There is another member who does not understand the facts of what the Prime Minister has done. There are two ways taxes are raised. One way is to raise the rate. The other way is to reduce the exemptions or the deductions or to tinker with the tax base on which one has to pay that rate of tax. He has not raised the rate, but he has surely and often in a number of ways tinkered with the deductions.
Let me give an example. From now on if ever the Prime Minister or the finance minister says that he has not raised personal income taxes-and I dare him right now to say it after I have put this into the record-his nose will grow like Pinocchio every time he says it.
The current rule in the Income Tax Act for labour sponsored venture capital corporations is that you are allowed up to 20 per cent of the net cost not to exceed $5,000. In layman's terms that is what the rule says basically. Now the government is reducing that for this year. There is a transition from 1996 to 1997. It has amended section 127.4 to provide that an individual's tax credit is limited to a uniform 15 per cent of the net cost. That means it has been reduced to $3,500. It means that those people who were putting money away, working for companies that sponsored these RRSP type investments now have to pay tax on another $1,500 that
prior to this they did not have to pay tax on. That is a personal tax increase.
The finance minister has increased personal taxes to the degree of disposable income for families on a personal basis going down by $3,000. I just hope that this finance minister has the courtesy to admit this and never again say in this House that he has not raised personal income taxes. That is as close to the Pinocchio syndrome that we have in this House. I would use another word, but I respect the Chair and I know that I cannot use language like that.
My final comment is that there is a member from Newfoundland who was talking about what I said about harmonization. We are against this nickel and dime, two bit effort to harmonize. If a package was presented to us that harmonized with all provinces we might consider supporting it. We would have to see it first. We have not seen it yet.
Second, if the government is going to harmonize and we do want to have the lowest rate, we have to look at the possibility of taxing everything that we can. This is what the member from Newfoundland will not put in his speech. To help the poorest and the neediest of the needy you have an increased rebate program to make sure that those people do not suffer. This would really tax the rich and that is what the Liberals like to do-