Mr. Speaker, it is an honour for me to address today's debate on the opposition motion on business taxation.
Canada is consistently rated as one of the best nations in the world in which to live. Yet the only way to maintain our position on the world stage is to create a business tax system that not only raises money but also creates jobs. I fully support the attempt by the Minister of Finance to re-examine the tax act.
By establishing a technical committee of outside experts, only through a close examination of the grant system will we be able to encourage economic growth and job creation. Who better than the team of experts that is in the field of taxation to tackle the challenge?
It is my hope that such a professional review might lead to enhanced fairness in the tax system by ensuring that all businesses share the cost of providing government services. Otherwise we are faced with declining trust among Canadians and will have a greater reliance on what is known as the underground economy.
In fact, one of the biggest threats posed to Canada's financial well-being is the infamous underground economy. The Ministry of Finance should be commended for getting tough with tax cheaters in this budget. By reinforcing the existing strategy to combat the underground economy, we are sending a strong message to tax cheaters everywhere. The underground economy is not made up of honest people who are merely bending the rules.
The message we are sending to tax cheaters is clear; in your quest for personal gain, you are endangering Canada's economic future. Tough, fair enforcement programs, aimed at protecting our tax system, will help ensure this country's economic future.
The warning in the section of the budget is likely to deter people who might have been thinking of cheating their government out of tax dollars. Pushing an economy underground simply causes the
main source to dry up. You cannot expect water tomorrow unless you are prepared to prime the pump today.
With this budget announcement, Revenue Canada has put in place a multi-faceted approach that enhances its existing underground economy strategy. This strategy aims at enhancing current levels of respect for the tax system in a handful of especially high risk areas of the economy.
As I said back in 1994, anyone who chooses to live in Canada must be prepared to pay for that privilege. Where there is no honour in the honour system, perhaps the fear of getting caught will now prove to be a sufficient deterrent.
It is essential that we maintain the integrity of our taxation system. If the public's trust in the government's revenue generating methods becomes completely eroded, there is no turning back.
Had we failed to get our economic house in order, we would surely have been heading in the direction of a banana republic by now. The life blood of any economy lies in the level of trust it holds among its citizens. Results from this section of the budget should be quick and significant.
Benefits will come in two forms, both in terms of traditional revenue generated for public programs and of greater fairness to other taxpayers who have always met their obligations. Public trust, being as it is a two-way street, this government has repaid honest taxpayers in the best possible way. For the first time in recent memory a federal budget has not unveiled new taxes.
How and how much a country taxes its residents is critical in determining its future economic success or failure.
Without a doubt, taxes in Canada are still higher than most of us would like. This is why a fiscal turnaround is so vital. Only by controlling the debt can we free up resources to eventually ease the tax burden.
In its latest budget, however, the government has taken what is clearly a step in the right direction. There are no tax rate increases, not personal, not corporate, not excise. There have been no personal income tax increases in any of the last three budgets.
Fairness to taxpayers who comply with their obligations demands effective enforcement of the tax law to ensure everyone shoulders his or her fair share of the burden.
To build on Revenue Canada's highly successful underground economy strategy the budget has proposed to devote more energy to Revenue Canada's audit program for unincorporated businesses and self-employed individuals. A higher audit rate for these two high risk groups is expected to recover about three times the cost of bolstering the program.
Because a technical commitment in the Department of Finance will be examining ways of simplifying the business tax system,
including corporate income, capital and payroll taxes and personal taxes, taxpayers will be able to more easily comply with the system.
An effective tax system should not simply raise taxes. It should raise awareness of the importance honesty and fairness play in securing the nation's future.