Finance Committee on Oct. 26th, 2022

[The Chair, Liberal, Peter Fonseca]

I call this meeting to order.

Welcome to meeting number 64 of the House of Commons Standing Committee on Finance.

Pursuant to Standing Order 83(1) and the motion adopted on Wednesday, September 28, 2022, the committee is meeting to discuss the pre-budget consultations in advance of the 2023 budget.

Today's meeting is taking place in a hybrid format, pursuant to the House order of June 23, 2022. Members are attending in person in the room and remotely using the Zoom application.

I'd like to make a few comments for the benefit of the witnesses and members.

Please wait until I recognize you by name before speaking. For those participating via video conference, click on the microphone icon to activate your mike, and please mute yourself when you are not speaking. For interpretation, for those on Zoom, you have the choice, at the bottom of your screen, of floor, English or French. For those in the room, you can use the earpiece and select the desired channel.

I remind you that all comments should be addressed through the chair. For members in the room, if you wish to speak, please raise your hand. For members on Zoom, please use the “raise hand” function. The clerk and I will manage the speaking order as well as we can, and we appreciate your patience and understanding in this regard.

I'd now like to welcome our witnesses who are with us here today. They're coming to us in person in the room or via video conference.

From the Business Council of Canada, we have Robert Asselin, who is the senior vice-president of policy. Welcome.

From the Canadian Taxpayers Federation, we have with us Franco Terrazzano, who is the federal director.

From the Centre for Israel and Jewish Affairs, we have Shimon Koffler Fogel, who is the president and chief executive officer.

From the Green Budget Coalition, we have Theresa McClenaghan, who is the executive director of the Canadian Environmental Law Association; Tom L. Green, who is a senior climate policy adviser for the David Suzuki Foundation; and Andrew Van Iterson, who is a manager.

From Info-Electronics Systems Inc., coming to us, I believe, from the west coast, we have Harinder Ahluwalia, president.

From the Union des producteurs agricoles, we have David Tougas, who is the coordinator of business and economics, and Martin Caron, who is the general president.

We will start with opening remarks for up to five minutes for the witnesses. We'll start with the Business Council of Canada.

The floor is yours, Mr. Asselin.

[Robert Asselin, Senior Vice-President, Policy, Business Council of Canada]

Thank you, Mr. Chair.

My name is Robert Asselin.

I'm the senior vice-president of policy at the Business Council of Canada. We represent the heads of 175 businesses, employing over two million Canadians.

I want to convey two simple messages to you today.

The first relates to fiscal policy in perilous times. We are in the midst of the riskiest economic policy landscape we’ve seen in decades. Inflation remains stubbornly high, and the risks of policy mistakes are increasing. This requires a change of direction on fiscal policy. As the recent events in the United Kingdom have shown us, misalignment between the Government of Canada and the central bank could cause unease in the bond market and raise the cost of borrowing inadvertently. Put simply, the more expansionary fiscal policy continues to be, the more difficult it will be for the central bank to do its job and bring inflation back to its mandated target range.

It is generally accepted that as long as economic growth outpaces interest rate increases, the burden of servicing debt will fall over time. In the current economic environment, we can no longer assume that this will be the case. When interest rates go up faster than growth, there is simply no easy way out. Debt financing becomes much more burdensome for taxpayers. Therefore, like former Bank of Canada governor David Dodge, we are of the view that the government should adopt a new fiscal anchor based on debt servicing costs. It should commit to ensuring that its debt service costs do not exceed 10% of annual government revenues going forward.

The second message I want to convey to you is on our economic competitiveness.

We must manage and look to the future without complacency. For too long, we have neglected our economic competitiveness. While the government has announced some measures in the last two budgets that will certainly help our economy, we're still a long way off. The federal government still lacks a coherent long-term growth plan and a modern industrial policy that will make Canada more competitive.

The world's largest economy—and Canada's largest trading partner—now has a clear and bold industrial strategy for the first time since the Cold War. Because of this, Canadian policy-makers need to acknowledge the real threat that the recent adoption of the Inflation Reduction Act, which is called the IRA, and the CHIPS and Science Act in the United States pose to our economic competitiveness. We are already hearing of projects moving to the U.S. to take advantage of the IRA.

To stay competitive, Canada needs an industrial strategy of its own with several key components. Although I don't have time to go through every component in this testimony, let me briefly emphasize three essential ones.

Number one is talent. In a recent survey of our members, 80% reported having difficulty finding the skilled workers they need to grow and compete globally. As a result of these shortages, 67% have cancelled or delayed major projects. Some 30% were forced to relocate work outside of Canada.

With an aging workforce and a declining labour participation rate, Canada's future prosperity depends on change to our immigration system to significantly increase the number of economic-class applicants who are granted permanent resident status.

The second is investments. Canada must demonstrate to the world that we can successfully complete major projects and build the infrastructure that is required to access global markets. For such projects to go ahead, however, investors need regulatory predictability and a clear understanding of the rules of the road.

We noted with interest the finance minister's recent speech at the Brookings Institution, in which she committed the government to “fast-tracking...the energy and mining projects that our allies need to heat their homes and manufacture electric vehicles.” We look forward to seeing more details on this important and welcome initiative.

The third and final point is innovation. The new direction of U.S. industrial policy reflects a broader government intervention beyond R and D to support technological developments from idea to market. In Canada, our capacity to undertake industrial research at scale is almost non-existent, and our technology transfer mechanisms have not kept pace with developments in knowledge creation. We still rely too heavily on incremental innovation or safe bets. Canada must become more competitive on technological innovation, and science must be translated into productivity growth and future prosperity.

Thank you for your attention.

[The Chair, Liberal, Peter Fonseca]

Thank you, Mr. Asselin.

Now we are moving to the Canadian Taxpayers Federation for five minutes of opening remarks.

Mr. Terrazzano, go ahead.

[Franco Terrazzano, Federal Director, Canadian Taxpayers Federation]

You’re going to hear from hundreds of individuals and groups asking for more money.

My name is Franco Terrazzano. I’m with the Canadian Taxpayers Federation, and I'm here on behalf of 235,000 Canadian taxpayers asking you to spend less.

I'm here today to say no more spending $8,800 on a sex toy show in Germany. No more racking up nearly six figures on fancy airplane food during a week-long trip. No more giving former governors general a $200,000-a-year expense account for the rest of their life. No more taking pay raise after pay raise while millions of Canadians struggle through a pandemic. No more giving 300,000 bureaucrats a raise while their neighbours lose their job or business. No more giving failing Crown corporations, like the Bank of Canada, millions in bonuses. No more announcing $295 million for the Ford Motor Company, $420 million for Algoma Steel, $12 million for Loblaw, $20 million for Maple Leaf Foods, $110 million for Toyota or $372 million for Bombardier.

Canadians need real relief, but Canadians are paying too much tax because the government wastes too much money. It's no wonder 72% of Canadians say they pay too much tax, according to a recent Ipsos poll released last week.

Fifty-one other national governments cut taxes during the pandemic, or eased the pain of inflation. That includes more than half of G7 and G20 countries. Two-thirds of OECD countries also cut taxes during that time.

While other countries cut taxes, Ottawa sticks Canadians with higher tax bills. The government has increased gas taxes, payroll taxes and alcohol taxes. The government is getting ready to impose a second carbon tax next year through fuel regulations, but Canadians cannot afford higher taxes, and we can’t afford to waste more money covering interest charges on the government’s credit card.

The government isn't scheduled to balance the budget until 2041, under the current trajectory. That's according to recent PBO data. Interest charges over that period will have cost taxpayers $800 billion by 2041. That’s a cost of $18,000 for every Canadian, and it's hundreds of billions of dollars that can’t be used to improve services or lower taxes, because that money is going to the bond fund managers on Bay Street.

There is some good news. The government could balance the budget next year. The government could also reverse its tax hikes. The government can do that by bringing program spending back to the prepandemic and pre-all-time-high levels of 2018-19, adjusted upward for inflation and population growth.

In 2018-19, the government spent more money than it did during any single year during World War II, even after accounting for inflation and population differences. That means the government overspent for years, so finding savings in every area of the budget should be like finding water in the ocean.

Fortunately, we're now hearing the finance minister say that if politicians want to fund new programs and spend more money, they're going to have to find savings in other areas of the budget. Spending buckets of extra cash would only be pouring gasoline on the inflation fire.

We're sure that politicians of all parties would agree with at least some of the savings in the CTF’s 80-page budget submission, and we're happy to work with you on those, because Canadians are struggling. Canadians can’t afford any more taxes or tax increases. Canadians cannot afford to waste more money on interest charges.

Fortunately, the government can provide relief and balance the budget. It will take modest spending restraint.

Thank you.

[The Chair, Liberal, Peter Fonseca]

Thank you, Mr. Terrazzano. You are well under time.

Now we will move to the Centre for Israel and Jewish Affairs, with Shimon Koffler Fogel, for five minutes, please.

[Shimon Koffler Fogel, President and Chief Executive Officer, Centre for Israel and Jewish Affairs]

Thank you to the chair and to all the members of the committee for welcoming CIJA's participation in this important conversation.

The Centre for Israel and Jewish Affairs, known as CIJA, is the advocacy agent of the Jewish Federations of Canada. We're a national, non-partisan, non-profit organization representing more than 150,000 Jews across the country affiliated through their local federations from coast to coast.

In my brief remarks, I'd like to focus on three things in particular. The first area is support for non-profit social services. CIJA works closely with our partners at the Network of Jewish Human Service Agencies across the country to advocate for non-profit social services. These non-profits provide assistance to both Jewish and non-Jewish Canadians, including people with both cognitive and physical disabilities; older adults; those facing mental health, substance abuse and housing challenges; and refugees fleeing persecution.

I think we all recognize that Canada's social service providers are in crisis. The pandemic increased demand on services across the board. While many non-profits were able to access emergency federal funding in the early months of the pandemic, this funding has been exhausted. Demand for services, however, has not slowed. Canada's non-profits are struggling to hire, train and retain the staff needed to function.

Recent Stats Canada results of the Canadian survey of business conditions show that 32% of non-profit sector employers believe retaining skilled staff will be an obstacle over the next period, while 36% are concerned about recruiting skilled staff. This is exacerbated by the reality that average salaries in community non-profits are already 35% lower than the economy-wide average in Canada. Current grant options on both the federal and provincial levels are limited in scope and availability, and are usually focused on programming.

Our recommendation is that the Government of Canada establish a national non-profit strategy that will provide the multi-year support needed to stabilize the non-profit sector. We also recommend that the government reintroduce emergency funding, or, through the CST, direct support for non-profit social services to address the short-term urgent capacity needs.

The second area concerns launching a community security trust to improve the security infrastructure program, or SIP. The security infrastructure program is a key initiative that provides essential funds to institutions to enhance their security infrastructure. SIP provides funding to private and non-profit organizations at risk of hate-motivated crime to mitigate the cost of such security infrastructure improvements as alarm systems and bollards. The efficacy and importance of this program have been well established over the last number of years.

However, while the SIP provides essential infrastructure funding, it's only part of the solution. It's essential to empower, equip and train community members to be aware of, identify, and deter threats, and to have the capacity to partner effectively with law enforcement, which in most cities is stretched beyond capacity and can therefore offer limited on-site support. Morever, at-risk communities need to feel a sense of ownership rather than feelings of victimhood and vulnerability.

Our recommendation is that the Government of Canada fund a pilot project to complement SIP, giving communities the capacity to deter threats and assume some responsibility for protection of their communal institutions and users.

The final area is with regard to government resources to implement the new anti-racism strategy. We at CIJA are deeply concerned by the situation in which funds from the Canadian Heritage anti-racism action program were directed to an organization that gave a platform to someone who publicly made statements of the vilest anti-Semitic content for years.

While we are grateful and pleased that Minister Hussen and the government have promised, and acted on, a review and renewal of Canada's anti-racism strategy, this was not an isolated incident. Our concern is that insufficient resources are being committed to actually address and educate on anti-Semitism and racism within the relevant government departments, especially for those tasked with vetting funding recipients.

Our recommendation is that the Government of Canada provide dedicated funding and work with community stakeholders to ensure that government funding never again goes to an organization that promotes anti-Semitism and racism in general. This funding should include education on anti-Semitism for government decision-makers; a genuine and measurable implementation of the IHRA definition, already adopted by the government; and continued funding for the office of Canada's special envoy on preserving Holocaust remembrance and combatting anti-Semitism.

Finally, Mr. Chair, although we eagerly anticipate the new legislation to deal with online hate and harms that both Heritage and Justice are working on, there is another dimension we feel is urgently needed.

We believe that a social media literacy campaign has to be undertaken. Our view is that hard-core haters represent a minority of Canadians. Those who would use social media to foment, disseminate and foster hate or use online platforms to incite violence are beyond rehabilitation. Most Canadians, however, engage in such activities or amplify such messages out of ignorance—not being sensitive to what these messages represent.

The path to sensitizing people to what hate looks like online, what forms it takes and what to do about it flows through education. We have to undertake a national social media literacy campaign to sensitize Canadians—especially the younger, more vulnerable demographic—about the appropriate use and abuse of social media.

Mindful of time, Mr. Chair, I will leave my comments there.

Thank you again for inviting us to participate. I invite any comments or questions.

[The Chair, Liberal, Peter Fonseca]

Thank you, Mr. Koffler Fogel.

There will be a lot of opportunity for questions from members. I'm sure they're looking forward to that.

We're going to hear from the Green Budget Coalition. We have two members via video conference and one, I believe, in person.

Go ahead for five minutes, please.

[Andrew Van Iterson, Manager, Green Budget Coalition]

Thank you, Mr. Chairman and committee members. Thank you for inviting the Green Budget Coalition to speak to you today.

The Green Budget Coalition, active since 1999, is unique in bringing together the expertise of 21 of Canada's leading environmental organizations, collectively with over one million Canadians as members, supporters and volunteers.

The Green Budget Coalition's mission is to present an analysis of the most pressing issues regarding environmental sustainability in Canada and to make a consolidated annual set of recommendations to the federal government regarding strategic fiscal and budgetary opportunities.

As the chair mentioned, I'm pleased to be joined today by three of my expert colleagues to help answer your questions: the coalition's co-chair, Theresa McClenaghan, with the Canadian Environmental Law Association based in Toronto and Paris in southwestern Ontario; the coalition's climate lead, Tom Green, with the David Suzuki Foundation in Vancouver; and Shaughn McArthur, associate director of government relations with Nature United in Madame Chatel's riding in Quebec.

Yesterday, I emailed you each the Green Budget Coalition's submission to the committee's pre-budget consultations, as well as links to this detailed document here in English and French, which is the coalition's detailed recommendations for budget 2023 with more detail.

Overall, as the world continues to grapple with major crises, including hurricane Fiona's recent impacts on Canadians on the east coast and energy shortages in Europe, the Green Budget Coalition believes it is now critical to focus more attention on the related climate and biodiversity crises in shaping a world that is equitable, carbon-neutral and nature-positive and provides secure, affordable energy for current and future generations of Canadians and people worldwide.

The coalition welcomed the federal government's multi-billion dollar investments in budget 2022 that advanced the coalition's recommendations, particularly for energy-efficient buildings, zero-emission vehicles and nature-based climate solutions; however, as we've seen, much more is needed.

The upcoming UN meetings on climate in Egypt in a couple of weeks, and then on nature in Montreal in December, are prime opportunities for the government to announce such new investments, to demonstrate global leadership and to inspire further action by our international partners.

In this context, the Green Budget Coalition has five feature recommendations for budget 2023 that will create jobs, enhance affordability by reducing energy costs and also support indigenous leadership and well-being.

First, advancing a zero-emissions electricity grid based on renewables—essential steps towards the major transformational investments required in the generation, transmission and demand side of electricity, including remote indigenous communities—will require an investment of $18 billion over five years.

Second is the renovation wave. Following on the model in the European Union, it is a plan for jobs and climate. We recommend upgrading the energy efficiency and comfort of Canada's residential building stock across the country, including low-income households and indigenous communities, and skills development for the retrofit economy.

Third, we recommend delivering on Canada's land and ocean protection commitments, integrating indigenous-led conservation, permanent funding for protection and stewardship, ecological connectivity and NGO collaboration.

Fourth is advancing sustainable agriculture, with recommendations to help producers and Canada be leaders in sustainable and innovative agriculture with a resilient and diversified food system.

Fifth is building capacity to ensure environmental justice for Canadians, establishing an office of environmental justice and committing an appropriate portion of benefits from climate and clean energy spending to disadvantaged communities following the U.S. Justice40 example.

Last, in our document, we also outline a number of complementary recommendations regarding climate mitigation and adaptation, nature conservation, environmental justice, environmental and human health, fresh water, reducing damaging subsidies and other important issues.

Implementing these recommendations together would lead to dramatic progress in advancing a healthier future for Canadians from coast to coast to coast.

To conclude, I would like to thank you again for inviting the Green Budget Coalition to appear here today. We look forward to your comments and questions.

Thank you.

[The Chair, Liberal, Peter Fonseca]

Thank you, Mr. Van Iterson.

I have to say, Ms. McClenaghan, that my wife and her family are from Paris, Ontario. I just wanted to let you know that. It's a small town.

[Theresa McClenaghan, Executive Director, Canadian Environmental Law Association, Green Budget Coalition]

That's amazing.

[The Chair, Liberal, Peter Fonseca]

We are now going to go out to the west coast via video conference.

We have, from Info-Electronics Systems Inc., Mr. Ahluwalia for five minutes, please.

[Dr. Harinder Ahluwalia, President, Info-Electronics Systems Inc.]

Actually, I'm from Montreal, not the west coast.

[The Chair, Liberal, Peter Fonseca]

Oh, I'm sorry. When you said during the audio test that it was raining, I just thought “west coast” right away.

[Voices]

Oh, oh!

[The Chair, Liberal, Peter Fonseca]

My apologies to the west coast.

[An hon. member]

I have a point of order, Mr. Chair.

[The Chair, Liberal, Peter Fonseca]

No, I'm teasing.

[Voices]

Oh, oh!

[The Chair, Liberal, Peter Fonseca]

Mr. Ahluwalia, you're from Montreal. You have five minutes, please. Thank you.

[Dr. Harinder Ahluwalia]

I'll be speaking about two points. One is how we should invest our foreign aid, which is already budgeted—the way it should be spent. The second point is about boosting our economy by strengthening our small and medium-sized high-tech enterprises.

With regard to the first one, at the 2021 G7 Leaders' Summit, Canada announced a doubling of its international climate finance commitment to $5.3 billion over the next five years. This was announced for improving energy systems and trying to reduce greenhouse gases. The problem is that developing countries, especially in Africa, introduce only 3% to 5% of greenhouse gases, so if we are helping them with that, it is for the future. Today's need for them is, really, safety because of all the problems that are being caused by global warming and climate change.

I believe that part of that money should go towards safety. Safety means building capacity in Africa and in other less developed countries. Safety means infrastructure. Safety means early warning systems so that they can save their lives and property. I have recommended in my written brief that this should be done in a different way. I have already met the international aid minister, Minister Sajjan, and will be meeting the environment minister, as well as the NRCan minister, about those topics.

I believe that assistance through the international community should be provided in a proper, targeted way and not like, “Well, everybody else is doing it one way; we should follow the same way.” We should be the leaders in this, and to be the leaders.... There are organizations that are international meteorological societies; there is the International Forum of Meteorological Societies. These are all volunteer-based organizations worldwide that are trying to create capacity. We should be supporting such organizations.

I am the president of the International Forum of Meteorological Societies, which unites all the national meteorological societies of the world. We are trying to create capacity. I spent half my life on that, doing that without any compensation at all. Most of the people who are working there are spending their own money. Therefore, we should support them so that they are successful.

Number two is my pet peeve, which is that the way Canada is supporting its high-tech SMEs is really not the right way. There are some good things, but there should be a different direction. There should be no development within the government, and industry should be given contracts to work, especially in environmental areas where most of the industry is dependent upon the government projects. Therefore, there should be no in-house development, and all the development or most of the development should be done by industry. This way, we'll be strengthening our small and medium-sized high-tech enterprises.

I believe that, in order to do that, we need to have a conference where the government and people—which includes politicians, as well as bureaucrats and high-tech industry people—all get together and discuss what really is required to increase our economic output. A lot of people complain that we are overspending, but I am trying to suggest that there are ways to create more wealth. That is where I would like to help Canada.

This is a sure way of creating wealth, and the first one is a sure way of creating capacity in developing countries and the least developed countries. We do that all the time; it's just to ensure that money is spent in the right direction. I request the Government of Canada to really be the leader in this.

Thank you very much. I appreciate being able to present my opinion.

[The Chair, Liberal, Peter Fonseca]

Thank you, Mr. Ahluwalia, coming to us from beautiful Montreal.

We now welcome David Tougas and Martin Caron from the Union des producteurs agricoles. You have for five minutes.

[Martin Caron, General President, Union des producteurs agricoles]

Thank you, Mr. Chair.

My name is Martin Caron, and I'm the general president of the Union des producteurs agricoles. I'm also a dairy farmer and field crop producer.

My opening remarks will focus on four themes: resilience of the agricultural sector; agri-environment and organic production; the tax system for farm and forestry businesses; and support for the dairy sector.

First, it's important to remember that the Canadian agri-food sector employed 2.1 million people in 2021, which represents one in nine jobs in Canada, in addition to adding $135 billion to the country's gross domestic product. In addition, Canada exported nearly $82.2 billion in agriculture and food products, including agricultural raw materials, fish, seafood and processed foods. Canada is the fifth-largest exporter of agri-food and seafood products in the world.

Despite the sector's strong performance, it has been plagued by inflation, especially since the fall of 2021. Farm input prices rose 25% between the first quarter of 2020 and the second quarter of 2022, according to Statistics Canada's Farm Input Price Index.

The three main production inputs, in other words, animal feed, fertilizer and fuel, have experienced much higher price growth than the consumer price index. For horticultural crops, the price of containers has also increased significantly. In addition, in eastern Canada, which relies more heavily on imported fertilizers, the punitive 35% tax on Russian fertilizers has not only increased the cost of fertilizer, but has also weakened its availability. At the same time, farm businesses have had to invest heavily in recent years in order to meet societal expectations regarding the environment and animal welfare.

As a result, the debt load of the sector doubled during this period. Each 1% increase in interest rates results in about $1.2 billion in additional interest expenses for farm businesses over time, representing about 25% of the sector's total net income in 2021. With the Bank of Canada's policy rate rising by 3% since the beginning of the year, you can imagine the enormous pressure producers are under.

In this context, and given the critical importance of agriculture to food security, especially in the current global context, the government must act quickly to support the agricultural sector and limit this exceptional inflationary environment.

As a result, the UPA is calling for a special assistance program for the agricultural sector in order to limit the impact of inflation on the financial health of farm businesses. It's also calling for the AgriStability program to be improved to increase the coverage rate to 85% of the reference margin, while maintaining the compensation rate at 80%, as recently announced by Agriculture and Agri-Food Canada.

With respect to the agri-environment, additional public investment is needed. Although used sparingly in Canada, payment to agricultural producers for the environmental goods and services they produce encourages the adoption of beneficial practices and recognition of their positive contribution. In the United States, direct support for agri-environmental initiatives represents 1% of farm receipts and 25% of the support paid to farmers. To achieve equivalent agri-environmental support, an annual amount of $650 million should be allocated to Canadian farm businesses.

In this context, the UPA is calling for a continuum of support and accompaniment over a 10-year horizon in terms of compensation for agri-environmental goods and services, as well as the fight against climate change, both in terms of adaptation to climate change and reduction of greenhouse gases. The UPA is also asking that agricultural producers be given a stable and predictable budget for agronomic and agri-environmental research and innovation adapted to their needs.

With respect to organic production, national organic standards must be reviewed every five years, but Canada doesn't have a program to support the review work, unlike the U.S. and the European Union. Canada could also increase the number of certified companies if it established a cost-sharing program for organic certification, as the Americans have done. That's why the UPA is calling for permanent funding to review and maintain Canada's organic standards and to offer a cost-sharing program for organic certification.

In terms of taxation, our brief includes three requests. The first is to introduce a 30% refundable investment tax credit for the purchase of new or used equipment by farm businesses with gross annual revenues of less than $50,000. The second is to eliminate or limit taxable capital gains on the gifting or sale of certain assets at low cost to a nephew or niece. The last is the creation of a personal silvicultural savings and investment plan for Canadian forest owners.

Finally, with respect to the dairy sector, we reiterate that it's important that the government fulfill its commitment to provide full compensation to dairy farmers to mitigate losses related to the Canada-United States-Mexico Agreement and to make no further concessions on supply-managed products in future trade negotiations.

Thank you.

[The Chair, Liberal, Peter Fonseca]

Thank you, Mr. Caron.

Thank you, witnesses, for your opening remarks.

I know the members have many questions, and we're going to move to them right now.

In our first round, each party will have up to six minutes to ask questions. We are starting with the Conservatives.

MP Lawrence has the floor for six minutes.

[Philip Lawrence, Conservative, Northumberland—Peterborough South, ON]

Thank you, Mr. Chair.

Thank you to the witnesses for being here today and for their preparations for the committee.

I'll start with the Canadian Taxpayers Federation.

Of course, Canada is facing a labour shortage, so, as we always should, I think it's incumbent upon us as stewards of the economy to do the right thing and to make sure that workers are fully incentivized for the hard work that they do. Canadians, of course, work extremely hard—some very long hours—and it's my belief that the government is taking too large a portion and that doing things like tripling the carbon tax and increasing payroll taxes will do nothing but disincentivize work.

Mr. Terrazzano, would you care to comment?

[Franco Terrazzano]

In a recent poll, 72% of Canadians said that they pay too much tax. If we want to encourage work, we need to stop punishing work. What we have seen is that, at the worst possible time, the government raised payroll taxes. If you're making $65,000 this year, then the government is taking nearly $4,500 directly from you through your CPP and EI tax. Then you have to add on what your employer must also pay through the CPP and EI tax.

If we want to encourage more work, we should stop increasing taxes on Canadian workers.