during our tour of Canada, on which there were only three of us present, especially in the city of Calgary there were a couple of people who did appear before the committee and they wanted us to open this up. So I don't believe this is an issue that's closed and finished with. Especially in the energy sector—and perhaps, Mr. Chairman, you can help me, because that's your province of origin—there is still a willingness to pursue this matter, and there is still a willingness to see if there are any problems with the way the finance minister provided those estimates regarding tax leakage and tax losses.
The only problem I would have with this amendment would be the number of hearings. I would like to limit that, if possible, to perhaps three or four. I'm not sure what Mr. Turner is requesting, so through you, Mr. Chair, could we clear that up? Then I would probably be able to support this motion.
Conservative
The Chair Conservative Rob Merrifield
I'm going to ask the mover what his intent would be regarding the number of hearings he thinks would facilitate the motion.
Liberal
Garth Turner Liberal Halton, ON
It would not be a huge number, Mr. Chairman, but I certainly think a couple of meetings would be a very good way to deal with this issue.
Conservative
Dean Del Mastro Conservative Peterborough, ON
Thank you, Mr. Chair.
Mr. Chair, you, yourself, joined the committee after we conducted investigative hearings into the impact of the income trust decision. Most of the members who are here were here for that study. We did in fact produce a report from that study.
As Mr. Menzies has indicated, this is extremely well-tilled soil. We have gone over this backwards, forwards, and sideways. I cannot see any benefit to this at the present time.
I believe Canadians have moved on. Mr. Turner's motion contemplates which trusts have been purchased, but he hasn't contemplated the companies that did not convert into trusts and how much of the public tax revenue was not lost, and the protection of Canadian companies from converting into trusts, which would be extremely bad for Canada's productivity and Canada's economy moving forward. He's taken a one-sided look at this. He wants to go backwards.
I encourage and implore committee members to look forward and deal with issues that are relevant to Canadians today. Let's have a positive impact on our communities.
Thank you.
Conservative
Liberal
John McKay Liberal Scarborough—Guildwood, ON
Losing money is always relevant to Canadians. If I lost money a year and a half ago, I'd still be pretty concerned. I'd have been concerned six months ago, and I'm concerned today, so this issue is relevant. It will be relevant in part because of the very point Mr. Turner's motion speaks to. It speaks to the issue that the Minister of Finance of Canada came into this committee, put up charts, and said he expected that if we carried on the way we were carrying on, we were going to lose $500 million in tax revenue. He was roundly criticized both in the press and by committee witnesses as asserting a falsehood.
Mr. Turner's motion speaks to that incredulity on the part of Canadians. It speaks to that issue. So Canadians have not moved on, Mr. Del Mastro, through you, Mr. Chair. The markets are volatile. We are in volatile times. A lot of the benefit and value of owning trust units has been bled out by the actions of the minister and of this government. So these hearings would test the proposition the Minister of Finance put before this committee, based on which, with the machinations of the votes in the House, he was able to successfully get it through the House.
We do not believe his proposition. We have very good reasons for not believing his proposition, and we are shocked and appalled--
Liberal
John McKay Liberal Scarborough—Guildwood, ON
--that he is not willing, through his other members here, to let us test his proposition.
Liberal
Liberal
John McCallum Liberal Markham—Unionville, ON
The other thing people should not forget is that all we got from the minister was a blacked-out document. It was an insult to Canadians and to members of this committee that he wouldn't even show us the numbers. The numbers are wrong--we know that--but at least he could show them to us rather than blacking them out. So I think it's a matter also of accountability and transparency, which this government has lacked.
Another point is that since the decision was made, we've seen, for example, BCE taken over by a combination of private equity and pension plans. If that transaction goes forward, BCE will pay no tax. So it's become self-evident that this was a losing proposition from the point of view of tax revenue, a losing proposition from the point of view of productivity, but I think the minds of the people over there are made up, so I'm not sure it's worth prolonging the discussion.
Conservative
The Chair Conservative Rob Merrifield
Yes, that's what I mean. We can debate this forever, but if we go forward in the study, I'm sure we'll have all kinds of time for that.
We have Dean Del Mastro. I think we've heard enough.
Dean.