Mr. Speaker, I am very pleased to stand and debate the issue today, although it obviously is a matter which concerns our colleagues in the Atlantic provinces more than the rest of Canada directly. In fact, it concerns all of us in Canada. What we have here in this proposition is a superior model for dealing with the problem of consumption taxes throughout Canada.
We have heard the member from the Bloc, the previous speaker from the province of Quebec. We know that Quebec has harmonized its tax system for obvious reasons. I will return to that.
The fact of the matter is this government has spent the last three years struggling with the problem of how to have the intelligent application of a consumption tax in the country. Every tax expert, anybody who knows anything about the way modern taxes work in a modern society, particularly one which is subject to globalization, knows very well that there is a proper mix of income taxes and consumption taxes that must be applied.
Why did we end up where we did with the GST, which we in the House have spent so much time talking about? We as citizens and members of Parliament have been trying to deal with the unfortunate hand that was dealt us by the last government.
The reason the GST was brought in was that the former manufacturers' sales tax which applied to manufactured goods in the country was no longer sustainable once tariffs were moved down to what they were after the war when originally they were around 50 per cent and then dropped to an average tariff today of 7 per cent. The manufacturers' sales tax only applied to goods which were manufactured in Canada. The consequence of applying that in today's world would have been totally impossible. It would have inhibited manufacturing in Canada and given benefits to imports. Of course we had to move to a consumption tax which could be applied at the level which would hit imports the same as domestically manufactured products. That is why a consumption tax must be regarded as a tool of any modern economy.
When we ran for the Liberal Party in the last election, we spoke of the need to deal with the problems of the GST. We spoke of the need to harmonize it. We spoke of the need to deal with the inequities in the system. We spoke of that in the last election in spite of what the member opposite has been crying out, saying "election promises". That was the election promise of the government, to deal with the serious problems that were inherent in the tax. That is what we have sought to do since we were elected.