Thank you, and congratulations on your new appointment.
Good afternoon. I am Manny Jules, chief commissioner for the First Nations Tax Commission.
In 1974, I was elected as a councillor for the Tk̓emlúps Indian Band, and I served as chief from 1984 to 2000. I've been doing this now for 50 years.
Thank you for the invitation to appear before this committee.
Why are our tax powers so important?
There are many reasons, but one is particularly important. For over 100 years, the government has put us under a fiscal system that was designed to implement assimilation. Now, almost everyone acknowledges that this was wrong. Canada is committed to self-determination. Many policies have changed as a result. However, for the most part, our governance arrangements are funded through the same fiscal architecture that was used to implement assimilation. It is still a model of dependency and federal involvement in virtually every activity of our governments.
Today, for every dollar we collect on reserve, the federal and provincial governments collect seven. This must change. By change, I mean an expansion of tax powers to be exercised by first nations on an optional basis and having those new powers included in the First Nations Fiscal Management Act.
Our strategy is straightforward. For me, it originated with my father. He understood where taxes came from—investment in our economy—and that we must compete for investment with other economies. He understood our competitive disadvantage because of the Indian Act and the extreme risk aversion of the Department of Indian Affairs and the Department of Justice.
While it is true that taxes are a subset of our economy and that the stronger our economy is, the more taxes we can generate, it is also true that taxes originate from the fiscal powers a government has. While we had fiscal powers before contact and during contact, we collected taksis from people who crossed our territory and kept a share of the resources they took, and from our members to pay for infrastructure like irrigation systems and to lobby for our land rights to the King of England and the Pope in 1904.
In 1927, the Mackenzie King government passed an amendment to the Indian Act prohibiting us from raising revenues to fight for the land question. I quote Peter Kelly, who spoke for 15 minutes at this hearing: “Then the position that we...take would be this: that we are simply dependent people. Then we would have to accept from you [the government] just an act of grace, whatever you saw fit to give us.”
The loss of these fiscal powers created dependency and removed our ability and incentive to compete for investment. The result is poverty. For 50 years, I have worked to right this wrong with many first nation leaders, including those called as witnesses by your committee.
We must have the option to expand the fuel, alcohol, cannabis and tobacco sales-tax powers announced in the most recent federal budget to include sales tax on casinos and ATMs. We must also have the option to collect excise tax from these products sold on our lands. First nations have paid billions of dollars in excise tax to the federal government over the years, and it is time we received our share.
We need to remove revenue caps on revenues collected on our lands. Our tax jurisdiction must be based on our geography, on our traditional lands. Revenues must be based on our economic infrastructure, generate more taxes for all governments and implement more jurisdictions to facilitate investment at the speed of business. More investment means higher productivity and more wealth for all Canadians.
We must also receive our share of carbon taxes. We have paid them. Our communities are the least prepared to reduce the risks of climate change. We need to develop and implement the first nations resource charge so that we can receive fiscal benefits from resources and projects within our territories, like other Canadians do.
While the federal government and, hopefully, the provincial governments cede tax room to us, they would be demonstrating a practical commitment to economic reconciliation. Expanding the FMA with more fiscal powers, as I have suggested, without federal revenue sharing and caps is the best way forward for first nations and Canada.
Finally, in addition to the fiscal gap, I urge this committee to consider the export gap between indigenous people and other Canadians. Enacting policies to facilitate indigenous trade can help close this economic gap between indigenous and non-indigenous groups. In addition to more fiscal powers, indigenous economies can meaningfully strengthen, through the support of first nations communities, by increasing access to markets for first nations businesses, reducing institutional barriers to economic participation and developing tax incentives and/or special economic zones that benefit first nations.
Today, there are almost 400 first nations that are part of the FMA, because it works. I urge you to build on the most successful first nations-led legislative initiative in history, not because it is good for first nations but because it's good for all Canadians.
Thank you, Mr. Chairman.