House of Commons Hansard #126 of the 35th Parliament, 2nd Session. (The original version is on Parliament's site.) The word of the day was harmonization.
Paul Forseth Reform New Westminster—Burnaby, BC
Mr. Speaker, pursuant to Standing Order 36, I am pleased to present a petition from lower mainland residents, many from my riding of New Westminster-Burnaby, who are concerned that Canada's national highway system is substandard.
These petitioners are calling on Parliament to urge the federal government to join with provincial governments to make the national highway system upgrading possible.
Paul Forseth Reform New Westminster—Burnaby, BC
Mr. Speaker, I have a second petition from over 100 New Westminster-Burnaby constituents and others from the surrounding area who are greatly concerned with the price of gasoline and the overall structure of our highways.
These petitioners request that Parliament not increase the federal excise tax on gasoline and strongly consider reallocating its current revenues to rehabilitate Canada's crumbling national highways.
Len Taylor NDP The Battlefords—Meadow Lake, SK
Mr. Speaker, I have the honour to present a petition pursuant to Standing Order 36 from residents of my constituency, virtually all from the city of North Battleford, with a couple from Spiritwood, Speers and Radisson.
The petitioners note that the availability of a low cost energy source is the natural advantage Canadians have to set off the high cost of transportation because of the great distances required to reach markets, that Canadians are paying approximately 52 per cent of the cost of a litre of gasoline at the pumps in the form of government taxes, that over the past 10 years the excise tax on gasoline has risen some 566 per cent.
The petitioners request that Parliament not increase the federal excise tax on gasoline in the next federal budget.
Paul Szabo Liberal Mississauga South, ON
Mr. Speaker, I have two petitions. The first comes from the city of Brantford, Ontario.
The petitioners bring to the attention of the House that the rights and freedoms of all Canadians, including the freedom from discrimination, is already protected by Canadian law.
Therefore the petitioners pray and call on Parliament to oppose any amendments to the Canadian Human Rights Act or any other federal legislation that would provide for the inclusion of the phrase sexual orientation.
Paul Szabo Liberal Mississauga South, ON
Mr. Speaker, the second petition comes from my riding and city of Mississauga South.
Whereas Canada and all state parties in the 1969 United Nations Treaty on Non-Proliferation of Nuclear Weapons reaffirm their commitment May 1995 to undertake and to pursue negotiations in good faith to the cessation of the nuclear arms race, the petitioners pray and request that Parliament support an immediate initiation and conclusion by the year 2000 of an international convention which will set out a binding timetable for the abolition of all nuclear weapons.
Marlene Catterall Liberal Ottawa West, ON
Mr. Speaker, I have several petitions to present. The first is from members of the Andy Andras, the Westboro and the Dovercourt co-op areas in my riding.
The petitioners draw to the attention of Parliament that co-operative housing is one of Canada's great success stories, that it brings people together to meet their housing needs and to create safe and supportive communities.
They express their concerns about transferring the management of this housing to the province of Ontario, calling on Parliament to consider the proposal put forward by the Co-operative Housing Federation to administer these housing communities.
Marlene Catterall Liberal Ottawa West, ON
Mr. Speaker, the second petition is from a number of residents of my riding who are concerned Canada's financing the sale of CANDU reactors to China and calling on Parliament to immediately withdraw from all arrangements concerning financial and technical assistance to China for nuclear reactor technology.
Marlene Catterall Liberal Ottawa West, ON
Mr. Speaker, the third petition is requesting that Parliament not increase the federal excise tax on gasoline in the next federal budget.
Mr. Speaker, finally-
PetitionsRoutine Proceedings
The Speaker
I think we will have three strikes and you are out.
Jay Hill Reform Prince George—Peace River, BC
Mr. Speaker, it is a pleasure for me to present a petition on behalf of citizens
of northern British Columbia, many of whom reside in my riding of Prince George-Peace River.
The petitioners note that our NAFTA partners, Mexico and the U.S.A., are currently upgrading their national highways system. The petitioners call on Parliament to urge the federal government to join with provincial governments to upgrade our national highway system as soon as possible because they note it is substandard.
Paul Zed LiberalParliamentary Secretary to Leader of the Government in the House of Commons
Mr. Speaker, I ask that all questions be allowed to stand.
The House resumed consideration of Bill C-70, an act to amend the Excise Tax Act, the Federal Province Fiscal Arrangements Act, the Income Tax Act, the Debt Servicing and Reduction Account act and related acts, as reported (with amendment) from the committee; and of the motions in Group No. 3.
Ken Epp Reform Elk Island, AB
Mr. Speaker, usually we say it is a pleasure to rise and enter into the debate. Frankly, I wish I did not have to give this speech today because it is one of such distress to Canadians. It is the one that turned the previous government on its ear and turfed it out. Primarily it was the imposition of the GST on the Canadian people that turned the people against the government of the day.
I would like focus on what this means to business. In order to do that, I have chosen to back into Hansard . It will be four years in March that the GST was being debated in the House. There was a bill brought forward which amended the GST rather substantially. That generated a lot of debate.
At that time the Liberals were in opposition. I went to Hansard to see what the Liberals said in the last Parliament about the GST, particularly about how it affects business.
There were several members who spoke about this. There are three people I would like to draw attention to. One is the Deputy Minister, another is the member for Broadview-Greenwood and the third is the member for York South-Weston.
I cannot help but have a great deal of sympathy for the voters of this country when they feel cynical about government. These three people very distinctly and explicitly gave the Liberal position on the GST. In fact, every one of these people took action on the side of the government when the GST had not been rescinded the way they promised during the election campaign.
I do not know whether the logic escapes Canadian people but, for example, the Deputy Prime Minister told the voters in her riding that she would resign if the GST were not abolished. There are really only two possibilities here. The first is that she, like millions of other Canadians, did not read the red book and the fine print in it. Therefore she actually fell into the group that really did not fully understand the Liberal policy. In that case, I recommend that she be considered quite incompetent because on such a major issue during the election campaign she should have known her party's policy. The second is she tried to deliberately deceive the voters in order to gain their vote without telling them the actual truth. We do not want to believe that but it is a possibility which should not escape our consideration.
I would like to talk about the member for Broadview-Greenwood who, previously in this Parliament, actually left the Liberal fold for a short time to sit as a Liberal independent, or whatever the name was that he chose, and then later on returned. I challenge him personally and all Liberal members to live up to what they committed themselves to in the campaign on behalf of the Canadian people in order to restore the trust and confidence that Canadians ought to have in this institution.
I will quote from Hansard of March 12, 1993, pages 16902 and following. This what the hon. member for Broadview-Greenwood said: This whole GST operation by the government has been the worst initiative that any government has ever perpetrated on a people''. He said that the GST isa tax that has done a great deal to dampen and suppress entrepreneurial spirit and consumer confidence in this country. I know in my own riding it has practically cut the restaurant business in half, not to mention what it does to students who tend to work their way through either high school or college by working in restaurants part time. They count on not only this type of work in the restaurant-tourism business but on the tips. It has just gutted the hopes for half-decent, part time income for tens of thousands of university students right across Canada''.
Earlier today in question period we were talking about jobs and the jobless rate in Canada. The fact is that 17 per cent of our youth are actively looking for jobs. I know what that means. I have a son who for over a year has been looking for a job. He cannot find one. The economy does not say to him to come and work because it is
so depressed. Partially it is because of the pervasive effect the GST has had on it.
The hon. member for Broadview-Greenwood said: "It has throttled people with this bureaucratic nightmare of a GST". Those are the words spoken by that member almost four years ago. The hon. member for Broadview-Greenwood quoted the leader of the Liberal Party of the day, the current Prime Minister, by saying: "My leader three weeks ago said that this GST will be scrapped. Make no mistake about it, the GST will be scrapped if we are given the trust to run the Government of Canada". That is a direct quote from Hansard . Here is another one: ``This GST has done much damage to the retail business in this country. It has done much damage and caused much unemployment and welfare''.
When the hon. member for Broadview-Greenwood was on this side of the House, he identified the true implications of the GST. He made a great point of expressing those sentiments. He went on to say: "If you developed a fair tax system in this country and if you put 400,000 or 500,000 people back to work, you could find $15 billion within four or five months, not to mention the fact that we would start giving people back their dignity. We have to understand that there are close to two million people in this country who are out of work".
Listen to these beautiful words from that member. I am happy to quote him because he is right. It is unfortunate he has changed his mind. He said: "I cannot imagine a single member of Parliament in any party in this House of Commons wanting to defend the status quo in terms of tax law in this country. In fact I have not met a member of Parliament who believes that the tax act of this country is fair, simple or efficient. We all agree that this 2,400-page document with its rules and regulations and its exceptions and its exceptions to exceptions is no longer intelligible. This tax act combined with the GST has caused an underground economy of cash deals in this country. Experts estimate that right now there are over $100 billion of cash transactions in this country".
He continued: "All kinds of schemes are going on in this country right now. The underground cash economy is just out of control". He then went on to discuss this.
It is very clear to me from this sample of three that there must have been many other members of the Liberal Party, but particularly these three, who said explicitly that they were going to scrap the GST. The fact that they have not done so and have changed their views, their words and their actions since they were elected to government is unconscionable.
The member for Broadview-Greenwood said that the tax act is so complex. He went on to say:
The GST has exacerbated that. No matter how many amendments or refinements the government brings in on this bill it cannot make a silk purse out of a sow's ear. The GST is a sow's ear and the Canadian public is never going to accept it.
I agree with that. I still continually hear complaints about the GST, about its draining of much money from our economy, of its preventing people from getting jobs and of the great complexity and annoyance of having to file the rebate statements and all of the administrative costs that are associated with it.
I will quote again from Hansard . At page 16906 the same member said:
We have a situation today where the government wants us to support a bill to refine the GST. I am totally opposed to the GST. It is an inefficient, unfair tax. Small businessmen despise the GST. They want it replaced. They definitely want to make sure we do it in a responsible way. We cannot just snap our fingers and pull something out of the hat. There has to be a serious debate on tax reform, but they do not want us to defend the status quo which the Conservative government wants to defend. We are not going to defend the status quo. There is no way. There is absolutely nothing that could ever make me change my attitude toward the GST.
Well it appears that being elected to the government side actually did change his attitude to the GST. He of all the members made one of the braver attempts to change it.
Excise Tax ActGovernment Orders
The Speaker
According to what I have hear the member's time is up.
Excise Tax ActGovernment Orders
The Speaker
I am surprised too because I was enjoying it so much. I think we will pass on to the hon. member for Saint John.
Elsie Wayne Progressive Conservative Saint John, NB
Mr. Speaker, I would first like to say that I am pleased to be able to speak to the report stage of Bill C-70.
I would also like to inform my colleagues from the Reform Party, notably the member for Prince George-Bulkley Valley and the member for Medicine Hat, that the member for Saint John has spoken out against the HST on a number of occasions. I also brought the Retail Council of Canada to my riding of Saint John, New Brunswick for a luncheon with the board of trade and the business community. I have spoken in this House several times and have written several articles for the paper as well. I just wanted to clarify a couple of statements that were made in this House.
The concept of harmonization is worthwhile, however not this government's version. I cannot support a bill which will hide taxes, shut down stores in Atlantic Canada and kill jobs for our people. This bill is nothing more than a political solution to cover up the Liberal failure to scrap the GST. Who is going to pay the price for a promise made during the heat of an election? The people of Atlantic Canada.
The amendments made in committee and the amendments we are debating today do not address the problems because the bill is fundamentally flawed. This comes as no surprise when we have a government rushing to live up to a poorly thought out campaign promise before the election rolls around.
But it is more than just that. There were hearings up here on the Hill and no one informed our people back home in New Brunswick, Nova Scotia and Newfoundland that if they wanted to come and make a presentation, the government would pay their way. No one mentioned it to them. They did not know this because no one told them. Is that because the government did not want to hear from them?
It is ironic that the majority of those affected by the HST have not had their say about this legislation. I am sure many Atlantic Canadians would have been delighted to come here to make it clear how much they oppose the legislation on this harmonized tax with tax in pricing. One also has to question why hearings were not held, as I have stated, in New Brunswick, Nova Scotia and Newfoundland.
One of the biggest problems with this legislation is the tax included pricing component. Retailers, businesses and restaurant owners to name just a few have explained what it will cost in dollars to switch to a tax in pricing system. More important, they have also explained the cost in real terms, in terms of jobs, jobs, jobs. Twelve stores have already stated that they will be closing down because of the harmonized tax and the tax in pricing.
It is also ironic that while the government is trying to make Canadians believe it has lived up to one campaign promise, it is reneging on the other promise of jobs. A representative from K Mart Canada said that the company will face an inevitable loss of jobs as marginally profitable locations become unprofitable due to increased costs.
One only has to look at the population of the area of Nova Scotia, New Brunswick and Newfoundland. Take a look. As the Retail Council of Canada stated, it is a much smaller population than central Canada, Quebec, or out west. It said that the profit there is very marginal and asked: "What would you do if you were us? Would you stay there or would you just stop? Would you pull out?"
This is a very serious situation. Those who have come to see me up on the Hill are: the Hudson's Bay Company, Canadian Tire, Sears, Eaton's, Shoppers Drug Mart. The list is long and they are all saying that they may pull out of Atlantic Canada.
When the Liberal MPs from our area vote for this, they will be going against the wishes of their people. How can they possibly do that? How can any of the MPs from these provinces possibly vote for this when, as the hon. member from the Reform Party just quoted, they stated when in opposition that it was no good? They said that this was wrong and that if they formed the government, they would never do it.
The hon. member for Acadie-Bathurst, who is now Minister of National Defence and Minister of Veterans Affairs, said: "The sign of the times is that so long as we have a tax that is hidden from the consumer, we are going to have problems that are a lot more serious than we understand". He also stated: "The whole idea of visibility was seen by many Canadians as being a deterrent to free-spending governments which would just raise the tax, get the money it needs at election time for promises and spend it foolishly". These were statements in Hansard in 1990.
How are Canadians to hold this government accountable when they do not know which position to believe because it changes from year to year? Perhaps the government members opposite could clarify their position and explain why it has changed so drastically now that they are the government.
It has just been brought to our attention that Assumption Life in New Brunswick must now charge HST on its management fees for segregated funds. However companies headquartered outside the harmonized zone do not have to charge the HST. If you were someone in New Brunswick, would you go to Assumption Life now knowing this? Any company selling mutual funds will choose not to locate in our area of New Brunswick, Nova Scotia and Newfoundland. Companies already in the harmonized zone would be better off relocating to a non-harmonized province which is what they are telling us every day.
This legislation will drive business away from the Atlantic region. We do not want to be have not provinces. We want to contribute to our country, but we cannot do this if this government continues to cut off our legs from underneath us when it brings in a tax such as this.
Representatives from One Voice, The Canadian Seniors Network came to see me. They explained that seniors will be paying more. One little senior called me and said: "I have very little money but when this new tax comes in, I must pay it on my heating bill, I must pay it on my hydro bill". She said further: "I do not believe that I will be able to go to the hair stylist any more to get my haircut. I cannot afford any more, Elsie. I can barely meet the needs that I have today with the money and income that I have. In addition, some groceries and children's clothing will cost more". This legislation is not good for the people of Saint John, my riding. It is not good for the people in New Brunswick, Nova Scotia and Newfoundland.
One must ask oneself why only New Brunswick, Nova Scotia and Newfoundland agreed to the HST. Would it be because these three provinces are the only provinces left in Canada with Liberal premiers? Would it be because all three provincial governments received a substantial monetary gift from the federal government on agreeing to implement the HST? Did they have any choice, because of politics? Why would all other premiers across the nation
say no and only the three Liberal premiers say yes? The answer is quite obvious to all Canadians.
I will conclude by urging the government to rethink the legislation. Please do not make Atlantic Canadians pay the price for ill-conceived campaign promises and hasty attempts to live up to them.
Harold Culbert Liberal Carleton—Charlotte, NB
Mr. Speaker, I am delighted to have the opportunity to join in the debate on this most important topic.
For the benefit of the House we should take the opportunity to review the famous GST and where it came from. As most members are well aware it is derived from the former manufacturers' sales tax. The previous administration decided that it would have a GST at 7 per cent across the country. Of course the proposal was that the government would use it to reduce the deficit.
We know the legacy that the Tories left us in paying the deficit, that each and every goal and projection that was set went in the opposition direction. For some reason instead of the deficit going down, it continued to go up until this government assumed office and assumed a $42 billion deficit at that time.
What happened to that $14 billion to $15 billion that was projected as new revenue from the GST? It went into the general revenue fund. The manufacturers' sales tax had disappeared. The new GST was here. Contrary to what others have said, and I admit I can only speak for myself, I know what the policy was of my party when I was campaigning. People did ask me what I thought would happen to the GST. Of course they loved it so much they wanted it left completely alone.
I said it would be changed to a fairer and more equitable tax system both for the small business people in our communities as well as for the consumers. I pointed out very clearly and in many cases said it twice: "Hear me, it has to be replaced in order to provide approximately the same amount of revenue".
Originally we were told that the GST would provide enormous additional dollars in revenue that would expedite paying down the deficit and we would reach a balanced budget much faster in the early 1990s.
It was projected that the $14 billion or $15 billion that came from the manufacturers' tax which was replaced by the GST actually came to approximately $28 billion. When the rebates and the additional administration costs were taken off so we were back to the the $14 billion or $15 billion figure which was the level of income from the previous manufacturers' tax.
When the government looked at possible ways of replacing that revenue, the finance committee travelled across the country from one end to the other, including my home province of New Brunswick of which I am very proud.
In New Brunswick I listened to presenter after presenter. Some were from the business sector, some from the industry sector, some from agriculture, some from the education sector and some from the consumer sector. They said we had to have a simpler system. We had to come up with a harmonized system that would reflect the total of the taxes they are paying. I agree it has to be very up front and very forward.
Following all of the presentations and hearings across the country after some two and half years, the finance committee came forward with its recommendation to harmonize the two taxes, the provincial sales tax and the GST into a new harmonized sales tax.
The first three provinces that came on board, in addition to the province of Quebec that had the harmonized sales tax, were the provinces of Newfoundland, Nova Scotia and New Brunswick. Some have criticized and complained about the formula that was arrived at, not for those three provinces, but for every province in Canada to use. It is a formula that would be fair and equitable to all provinces and treat each and every one in the same fashion.
What does harmonization do for the business sector and the retail sector? I have talked to many business people. First of all it means that they have to keep one set of books instead of the previous two. It means that they have to issue one cheque instead of the previous two. It means that one tax auditor will come in and review their books instead of two. It is a much simpler system for every business person throughout the communities that are involved in the retail sector.
What does it do for the consumer? Report after report and survey after survey have indicated that the consumer does not want any more surprises when he or she arrives at the cash register and wants to know exactly what amount must be paid.
There is no intent to hide the total amount of taxation that would be paid on any product that is taxable at the cash register. As a matter of fact the proposal stated very clearly that consumers want it shown on the cash register tape the price of the product, the tax that is included and the total. On the shelf the consumer will see the price that is being paid which includes the taxes.
It is not a hidden tax. It is a tax that is very up front. Right on the cash register tape is everything that is purchased. Let me look at some of the key elements.
It says: "Consumer in participating provinces will benefit from the removal of the provincial retail sales tax from business inputs. This advantage, combined with the benefit of a lower rate and lower compliance costs for businesses, will lead to lower consumer prices on many goods. Tax inclusive pricing rules will ensure that consumers know the full price of the good or service before paying for it while keeping the amount of the rate of sales tax payable visible on the receipts".
As I mentioned, it is simpler for the business community, simpler for the consumer and it provides the revenue toward decreasing the deficit that we know the government assumed at $42 billion plus. We know that Canadians want the government to put its financial house in order. That is exactly what is being done.
We are not the first government ever to set goals. There have been others. However, I suspect we are the first government in recent time to have been able to achieve those goals, to meet or exceed them in each and every instance and we will continue to do so.
Philip Mayfield Reform Cariboo—Chilcotin, BC
Mr. Speaker, I am pleased to join the debate on the report stage of Bill C-70.
Some members opposite would have us believe that the debate is about harmonization of the GST with the provincial sales tax in the Atlantic provinces. They would have us believe that the debate is about doing taxation better. That is not what it is about.
I take my cue from a headline on the Saint John Telegraph Journal editorial in January which said: ``Most people can hold their breath longer than the Liberals can hold their principles''. That is basically what the debate is about.
The debate we are having today is about integrity, about responsibility and accountability; the lack of accountability of the government to the Canadian people. The debate is about the government's failure to keep its election promise to scrap, kill and abolish the GST. It is about why Canadians cannot trust the government.
Integrity is important to Canadians. When I travel around my riding in British Columbia, people stop and tell me that they do not expect miracles from their politicians, but they do have some expectations. They expect politicians to show compassion, expect them to care and to set an example and to keep their word. The Government of Canada has fallen short of these expectations. It has not kept its word. It has broken faith with those who trusted it. Canadians cannot trust the government for three major reasons.
The first reason they cannot trust the government is because during a CBC town hall on October 18, 1993 the Deputy Prime Minister promised Canadians: "I have already said personally and very directly that if the GST is not abolished, I will resign". The Liberals refused to abolish the GST and it took months of denial, cover-up and flip-flops before the Deputy Prime Minister finally did resign to run again in a byelection. She resigned only after a poll told her that she would win. This is not resigning. This is not responsible action. This is not integrity.
It is like saying "you caught me this time, I will go through the motions but I still don't have to be accountable". Canadians do not trust this government.
Let me share with members again the second reason why this is the case. The finance minister said on April 4, 1990: "I would abolish the GST". That is what he said. Instead of abolishing the tax and keeping his word after being elected, the finance minister tried to cover up his broken GST promise. He hid behind the coat-tails of the new tax he created, the harmonized sales tax.
Yes, the finance minister, instead of keeping his word, bribed three Atlantic provinces with about $1 billion cost to the rest of the country to harmonize their provincial sales tax with the GST. This is his way of saying that the GST has been abolished.
Paul Szabo Liberal Mississauga South, ON
Mr. Speaker, I rise on a point of order. I understand that debate does get a little hot, but the member has just imputed motive to the Prime Minister, talking about bribing the electorate with regard to the arrangements in the maritimes.
Would the Chair raise this matter with the member with the view to withdrawing that comment?
Excise Tax ActGovernment Orders
The Deputy Speaker
Perhaps the hon. member for Cariboo-Chilcotin would indicate what it was he said in the context of what has been raised by the member for Mississauga South.
Philip Mayfield Reform Cariboo—Chilcotin, BC
Mr. Speaker, what I said was that the finance minister, instead of keeping his word, bribed the three Atlantic provinces with $1 billion to the cost of the rest of the country to harmonize the provincial sales tax with the GST and that this is his way of saying that the GST has been abolished.
Excise Tax ActGovernment Orders
The Deputy Speaker
The dictionary is on the table and if we look in it we will see that "bribe" means to give money to or induce somebody to do an illegal act.
I realize that we cannot get into a definitional fight over every word that is used, but I would ask the hon. member, if he accepts that definition, if he might consider rephrasing that.