Mr. Speaker, the proposals contained in Bill C-9 implement measures announced, as you will all recall, by the previous government in its economic and fiscal statement and April 1993 budget.
The new government, already short of ideas on new tax incentives to offer small business owners and workers, is borrowing ideas from an old government worn out by nine years in office.
This bill in fact proposes 12 amendments to the Income Tax Act. As we all know, the first measure deals with unemployment insurance premium relief for additional jobs. It provides a refundable tax credit in respect of an increase in unemployment insurance premiums payable by certain employers for 1993.
How much does it cost to administer this extensive red tape? That is the question. This kind of relief is reminiscent of GST refunds. The government collects some $13 billion in GST. Once you subtract all the associated administrative costs and refunds, you realize that this tax, while it was supposed to reduce the debt and eliminate the annual deficit, is really
bringing in very little revenue because of the red tape and all the efforts put into levying it.
It is the same thing with the unemployment insurance premium relief proposed in Bill C-9. What is the use of increasing taxes and premiums without eliminating loopholes? That is basically what is suggested here: reductions, relief for certain target groups. Why favour those groups over others? At the end of the day, all those taxes and premiums are of very little benefit to the community as a whole.
This morning I had before me a copy of the federal Income Tax Act. It is a four-inch thick document. The main objective of income tax should be to enable the government first to collect the money it needs to operate and second to redistribute the wealth among the population.
Why all these tax credits, these extensions, these abolitions and so on, if not to feed and support the whole bureaucratic machine and all the professionals gravitating to it.
A friend of mine who owns a small business was telling me last week: "A small business with 20 employees must have a full-time person, I repeat full-time, just to fill out government questionnaires and forms, including the endless changes, like those proposed in Bill C-9, that the government is constantly making to its laws and regulations." This friend is the owner of a small business employing some 20 people.
And to think that, during the last election campaign, one could read on page 19 of the Liberal Party's red book: "Expenditure reductions will be achieved by cancelling unnecessary programs, streamlining processes, and eliminating duplication. This effort will take place in partnership with provincial governments".
Unfortunately, the red book does not mention that the government will stop constantly increasing taxes and expanding the tax base by always creating exemptions for various groups, as proposed in Bill C-9. If the government conducted cost benefit analyses before creating new taxes or raising contributions such as unemployment insurance premiums, it would know the real, net benefit from each type of tax or contribution.
The tax or contribution collection costs should include the true cost of the bureaucracy needed to collect this tax, as well as the cost of all these relief measures, tax credits, tax deductions and program extensions such as those proposed in the bill before us today.
If we add up all tax collection costs and all changes and relief measures to make taxes less regressive for the poor or less detrimental to investors or investments creating jobs, the real benefit of various taxes or contributions is often minimal in the end for the government.
Bill C-9 is aimed at amending the very foundation of the income tax act. We in the Bloc Quebecois want to tell this to the current government: We already have in Canada a four-inch thick Income Tax Act. Let us stop making it more complicated and trying to make it more complex. What taxpayers want is simpler tax procedures. We should redesign this legislation from top to bottom and stop making it more complex, only to feed, as I was saying earlier, the whole bureaucratic machine and all kinds of tax consultants.
If we read carefully the 12 changes proposed in Bill C-9, what do we see? The first measure provides for premium relief. The second one refers to a tax credit that, in fact, amounts to a temporary exemption for small business. It is a kind of tax shelter, another exemption. Why create so many tax measures when there are so many exemptions in the end?
The third measure is also an extension for small business. This begs the question: Why do we always have to rescue fiscal lame ducks unable to make it on their own?
The fourth measure abolishes a tax. The fifth concerns labour-sponsored venture capital corporations. It is another addition to the current Income Tax Act. The sixth measure also extends an existing plan. The seventh measure refers to flow-through shares. It is a tax deduction, another tax shelter. The eighth measure removes a deduction; it amends an existing measure. The ninth measure is also an improvement to an existing credit.
The question we should be asking is this: Why all these tax shelters? On this subject, the economist Jean-Luc Migué tells us: "Why subsidize investments? If they are profitable, they will be made; if not, they should not be made from an economic standpoint".
These first nine measures of which I just spoke are taken from the former Conservative government's economic and fiscal statement, as was mentioned before. As I also said, did this government inherit its fiscal imagination from the former Conservative government?
The last three measures were also announced in the former government's budget of April 26, 1993. Here again, measure 10 is a tax credit, measure 11 is another tax credit and measure 12 concerns instalment payments of income tax. These 12 fiscal measures are a heterogeneous assortment, with no overall vision.
We would have expected imaginative, innovative fiscal measures that would have created jobs, but they give us adjustments to old tax measures that only further entrench this Tower of Babel which the federal Income Tax Act is.
The Prime Minister and the Minister of Finance always tell us to wait for the next budget when we ask them what fiscal policy this new government intends to adopt. Why have Bill C-9 when
the next budget will likely change everything again on February 22?
I will let this House consider the study conducted by André Lareau and a team at Laval University, which says: "If the government is not more imaginative, the reason is that the lobbying is done not by families but by companies. Thus, parents must pay tax on diapers, but there is no tax when you buy shares in a company".
We might also add that the lobbying is not done by middle-class individuals or the most disadvantaged people and this new government acts only in response to well-organized pressure groups, which explains an Income Tax Act that is changed and gets bigger in response to pressure from various quarters.
In conclusion, I would like to emphasize that Bill C-9 says nothing about helping families who have to pay taxes, indeed income taxes.
Mr. Yves Séguin, a former Minister of Revenue in Quebec, said in La Presse on February 6, 1994: ``Former spouses, in most cases ex-wives, who receive alimony must add it to their income. This alimony is calculated very strictly, on the basis of the children's needs, and gives the mother absolutely nothing. Instead of paying 25 per cent income tax, for example, in many cases she has to pay 37 per cent or more, perhaps $2,000 or more, and she does not have the money to pay it''.
Finally, nowhere in this Bill C-9 do we see any tax measures directly for the people, individuals or families, but rather abatement measures intended for businesses, and most of these abatement measures are inherited from the former Conservative government.