Finance Committee on Nov. 21st, 2017

[The Chair, Liberal, Wayne Easter]

We'll call the meeting to order.

Pursuant to the order of reference of Wednesday, November 8, the committee is studying Bill C-63, a second act to implement certain provisions of the budget tabled in Parliament on March 22, 2017 and other measures.

Mr. Dusseault, on a point of order.

[Pierre-Luc Dusseault, NDP, Sherbrooke, QC]

Mr. Chair, I would like to raise a point of order to clarify what is happening this morning. I am seeking your wisdom.

Our last meeting ended abruptly, before a motion had been put to a vote. That was done in a very cavalier manner. We had not even made a decision on the motion under consideration. I am therefore raising a point of order to find out why we are not picking up where we left off at the last meeting, that is, with debate on my colleague Mr. Poilievre's motion.

[The Chair, Liberal, Wayne Easter]

The motion that you moved you can lift off the table at any time—now, later, tomorrow, or....

[Pierre-Luc Dusseault, NDP, Sherbrooke, QC]

I would like to do that now, Mr. Chair.

[Pierre Poilievre, Conservative, Carleton, ON]

I'd like to speak to that.

[The Chair, Liberal, Wayne Easter]

Okay.

Mr. Dusseault, do you want me to read the motion into the record?

[Pierre-Luc Dusseault, NDP, Sherbrooke, QC]

Yes.

You can read it to remind everyone of what we're talking about.

[The Chair, Liberal, Wayne Easter]

The motion reads as follows:

That, given ongoing media revelations that could implicate some Canadians in aggressive tax avoidance or tax evasion, the Committee invite Stephen Bronfman, Revenue Chair for the Liberal Party of Canada; and Leo Kolber, former Senator and former chief fundraiser for the Liberal Party of Canada, to appear before the Standing Committee on Finance before November 30, 2017, to answer questions relating to their offshore assets in jurisdictions that are considered to be tax havens.

The floor is yours, Mr. Dusseault, and then I have Mr. Poilievre.

[Pierre-Luc Dusseault, NDP, Sherbrooke, QC]

Thank you, Mr. Chair.

I do not want to repeat myself, but I am a bit disappointed that we have to resume debate on this motion. We could in fact have made the decision at the last meeting, last Thursday.

I would like to find out why the two people mentioned in the motion are now saying that they acted in full compliance with the law and can therefore invest their assets offshore. This affords those individuals quite a lifestyle and income, income that is obviously declared in those countries.

The purpose of this study is to find out what strategy is used so that we at the House of Commons Standing Committee on Finance can find ways to thwart those tactics. For my part, I find them absolutely deplorable and immoral. They say it is legal, but to my mind it is completely immoral. As legislators, we have to find a way to counter this circumvention of tax provisions which results in a very low rate.

These two individuals appear to be experts on that. They said they acted completely legally and that there is nothing wrong with what they did. So it is up to us now to hear from them so we can learn more and, above all, so we can find ways of addressing this. I will not repeat what I spent five minutes explaining at the last meeting. The purpose of my motion today is essentially the same.

I would like to get my colleagues' support so that we can hear these individuals' explanations and find ways of countering the immoral and excessive use of tax havens.

[The Chair, Liberal, Wayne Easter]

Thank you, Mr. Dusseault.

Mr. Poilievre.

[Pierre Poilievre, Conservative, Carleton, ON]

I'd like to thank the member for his original motion. He brought this matter to the attention of the committee.

I think it is important to talk about this. It is up to the Standing Committee on Finance to deal with matters related to income tax and taxes. There are major revelations about certain amounts that individuals who use tax havens have paid or rather have not paid. It is up to us to uncover the truth in this regard.

The tax rate for Canadians is rising. This represents a major burden for them, especially for members of the middle class, 87% of whom are paying more tax that they did two years ago, $800 more, on average. The huge increase in government spending is of course one of the reasons for this burden. The fact that some Canadians, especially those who are well-off, use strategies, whether they are legal or not, to avoid paying their fair share could be another reason.

The government has increased the tax rate on farmers, small and medium-sized businesses, and people with diabetes. On the other hand, the billionaires who are able to hide their assets and money offshore are protected. They can use tax shelters not available to other Canadians who do not have those resources.

I believe my colleague from the New Democratic Party is correct in proposing that our committee study this matter. On behalf of the Conservative Party, I also call on the government to conduct this study in order to provide for transparency.

Thank you, Mr. Chair.

[The Chair, Liberal, Wayne Easter]

Are there any other speakers or am I going to the question?

I'm going to the question.

[Pierre Poilievre, Conservative, Carleton, ON]

I'd like a recorded vote.

(Motion negatived: nays 5; yeas 4)

[The Chair, Liberal, Wayne Easter]

Before we go to the witnesses on division 10, we have a request for the project budget related to Bill C-63, a second act to implement certain provisions of the budget tabled in Parliament on March 22, 2017 and other measures. This expenditure, related to a number of witnesses who have come to present their views on Bill C-63, is in the amount of $15,500.

Do we have a motion to accept the budget as presented?

[Greg Fergus, Liberal, Hull—Aylmer, QC]

I so move.

[The Chair, Liberal, Wayne Easter]

We'll vote on the motion.

(Motion agreed to [See Minutes of Proceedings])

We'll now turn to division 10, which relates to trade within Canada and the harmonization of energy efficiency requirements.

Witnesses, thank you for your patience. I know you've been here several times.

Mr. Fertuck is acting director general of the external and trade policy branch at ISED. Ms. Hill is special adviser in the strategy and innovation policy sector at ISED. Ms. Henry is director general, office of energy efficiency, Natural Resources Canada. Ms. Scharf is director of the equipment division in the office of energy efficiency at Natural Resources Canada.

Is someone starting off with a short presentation? No.

Do you have any questions on division 10? Four people here are just dying to answer them.

Go ahead, Mr. Kmiec.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

I have a question. Under clause 222, section 26 of the act is being repealed. I went to find out what section 26 of the act is about, and the bill says it's in regard to the Energy Efficiency Act. You can go through it. It talks about the publishing process with regard to the Canada Gazette. It seems to me that you are removing the requirement to publish changes to proposed regulations. Because the entire thing is being removed, that's how I read the section. Is that the effect? Is that the intention?

[Joyce Henry, Director General, Office of Energy Efficiency, Department of Natural Resources]

Thank you for your question.

That's not the intention. The intention is to just update the act.

This part of the act, section 26 of the Energy Efficiency Act, was put in place before the regulatory process that's now directed through a cabinet directive through Treasury Board, so there is already a requirement to consult with stakeholders and provinces and territories. It's over the same time period. It's 75 days. We're also governed by the World Trade Organization requirements for obligatory consultation on regulatory changes. What this does is it takes something out of the statute because it exists in other areas now.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

Is it a legislated requirement in the other statutes?

[Joyce Henry]

The cabinet directive is a directive that's published through the cabinet and implemented by the Treasury Board and the Treasury Board Secretariat.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

It's not a statutory requirement, then.

[Joyce Henry]

It's not a statutory requirement, but it does govern how departments operate when they're doing changes to regulations, and it is public.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

Are you asking us to remove a legislated requirement to consult and to publish in the Canada Gazette a regulation in exchange for a cabinet-level directive to Treasury Board to consult and to publish in the Canada Gazette?

[Joyce Henry]

Effectively, yes.

What I would say is that the cabinet directive is a long-standing directive. It's been in place for a number of years, and it's what governs departments in all the regulations that they do. My understanding is that there aren't that many pieces of legislation that still have a legislated requirement for consultations because it exists in other arenas that the government follows. The cabinet directive on regulation-making...I'm not sure if that's the technical term—

[Tom Kmiec, Conservative, Calgary Shepard, AB]

Can you explain to me, then, if the cabinet wanted to change that directive, how fast could it do so?