Debates of Dec. 5th, 1996

Taxation

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

Mr. Speaker, on Tuesday, in response to a question on the possibility of a family trust being transferred abroad without payment of capital gains tax and without interest on tax owing, the Minister of Finance declared in the House, and I quote: "The Bloc Quebecois critic is wrong. As soon as taxes are due they have to be paid. If they are not paid, interest will be charged".

My question is for the Minister of Finance. Does the minister still hold to his Tuesday version of the facts, that a millionaire transferring a family trust abroad must pay taxes to Revenue Canada and interest owing on unpaid taxes?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, I repeat what I said last week. When taxes are due, they must be paid. If, for one reason or another, a tax due is not paid and the tax is duly levied, interest accumulates.

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

Mr. Speaker, we have a problem. We have a Minister of Human Resources who does not know his business, a Deputy Prime Minister brandishing flags at all and sundry and a Minister of Finance who is uninformed about the tax system he claims to manage.

In the technical document he tabled with his ways and means motion on October 2, he said that when a family trust is transferred abroad, and I quote: "The person transferring must provide Revenue Canada with a guarantee of future payment without interest costs".

He says there are interest costs, and his document says there are none. We just do not understand this government any more.

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, unfortunately it is the member opposite who does not understand the tax system.

The change we made to the system means that, when someone leaves the country, it is quite likely the tax is not due, since the item in question was never sold; so there is no capital gains tax. We want to be sure that, when the item or shares are sold, the tax will be paid by someone who is now a non-resident. So we insist on a debenture.

Unfortunately, the situation is clear enough for the member to perhaps have some difficulty understanding it.

Krever Inquiry

[Grant Hill, Reform, Macleod, AB]

Mr. Speaker, the Deputy Prime Minister has said very clearly that no documents that are being hidden from the Krever commission came from the administration of John Turner. That means she knows, the Prime Minister knows and the cabinet knows where those documents came from.

I would like to ask the solicitor general, very plainly, could he state for this House that these documents did not come from the administration of Pierre Elliott Trudeau?

[Herb Gray, Liberal, Leader of the Government in the House of Commons and Solicitor General of Canada]

Mr. Speaker, I was simply repeating to the House my recollection of what the Deputy Prime Minister had said as to what she had been informed by the clerk of the privy council. I have no further information that I can convey to the hon. member.

If he would like to specifically indicate what documents he is talking about, if he has any such knowledge, I will see if I can obtain further information on a proper basis for him.

[Grant Hill, Reform, Macleod, AB]

Mr. Speaker, the excuses continue.

It is interesting that the cabinet has called these documents draft regulations, every one of them. It is also interesting that the draft regulations were given to Krever. In fact, I happen to have those draft regulations with me today.

I ask again, since these regulations are not draft regulations that they are hiding, exactly what documents are they? I ask again, did they come from the administration of Pierre Elliott Trudeau?

[Herb Gray, Liberal, Leader of the Government in the House of Commons and Solicitor General of Canada]

Mr. Speaker, I see no way to answer my hon. friend's question unless he precisely identifies the documents he is talking about. If he is talking about documents of which he has a copy, which he said Mr. Justice Krever already has, why is he wasting the time of the House asking his question?

Credit Cards

[Pierre De Savoye, Bloc, Portneuf, QC]

Mr. Speaker, my question is directed to the Minister of Industry.

We have learned that a record number of people in Canada and in Quebec are experiencing financial difficulties and are being forced to dip into their registered retirement savings plans. At the same time, banks and major department stores are charging exorbitant interest rates on their credit cards and the government is refusing to assume its responsibilities with respect to this issue of public concern.

Does the Minister of Industry realize that the low interest rate cards being touted by the secretary of state the day before yesterday are available only to clients who are well off financially, and that it is those in the middle class who are paying for others through the elevated rates still in effect on regular cards?

[Morris Bodnar, Liberal, Parliamentary Secretary to Minister of Industry]

Mr. Speaker, the whole matter of credit cards is one of the market dealing with matters. When there are lower interest rate cards which are available to some, others can be cut out who may want cards and who are eligible now for the higher rates.

It is a matter of the marketplace taking care of the situation as it exists at the present time.

[Pierre De Savoye, Bloc, Portneuf, QC]

Mr. Speaker, an Industry Canada report that came out last September stated that interest rates charged credit card holders are still too high, given the fall in the Bank of Canada rate. The Minister of Industry himself said at that time, and I quote: "The president of the Bankers' Association does not perhaps understand that consumers are fed up".

How can the Minister of Industry take the completely unacceptable approach of doing nothing, while interest rates are dropping everywhere but on credit cards? Why does the minister not join the coalition of 150 MPs who are trying to improve the situation for the average member of the public?

[Morris Bodnar, Liberal, Parliamentary Secretary to Minister of Industry]

Mr. Speaker, it is interesting that the minister has always taken the position that he encourages banks to reduce credit card interest rates. In dealing with a group who had signed the requests, he was certainly supportive of the group in dealing with the high interest rates that are being referred to.

Again, there must be encouragement by the public to the banks to reduce the rates. This can be done in many different ways. One way is by not utilizing the cards and another way is by applying for the lower interest rate cards.

Canada Pension Plan

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

Mr. Speaker, today six working people pay taxes to support one pensioner. Twenty years from now there will be only three. Their CPP taxes will be double and on top of that they will have to pay interest on the $600 billion debt the Liberals are leaving them. Reform of CPP must come soon to prevent serious intergenerational conflicts.

Will the minister break the log jam preventing agreement with the provinces on CPP by agreeing to match increases on CPP premiums with long overdue decreases in EI premiums?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, there is no linkage between CPP premiums and EI premiums any more than there is between CPP premiums and other payroll taxes such as imposed by the provinces, workers compensation, health or education levies. In fact, each has to stand on its own feet.

The member's question is very pertinent. One would really hope that the joint stewardship of the CPP between the federal government and the provincial and territorial governments will lead all

parties to deal with the immediate need for financial stability of the plan.

I am, I must say, quite optimistic that we will arrive at a solution. I would prefer to have done it by January 1. We may go beyond that but I believe there is goodwill on all sides to arrive at a solution.

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

Mr. Speaker, a poll confirmed what financial institutions have known for some time. Canadians are cutting back on their RRSP contributions. They just do not have the money after the Liberal policies reduced after tax family income by $3,000 on average.

Will the minister help Canadians by giving them tax relief in the next budget, financing it by more spending reductions and giving Canadians the smaller federal government they want?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, as the hon. member knows, we have brought in selective tax benefits for Canadians in all of our budgets and we intend to continue in that vein.

The hon. member put his finger on it when he said that if there are going to be further tax cuts they will have to be accompanied by cuts in social spending. I congratulate the Reform Party for at least having outlined those areas where it believes ongoing cuts in spending should be made. I encourage the Reform Party to speak to their other extreme right wing cousins, those in the Conservative Party, and ask them to outline where they would make the cuts.

Lists Of Voters

[François Langlois, Bloc, Bellechasse, QC]

Mr. Speaker, my question is for the government House leader.

Amendments to the Canada Elections Act proposed by the government allow the chief electoral officer to use only the Quebec civil register and Quebec driver's licence information to establish the list of electors for the next federal general election.

In view of the representations made by the official opposition as well as by the Quebec government and Quebec's chief electoral officer, is the minister now ready to reconsider his position and to allow the use of the permanent list of electors established by the Quebec government?

[Herb Gray, Liberal, Leader of the Government in the House of Commons and Solicitor General of Canada]

Mr. Speaker, I would be happy to examine the representations made by Quebec's chief electoral officer, but the bill is now being considered in the Senate. Therefore, I cannot give a more detailed answer at this time.

[François Langlois, Bloc, Bellechasse, QC]

Mr. Speaker, the government has a choice: since it controls at least half of the other place, it could act immediately by having Bill C-63 amended, or it could do so in this House.

Since we know that taxpayers in Quebec and Canada would save at least $15 million if Elections Canada used Quebec's permanent list of electors, why are the government and Elections Canada still refusing to use that list?

[Herb Gray, Liberal, Leader of the Government in the House of Commons and Solicitor General of Canada]

Mr. Speaker, I think this House passed an amendment regarding the use of Quebec's and other provinces' lists of electors.

As I just said, the bill is in the other place. I do not think it would be wise for me to comment on what goes on in the other place. Again, I will consider the representations made by my hon. friend and by Quebec's chief electoral officer.

Chalk River Nuclear Site

[Mac Harb, Liberal, Ottawa Centre, ON]

Mr. Speaker, my question is for the Minister of Natural Resources.

It was reported in 1994 that radioactive waste dumped nearly 50 years ago at the Chalk River nuclear site is polluting local vegetation, swamps, lakes and wildlife. This waste is now seeping into the Ottawa River and is posing a possible health risk to area residents.

What is the minister doing to stop this leakage immediately and to ensure the future safety of our natural resources and human health?

[Anne McLellan, Liberal, Minister of Natural Resources]

Mr. Speaker, first I want to reassure the hon. member and those who live in Chalk River and along the Ottawa River in relation to the story that appeared today in the Ottawa Citizen , the leak in question was reported to the AECB some number of years ago. Since that time the AECB has been monitoring the situation and taking whatever steps that have been necessary.

I want to reassure the member that the atomic energy board has stated that the leak in question presents no threat to the public or to the public health. The level of contamination is well below limits set by the AECB in relation to health and safety.

I also want to reassure members of the House that this leak is not from radioactive waste streams. The leak comes from water from

the bays in which the used fuel from the reactors is stored. It is important to reassure people that we are not talking about radioactive waste in this context.

Taxation

[Monte Solberg, Reform, Medicine Hat, AB]

Mr. Speaker, I must say in response to the previous question to the finance minister that an extremist is anyone who happens to be winning an argument with the Liberals.

The Certified General Accountants have produced a study that confirms what Reformers have been saying all along, that lower taxes create jobs, real permanent jobs, not the McJobs that the infrastructure program allegedly created. The CGA say a $4 billion personal income tax will create 108,000 new jobs by the year 2001.

Given the overwhelming evidence that lower taxes create jobs, will the finance minister agree to start lowering taxes so that Canadians can have those jobs that they really do deserve?

[Paul Martin, Liberal, Minister of Finance]

Mr. Speaker, under those circumstances it is quite clear that I will have to change my definition of an extremist.

Whether it be a $4 billion tax cut or whether it be as the Reform has suggested a $15 billion to $20 billion tax cut, the fact is that one has to pay for it. The issue is not whether one would like to see a tax cut. There is nobody in this House who would not like to see a tax cut. The question is: What programs would have to be cut, would have to be given up, in order to pay for that tax cut?

The government is not prepared to see health care impaired. The government is not prepared to see old age pensions impaired. This government is going to stand behind the basic social fabric of the nation and under those circumstances, we will stay the course.

[Monte Solberg, Reform, Medicine Hat, AB]

Mr. Speaker, the fact is that Reform would put more money into health care. We would fix the programs that the government has destroyed, the $7.2 billion in cuts to transfers. Reformers believe by the way that real compassion is not putting money into welfare; it is getting more people off welfare.

The CGA says the 20 per cent reduction in UI taxes would create 68,000 jobs by the year 2001. As a matter of fact, the Reform plan calls for a 28 per cent cut in UI premiums. Imagine how many more jobs that would create. Today the Liberals on the finance committee are saying that UI taxes cannot be lowered. Will the finance minister ignore the recommendation of the finance committee and lower payroll taxes to create the jobs that Canadians so desperately want?