Finance Committee on May 18th, 2021

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Thank you, Mr. Chair.

I have another question for Ms. Potter.

You said that your association would be very happy if the government gave you the best possible plan for the way forward. I'd like to hear your comments on this.

I'll give you an example that pertains more to artists and festival organizers. Some of them are calling us to say that they're organizing their summer. Some artists are making arrangements to go and perform in the United States or across Canada. However, festival organizers are telling us that they're trying to invite artists, but that, for now, the 14-day quarantine is still required for people who cross the border. The organizers are asking us whether it's possible to find out when these measures will be lifted. Of course, the public safety people are telling us that they don't have that information. We're asking them when they'll receive it.

That's why I want you to talk about the importance of transparency in terms of the game plan for lifting the lockdown. I also want to know whether you've faced situations like the ones that I just described.

[Beth Potter]

Thank you, Mr. Ste-Marie.

We are looking for opportunities to travel without quarantine. This will be incredibly important. When you think about the resumption of travel, whether it's travelling for leisure, going to a music festival or an art festival or travelling for business, the cost of quarantine is going to be too prohibitive for us to see a resumption of travel at the levels we need to see.

The United States is resuming business travel now. I was speaking to a hotel operator this morning out of the United States, and they are back to 60% capacity across their suite of properties. At 60% capacity, a hotel starts to make a profit. We need to get people moving around the country to allow businesses to start standing on their own two feet again.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Thank you.

[The Chair, Liberal, Wayne Easter]

We'll go to Mr. Julian and then Mr. Falk.

[Peter Julian, NDP, New Westminster—Burnaby, BC]

Thanks very much, Mr. Chair.

I'm going to come back to Mr. Aylward.

I know that many members of the Public Service Alliance of Canada work within the CRA. We've heard from CRA employees at this committee that they have never been given the legislative tools and resources to really crack down on overseas tax havens, which we know cost us $25 billion in taxes every year. It's a national shame that gets far less media coverage than it should. We know about the billionaires with no wealth tax, and the huge profits for corporations with no excess profits tax.

Mr. Aylward, in your statement you referenced the growing inequalities that we're seeing in this country. How important is it to have in place a fair tax system where everybody pays their fair share so that we have the resources and wherewithal to provide supports to everybody in the country and we stop the growing gap between a very small number of very wealthy people and everybody else?

[Chris Aylward]

My home department is the Canada Revenue Agency, and a lot of the inequities we see in the country are economic inequities. Until we get a good grasp of that and make sure that all loopholes are closed, the wealthy are going to keep getting wealthier and, unfortunately, those who are struggling will continue to struggle.

A wealth tax is long overdue in this country. It would ensure that the wealthiest pay their fair share. They're not right now, and until we get a good grasp of that, unfortunately it's going to continue that way. The numbers will continue to go in the opposite direction, which is not going to be good for the economy, nor for Canadians.

[Peter Julian, NDP, New Westminster—Burnaby, BC]

I have a quick question for Ms. Potter.

We heard from Susie Grynol that we will lose 70% of our hotel sector if supports are not put into place. For the tourism sector overall, if the targeted supports you're talking about are not put in place, how many years would it take us to rebuild the tourism infrastructure, and particularly the hotel infrastructure, that will collapse as a result of the government not providing supports in a timely way?

[Beth Potter]

It's most likely a decade. We are looking right now at numbers that say that, with supports continuing, it's going to take us until 2024-25 to get back to 2019 numbers, as it stands right now. If we open the border in October, that number might stay at 2024. The longer the border stays closed, the longer it's going to take us to recover. If we lose 60% of businesses across the board, we're looking at a minimum of a decade.

[The Chair, Liberal, Wayne Easter]

Thank you all.

We have about four minutes each for Mr. Falk, Mr. McLeod, Ms. Jansen and Mr. Fragiskatos.

Ted, you're up.

[Ted Falk, Conservative, Provencher, MB]

Thank you, Mr. Chair.

Thank you to all of the witnesses. I enjoyed hearing your various comments and testimonies.

I'd like to ask Mr. Moody a few questions. You indicated in your opening comments about the size of the budget—724 pages—with this bill being 366 in all, how extremely extensive it is and that to give it an adequate study it would take a lot more time than what we're doing.

You also talked about inflation, and I've had the same experience you've had. I know that when I go to the grocery store groceries cost more. They're telling me a sheet of OSB for building houses was $8 a year ago. Today there's a limit on it at $80 a sheet. A homebuilder, on the weekend, told me it costs an average of $40,000 more this year to build a home than it did a year ago. RVs and autos are more expensive. Housing and even the cost of everyday goods and services have seen, for the most part, a significant increase. We know that inflation is happening, and we know when inflation happens interest rates are going to increase.

Have you done any calculations as to what size of a rate shock Canada can afford on its debt?

[Kim G.C. Moody]

Thank you, Mr. Falk.

The short answer is no. I personally have not. I spend all of my time in tax stuff and tax policy more than in inflation and economics. I leave that to my economist friends. I think common sense dictates that it's not going to take much of a rate increase in order to have a huge economic shock.

[Ted Falk, Conservative, Provencher, MB]

Then let's switch to taxes.

The national early learning and child day care program that's being suggested by this budget is going to use Canadian tax dollars to subsidize the parents who make a choice to take advantage of a national day care program. There are parents, men and women, who are going to make a difficult and sacrificial choice to raise their children at home.

What do you think about the fairness of subsidizing some parents and not others?

[Kim G.C. Moody]

It's foundationally unfair. I don't share the enthusiasm of some of the witnesses and members of the committee with respect to the deployment of a national child care program, notwithstanding the fact that ideally we would have one. I'm concerned about the cost. I'm concerned about the inequities. Yes, I appreciate that some parents, my family included.... I have four children, and certainly we struggled with finding child care cheaply as well. Having said that, do I think this country can afford it? I think ultimately the short answer is no. I don't share the enthusiasm.

[Ted Falk, Conservative, Provencher, MB]

Okay.

From your perspective what is the most glaring omission in this budget?

[Kim G.C. Moody]

I said it in my opening remarks, and I'll say it until it happens, which might ultimately not be until I die or sometime after I die: the lack of a comprehensive tax review and reform. That has not happened in this country since 1962, with the Royal Commission on Taxation. This committee recommended a comprehensive review and reform, and so did the Senate finance committee. All of these asks....

I noticed the member from the NDP calls for a wealth tax. Maybe a wealth tax is a good idea—who knows?—but it shouldn't be done in isolation. It should be part of an overall comprehensive review and reform. We're long overdue. That to me is the glaring omission from this budget and many budgets previous.

[Ted Falk, Conservative, Provencher, MB]

Can I have one more question, Mr. Chair?

[The Chair, Liberal, Wayne Easter]

You can make it 30 seconds.

[Ted Falk, Conservative, Provencher, MB]

No, I don't want to rob Tamara.

[The Chair, Liberal, Wayne Easter]

Mr. McLeod, you have roughly four minutes.

Mr. Moody, I believe we made that recommendation twice on this committee.

Mr. McLeod.

[Michael McLeod, Liberal, Northwest Territories, NT]

Thank you for giving me some time, Mr. Chairman.

First of all, thank you to all the presenters. It's a very interesting discussion.

My question is for the tourism association, Beth Potter.

I represent the Northwest Territories and over half of the Northwest Territories is indigenous, so it was very important to us to see the Indigenous Tourism Association finally set up an office here in the Northwest Territories. I know, by your presentation, that they are part of your organization.

For us, they serve a very important purpose. They play a really important role in the north, and it's a different role from most of the other agencies that deal with tourism, because we have different challenges here in the Northwest Territories—and the Yukon and Nunavut, for that matter—but we have huge potential. Our communities are small. Getting professionals is very difficult, and getting consultants or accountants to deal with the small communities and the people who live there is a real challenge.

I find that a lot of our operators struggle to get even insurance or permits, things of that nature, where you have to go to the regional centre to get them, and the Indigenous Tourism Association plays a big role in helping them and guiding them.

This year we've seen the Indigenous Tourism Association in the budget; it got money. I want to ask you if you feel that is something we should be encouraging to do better, to get more money for indigenous tourism, so they can have more staff on the ground and more people to help things move along and move forward.

[Beth Potter]

Indigenous tourism is an incredibly important product as part of Canada's overall offering. We've seen huge growth in the level and the quality of indigenous product and the number of businesses and experiences that are being offered. Yes, we need to continue to foster the development of these great experiences, make sure that they are market-ready and take them to the world.

Of course we would always encourage the continued work with indigenous tourism as a sector.

[Michael McLeod, Liberal, Northwest Territories, NT]

Yes. Thank you for that.

I would also like to ask you—and I am not sure if you're aware of this—but there are real challenges when it comes to getting indigenous people formally involved in tourism development. In our communities, and I believe it would be the same in the tribes in the south, it is really important to have things structured in a way that you don't step on somebody's toes when you go into a different area of one tribe's traditional lands or a family's traditional lands. A lot of the communities are working on and have been talking with Indigenous Tourism to develop tourism development plans so that the tourism industry knows where they need to stay away from—important burial grounds, sacred sites or environmentally sensitive areas—and the plans have to fit into land-use plans.

I don't know if you've ever had a chance to talk about a big picture strategy that indigenous people need to have versus everybody else who just gets a licence, a permit and whatever they need to sell their product, but I think it needs more. Maybe you could talk about that.

I also think that a lot of the money that came for tourism relief left indigenous people out. I know many hunters on the northern coast along the Beaufort Sea, the polar bear hunters, the ecotourism operators or single operators like a father and son or a couple, just closed their doors. They didn't bother to try to get some of the money to provide relief because they don't have access to people who can package that stuff.

I'll just leave that with you to comment on. It's a different world when it comes to indigenous tourism, and I think you're aware of some of that.

[The Chair, Liberal, Wayne Easter]

Please be fairly quick, Beth.

[Beth Potter]

Yes, no problem.

There are many indigenous tourism organizations across the country that work very closely with their local businesses and will continue to do so, and we would encourage them to continue to do that and to continue to work with the different levels of government as well.

We've certainly been encouraged to see funds available to indigenous tourism businesses through the aboriginal financial institutions that make sure that there is a way for them to access those funds.

[The Chair, Liberal, Wayne Easter]

You have a tightened four minutes, Ms. Jansen, followed by Mr. Fragiskatos.