Debates of Dec. 8th, 1994

Income Tax

[Yvan Loubier, Bloc, Saint-Hyacinthe—Bagot, QC]

Mr. Speaker, after wasting one year in the fight against the deficit, the Liberals now propose, in a report to the Minister of Finance, to increase the tax burden of all taxpayers by imposing a temporary surtax which could bring in over one billion dollars, to be used to reduce the deficit. By the way, the last temporary tax was the income tax of 1914, which has now been in effect for 80 years.

Will the Prime Minister pledge to reject the proposal made by his members to impose a surtax which would be in direct contradiction with his own election promise not to increase the tax burden of Canadians during the first two years of his mandate?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, the committee travelled across the country. It then made recommendations to the Minister of Finance who will review them. When the minister tables his budget in February, we will see which of these recommendations he intends to follow. The remarkable thing about the Bloc members who sat on that committee is that they could not make a single specific recommendation. They shied away from their responsibility to make decisions and recommendations. They speak eloquently, but they do not have the courage to take a clear stand.

[Yvan Loubier, Bloc, Saint-Hyacinthe—Bagot, QC]

Mr. Speaker, not only does the Minister of Finance not read his letters before signing them, but the Prime Minister does not read the documents tabled by the Official Opposition. If he did, he would know that we made ten specific proposals to implement real streamlining and saving measures to improve the government's finances. I am not talking about measures which would

hurt the unemployed and the poor, but about real saving and streamlining initiatives.

How can the Prime Minister, or his government, consider imposing such a surtax on Canadians who honestly pay their taxes, when this government has yet to act, or even show the political will to recover over $6 billion dollars in unpaid taxes from the wealthiest Canadians? Is this his definition of justice? Is this his definition of fairness?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, we said that we will reduce the deficit to 3 per cent of GDP by the end of the third year of our mandate and we will do it.

He can make all the speeches he wants. We have a clear program. It is well documented, it will be met and it will be realized. He will see that we can do it.

Quebec

[Preston Manning, Reform, Calgary Southwest, AB]

Mr. Speaker, the federal government's reaction to Premier Parizeau's draft bill on Quebec sovereignty has been unfocused and even confusing.

The Prime Minister is quoted as saying his strategy is to win the referendum battle but he does not say which referendum, having dismissed Mr. Parizeau's referendum plan. The government seems very reluctant to comment on the illegality or legality of what is proposed or to point out specific flaws in the Parizeau plan.

Section 5 of the draft sovereignty bill states Quebec citizenship may be held concurrently with citizenship of Canada or any other country.

Does the Prime Minister accept this position, yes or no? If he does not, why does he not say so?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, the Leader of the Opposition has not listened to me a lot over the years. I have always said that they cannot impose a situation unilaterally. Citizenship of Canada will be determined by the Parliament of Canada not by the Parliament of Quebec.

Mr. Parizeau's proposition is funny. He wants to keep all the good things that Canada has provided for Quebec. Quebec should stay in Canada. That is my answer. I am from Quebec and whenever I travel around Canada I am comfortable in every part of the country.

[Preston Manning, Reform, Calgary Southwest, AB]

Mr. Speaker, I appreciate the Prime Minister's answer. We had trouble getting that type of answer yesterday and the day before.

The Quebec government has also stated that in the event of a vote for sovereignty in the upcoming referendum, an economic association with Canada would be maintained. Again, the statement is completely presumptuous, without regard for the position which the government and the people of Canada might take on such an association.

Does the Prime Minister concur with the position that an automatic economic association between Canada and a separate Quebec should be assumed? If he does not, why does he not say so?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, it is not a big problem. It is evident that the people and the Government of Canada will decide. For example, the PQ wants to keep the Canadian currency. Monetary policies will be decided by this Parliament and it will have absolutely no voice. Nobody will be able to get up here and ask the Minister of Finance what is right or wrong with the monetary policies of Canada.

Of course certain countries have used the currency of other countries. Not long ago I discussed that with some French African countries that depend on the franc. When Paris decided to lower the value of the franc used in Africa, it had nothing to say, it just paid the price.

[Preston Manning, Reform, Calgary Southwest, AB]

Mr. Speaker, for the first time in a year I actually think we are making progress in Question Period.

Section 7 of the proposed sovereignty bill states Quebec shall assume the obligations and enjoy the rights arising out of treaties to which Canada is party. This statement is not only presumptuous but also clearly unconstitutional.

The federal government has the sole role to negotiate and sign international treaties and many have their own provisions for who joins those treaties.

Is not section 7 of the proposed sovereignty act beyond the power of the Quebec government? If it is, should not the federal government say so now?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, I do not want to debate what is in this project of law. We can have a long debate on that. The question is a very simple one.

They should have the honesty to ask the Quebec people first: "Do you want to separate, yes or no?". To play games like that will lead nowhere. It is just a sign that they are afraid to be honest with the people and ask a very simple question: "Do you want to separate from Canada, yes or no?".

[Some hon. members]

Hear, hear.

Income Tax

[Pierre Brien, Bloc, Témiscamingue, QC]

Mr. Speaker, my question is for the Prime Minister. Despite a healthier economy and rising tax revenues, the federal government, like the pre-

vious Conservative government, is preparing to add to the tax burden of all Canadians, because it has shown itself totally unable to reduce federal spending, to eliminate unjustified tax privileges like the ones for family trusts and to take whatever measures are needed to collect more than $6 billion in unpaid taxes.

Will the Prime Minister acknowledge that, instead of introducing a surtax that could jeopardize the economic recovery, he should have the courage to end duplication, waste and inequities in the tax system?

[David Walker, Liberal, Parliamentary Secretary to Minister of Finance]

Mr. Speaker, on behalf of the Minister of Finance, I would like to thank the committee and its chairman, the member for Willowdale, for the excellent work done this fall on reviewing the budget.

All members of the committee worked very hard hearing the representations from Canadians. All three parties made an effort to put forward their own ideas. On behalf of the minister, I would like to also thank the other two parties for putting forward their ideas.

The Minister of Finance has made it quite clear that during this process we will not be commenting on any specific proposals from any sources. We will just simply continue our consultation process until the budget is announced in February.

[Pierre Brien, Bloc, Témiscamingue, QC]

Mr. Speaker, I have a supplementary question for the Prime Minister.

Does the Prime Minister acknowledge that, by recommending cuts of $3.4 billion in social programs, government members on the finance committee are confirming the government's shameful objective of reducing the deficit at the expense of the unemployed, welfare recipients and students?

[David Walker, Liberal, Parliamentary Secretary to Minister of Finance]

Mr. Speaker, the opposition knows full well that under the leadership of the Minister of Human Resources Development that the process of consulting with Canadians continues. The government will make a decision in the coming year as to how to deal with each of the items in the budget.

Taxation

[Herb Grubel, Reform, Capilano—Howe Sound, BC]

Mr. Speaker, the finance committee report recommends increased taxes on gasoline, lottery winnings and corporations. Most incredibly, it suggests increasing taxes on income.

Canadians told the committee clearly that they do not want higher taxes. They are taxed to the max. They want smaller government. Reform's proposals show that the deficit can be eliminated by spending cuts alone.

Is the government going to accept the recommendations of its finance committee and increase taxes, yes or no?

[David Walker, Liberal, Parliamentary Secretary to Minister of Finance]

Mr. Speaker, the hon. member knows as he participated in many of these meetings that we heard a variety of opinions from Canadians concerned about the government, taxes and about the integrity of our programs. The Minister of Finance will take these into account as he makes up his mind.

[Herb Grubel, Reform, Capilano—Howe Sound, BC]

Mr. Speaker, today Stats Canada noted that during the last 23 years Canadians' taxes increased nearly 50 per cent while their income remained constant. Now there is the prospect of even higher taxes on gasoline and lottery winnings. The Liberal credo seems to be: If Canadians like it, tax it.

Is the minister seriously planning to raise taxes on the use of cars and the dreams Canadians buy with their lottery tickets?

[David Walker, Liberal, Parliamentary Secretary to Minister of Finance]

Mr. Speaker, if the member is a great fan of Stats Canada he should be quoting the tremendous rate of economic growth in this country under the leadership of this government.

The member will know full well that everyone is concerned about the high level of taxation for Canadian families, just as we are with the integrity of all of our programs.

Pearson Airport

[Michel Guimond, Bloc, Beauport—Montmorency—Orléans, QC]

Mr. Speaker, my question is for the Prime Minister. According to the Globe and Mail , in 1990, while he was practising law, the Prime Minister advised the Matthews Group, a partner in the Pearson Development Corporation, on the privatization of Pearson Airport. This consortium is now demanding $440 million in compensation for the cancellation of the airport privatization contract.

Considering his previous professional relations with the Matthews Group, a partner in the Pearson Development Corporation, can the Prime Minister confirm that he has not taken part, since he was elected, in any Cabinet decision concerning the Pearson Airport nor been involved in any way in this issue, so as to avoid any apparent conflict of interest?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, there is no issue on that group.

[Michel Guimond, Bloc, Beauport—Montmorency—Orléans, QC]

Mr. Speaker, what is the assurance of the Prime Minister worth, since Bill C-22 proposes a discretionary process to provide compensation for the cancellation of the Pearson Airport contract, which could benefit the Matthews Group he advised as a lawyer?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, never as a lawyer, did I have any discussions about Toronto Airport with any of these people. Besides, I am the one who proposed cancelling this project. Not only is there no conflict of interest, but I am the one who axed the whole thing.

Bosnia

[Jim Hart, Reform, Okanagan—Similkameen—Merritt, BC]

Mr. Speaker, the Reform Party caucus and indeed all Canadians welcome the good news of the release of the 55 Canadian hostages held by the Bosnian Serbs. Yesterday the French foreign minister called for a withdrawal of its peacekeepers in Bosnia. This only makes public the growing realization that this is a political, not a military problem and that peacekeepers cannot do their job in the current environment.

My question is for the Prime Minister. Now that Canadians have been released, will the government align with France's position and use this opportunity to withdraw our troops?

[Jean Chrétien, Liberal, Prime Minister]

Mr. Speaker, first I would like to pay tribute to the soldiers who acted with calm and courage. They know they are involved in an extremely important mission which is to help the poor civilians who are trapped in this terrible situation by providing them with food, medication and so on.

I was at a discussion in Budapest. The situation is very bad. The President of Bosnia was pleading with me to try to keep our troops there because they are considered the best. Canada has no political interest in the area. I said to him that our interest was not political, that our interest was in peace and to help the civilian population.

We have a mandate until the month of February. In January cabinet will review that. I would like to point out that we had debates in this House of Commons. Members of the House were consulted and the great majority were in agreement that we should be there to help the civilian population. We will review the situation in January. Of course not only Canada has troops there. There are others and we have to consult them too.

I have to say again that we are all very proud of the way the Canadian soldiers behaved. I was delighted to hear the President of Bosnia tell me that the Canadians are the best there.