Mr. Speaker, Bill C-90 is now at the third reading stage. We have already had an opportunity, as the official opposition, to state our position on this bill at the second reading stage and in committee, the Standing Committee on Finance.
Although some of these measures may be positive, there is one that bothers us particularly, so much so that we would vote against this bill. I am referring to the proposal to increase the excise tax on gas by 1.5 cents per litre.
I will be brief. I want to make a connection between this debate and the one we had when we were discussing the excise tax on cigarettes.
In fact, this bill contains measures that would bring about a gradual upward adjustment of the tax on tobacco products. Of course we all realized at the time that the purpose of the drastic reduction in taxes on tobacco products was to destabilize smuggling networks. However, everyone agrees that now the price is so affordable it could have a disastrous impact on the demand for these products in the long term. The lower the price, the better a product sells.
No one objects to an adjustment. However, we should be careful not to do this too quickly and in the process give these networks a chance to regroup and take control again.
That being said, the government still has a duty to monitor the situation, because there are other ways besides taxation to ensure that people engaged in smuggling various products are arrested. This still goes on. It is still the case for various kinds of products. Enforcement is not as strict at that level. Much remains to be done to improve the way we deal with various smuggling networks.
As far as the excise tax on gas is concerned, everybody knows it can be very irritating, and it is so easy for the government, when it needs money quickly, to use the excise tax on gas, because this is instant revenue. We are talking about $500 million which the finance minister quickly took out of taxpayers' pockets.
It is hard for the consumer to see this happening, because when the price of gas goes up at the pump, the consumer is not sure whether the price of oil has gone up or the retailer, the manufactur-
er or someone else has raised his profit margin or whether the government has just increased the excise tax.
Unlike other types of products, when we buy gas, it does not say what proportion of the price we pay for a litre of gas is actually taxes. It is just as well, because taxpayers would be even more furious with the various governments. They would be constantly reminded of all the taxes levied on gasoline products.
In this case as in the case of tobacco products, when the government goes to the other extreme and tax levels rise beyond the acceptance threshold, taxpayers feel they have every right to buy contraband goods. We may deplore it, but the taxpayers' feeling is that this is a legitimate action they are taking.
We must not do anything to bolster this trend, because we know all the problems there are with the underground economy, the black market economy. At some point, the tax on gasoline reached the limit people would bear. We feel that any increase will only contribute to pushing consumers toward an underground economy which is extremely counterproductive for everyone. Counterproductive not only for the taxpayers who make use of it, since those using the black market economy are penalizing themselves without knowing it, but also for everyone in the long run. At some point we have to learn our lesson.
It does not seem that we have learned any lesson from what happened with tobacco products. Certain products in a number of different areas are still being heavily taxed.
However, it is not abnormal for there to be higher taxes on gasoline than on other products, because of the environmental effects everyone is aware of. Steps must be taken to ensure that when what the economists call externalities result from the consumption of a product, there are provisions to make the users bear the cost of those externalities. At some point, however, there is some uncertainty as to whether we have gone too far in this.
Essentially, we strongly disagree with this measure and feel that raising the tax again by 1.5 cents a litre in his last budget was not the route the Minister of Finance ought to have taken. We do not feel this is a measure that will contribute to any great extent to economic recovery. Everyone knows that there is a lot of work to be done on the expenditure side. If the Minister of Finance has no ideas of his own, we might suggest that he hasten before the finance committee to discuss it, something he has refused to do because of his fear of presenting his financial statements before the referendum. That is understandable.
If he wants to discuss it in more detail, we invite him to do so. This will provide us with the opportunity to debate the matter with him and to point out that there may be other avenues he ought to explore when he needs to balance his books, instead of constantly digging into the taxpayers' pockets for more revenue.
So, essentially, it is our intention to oppose adoption of Bill C-90 on third reading and, as I have said, essentially because of this measure. There are others on which I have not spoken but which we were able to bring up during second reading or in committee on which we do agree. But we have a major disagreement with this one.