Nick, where are you when I need you?
At any rate when we had public debates and it came to the issue of tax reform, the Reform Party candidate would stand up and say: "When it comes to tax reform we support Mr. Mills' idea of a single tax system. We call ours the proportional tax but generally speaking we think he is heading in the right direction". Actually the Reform Party member helped me get elected because some of the things that my constituents perhaps did not like about me were offset by the fact that the Reform Party candidate helped me push forward on the single tax.
Here we are one year later and we have not been able to spark an interest in comprehensive tax reform in this House of Commons. I want members to know that we are missing a great opportunity. You might ask: Why does the government not take it up on its own initiative? It does not work like that around here. As members know, the essence of a democracy is good solid debate. There has to be a to and fro. A good opposition has the ability to move an agenda item from the back burner to the front burner.
On the issue of tax reform the opposition has done a lousy job and that is in spite of my giving them a good push every now and again. At any rate, I want to say to the people of Canada that I passionately believe the single biggest thing we could do to spark economic activity in this country is to act on comprehensive tax reform.
I say that because we as a government are counting on the small and medium size businesses to recharge and reignite this economy. I hear constantly as I am sure other members do from those same small and medium size businesses that the paper burden relating to the income tax system, the complexity of it, and the unfairness of it on the corporate and personal side make it a disincentive to productivity. It is a disincentive to risk taking. It is a disincentive to taking that extra shot.
I believe that. In fact a lot of entrepreneurs who have achieved success are not only frustrated by the tax act of Canada but many of our superachiever entrepreneurs are currently being taxed at a rate of 58 per cent rate when the federal and provincial taxes are combined. Many of them are starting to do two things. Some of them are parking their resources, their investments and their cash offshore. The second thing is some are starting to move themselves offshore. They are not just moving their cash but some of them are actually taking their talent and walking into better tax regimes.
When we have a bill like C-59 with all of its pluses and advantages in moving and improving the tax act it gives us the opportunity to look at the big picture over the next eight to ten years.
If Canada does not have a globally competitive tax system we are going to see talent and capital fly out of this country at a rate we cannot imagine. When capital flies out interest rates go up. It is like any other commodity. A store that has only a few pieces of chicken or a few potatoes can demand a higher price. Capital is no different.
When capital is not in the marketplace or if there is restricted amounts of capital, interest rates go up. That causes a tremendous strain on our ability to service our deficit and our debt. It is a tremendous burden. It is tough for our entrepreneurs. When they go to the bankers and try to rent money from them, those rates are higher as well.
If Canada had a globally competitive tax regime, if we had something like the single tax system where-