There is a lot to comment on. I'll take them one at a time and briefly, Mr. Chair.
On corporate income tax, yes, the previous government's recommendation has basically been adopted in the recent federal budget. Our proposal had been to do something a little more aggressive--start in the current year with a one-point reduction and do three more over the next three years, so that we'd go from 21 down to 17 over a four-year period. In the interests of time, I won't take the time to talk about each one of these in detail.
On personal income taxes, there's a real issue at the bottom end of the rate, particularly as it relates to people, as I mentioned, who are somewhere in the $25,000 to $40,000 income range. The problem is clawbacks. It's a well-known problem and it's a tremendous disincentive, because if you are in that income group and want to go out and earn another dollar of marginal income, you're going to have it clawed back, essentially, because you're going to lose whatever other GST credits, other child tax benefit credits, or any of the other issues out there, which seems to us to be totally counterproductive.
On CCA rates--capital cost allowance rates--in terms of incenting investment, we saw and were very supportive of initiatives that had come out of the last couple of budgets, which looked at energy, telecommunications, pipelines, and a number of other areas in terms of incenting, through the depreciation regime, more investment. This is absolutely, fundamentally critical. I didn't mention a bunch of things in my remarks today because I was trying to keep a lid on the time, but that's certainly an area that we strongly believe is important. What we have to do is look at the useful life of assets and match that up to economic realities; that's something the Department of Finance needs to really focus on, and we need more out of that. I think we've taken the right baby steps there, but much more can be done for many sectors.
In terms of the GST, from the standpoint of a recognition that Canadians are overtaxed, it's another tangible example of an acknowledgement from government that Canadians are overtaxed, so there is one upside view on it. Was it our first priority? No, I'll have to admit that it wasn't, because we've got our focus on taxing income and trying to alleviate the pressures on Canadians and on the business community in that regard.
On the security and prosperity partnership, a hugely important initiative, I don't think we can ever get to a point at which we can say that security has received too much attention. In the dialogue with the United States, that is never going to change. That is the preoccupation there. We have to live with it. We have our own trump cards. In terms of being able to have the right kind of dialogue, the issue is the one you raised--what are we doing about the border?
The border is potentially an extremely negative component of our relationship because we have to behave, from a commerce standpoint, as if the border isn't there. We have such an integrated supply management system and supply chain system between our countries that any hint that the border is going to be an impediment immediately affects investment decisions. We already have examples of that, so it's absolutely crucial to get that right.
If we want, we can get into WHTI later. I'd be happy to talk about that.