Evidence of meeting #47 for Finance in the 40th Parliament, 3rd session. (The original version is on Parliament’s site, as are the minutes.) The winning word was finance.
A recording is available from Parliament.
Conservative
The Chair Conservative James Rajotte
What is the linkage between the changes made to the equalization formula and the cash transfers?
Chief, Equalization and Policy Development, Department of Finance
There's no interaction at all with the changes that were made to the equalization program. If you are referring to the changes that were effective in 2009-10, there's no interaction.
Conservative
The Chair Conservative James Rajotte
The Alberta government is arguing that the changes made to the equalization formula after the 2004 health accord have affected cash transfers going to the Province of Ontario. But you're stating categorically that this is not the case.
Chief, Equalization and Policy Development, Department of Finance
There's no interaction between the equalization changes and the cash transfer of the CHT, no.
Conservative
The Chair Conservative James Rajotte
I appreciate that answer. If you have anything further on that, I would certainly appreciate it as the chair and as a member of this committee.
I have Monsieur Mulcair, s'il vous plaît.
NDP
Thomas Mulcair NDP Outremont, QC
Thank you, Mr. Chair.
It is a pleasure to meet with the finance officials again. I would like to know whether they can describe the current efforts being made to reduce the opportunities for Canadians to use tax havens, which, for lack of a better term, I will call opaque jurisdictions. According to the OECD, the figure is in the neighbourhood of $6,000 billion, or $6 trillion, which, in proper French, would be “6 billions”. That can lead to confusion here, in Canada, because the English “billion” is not the same thing; the difference is a factor of 1,000, so it can be a bit complicated. The Tax Justice Network in the U.K. estimates that the amount of money being hidden in these opaque jurisdictions is more along the lines of $10,000 billion.
What are we doing in terms of strictly enforcing legislation? Do we need more resources? Should we do something on that front?
Gérard Lalonde Director, Tax Legislation Division, Tax Policy Branch, Department of Finance
Thank you for that question.
As you may know, the OECD and the G-20 have strongly supported the introduction and use of tax information exchange agreements to ensure that countries can be informed about income that their residents and citizens may have in other jurisdictions. To that end, and even before the attention of the G-20 on the issue, the Government of Canada was proactive and in 2007 introduced a policy that provided incentives for countries to enter into tax information exchange agreements with Canada, as well as disincentives for refusing to do so after having been invited to do so, and introduced as a policy, in addition to the tax information exchange agreements that are particular to information exchange, that all of Canada's new tax treaties and renegotiations of existing tax treaties from that point hence would be required to include the OECD standard language on the exchange of tax information.
That's a policy that Canada has pursued vigorously. Canada has signed some 11 tax information exchange agreements so far and is under negotiation with another 14. We've also updated some treaties, perhaps most notably with the country of Switzerland, and we now have the latest OECD-approved language for tax information exchange for Switzerland. The government sees this as a very important tool for permitting tax information exchange because, as the minister said, if Canadians are of the view that they could in the past have hidden income in other jurisdictions, they will be disabused of that in the near future.
NDP
Thomas Mulcair NDP Outremont, QC
I have a purely personal question for you, but I assure you that I am not trying to be critical, I just find it intriguing. Given that you need to know French in order to get to a position of your level and given that people whose first language is French regularly try to answer in English when we ask them questions in English, even if they are not nearly as comfortable in it as their first language, I just find it interesting that you answered me in English.
Conservative
Ted Menzies Conservative Macleod, AB
On a point of order, Mr. Chair, this has nothing to do with the appearance of these officials. That is an offensive comment—
NDP
Thomas Mulcair NDP Outremont, QC
It is hardly an offensive question, Mr. Chair. To have such a high-level position, you have to have a certain level of proficiency in both languages. Furthermore, there was nothing inappropriate or disrespectful about the question. If Mr. Lalonde does not wish to answer, he does not have to, but my question was directed at him.
I would point out, Mr. Chair, that Mr. Menzies has interrupted me at least 20 times in the past two years, something I have never done to him in my life. I would ask you to start reigning him in, because members are not allowed to interrupt someone whenever they want.
Conservative
The Chair Conservative James Rajotte
Just on this point of order, Mr. Mulcair, as you know, when a member raises a point of order, they can do so, and the chair cannot shut down a point of order.
NDP
Thomas Mulcair NDP Outremont, QC
But when it is not a point of order, Mr. Chair, it is your responsibility to intervene.
Conservative
The Chair Conservative James Rajotte
Where they raise a point of order, I have to rule whether it's a point of order.
I would just observe as the chair that it is the right of witnesses to speak in either official language,
in French or in English. It is up to the witness.
NDP
Thomas Mulcair NDP Outremont, QC
I asked Mr. Lalonde a question, and I want an answer.
Go ahead, Mr. Lalonde.
Director, Tax Legislation Division, Tax Policy Branch, Department of Finance
It is for the chair of this committee to say whether I have to answer that question or not. I have no problem doing so, but it may be for the chair to say one way or the other.
NDP
Thomas Mulcair NDP Outremont, QC
Do you have to have a certain level of proficiency in French in order to hold a high-level position such as yours?
Director, Tax Legislation Division, Tax Policy Branch, Department of Finance
I will wait for the answer of the....
NDP
Thomas Mulcair NDP Outremont, QC
That tells me everything I need to know. Okay, it is fine, Mr. Chair.
November 23rd, 2010 / 1:20 p.m.
Conservative
The Chair Conservative James Rajotte
I do want to clarify this, though. All officials, I think, should be aware of this. It is up to the official themselves to determine whether they wish to speak in English or French,
in French or in English. It is up to you.
You can speak either official language before this committee, whichever you prefer.