Finance Committee on May 7th, 2019

[Kim Moody]

I would suggest that there is a disincentive to take risk, but is there a disincentive to stay home and not work? Probably not. But is there a disincentive to take risk? Yes.

I would add to your commentary. Do I think there's a war on the wealthy in Canada right now? Absolutely. One of the things that I spend a lot of time on is giving advice for the wealthy. Now, a lot of people say we should tax them more. I see how much they pay. It's easy.... For example, I do some professional athlete work in Canada. The amount of tax these people pay both in Canada and the United States is absolutely astounding. Do you want them to pay more? The average response from people who don't make that kind of money is “sure”. Really? You do, do you? That is a disincentive in many cases to ultimately wanting to perform, so—

[The Chair, Liberal, Wayne Easter]

Pierre, you're out of time.

Mr. Marshall wants in as well. Then I'll go to Mr. McLeod, and Mr. Boulerice will have to wrap it up.

Mr. Marshall.

[Brendan Marshall]

You raised a question about what a comprehensive tax reform could look like. One element that could be included in that, which would be instructive, is what are the types of tax policies, both corporate and personal, that would be required to make Canada the leading choice for having a corporate head office?

What would be required to make an investor decide they want to move and put their head office in Toronto, Calgary, Vancouver, Montreal or any other jurisdiction in this country; and why aren't they choosing to do that now?

In the mining space, we've seen significant merger and acquisition activity over the last 15 years. What that has effectively resulted in is tantamount to a hollowing out of our corporate head offices. Taxation is a part of that. A strong openness to free trade is another part of it, and that's a bonus. How do you balance those things out?

Any holistic overview of Canada's tax system would be well served by rigorously holding up that question and trying to answer it as truthfully as we possibly could.

[The Chair, Liberal, Wayne Easter]

Thank you, Mr. Marshall. Those are very valid points.

You should know, and Mr. Moody as well, that the finance committee has recommended that there be a comprehensive review of the taxation system. Certainly one of the big questions is, how do you do it? I'm of the line of thought that, first, you really need to have experts in the wide-ranging field do the review and come up with a white paper, and then at that point in time turn it over to a parliamentary committee.

One of the difficulties with that, though, is if you started it before an election, you'd be accused of doing it to raise taxes, and the other side of would be accusing you of something else. It's part of the difficulty in the realm of politics. However, we have recommended that there be a comprehensive tax review, and I certainly believe the way to start would be to develop a white paper and then go from there.

Mr. McLeod, and then Mr. Boulerice will wind up.

[Michael McLeod, Liberal, Northwest Territories, NT]

Thank you, Mr. Chair; and thank you to the witnesses for the presentations today.

On the point of the tax review, it would be interesting to see how the parties voted on the recommendation to do a tax review and analyze the results.

I don't think we talk about the north enough in this committee, and I want to go back to the presentations here today regarding the north.

For quite a few years now, for a good part of my life, I've advocated bringing attention to the north because of the potential there. As one of the presenters mentioned today, it is where the future lies. It's virtually untouched. It has huge potential in many areas, and it would be interesting to hear your points of view on how important the north is to our future.

We have big areas such as Grays Bay and different parts of the north where we could see much happening in the future. Some of those projects could be comparable to Ring of Fire, or even bigger.

Could I get both PDAC and the Mining Association to give us a quick snapshot of your opinion on the north?

[Lisa McDonald]

As mentioned earlier, we do agree that the future is in the north for Canada. We once again point to the challenges with the costs of operating in the north. It's not rocket science; it comes down to a lack of infrastructure, in terms of roads, from an energy perspective, from a communications perspective, and from the mining industry's perspective.

We're a willing partner, and I'm sure my colleague Brendan can elaborate on examples of our companies that are partnering on the types of infrastructure projects that are needed in the north. For us, this isn't just about building a road to a mine; this is about partnering and building infrastructure that will benefit all of the communities that are in the north.

Brendan, maybe you could talk about some more specifics.

[Brendan Marshall]

I think, to make a long story short, there is tremendous potential, and while infrastructure is a barrier, it's most certainly not the only one.

I think one of the barriers is giving northerners a greater level of autonomy to make decisions on what they want for their own future. Historically, when we looked at infrastructure funding programs, the north has been unduly limited through per capital allocation formulas.

One of the things that the current government should be commended on is the departure from that and having a per capita plus formula, and also specific northern carve-outs for infrastructure, allowing our region of the country to participate on a more level playing field in competition for limited pools of resources.

I think even beyond the policies and the programs—and we could talk about that for a long time today, which I am happy to do, not only as a professional but as a personal advocate for responsibly developing northern Canada—we need to move away from having this Garden of Eden mentality about the north in people's minds in southern Canada.

It is not a massive expanse of 3.4 million square kilometres of parkland. It's people's homes. It is a place where people are born and raised. It's where people's families are. It's where people raise their children. We cannot be continually unilaterally making decisions about what that part of the country means to us without elevating the perspectives of the people who live there to a level playing field.

I would say that is a really important piece of balance in this discussion—

[Michael McLeod, Liberal, Northwest Territories, NT]

I'm going to interrupt you because I want to bring up one more point.

The chamber of mines and chamber of commerce have said that if we were to deal with the infrastructure deficit, we wouldn't even have to talk about subsidies, tax credits or anything of that nature in the north.

I think we've done a pretty good job of putting infrastructure investment in transportation and we need to do a lot more. We're looking at energy costs as something we can start to tackle.

The one point that nobody has raised here is the resolution of land tenure with indigenous governments and self-government. If we're going to grow the economy, we have to resolve those issues. It's been on the table for a long time. With some indigenous governments, it has been 30 or 40 years. It creates uncertainty for industry, I'm sure, and I've heard it.

Maybe you could touch on how important it is for us to get—

[Brendan Marshall]

I'll defer to Lesley for that.

[Lesley Williams, Director, Policy, Prospectors and Developers Association of Canada]

Thanks.

It's absolutely critical. As an association, we've been working on advocating for the resolution of land claims and working together on those issues for many, many years now. We've seen success stories in the north, where land claims have been resolved, and there are quite excellent partnerships around that.

The Tlicho are an excellent example. Look at Nunavut and a number of the successful projects that have moved along as a result of having land claims and working through those land claims.

They're still kind of a work in progress in terms of their implementation and how we see those through, as well as the various processes that come along with them around the land management regimes, water, wildlife and whatnot. They help to provide that sense of certainty for explorers and for mining projects.

[The Chair, Liberal, Wayne Easter]

We have time for one question.

Mr. Boulerice.

[Alexandre Boulerice, NDP, Rosemont—La Petite-Patrie, QC]

I would like to ask Mr. Bradley my next question.

My political party advocates the electrification of transport, both individually and collectively. We have very little time, but I would like to know what you propose to the federal government in terms of an action plan that would allow it to electrify transportation.

[Francis Bradley]

Wow.

[Alexandre Boulerice, NDP, Rosemont—La Petite-Patrie, QC]

In one minute.

[Francis Bradley]

I think we're taking some of the right steps already. There is a very active dialogue that's taking place right now among the key government departments, industry and civil society.

I think what we need to do is look at developing a comprehensive electrification strategy for Canada. It's something that we've been advocating for. It means we need to do some additional research so that we can understand, in fact, what the next steps are.

This is going to be too important, I think, for the future of our country and it's something that we collectively have to get on board with. We have to have a clear and well thought out, well reasoned strategy for moving forward, and moving forward fairly quickly with electrification if we actually want to have some kind of an impact on climate change.

Thank you for the questions.

[The Chair, Liberal, Wayne Easter]

Thank you, witnesses, for your presentations and for answering our questions, and for the lively discussion, at times.

With that, colleagues, we'll meet tomorrow from 3:30 p.m. to 6:30 p.m. in room 125.

Thank you to all.

The meeting is adjourned.