Mr. Speaker, Bill C-90 contains legislative provisions permitting the implementation of a number of amendments to the excise tax announced earlier this year.
Most of these proposals are linked to amendments announced in the February 27, 1995 budget, including amendments to the air transportation tax, the excise tax on gasoline, the marking requirements on tobacco products for sale in Prince Edward Island and the seizure and notification provisions relating to violations of the Excise Act.
Other proposals concern amendments to rates of excise tax on tobacco products for sale in Quebec, Ontario and Prince Edward Island. These amendments were announced in February and March along with provincial tax increases on tobacco.
Let me begin by addressing the key budget measures contained in Bill C-90. First, proposed changes to the air transportation tax will enable the government to recover a greater proportion of the costs of the air transportation services and facilities that are used by air travellers.
The proposed amendments to the Excise Tax Act will increase the maximum air transportation tax on higher priced domestic and trans-border air travel and the tax on international air travel purchased in Canada from $50 to $55.
In addition, the maximum tax on trans-border air travel subject to the United States' 10 per cent air transportation tax and the tax on international air travel purchased outside Canada will increase from $25 to $27.50.
These changes to the air transportation tax, effective May 1, 1995, will generate additional revenues of $27 million in the 1995-96 fiscal year and $33 million in the 1996-97 fiscal year.
Second, Bill C-90 proposes an increase in the rates of excise tax on gasoline equal to 1.5 cents per litre effective February 28, 1995.
In a budget that focused almost entirely on reducing the spending of government and delivered expenditure cuts by a margin of seven to one over tax increases, a move that I know was applauded by members of the Reform Party, this measure is necessary to raise an additional $500 million per fiscal year to ensure that the government meets the deficit reduction targets that are integral to a strong and growing economy. The Minister of Finance has reaffirmed repeatedly the government's commitment to meet the deficit reduction targets outlined in the budget in 1995 and will undoubtedly reaffirm those in the next budget.
Third, in addition to these rate changes affecting the air transportation tax and gasoline, Bill C-90 also enacts amendments to the
marking requirements for tobacco products for sale in Prince Edward Island. These amendments will phase out the sale of black stock or unmarked tobacco products in Prince Edward Island and allow for the sale of Nova Scotia marked tobacco products in the province.
This change in the tobacco marking scheme is being undertaken at the request of the two provinces and will allow for greater efficiency in serving the Prince Edward Island market.
The final budget measure contained in Bill C-90 concerns the seizure and notification provisions in respect of offences under the Excise Act.
The proposed amendments will rectify certain enforcement difficulties by allowing officers discretion in their ability to seize vehicles while stipulating that reasonable efforts must be undertaken to provide notice of seizure to known third party interests.
The bill also implements important changes in respect of excise tax rates for tobacco products for sale in Quebec, Ontario and Prince Edward Island.
As all hon. members are aware, modest federal excise tax increases were announced earlier this year in conjunction with provincial tobacco tax increases in these three provinces.
These tax increases follow the success to date of the national action plan to combat smuggling in significantly reducing contraband tobacco activity and restoring the domestic tobacco market to legitimate Canadian wholesalers and retailers.
In Quebec and Ontario, federal excise tax rates are being increased by 60 cents per carton of 200 cigarettes, while in Prince Edward Island excise taxes are being increased by $1 per carton of 200 cigarettes and 32 cents per 200 tobacco sticks.
The excise tax increases in respect of cigarettes for sale in Quebec and Ontario are effective February 18, 1995 while the increases in respect of cigarettes and tobacco sticks for sale in Prince Edward Island are effective April 1, 1995. These changes will generate an additional $65 million in federal revenues on a fiscal year basis.
In conclusion, I would like to emphasize the importance of the provisions contained in Bill C-90, notwithstanding the flippant remarks made by the hon. member of the Reform Party while speaking earlier and saying that the legislation on the government's agenda was unimportant.
The proposed changes to the air transportation tax and the excise tax rates for gasoline are an important part of the government's commitment to increased cost recovery and deficit reduction.
Amendments to the tobacco marking scheme will allow for greater efficiency in serving the Prince Edward Island market, while amendments to the seizure and notification provisions of the Excise Act will improve the delivery of enforcement activities.
Finally, the changes to the excise tax rates for tobacco products for sale in Quebec, Ontario and Prince Edward Island represent important first steps toward the long term restoration of uniform federal excise tax rates for tobacco products across Canada.
I encourage my colleagues to pass this bill without delay.