Finance Committee on Oct. 26th, 2010

[Denis St-Pierre]

I think CGA-Canada is on the record as supporting the stimulus package, but we're also on the record about getting out of the stimulus.

I personally advise clients on purchasing businesses and structuring their affairs. When we do these kinds of things, there has to be stability for the medium term for the client. Tax cuts were announced. There are measures in place to get out of the deficit. CGA's Canada position is to stay the course and continue to focus.

There is a plan. If there is a radical change in that plan because of deficit issues, it might create an unstable environment for the clients and the economy as a whole. We believe that we should just stay the course. There is a plan to get out of the deficit and I think that would create much more stability for the economy.

[Paul Szabo, Liberal, Mississauga South, ON]

Continuing with CGA on the modernizing of the tax regime, you talked very briefly about sunset provisions on changes that haven't been enforced. Most of them are effective immediately, whether or not the legislation is passed. Is there anything in that little treasure chest you have on changes that might be worth pursuing in the shorter term on tax fairness, opportunities, etc.? Is there something there that you want to highlight for us that CGA might want to recommend to the committee?

[Denis St-Pierre]

Had I been able to bring an Income Tax Act, I would have done a simple thing and just flipped it over. The grey parts in the Income Tax Act are the proposed changes. When you say that tax is a grey area, that has become reality right now. Simply flip over an Income Tax Act and look at the grey sections: it's full of proposed measures.

Some of them, like proposed section 56.4, date back to 2003. We're supposed to keep data on income tax sections that do not exist yet, with forms that do not exist, and when they come into legislation, we'll have to back-file for seven years. It's an incredible burden on the taxpayer.

It's also unfair in the sense that you're supposed to know your affairs are done after a certain time. After more than three years, to me, the sunset provision should be implemented so that taxpayers have a sense that it's final, that they've filed their tax. But right now, there's just too much tax baggage out there.

[Paul Szabo, Liberal, Mississauga South, ON]

Okay.

[The Chair, Conservative, James Rajotte]

Thank you, Mr. Szabo.

Monsieur Paillé, s'il vous plaît.

[Daniel Paillé, Bloc, Hochelaga, QC]

Thank you.

Ms. Hébert, I was looking over today's agenda a little earlier on. I was wondering what you would do, surrounded as you are by combine-harvesters, steel, batteries, mines and two groups of accountants. I told myself that it would do them good to have you here.

Further, our anglophone colleagues never wonder whether they should express themselves in English: they just speak English. So, thank you, Ms. Hébert, for having spoken only in your language, since respect begins with self-respect.

That being said, you highlighted increased challenges for the arts sector. I really liked your use of the expression sustainable development, which reflects the times we live in. For all intents and purposes, you are asking that governments invest more and increase their commitment towards the arts sector, and to treat it as more than just the flavour of the week. You are asking governments to take a long-term view, especially as regards international promotion of the arts. I believe that everyone here, in every sector, understands that when you decide to organize a trade fair, whether it be for steel or batteries, that it takes more than a year to do so. You also have products to sell.

I would like to you to speak to that in greater detail. I would also like you to explain your expression “cultural diplomacy”: It seems that there have been major cutbacks in any international support we give to artists. If I understand correctly, as soon as artists leave a country, they are on their own.

[Lorraine Hébert]

Companies have to work very hard to position themselves in the market. This takes a lot of time and a lot of energy, and we have to build on the work which has already been accomplished. In the past, not only did a government-supported company have to do the work on the ground, but that company also had access to an entire network of cultural officers in our embassies, whose specialty was to widen these networks, to stay plugged in, and to organize promotional events every time artists performed abroad. This is very important for new artists. It is extremely difficult to gain a foothold in another market. However, everyone says so, we have exceptional artists who will not be able to gain a foothold abroad if we do not have people and measures on the ground to help them.

[Daniel Paillé, Bloc, Hochelaga, QC]

As far as young artists are concerned, we were talking about their living conditions. Last year, we had introduced a measure to allow for income averaging. I imagine that you would respond that this is a good thing as long as there is a revenue.

Don't you have the feeling that by reducing the amount of money spent on promotion, cultural diplomacy and the budgets of departments, this translates into an abdication of Canadian culture?

We will become marginalized and Canadian culture will increasingly resemble American culture. At that point, Quebec culture will be in a difficult position, because one of the two governments has abdicated its responsibility, don't you think? In that case, don't you think it would be better to take all the money earmarked for culture and send it to the place which is closest to where culture is being created, namely to the provincial governments including, of course, the Government of Quebec?

[Lorraine Hébert]

I am very frustrated. I will speak on behalf of the world of dance, because I represent dance companies. If the Canada Council for the Arts had not supported these companies in the 1980s, dance would not have flourished as much as it did. In the meantime, the Government of Quebec and the Conseil des arts et des lettres du Québec have stepped in. That is why I am frustrated.

I believe that our councils of the arts and our governments, as the gentleman said with regard to skills development—must work together as long as we live together.

[Daniel Paillé, Bloc, Hochelaga, QC]

I believe you are right. We do not look down upon what has come before us, but we are turned towards the future.

There is something else. You talked about the financial reality. You very quickly said at the end of your presentation that we would need strategies and funding. I have a minute left, and I will give you that time to talk a bit more about that.

[Lorraine Hébert]

We are exploring these issues in every one of our sectors. The federal government has held national consultations, because it intended to develop plans of action. That being said, the government's focus was too much on industry, and we are not an industry. We need strategies which are adapted to who we are, because we are content generators for the industries.

[Daniel Paillé, Bloc, Hochelaga, QC]

I have one last thing. You said that in November 2010 you will publish a document on cutbacks. I would ask you to send it to us.

In 10 seconds, could you tell us about the Société Radio-Canada's support?

[Lorraine Hébert]

Do you mean its support for arts and culture?

[Daniel Paillé, Bloc, Hochelaga, QC]

I'm talking about the arts.

[Lorraine Hébert]

They still have some work to do.

[Daniel Paillé, Bloc, Hochelaga, QC]

Thank you.

[The Chair, Conservative, James Rajotte]

Merci, monsieur Paillé.

Mr. Menzies, please.

[Ted Menzies, Conservative, Macleod, AB]

Thank you, Mr. Chair.

Thank you to all our witnesses for coming here today.

Mr. Mains, I will start with you. You raised this issue with me about the tariffs into Russia and a large lack of understanding. It wasn't just Russia, but Ukraine, I understand, and many of those countries. Can you quickly give us a bit of background on the Canadian technology-- and Ms. Block will recognize this—on the incredible technological advances in the agricultural machinery equipment that comes out of Saskatchewan? There's more than just potash that comes out of Saskatchewan.

[Howard Mains]

Thank you for that, Mr. Menzies.

As you mentioned, there is some incredible technology developed in western Canada. A number of Canadian companies were confronted with this problem, not only MacDon, with the headers on the combines, but also a couple of Saskatchewan companies that make what are described as air seeders.

Because of Canada's long history in small grains, the technology that has been developed in Canada has increased the productivity for grain farmers in western Canada as well as other parts of the world. It is just astonishing to see how much ground can be covered by one farmer, by one operator using seeders that are now over 80 feet wide and are planting a quarter of a section of cereal in a matter of hours, versus the days it took before now.

The trade restrictions put in place by Russia and the Ukraine last year affected Seed Hawk, I think, and I'm trying to remember the—

[Ted Menzies, Conservative, Macleod, AB]

There was Bourgault, I believe.

[Howard Mains]

Yes, Bourgault. There were two Saskatchewan-based companies that were affected.

[Ted Menzies, Conservative, Macleod, AB]

Are those tariffs still in place?

[Howard Mains]

Yes.

[Ted Menzies, Conservative, Macleod, AB]

That's what I was afraid of.

For those who haven't been to other grain-producing countries in the world, all over Australia you'll see Saskatchewan, Manitoba, and Alberta technology. All over Eastern Europe, we're a leader in that.

On the tariffs that we eliminated this year in budget 2010, as a rolling out, I'm sure your members appreciated that because they're buying, whether it's steel or whether it's parts from other parts of the world. Did those tariff eliminations help?

[Howard Mains]

The members of the Canadian Manufacturing Coalition, which includes a couple of members around this table, certainly appreciated that. I think Jay Myers at the CME has more recent information about that.

Ron, you might be able to comment about the specific investments that have resulted, but yes, anything that reduces the input costs for the manufacturing sector is certainly appreciated. I think the CME, in their presentation, did present the committee with some data on that.