Thank you, Mr. Chair.
Mr. Hannah, I want to talk to you about this issue of the credit network operating services. Since I've been here, since 2019, I've seen the government break a lot of promises. If I were to list them all, I would run out of time. What I've never seen, though, is a government make a promise in a budget and then break that promise in the same budget.
Let me read you something from budget 2023. I realize that interchange fees are different from the card network operating services tax, so I'm not conflating those. The government says,
The pandemic brought an increase in people using credit cards when they shop. Small businesses pay fees...with the largest component being the “interchange fee”.... [They promised] to lower these transaction fees.
In Budget 2023, the government is announcing that it has secured commitments from Visa and Mastercard to lower fees for small businesses, while also protecting reward points for Canadian consumers offered by Canada's large banks.
Now, your organization and the Canadian Bar Association have made submissions. Moneris has made a submission.
In Moneris's submission, they say:
We [want] to draw your attention to a proposed amendment to the Excise Tax Act respect to the Goods and Services Tax...Treatment of Payment Card Clearing Services and its impacts on not only the Canadian acquiring and payments industry, but on Canadian merchants and consumers. This proposed change may ultimately result in higher costs to merchants and therefore higher costs to Canadian families at a time when we are working towards making life more affordable....
On one hand, we have the government saying, “Hey, we're going to pat ourselves on the back. We made a deal with the credit card companies to lower these interchange fees,” and at the same time they're bringing in retroactive legislation to go back to 1991.
At the risk of being accused of what Mr. Baker was being accused of, I'm going to go on.
The Canadian Bar Association, in their correspondence, say:
Canadian democracy is founded on the rule of law, and the “law should be such that people will be able to be guided by it.” It is important for people to be able to “foresee the consequences of their conduct in order that persons be given fair notice of what to avoid.”
It is a “basic tenet of our legal system” that the legal consequences that flow from a person's conduct “should be judged on the basis of the law in force at the time.”
Given all of this, I recognize your frustration. It's more a comment than a question, but how are merchants supposed to deal with the situation in which the CRA can now go back 30 years and try to collect money from them that is based on this retroactive rule?