Debates of Feb. 5th, 1997

Excise Tax

[David Anderson, Liberal, for the Minister of Finance]

moved:

Motion No. 1

That Bill C-70, in Clause 26, be amended by replacing lines 30 to 45 on page 38 and lines 1 to 6 on page 39 with the following:

"(1.3) Where a ) a registrant (in this subsection referred to as the auctioneer''), on a particular day, makes a particular supply by auction of prescribed property on behalf of another registrant (in this subsection referred to as theprincipal'') and, but for subsection (1.2), that supply would be a taxable supply made by the principal, b ) the auctioneer and principal jointly elect in prescribed form containing prescribed information in respect of the particular supply, and c ) all or substantially all of the consideration for supplies made by auction on the particular day by the auctioneer on behalf of the principal is attributable to supplies of prescribed property in respect of which the auctioneer and principal have elected under this subsection,

subsection (1.2) does not apply to the particular supply or to any supply made by the auctioneer to the principal of services relating to the particular supply."

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

moved:

Motion No. 2

That Bill C-70 be amended by deleting Clause 69.1.

Mr. Speaker, unless I am mistaken, we are now dealing with Group No. 1. Is that correct?

[The Deputy Speaker]

Yes.

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

So, it is about the GST as it applies to books.

I am very pleased to discuss this provision of Bill C-70 concerning the partial zero rating-

[The Deputy Speaker]

Order, please. I want to make a correction. Motion No. 1 is in the name of the government. The mover of a motion is always entitled to speak first. In this case, I made an error. I now give the floor to the Parliamentary Secretary to the Minister of Finance.

[Barry Campbell, Liberal, Parliamentary Secretary to Minister of Finance]

Mr. Speaker, Motion No. 1 in Group No. 1 pertains to clause 26 of Bill C-70. It enacts new subsections 177(1.2) and (1.3) of the Excise Tax Act which sets out the sales tax treatment of goods sold by auction. Subsection 177(l.2) provides that the tax on such goods must be collected and remitted by the auctioneer.

In response to concerns raised by some registrants that frequently sell goods by auction in large lots, typically at the wholesale level, the Standing Committee on Finance passed an amendment to add new subsection 177(1.3). This subsection allows an auctioneer and a registered principal to jointly elect to have the auctioneer instead pass back the tax to the principal that would be required to report and remit it.

This election could be made where all or substantially all of the proceeds from the sale of goods on behalf of the principal at the particular auction were attributable to prescribed goods that are often wholesaled in this manner, such as motor vehicles, certain construction equipment, horses and flowers.

The purpose of the motion before the House now is to correct a deficiency in new subsection 177(1.3). The correction adds that the election applies only with respect to sales by auction in respect of which the principal would otherwise be required to collect the tax. That only seems a fair and appropriate correction.

As a result, the general rules that apply to sales by auction continue to apply, for example, to personal use property of the registrant sold by auction.

That concludes what I have to say with respect to Motion No. 1. However, I need some guidance from the Chair as to whether we would be debating Motion No. 1 or whether I could make some comments on Motion No. 2 as well at this time.

[The Deputy Speaker]

The short answer is yes. In fact, the parliamentary secretary is only entitled to speak once in this group so he had better do it now.

[Barry Campbell, Liberal, St. Paul's, ON]

Mr. Speaker, with respect to Motion No. 2, which my hon. colleague will be speaking to in a few moments, I might reserve my comments, as the same issue comes up later on. It does speak to the issue of books and the possibility of zero rating books and deleting the rebate which has been provided for in Bill C-70.

We feel quite strongly that the provision with respect to the purchases of books by certain libraries and public institutions responds very directly to the concerns of those who care about the important issue of literacy in this country, that the proposal instead that we are going to hear about in a few moments would be costly and not effective in responding to the literacy needs of this country.

The provinces that are harmonizing at this time are also offering point of sale rebates which will also go a long way toward addressing some of these concerns. I will reserve my further comments for later on.

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

Mr. Speaker, I am particularly pleased to speak to this clause of Bill C-70 concerning a partial lifting of the tax on books purchased by libraries and literacy organizations, which the government has decided should be exempt not just from the new sales tax that applies in the maritimes, but also from the GST in the rest of Canada.

We applauded this measure, but we also told the government that it was not going far enough in this objective of exemption from the GST or from the new national sales tax in the maritimes. All books bought by educational institutions, by institutions, by literacy organizations, as well as those bought by consumers must be exempt from the sales tax.

In Quebec, there is no provincial sales tax on books. We have understood that culture is important to a people. We have understood that taxing books is taxing ignorance, something the government has not yet figured out.

Before going any further with this analysis of the clause in the bill, I would like to remind the House that the initial seven members of the Bloc Quebecois were the only members in this House to defend the exemption from the GST of all books sold in Canada. They were the only ones to say that the GST should not apply to books, because culture is important, knowledge is important, and that consideration must be given to the fact that Quebec and Canada constitute two distinct cultures that must be protected and promoted, and that their authors must be protected as well.

I would like to pay tribute to those who defended this principle: the former member for Lac-Saint-Jean, Lucien Bouchard, now premier of Quebec; the former member for Shefford, Jean Lapierre; the former member for Hull-Aylmer, Gilles Rocheleau; the member for Rosemont; the member for Longueuil; and the member for Saint-Hubert. Without their conviction regarding two cultures, Quebec's and Canada's, there would never have been any talk in

this House of tax exempting books and culture generally. They were the sole defenders.

I wonder why, and actually I think I know why the government does not abolish all taxes on books. This is a government made up of ignorant people. This government has no culture and does not care about culture, not even about the Canadian culture it claims to defend. It cares even less about Quebec culture and the preservation of that culture.

Not long ago, the Minister for International Trade gave us a good idea of what he thought about protecting Canadian and Quebec culture. Everything is on the table. Canadian and Quebec culture are just pawns in the new trade relations with Canada's partners. Nothing is sacred.

Traditionally, those who called themselves Canadian nationalists and those who call themselves Quebec nationalists and still do as I was saying, all Canadian nationalists were intent on preserving what make them different, just as Quebec nationalists and especially sovereignists are intent on preserving what they are and the very basis of what they are, their culture and also their literature, which is an important cultural link.

But this government is breaking with every tradition. This government has chosen to ignore all the principles defended by the greatest federalists, the greatest Canadians in our history. It is true in the cultural sector and it is also true in Canada's external relations.

I want to take this opportunity to pay tribute to Mr. Pearson who was a great Canadian Prime Minister. Mr. Pearson was the image of a diplomat who was a supporter of world peace and a defender of freedom and human rights. And he stubbornly defended this typically Canadian policy.

Today we have a government that could not care less about human rights. It does not mind doing business with countries that ignore human rights and basic freedoms. The important thing is to sign trade agreements.

The government has broken with a tradition of defending Canadian and Quebec culture. It has broken with a tradition of conducting a foreign policy intent on preserving and promoting peace and basic freedoms. This government is destroying everything it claims to defend as being fundamentally Canadian.

If there were no Société des auteurs dramatiques or Union nationale des écrivains or their Canadian counterparts to defend and promote Quebec and Canadian culture, this government would certainly not do it for them.

If we did not have people like Mr. Beauchemin, for instance, one of our well-known authors, the author of The Alley Cat , and if we did not have Margaret Atwood on the Canadian side, this government would certainly not defend Canadian culture.

Ms. Atwood is a great writer to whom I want to pay tribute, because her last two books are truly outstanding. I really enjoyed reading Wilderness Tips last year, and the Robber Bride , published recently by Ms. Atwood. She is one of the greats. So, if Ms. Atwood had not vigorously defended Canadian culture, this government would not have been there to do so.

Recently, again, she was not afraid to stand up to the attitude of these lowbrow governments, which do not care about their own culture and ridicule Quebec culture with such stupid and shameless decisions as the one to put everything on the table during trade negotiations, when no one was protecting Quebec and Canadian culture.

The government penalizes learning. Every day, the government is killing off Canadian and Quebec culture and the likelihood of developing new authors and keeping the ones we have, like Mr. Beauchemin and Ms. Atwood.

The government does not realize it is destroying what it claims to be representing. It prefers to spend tens of millions of dollars promoting the flag. Behind this flag, however, there is a cultural, a patriotic, reality it claims to be defending. When I hear the Minister for International Trade and see the government taking positions such as this, which resolve a minor part of the problem, when we should be removing all tax on cultural products, I say these people are irresponsible.

The position of the Bloc Quebecois, the official opposition, as contained in the first group of motions, is that books should be exempt from the GST, as they are from the sales tax in Quebec. That seems clear. There are not hundreds of millions of us in Quebec or Canada. It seems to me that each of the two peoples has a distinct identity, which it wants to promote both within and outside its borders.

I think it would be worthwhile to give these two cultures a hand up so that their influence can spread across Canada, in Quebec and even abroad. If the Minister of International Trade wants to discuss trade, he should talk about the real thing. Before cultural products can be traded, a favourable environment must first be created for their production.

We have to start by promoting authors, and the sale of their books so that they can earn a living and go on producing the master works they make us so proud of every year.

Seeing how ignorant and unrefined this government is, and how insensitive it is to the Canadian identity, let alone to the Quebec identity, one can understand why it has such a hard time doing

things that come naturally between two peoples that respect one another.

[Monte Solberg, Reform, Medicine Hat, AB]

Mr. Speaker, it is a pleasure to speak to Bill C-70 and, in particular, some of the motions that are being moved with respect to Bill C-70.

I must say that although this is the new year, 1997, and my first speech here in the new year, it is unfortunately not very new legislation. Although there have been some amendments which had been discussed in the previous year, and although there has been a hue and cry from many corners of the country about this legislation, it remains substantially unchanged. Therefore it is quite unacceptable to the Reform Party.

I want to start by touching on some of the major objections that we have heard not only from people in Atlantic Canada but from national retailers who do business in Atlantic Canada. I do not know if members have been following the papers, but it is absolutely flabbergasting to me that the government still insists on pushing forward with many components of this bill even though there is a groundswell of opposition to it.

Probably the most obvious example of that is the tax in pricing component. During the finance committee hearings a couple of weeks ago here in Ottawa we had retailers from across the country come to Ottawa and say to the government repeatedly they do not have big concerns about harmonized sales tax with the single caveat that it should not include tax in pricing at this time. Some of them had other concerns and there were some minor objections that they raised with respect to other issues, but with almost with one voice they said they do not see any point in bringing in tax in pricing at this time when it is only going to happen in one part of the country. They raised a number of objections.

One of the objections they raised, which is so obvious, is that if we bring it in in one part of the country but not in the rest of the country then we do not have tax simplification, which is what the government said it was aiming for, but tax complication and confusion. Now we have different prices for the same goods on different sides of the border, depending on whether one is outside of Atlantic Canada or inside Atlantic Canada. When I say Atlantic Canada I should exclude Prince Edward Island because it did not become part of this deal. People obviously have big concerns about this. It is going to add all kinds of regulatory burden.

If it were only regulatory burden that would be bad enough, but business leader after business leader came before the finance committee and said that it was going to mean extra costs and extra costs can be reflected in several ways. It will mean higher prices for consumers. It will mean that people will have to be laid off or in some cases businesses will have to close.

I see the parliamentary secretary here. He was at the same meeting I was at where the representative from Carleton Cards said that they would close 19 stores if this legislation came in as it was because they had 19 stores that were marginal, stores that were either just barely making it or slightly unprofitable. They said that this legislation would mean that they would no longer be profitable and would have no prospect of becoming profitable and therefore would close.

Obviously in Atlantic Canada where the economy has been in a shambles for a number of years, this legislation is going to hurt those people and there is no reason for it. So far the government has been unable to come up with a single shred of evidence to explain why tax in pricing has to come in at this time in Atlantic Canada. There is not one piece of evidence.

At one point a poll was conducted which, by the way, it was suggested was worded so that somehow the people of Atlantic Canada wanted tax in pricing. When the poll was looked at closely, it was discovered very early on when people discovered that tax in pricing was going to mean extra costs for them, the support dropped. Actually only a minority of people in Atlantic Canada, even according to the Nova Scotia government poll, supported tax in pricing. That is a major concern.

It is going to cost jobs. Woolworth Canada has said it could close as many as 30 per cent of its 125 stores in Atlantic Canada. Another group has already closed a number of stores in New Brunswick specifically because of tax in pricing. Again, I do not understand why the government is going after the people of Atlantic Canada and hurting them with this legislation.

The next point I want to make is that for the life of me I cannot understand why, when I proposed a motion in the finance committee that the hearings be extended and moved to Atlantic Canada where people will be most affected by this legislation, the Liberal members voted against taking the hearings to Atlantic Canada. To me that is unbelievable. Here is legislation, probably the most important tax legislation to affect the people of Atlantic Canada in a generation, and they are not given a voice on what kinds of changes should be made or whether or not the legislation should even go ahead. It is certainly taxation without consultation, and I would argue it is taxation without representation.

I heard one Liberal member say: "In my riding of Atlantic Canada I personally put out some notices that said we would fly people from Atlantic Canada to come to the meeting". That is ridiculous. People in Atlantic Canada have a right to demand that their government come to them when it is proposing a taxation system that in some cases will have dramatic effects on their own personal economic well-being.

One of the effects of the harmonized sales tax is that people on fixed incomes in particular will be hard hit. Those people who are on fixed incomes and who perhaps are disabled should have a right to be in their own community, whether it is Truro, Nova Scotia, or St. John's, Newfoundland, or Saint John, New Brunswick, wherever it is they should have a right to call the government to account in their own community. They should not have to apply to see if the government will bring them to Ottawa and take a day or two away from their families. That is fundamentally wrong. It is contrary to democracy.

I do not want to try to anticipate what the government is going to do with respect to limiting debate on this legislation. If on the one hand the government does not let people in Atlantic Canada have hearings on this legislation, and on the other hand the government tells Canadians it is not going to let the opposition point to the flaws in the legislation and introduces time allocation, then people will have every right to be as cynical as they are today about the lack of democracy in this country.

When we go door to door, people say that we have an elected dictatorship. If I have heard it once, I have heard it a thousand times. The government has a chance to prove that is not the case, to a small degree this time, if it says it will not introduce time allocation. I will not go on about that any longer.

I do want to touch on the issue of GST on books. I see a Liberal colleague across the way who has spoken out on the GST on reading materials. The government had a prime opportunity this time around to introduce new legislation that would fulfil a red book promise, a promise to the Don't Tax Reading Coalition, a promise that was made in two successive Liberal policy conventions that they would scrap the GST on reading materials.

Instead, the GST will now be doubled on reading materials in Atlantic Canada. No matter how we look at it, that is not fulfilling the promise. In fact, it is mocking the people to whom the Liberals made the promise before, that they would get rid of the GST. There is just no other way to put it.

Mr. Speaker, I know my time is running short. I will simply conclude by saying that this legislation is wrong and that these amendments do not fix the bill. I encourage all members in this House and especially members from Atlantic Canada to scold the government by not voting for it.

[Richard Bélisle, Bloc, La Prairie, QC]

Mr. Speaker, I wish to address Group No. 1, which concerns the GST on books and which is made up of Motions Nos. 1 and 2.

The Liberals claim that books will no longer be taxed. This is not true and, as regards the GST credit on books, the government does not go far enough. Ever since Quebec introduced the QST, all books have been exempted from the provincial sales tax, not just those purchased by literacy institutions, schools, public libraries and so on. All books are QST exempt, including those purchased by consumers in bookstores, which represent the bulk of GST revenues on book sales.

The measure announced by the Minister of Finance and which the parliamentary secretary explained earlier this afternoon is a half-measure designed merely to enable the Liberals to boast that they have eliminated the GST on books, when in fact they have done no such thing.

Taxing books means taxing knowledge. It means taxing education and, in the longer term, it means taxing employment, given how important education is to finding a job in the new economy that is emerging in Canada.

The Bloc Quebecois has been fighting since the very beginning, even under the Conservatives, to have books exempted from the tax. But this can only be a total victory if all books are exempt from the GST, not just those bought by literacy and educational institutions.

With the federal election looming ahead, this government is resorting to a favourite strategy of the Liberal Party, that of the coverup. Whether it is the Somalia inquiry, the Krever commission, the Airbus affair or the Pearson Airport issue, the Liberals want to hide the truth from Quebecers and Canadians at any cost. They want to sweep everything under the rug as quickly as possible, before the election campaign.

The Liberals display exactly the same attitude, which is something of a tradition with them, toawrd the GST. The Liberal government is obviously embarrassed by the broken promise made by the Prime Minister and the heritage minister to eliminate the GST, a tax which they claim to hate. In order to avoid having to explain this broken promise, the Liberals want to reach an agreement at any cost with the maritime provinces on GST harmonization, so as to be able to claim that they at least did something, however little, to change a tax that is resented by all Canadians.

It is not the first time that Liberals make a colossal error which, in the end, ends up costing hundreds of millions of dollars to Canadian taxpayers. However, this time the Liberal government is also making a mockery of democracy by preventing elected members from the opposition to properly carry out their duties as parliamentarians.

[An hon. member]

Unbelievable.

[Richard Bélisle, Bloc, La Prairie, QC]

Indeed, as per usual.

Just before Christmas, we criticized the manner in which the Minister of Finance tabled these documents. The official opposition-I remember, I was there-had fewer than 24 hours to examine a technical bill over 300 pages long, for which we had not received explanatory notes before debate at second reading.

But last January, we witnessed a spectacle that was even more disgraceful for anyone who still believes in the quality of democratic life in Canada. First, the Liberals allowed only three days of public hearings on a bill as vital to the maritimes as Bill C-70. This was last January 20, 21 and 22, you will recall.

The opposition parties asked the government to extend the consultations and to travel to the maritimes to be able to hear what these people have to say, but the Liberal majority on the Standing Committee on Finance, including the parliamentary secretary, defeated this motion in committee.

I also remember tabling this motion in the finance committee last January 22, at the end of the day, and the Liberals simply brushed it aside. Yet the Liberals came up with 13 important amendments-those were their words, "13 important amendments"- to Bill C-70, the very evening of the third and final day of public consultation, claiming that these amendments were a response to the complaints heard during the three days of hearings.

If it was possible to find 13 amendments in three days, imagine how many we would have had if we had been able to extend the public hearings by one week, as the official opposition had requested.

In their haste to leave behind the embarrassing issue of the GST, the Liberals do not want to hear what people have to say; they are afraid that people in the maritimes will tell them the plain truth: Bill C-70 is a botched job, a very bad bill. The Liberals are standing in the way of democracy by preventing citizens from expressing their views, and by moving full steam ahead, worrying more about their electoral agenda than about doing a good job of serving the citizens who will pay for this new tax.

That is not all. The very evening of the clause by clause study of Bill C-70 in committee, the Liberals introduced, at the end of the day, 113 amendments for a bill that had 272 clauses. This in itself is irrefutable proof that Bill C-70 has received amateur treatment from the Liberal government and that more public consultation is needed if citizens' needs are to be met. We are already at third reading. The Liberals turned down the Opposition's request to continue the hearings; it is therefore too late, unfortunately.

Still more distressing is the fact that the official opposition's research service was given only an hour's briefing by the Minister of Finance's staff concerning the 113 amendments the government was planning to table two hours later in committee, and no document was left with them for consultation.

As a Bloc Quebecois member, I sat on the committee the entire day of January 22, and I was given a copy of the 113 amendments under embargo some two and a half hours before the clause by clause study.

As a result, the Bloc Quebecois was not in a position to play its role as the official opposition effectively and appropriately on the finance committee at that time. In a way, the government was asking us to trust it implicitly, to give it carte blanche, to take it on its word, and above all not to hold it back in accomplishing its game plan before the next election.

The Bloc Quebecois proposed a motion to suspend the work of the committee for a week, allowing it the time to examine the Liberal amendments; this motion was rejected by the chair of the finance committee himself.

Even this week, the opposition had not even received the printed copy of Bill C-70 reflecting the amendments received in committee, 24 hours before resumption of the debate on third reading. On February 3, we learned from the Téléjournal that the chairman of the finance committee was still in the process of reviewing the legislation, and that it was possible the government would back down on its plan to include the tax in the price.

How can anyone do a proper job under such conditions? The Liberals are shamelessly thumbing their noses at democracy. We can be sure they will pay dearly in the next election for their arrogance.

In conclusion, I would like to state that the government is deceiving the public by saying that the GST has disappeared. In fact, the Liberals are not living up to their commitment on this, nor have they ever. The GST is still with us, although it was supposed to quite simply disappear from the books, and to do so as quickly as possible.

[John Williams, Reform, St. Albert, AB]

Mr. Speaker, Bill C-70, which is the son of the GST, the most hated and the most reviled tax we have had in Canadian history, has been revisited upon us, especially upon those people of Atlantic Canada.

The government said that it would axe, scrap and abolish the GST. It did not say it once, it said it on innumerable occasions during the election campaign.

In previous speeches I have read into the record the Prime Minister and other members of the Liberal government who stood in this House and condemned the GST. They said that at the first available opportunity they would get rid of the GST. Canadians who voted for the Liberals at the last election believed that they would follow through on their commitment to axe, scrap and abolish the GST.

Today we are debating the son of the GST. The son is larger than the parent. It now means more tax, not less tax. It now means that we are going to tax more areas. We are not going to take the government of out people's hair, we are going to expand it everywhere.

We had a debate a few months ago in the House about books. Books and learning materials are important to all Canadians. They are important to our young. They are important to many people in the information society in which we live, yet the tentacles of government have reached out and now cover books as well as everything else.

The Minister of Finance thought that he would make a grand gesture and say: "Yes, books are important to students. Books are important to schools. Books are important to universities. Therefore, the books purchased by universities are going to be exempt from tax". However, students will still have to pay the tax. The universities are going to be exempt, but the students are going to have to pay. That means that the government, through its smoke and mirrors policy, through its sleight of hand policy, is saying: "Books to the universities are going to be tax free, but students are going to get squeezed even more". The Minister of Finance cannot keep his fingers off anything.

We have seen how the government has cut transfers to the provinces for health and education. We have seen it in the headlines of the newspapers. In Edmonton last week there was a headline which pertained to the University of Calgary that stated that fees are going to go up $300 a year. Fees are going up not because it costs more for the university, but because the government is going to pay less.

While the government is going to pay less, it is going to take more from university students. It is going to take more by way of the GST and the students will have to pay more for their university tuition while the Minister of Finance stands in the House and brags about how he is bringing down the deficit. It is despicable that he would have the gall to have a smile on his face while he is bringing down the deficit on the backs of students and on the backs of the people who we need to be educated to maintain our standard of living in the future. It is amazing how shortsighted the government is, that it would smile and take the credit for this type of thing. University students, which include my son, have to scrimp and save and do without so that the Minister of Finance can sing his song of deficit reduction. Shame.

I remember it being said in debate when the GST was first introduced that second hand goods would not be taxed, that the government would tax goods once and once only. That is why it said that it would put a tax on new housing but that it would not put a tax on used housing. The Liberal Party at that time condemned the Tory government and forced it into making the commitment that goods would be taxed once and once only.

Now the Minister of Finance has introduced this son of the GST, and what has he done? He has taxed used cars. Every time a car goes through a car lot the Minister of Finance picks up the GST because that is one of the new rules contained in the son of the GST. Therefore, car dealerships in Alberta and right across the country will now have to suffer greater competition from the backyard dealerships, the private sales and so on. Livings will now be harder to come by because the Minister of Finance squeezed them for more money. Every time a car goes through their lots, he now collects the GST.

That is what we are up against, a tax grab anywhere, everywhere. Is there anywhere that the Minister of Finance has not looked for tax? Is there a stone he has not turned to look for another tax dollar? I doubt it very much. That is why this government no longer has any integrity. That is why the Prime Minister's popularity is coming down in the polls. People out in this great country of ours are starting to realize that what the Prime Minister says and what the Prime Minister does are two different things.

Surely we deserve better. We thought we could get better but unfortunately the government is quite content to maintain this double standard.

[An hon. member]

Your leader is just cruising along the bottom, bottom fishing.

[John Williams, Reform, St. Albert, AB]

I hear some heckling coming from the other side. We had some heckling yesterday that caused a little ruckus in the House. I hope these people do not get back down to that level again today because that seems to be where they are most of the time, down somewhere around the gutter. They do not have the moral fortitude to stand up and deliver on their word.

They like very much to shout epithets across the House which they would never dream of saying outside the House. They accuse other people and other parties with their broad brush statements-plural, have no doubt, Mr. Speaker. They make sure that nobody is missed with the wide sweep of their broom. They feel they can denigrate other people's ideas, but they only drag themselves down.

This country should have better government. The Minister of Finance tells us how the deficit is coming down and how his policies have achieved great deficit reductions. Yet when we take a look at the figures, which include the small figures, we realize that while the deficit has come down by $25 billion, revenues have gone up by $25 billion.

My point is that the GST only brings in $15 billion. The Minister of Finance stood up in this House and said, "I can't live up to my promise because if I got rid of the GST I would have to get another tax to replace it'. That is a deliberate misstatement of the facts. He is now collecting $26 billion more. He could have eliminated the GST and still had $10 billion more than he had when he started

three years ago. He could have lived up to his promise on the GST. He is now collecting more revenue than what the GST creates in its entirety.

That is the type of deception that we have to get out. We have to make sure the people understand the type of information that is being disseminated by this party on the other side. When I tell people back in my riding they say: "I had no idea. Is that right? If I had known." Let us tell them the deception that is going on, the smoke and mirrors. As I said, I do not think the Minister of Finance will leave any stone unturned.

I saw another bill this morning. I am not sure if it was Bill C-69 but it was a tax implementation act. It had about 20 different categories to squeeze out some more, broaden the rules to collect more, close the loopholes to make sure that nobody is missed.

I could go on and on, but I think I have given a picture at this point in time. I will allow my colleagues to continue on.

[Réal Ménard, Bloc, Hochelaga—Maisonneuve, QC]

Mr. Speaker, I am grateful for this opportunity to speak to Bill C-70. I salute the parliamentary secretary, the hon. member for St. Paul's. I know he is a gentleman and a scholar. I had the opportunity to discuss a variety of topics with him, and I know he is a humanist with all that entails.

I must admit I cannot understand why he supports, why he goes along with a bill which, after all, deals a harsh blow to our culture by maintaining the GST on books. It is a harsh blow to culture in Quebec but also to culture in English Canada.

I may remind the parliamentary secretary, the hon. member for St. Paul's, that his riding is an important centre of intellectual life. Will he be able to show his face in his riding this weekend? I fear for his safety. Will he be able to visit the upstanding citizens in his riding with a proposal like the one he has just tabled?

I think we have to go back to the basics. We believe that for all kinds of reasons which are typical of our time, of our era, until a few years ago, literature was appreciated both as a discipline and as a source of knowledge. The printed word was a part of our lives. The hon. member for Anjou-Rivière-des-Prairies is well aware that this goes back to Gutenberg and that there are whole generations for whom the printed word was a part of learning and of the way we acquired knowledge.

Times have changed. We all know that as far as learning and the transfer of knowledge are concerned, the electronic media have become a major factor. We are sure that if we did a little survey of all the pages here in the House, we would find that each and everyone of them has a computer and is familiar with the Internet. But they do not necessarily invest as much time in a more conventional activity: reading.

We believe books should be exempted from the GST or its new form, the harmonized sales tax, because it would be a way to support book sellers and encourage the spread of knowledge by a medium that is somewhat more conventional but still has its place and which we all know is still a very important factor in establishing the identity of a community, and I am referring to literature, what people write about us, and what is written elsewhere.

It is surprising to find such a provision in Bill C-70, because, on a number of occasions, here as elsewhere, the Liberal members, the members of the government, took a totally opposite stance. It is more than just a simple paradox.

When analysts, observers, journalists and even historians write history and look at what the present legislature produced, one thing will stand out: the fact that the government opted on a number of occasions for a strategy of camouflage, half-truths and about-faces in matters of importance.

We know how much the GST is a sore point with the government. First because of the Minister of Canadian Heritage. There are a number of terms to describe the personality of the Minister of Canadian Heritage. She is indeed a woman capable at times of kindness, but she is also capable of a ruse that was at the limit of honesty in connection with her government's promises.

I see my colleague, the member for Pontiac-Gatineau-Labelle, nodding in agreement. There is a lack of insight on the government benches.

It would have been interesting had the government used Bill C-70 to really dust off its honesty and ensure that its actions are more in line with the red book and its election promises.

I am sure all the members of this House realize that words like literature, knowledge, heritage, the value of the printed word, though abstract, refer to basic values. How can government members go for this kind of a bill?

If we were admitted into your private life, Mr. Speaker, I know we would find out that you have an impressive collection of books and that you have always been a man who believes in knowledge.

Why not adopt measures that will act as incentives toward acquiring knowledge instead of restrictive measures? Could someone explain that to us before the end of the day? Government members are awfully quiet today. It would be interesting to hear what one of them has to say. Perhaps the Minister of Transport will do the honours.

Perhaps the Minister of Transport will stand up and, on behalf of British Columbia as a whole, tell us why this government has chosen to slap down whole segments of the cultural industry? In the name of what rationale will educational institutions alone be exempt, I would like to know. I said educational institutions, but the bill actually talks about literacy.

The Minister of Transport is a man in his early fifties. He probably studied the great classics of our time in school. Would he have read them if, in those days, the constraints that make our taxation system unfair today had existed? We should take advantage of the presence of the transport minister, who is said to be among the moderates in cabinet and a man of sound judgement.

It would be interesting, and I will close on that, if the Minister of Transport stood up and, based on his experience as a man in his fifties, told us why it has been decided to use a bill like this one to deliberately limit exemptions applying to books to those bought by educational institutions and other organizations involved in literacy programs.

Is this not something of an insult to the intelligence of consumers? Does the Minister of Transport not realize that I for one-and the hon. whip can bear witness to the fact that my workload is on the heavy side, but I am not complaining-read at least one book every week? This makes me a seasoned consumer. I buy many books. Granted, not all of them are new.

Does the minister not recognize that this is a discriminatory factor, that it is a bias, that it goes against the principles governing the transmission of knowledge to not allow consumers to buy new and used books without having to pay the sales tax?

Does the minister not recognize that the Bloc Quebecois' proposal is extremely reasonable? Sure, you will tell me: "Yes, but we did not have enough time to discuss it". You are right because, once again, government members opted for a process which I find barbaric, if I can use that term. Indeed, we learned from our finance critic that 113 amendments had been tabled and that the Standing Committee on Finance only had three days to look at them.

This is a very harmful practice in a system where members are asked to do a good job and to make a thorough analysis of the wording of a bill.

My rather hope that cabinet and the government will review the bill and agree with the very reasonable arguments put forward by the official opposition. I believe a great cultural complicity is possible between the opposition and the government, if only some common sense were displayed in this House.

[Leon Benoit, Reform, Vegreville, AB]

Mr. Speaker, I am here today to debate the Group No. 1 amendments to the GST-2 bill, the so-called harmonization bill.

Really we should not be here today debating this piece of legislation. I remember so clearly during the election campaign one Liberal after another, including the Prime Minister, state they would get rid of the GST, they would abolish the GST, kill the GST.

I remember listening and thinking it is going to be interesting to be there in the House of Commons to see how they will do that.

They decided after they got into government that they could not do it. Therefore to try to deceive Canadians they presented this harmonization bill saying "we have done what we have promised, we got rid of the GST as we promised". Of course, it will not fool many Canadians.

We have the GST. Now what we have is one GST for three provinces, the so-called harmonized GST-2. Then we have the old GST, the one brought in by the Conservatives, the one that was going to be killed by this government in the rest of Canada.

This promise made during the election campaign no doubt won this Liberal government many seats. There is no doubt about that. In Ontario 10, 20, 30 seats, who knows, were won by Liberal candidates because of promises to get rid of the GST. It was a key election promise. It is a promise that has not been delivered on in any way, in any state, in any fashion. This government must be held accountable for that. What we have is GST-2, a so-called harmonized GST.

We are here today to debate Group 1 of the amendments. It is hardly worth debating amendments to this piece of legislation. This legislation really does not warrant support in any way. By making these amendments it is not going to negate the fact that another promise made by candidates running in the last election, made by the Prime Minister before the last election, during the election campaign and even since the election promise to get rid of the GST, no number of amendments are going to overcome that fact, and that is a fact. This government does not seem to understand what integrity is. This is just another one of those issues that demonstrate that so clearly.

The promise, of course, has come back to haunt this government. We have had the Deputy Prime Minister, after talking to a bank machine, decide that she was going to step down. She did it because she knew she would not have a hope in heck of winning again during a regular election campaign if she did not. It cost the taxpayers $500,000 because she could not look that bank machine in the eye.

We have a finance minister that has asked for forgiveness for maybe not delivering on this key promise of the last election campaign. He said "we made a mistake" and he asked for forgiveness. But this is more than a mistake. A key election promise was broken. That is not a mistake. I do not think the taxpayers and the voters in this country should be forgiving. I do not think they should just let the finance minister get away with breaking a key promise.

We have the member for York South-Weston who was banished from the Liberal caucus by the Prime Minister because he kept insisting-he was member of Parliament for this Liberal government-that his own political party and his own government would see the light, would show some kind of integrity, some degree of integrity and keep that election promise. He was so determined that he was not going to be a part of this broken promise that he pushed the point until he was thrown out of the party. He is now sitting as an independent. He at least of all the hundred some Liberal members of Parliament had enough integrity to stand up for this constituents on this issue.

The member for Broadview-Greenwood temporarily went into self-imposed exile over this issue. He knew that it is wrong to break a promise and that Canadian voters no longer are going to just say "oh well, we didn't expect you to keep this promise anyway". They expect political parties when they are out on the campaign trail to make promises that they are going to keep, in particular the key promises. I think they should expect that all promises will be honoured but in particular the key promises like this GST which should certainly be honoured by the people who make the promises.

There is no doubt this issue is going to cost this Liberal government those seats that it won based on this promise and I think it is going to cost it a lot of seats besides. Canadians are absolutely sick and tired of politicians who say they are going to do something and they get down to Ottawa and they completely forget what they said they were going to do.

Thinking of the events of yesterday and today, Canadians have decided they are fed up with other things that take place in this House as well. Yesterday we heard once again a member from across the floor use a word and call one of my colleagues a racist. That is unacceptable. But we have been putting up with this for three years in this House. Words like that-

[The Deputy Speaker]

I do not know if the hon. member was in his chair earlier when the Speaker ruled that matter was finished. It was raised this afternoon. I do not mean to interfere with the member's freedom of speech, but I would urge and invite him to please let us treat that as a closed book for the interests of all members.

[Leon Benoit, Reform, Vegreville, AB]

Mr. Speaker, I certainly meant no disrespect by raising an issue that had been dealt with by the House. I could refer just as easily to many times in the past when this word has been used as a means of closing down debate.

Many times members of our party have been standing here, engaged in honest, open debate, trying to get our point of view across. We want to hear the opposition's point of view. We need that open debate, not just here in the House but across the country. So often debate has been closed down by members of the governing party hanging labels on us. That is unacceptable. It is a practice that hurts. It does not just hurt us, it hurts the people who are hanging these labels that end debate. It hurts democracy more than it hurts anything else.

In this country we must be allowed to have open and honest debate. Canadians expect that.

With regard to the harmonization bill, it is not going to get the government off the hook and the amendments are not going to fix the bill. No amendment could fix this bill. The promise must be kept.

[Paul Crête, Bloc, Kamouraska—Rivière-Du-Loup, QC]

Mr. Speaker, I would like to remind members that we are talking about a group of amendments presented by the Bloc Quebecois, the purpose of which is to obtain a complete exemption from the GST on the sale or purchase of books.

It must be recalled that, even before the 1993 election, the delegation of Bloc Quebecois members here in the House had asked that books be exempted from the GST, in order to make culture as accessible as possible.

We can point to their partial victory in the fact that the GST will no longer apply to books purchased by institutions concerned with literacy. But there is still a vast array of books citizens can buy to which it continues to apply.

A government is entitled on occasion to make choices, to decide that it will pay particular attention to culture, that it will give a particular opportunity to those who write books, which are what make up a country's cultural life, which develop knowledge in our population. This is a wonderful opportunity, in the context of this debate on the GST, for the government to make this kind of decision, to give a boost to culture, to give an opportunity to those who, through reading, broaden their culture.

We are not just talking about people who are members of the establishment, but about all citizens, those who go to the bookstore on Saturday mornings with their children, and who could buy one or two more books, if there was no GST on them. This could be a way of broadening the culture of young people, while getting them

interested in reading in a much more acceptable and meaningful way.

The government would make a great contribution if it were to listen to an amendment such as this. Tenacity is perhaps one of the things which characterizes Bloc members. When something strikes us as appropriate, we stick to our guns until we get the government to listen to our arguments.

In the case at hand, I would not hesitate for a moment before choosing between giving $2 billion in geographical compensation to the maritimes and evaluating the costs of eliminating the GST on books for all Quebecers and all Canadians. I would offer Quebec culture and Canadian culture the opportunity for further development by making books more accessible.

It was natural for this message to come from the Bloc Quebecois. You know we represent the only francophone people in North America and we have always had a particular interest in defending our culture with a view to our development. Canadian society as a whole can benefit from this notion, moreover. We trust that the government will develop an interest in it and will evaluate whether it is worthwhile following up on.

Today, when we look at what will be important to our society in future, we realize that this is no longer a generation where brawn counts most. Employability no longer depends on muscular strength. What is important now is to make our younger generation well-informed, to awaken its interest in finding out things, to make it capable of mastering knowledge. Reading is one of the routes toward this.

It might be considered that GST exemption for books would be more of an investment than a cost for our society. I think it would be in the government's interest to consider the amendment proposed by the Bloc Quebecois when examining this bill at the report stage. This amendment ought to be the government's choice.

You will certainly counter by saying that if the decision is made to exempt books, we will come up with some other thing that will have to be exempted as well. Essentially, it is a question of political courage. It is a question of making the choice to provide a competitive edge to a sector that is of vital importance to Quebec culture, and to Canadian culture.

Will the government have the courage to make that choice? Will it in its wisdom conclude that exempting books from the GST is a significant and important decision that will have an impact on the development of our culture? I think there is a direct connection with the amount of tax we pay.

As you know, a 15 per cent tax may often be a factor in deciding whether or not to buy a product. People say this book would cost $40, but if you add the taxes, it is $45 or $46. If we are talking about a children's book worth $10, this means an additional $2. The parent or person who buys the book may decide not to or may not be able to afford it.

The House would do well to act on the proposal by the official opposition that would exempt all citizens from paying GST on the books they buy. This would certainly be an incentive to buy books and increase the sales of books by Quebec and Canadian authors. The direct impact of such a decision would be, in the case of authors who, often for many years, write more for the sake of writing than with any guarantee of making a living, an opportunity for the Canadian government to show that it recognizes the importance of these authors and the work they do, the importance of this literary production for the future of our society.

This change in the tax exemption for books is in the GST legislation. This is a typical example of the double standard that exists in this country.

The government decides to compensate the maritime provinces to a very significant extent for harmonization, while Quebec, where harmonization took place a few years ago, gets no compensation at all.

In a way this is an incentive for inefficiency, but above all, it creates a double standard regarding the development of the regions concerned. In fact, those two billion dollars will be distributed throughout the maritimes, for instance in the Madawaska ridings in New Brunswick, near the Quebec border. I think this may lead to unfair competition.

The federal government has decided to make changes in the GST. Let us take the opportunity at least, even if we may not entirely agree on the issue of compensating the maritimes, to make some significant changes. The Bloc Quebecois has contributed significantly in the consideration of the bill. It is proposing a number of amendments to improve the bill. The one exempting books from tax seems to me to appeal especially to the nobility of this House and to the respect for Quebec's and Canada's culture of each member of this House.

I hope the Liberal majority has the courage to listen to us and acknowledge the relevance of this idea. Everyone buying books in Quebec and Canada and everyone in the book industry, particularly authors, will take this to be positive recognition of their work. I hope, when the bill is passed, that people will remember the contribution made by the Bloc Quebecois over a number of years, from the time we sought a tax exemption for books. There will now be one for books sold to institutions.

We hope to continue this work until it is universal, until all books are exempt. Our culture certainly deserves to be exempt from this tax.

[Keith Martin, Reform, Esquimalt—Juan de Fuca, BC]

Mr. Speaker, it is a pleasure to speak to Bill C-70 which would harmonize and streamline the GST.

I am not going to deal with the obvious lack of credibility the government has on this issue. That has already been spoken about eloquently by my colleagues. However, I am going to demonstrate that the harmonization of the tax will have an enormous negative impact on the business community in Canada, as well as all Canadians, in particular those who strive to develop business and commerce within Canada.

It is obvious that the harmonization of the tax will have a huge negative impact on Canadians. It is estimated that harmonization will cost Ontarians $3 billion. It will cost three major retailers in the Atlantic provinces over $27 million. The Retail Council of Canada estimates that harmonization and streamlining the GST will cost retailers over $100 million a year.

That will not put Canadians back to work. It will not improve commerce in the country. It will not elevate people out of the egregious taxation system that we have in this country. It will do the exact opposite.

There are solutions, but the government seeks not to employ them for reasons that only it knows.

I cannot think of a tax which is more hated than the GST. There is no tax which compromises the ability of Canadians to use their entrepreneurial spirit, to be the best they can become and to provide for their families, their children and society than this tax. In fact, one-third of the GST is spent merely on its management.

The GST, to the small business people of our communities, is invasive and enormous. It has a strangulation effect on their ability to do business.

If the government would look back in history, it would see that when taxation levels were decreased and simplified it did not decrease the revenues that went into the public coffers, rather they increased. Furthermore, it gave a huge impetus to small and medium size businesses, those business which truly create long term employment in this country. It provided employment and stimulated the economy. If ever there was a time when we needed to decrease unemployment levels and give Canadians some element of security, it is now.

Again the government has chosen to ignore the good solutions out there to simplify and decrease the tax and the GST. For heaven's sake, decrease the GST and enable our businesses to employ their entrepreneurial spirit to become the best that they can become.

I encourage every member in this House, especially those in cabinet and those members on the finance committee, to go out into the trenches and speak to Canadians who are trying to struggle to become the best that they can be in the business community. So many businesses are closing and so many people are losing their jobs.

Many individuals cannot get work and many businesses cannot get on their feet because in part of the taxation system, its levels and complexities. That must change. It is strangling the life out of the Canadian economy. Let us look south of the border at the infusion and stimulation the U.S. has given to its economy by lowering taxation levels, keeping interest rates low and decreasing the morass of entangled, bureaucratic overregulation under which Canadian companies have to suffer.

This is no small point. Canadian companies from coast to coast have to struggle through three levels of bureaucratic entanglements to do business. I sympathize with them. If I were trying to start a business, quite simply I would not. I cannot imagine the courage it takes for them to attempt to get through and overcome the morass of bureaucratic entanglements merely to try to start up a business, hire people and provide for themselves and their families.

Our finance critic from Medicine Hat has put forth many intelligent, eloquent and substantive solutions so that this government can simplify the taxation system, decrease the taxation levels and provide an impetus to our Canadian economy. However, it has gone absolutely nowhere.

One particular short point I would like to make is with respect to how GST affects physicians in this country. People are supposed to be treated equally yet physicians are treated differently. They should be tax exempt under the Excise Tax Act because medical services, equipment and supplies which are necessary to deliver quality care are supposed to be GST exempt. However, of all the medical professions, only one is singled out to not benefit from this and that is the physician population.

The government should immediately enable physicians to be treated equally, not preferentially, but equally with all other medical professions. country. This government has failed to do that and continues to ignore their pleas for fairness and equity.

I must say I am getting absolutely disgusted with this House. This House is supposed to be an area of higher debate. This House is supposed to be a place where we are sent when elected to present the greatest and best solutions to the problems that affect Canadians across the country.

Canadians are crying out for answers yet what we see in this House at best is bad theatre. At worst, it is a shame on all of us to be engaging in the behaviours we see not only in this House but also in committee. We need a radically different view on how we conduct government in this country. We need to remove the control of the executive from the members in this House. Members from across party lines should be getting together, along the lines of what they

do south of the border in the United States, to bring forth the best possible solutions, solutions they could apply to the problems this country has.

There are good solutions across party lines, but we do not see the development of the best solutions applied to the problems of this nation; we hear petty pathetic insults going back and forth. That does not serve this House in any way, shape or form. Most important, it does not serve the Canadian people. There is a complete and utter disarticulation of the problems of people in this country and the high jinks that go on this House.

I hope every Canadian will find out about what is going on in this House. I hope they will make it their business to find out what is happening. I hope Canadians will put pressure on their elected officials to smarten up, get with the program and apply the best solutions to the problems that affect them. This includes not small changes but large changes.

We cannot continue with the form and structure of governance this nation has today and expect things to change. Nothing will change unless we have a radically different way of dealing with issues in this House. We must enable committees to be effective, enable public input at committees and allow them truly to be heard in the legislative process of this House. We must enable the good solutions that exist in the public to be applied to the debates and ultimately become the solutions that are desperately needed for the problems that affect us. Unless we do these things, we will not see the change this country needs and as a result, we will not become the truly great nation we have the capability of being.

I hope the government will listen to this, although I do not think it will. Most important, I hope members of the Canadian public make it their business in the coming election to get involved, to get interested, to get active regardless of their party affiliations. I hope they force their people to do what it is they want them to do.

[Pauline Picard, Bloc, Drummond, QC]

Mr. Speaker, I am pleased to speak to the Bloc Quebecois amendment to Bill C-70. I find it sad to have to propose an amendment to Bill C-70 to have books exempted. Taxing books is like taxing knowledge, taxing education, taxing skills.

Why is the Liberal government still taxing culture? Culture is the foundation of what we are, it is our identity, it is our roots. Culture is the Quebec culture, and it is also the Canadian culture.

In Quebec, since the introduction of the QST, all books have been exempted from the provincial sales tax, not just books acquired by literacy institutions or public libraries, but all books.

We also know the reason for maintaining the tax on books. For the information of our viewers, it is that the tax on books accounts for the greatest part of revenues generated by the GST. The government does not give a hoot about preserving our fundamental rights. The government thumbs its nose at both the Quebec culture and the Canadian culture. Its favours a system made for the rich. We, in the Bloc Quebecois, feel that it is unfair and unjust.

Our authors, the advocates of our languages and our cultures, have been critical of the fact that all cultural products are taxable. The government must promote cultural products and encourage our authors by abolishing GST on books.

I also want to speak of a political handout. In my view, Bill C-70 is a political handout. It is not a gift to Quebecers. It is something the Prime Minister and his Minister of Finance gave to the maritimes. It is something worth $1 billion.

As we know, this government never gives handouts without a reason. One can rightly conclude that there is a reason behind the handout, in fact I think there are two reasons. The first one is that the Prime Minister is trying to be forgiven for having broken his famous promise to abolish the GST. Whatever the cost, the Liberals wanted an agreement with the maritimes on GST harmonization, but whatever they may say to justify their actions, we are not fooled. They say they never promised to abolish GST, but everybody heard what they said. We will not be fooled.

During the 1993 election campaign, the main thing Liberal candidates said when presenting their platform, the first thing they said, was that the GST had to go. Everybody, across Quebec and Canada, heard what they said. Now, they boldly claim they never said that; Quebecers and Canadians were mistaken, they cannot have heard such a thing since it was not written in the red book. There is something wrong here. It is an abomination. We look like ignoramuses. We have been tricked, and it is our own fault because we did not hear right. We are not that stupid. I wonder how they dare justify breaking their promise by saying that we are the ones who misunderstood.

They made a big fuss about an agreement with three maritime provinces, saying: "Look, this shows we are keeping our promises". In fact, they did nothing of the sort, the GST is still here, even though it was supposed to be killed, scrapped, abolished.

The other reason why they are giving the maritimes such a handout is the unemployment insurance reform. As we know, it has not been well received in that area. To shore up its image, the government has decided to give them a $1 billion present by harmonizing the GST. This will placate critics of the new unemployment insurance program. The Prime Minister is handing out goodies to repair his government's tarnished record, just before calling an election, as we have witnessed lately. We know elections are not far away. The government is clearly on the campaign trail:

across Quebec, even in my own riding, it is handing out presents. Before, it had no money, but suddenly there is money. "So, if you need any for your programs, let us know, we can help".

At the Federal Office of Regional Development-Quebec they have money. They visit the ridings and give little goodies to the agencies. Since there is an election coming, the goodie is harmonization of the GST so that people will forget about the unemployment insurance reform.

However there is something special about that gift from the federal government. Unlike what normally happens, this time the federal government will not bear the cost of this pre-election handout. It will palm it off to Quebec and the other provinces.

In Quebec alone, the people will have to spend about $250 million to cover the cost of the federal handout to the maritimes. On the whole, that gift will cost Quebec and the other provinces one billion dollars. Needless to say, given the restructuring process going on, this sum could easily have served a better purpose.

Everybody knows that the Prime Minister had promised to slash the GST. We can even say the Liberals criticized that tax long before the last election campaign.

Let me quote the minority report on the GST presented by the Liberals in November 1989, when they were still in opposition: "The Liberal members of the finance committee maintain that the goods and services tax proposed by the Tory government is bad and that no "repair job" of any kind will make it fair for taxpayers". You can find that quote on page 283 of the report.

In closing, I would like to say that Bill C-70 itself is some sort of "repair job".

[Nic Leblanc, Bloc, Longueuil, QC]

Mr. Speaker, I am pleased to speak to Bill C-70 this afternoon. I am all the more pleased, and I am not doing this out of spite, to say a word about the experience I had when the federal tax was changed.

When the federal tax was changed, we had an all-out war from the Liberal Party, which was then in opposition. Liberal members were adamantly opposed to the tax they were calling the new federal tax, although this was completely untrue. It was not a new tax, it was a tax reform.

We must remember that there was a federal tax before. Having been in business for 20 years, I know how much federal tax I used to pay during those years. We were paying a 13 per cent tax on goods. The manufacturer billed the retailer for the tax. It was a hidden tax for the consumer. The consumer did not see this tax.

The Liberals, then in opposition, started saying that this new tax should not be hidden. They tried to convince people that the Conservatives, at the time, were creating a new tax. They made such fiery and intelligent speeches-I think what they did was smart, but dishonest-they managed to convince people that the Conservatives were creating a new tax, while the 13 per cent manufacturing tax went down to 7 per cent at the retailing level.

The end result was about the same. In 1989, for example, total federal tax revenues were about $18 or $19 billion, while the reformed tax, which we now call the GST, brings in about the same amount. The difference is that, at the time, the Liberals were still saying that this was a totally dishonest tax because it applied to books, food and drugs. They made a big fuss, saying it was an immoral tax, an absurd, unacceptable, outrageous tax.

In my opinion, the bill before the House is even more outrageous. We had time to think things over. We heard witnesses, made speeches, informed the people, evaluated all the possible effects of these amendments. We realize, in Quebec particularly, that this tax will, in fact, affect the development of Quebec culture, of Quebec's very sizeable book market.

Quebec is a French speaking country. We have many writers, authors, and creators, whose books are read by a great number of French speaking Quebecers. That is why we, in Quebec, feel that our rights and privileges are being denied.

In Quebec, our approach has always been to use the tax to promote made in Quebec products. Once again, we must observe federal standards. The federal government is dictating which products are to be taxed. Cultural products will be taxed, and this will affect the development of our economy, of our writers and authors. This goes directly and totally against Quebec's wishes.

In Quebec, when we say we want to be our own masters, to decide our own fate, it is because we believe that we will do better if we are allowed to solve our own problems and to promote what we feel is right, if we want to grow, to create jobs, to increase our intellectual and economic potential, and if we can better share our resources. In Quebec, we want to build a better future.

Once again, today, we realize that the federal government just decided unilaterally to tax books, a move that will hurt our creators, our writers, our authors. As we know, there is a tremendous potential in that area in Quebec. A large majority of books are written in our province. A lot of research goes into that.

Whether it is in the areas of new technologies, education or health, Quebecers read mostly books in French that are often written by French speaking authors from Quebec. Our experts will be hurt, and that will thwart the development of Quebec. That is why we oppose this legislation and this change that will be prejudicial to the development of our book industry.

We realize also that we are hurt by the fact that the government gave compensation to the maritimes to get them to agree to harmonize the provincial and the federal sales taxes. Elections are drawing near. Elections were held just recently in Prince Edward Island, and the Liberals were defeated. The current trend does not seem to be favourable to the Liberals. They do not enjoy great popularity. However, this is a great gift the government has given the maritimes. Some say it is as much as $1 billion.

Quebecers will have to pay between 25 and 30 per cent of that billion dollars. That could represent a cost of some $300 million a year Quebecers would have to pay because they have to pay their share of the bill. That is a tremendous amount.

That is why the finance minister requested a few months ago a $1.9 billion compensation for previous years, as well as all the costs incurred by the federal government to generously compensate the maritime provinces who agreed to harmonize.

And not only do we have to pay the bill for harmonization with the maritime provinces, but Mr. McKenna, the New Brunswick premier, is using that money to set up shop in Montreal in order to lure Quebec companies into his own province. He is using the money we gave the federal government to lure our companies away. This is not fair-play.

This is one more proof that Quebec has been striving for years to get more autonomy, but will never get anywhere if it does not have full sovereignty. Quebecers will never be able to develop normally if they do not collect all their tax revenues, pass their own laws and sign their own treaties.

Quebec has great intellectual resources as well as tremendous natural resources. It has more markets than it needs. The only missing thing is that we have not yet taken full responsibility for our economic and social endeavours. The reason we sit here is to protect our interests before we reach full sovereignty. When we cross that threshold, Quebecers will prosper and Quebec will be one of the wealthiest countries in North America.

[René Laurin, Bloc, Joliette, QC]

Mr. Speaker, we now have proof of what we have known since the very beginning and what we have so vehemently condemned: this bill on GST harmonization serves only one purpose, one political objective, to show the people that the Liberal government is keeping its 1993 campaign promise to scrap or change the GST.

They are fulfilling their commitment in three provinces, and as we also know, this gift to the maritimes will cost Quebec and Canadian taxpayers $1 billion. Moreover they are not considering the other impacts of this tax, which is not a new tax, mind you, only a hidden one. It is so well hidden that we will not be able to see it any more, since it will be included in the sales price. This will be seen as a despicable hidden tax because of its effects on some aspects of the lives of the taxpayers.

I want to dwell on the issue of education. Having been a teacher and a school board administrator, I know how vitally important books are for the development and education of children.

What better way to build a nation, to develop children, and to nurture our youth than to teach them how to read and then to encourage them to buy books to increase their knowledge, expand their horizons and learn how to see beyond their town, their city, their province, their country, and to communicate with the rest of the world?

The government wants to tax books as if they were luxury items. It wanted to look good by tax-exempting certain educational institutions such as universities, colleges and primary and secondary schools, but it is the institutions and not the books that are exempted.

If my child needs a book, I cannot buy the book from the school board. I have to buy it from a bookstore and pay the tax, since I am not an institution. The school board would not pay this tax.

A child needs books long before he or she enrols in school. Given the financial problems that school boards, universities and cegeps have today, they are less and less able to provide books for free.

They may be able to provide some books, but certainly not all of them. For example, is there a more important tool to learn our own language than a French or an English dictionary?

There are dictionaries in school libraries, but it is not practical to ask the teacher during class: "May I take a couple of minutes to go to the library and check if such or such word is correct in French or in English?"

A school board cannot afford to provide dictionaries for each and every student because students use these books throughout their school years. Who will buy it? The parent will have to buy it at the bookstore. Even though the parent is a member of a family, this institution would not exempted from this tax on books.

The parent will have to pay, and just think of how much a dictionary costs. It is quite expensive. One can pay $30, $40, or $50 for a dictionary. If you add the federal sales tax on a $40 dictionary,

you will have to pay $2.30 to $3 more. If the parent has four children in school, he will have to shell out another $12. This is not an incentive. Parents may be tempted to give their children something else.

In the case of younger children, such as a two-year old or a three-year old, what could we give them, for example, to get them interested? What book could we give a two-year old who cannot read yet, but whom we would like to get interested in reading?

We start by getting him colouring books. Will this colouring book be taxed? And what if it is a picture book? If we want to get kids who cannot read interested in books, we start by showing them picture books to slowly introduce them to the world of books, to all the new things in books. It is a new world for this very young kid.

If parents have to pay tax on these books, it will not encourage them to choose a book rather than a toy for their children.

The purpose, and that is what Quebec did when it exempted all books from the PST, was to bring people to buy books instead of something else when they gave a gift to their children, or to make the necessary school books more affordable. With the tax, the incentive is not there. People will be penalized.

I mentioned colouring books and picture books, but when the child reaches three or four years, he likes to be told tales and stories. Some parents have enough imagination to invent these stories, but others need books. So, they buy children's story books. They read it with their children. They start teaching their kids to read. They get them interested in reading. They show them that literature is interesting. In elementary school, and especially in high school, when children are still searching for their own identity, books would be an excellent means to help them. But that is out of reach because we tell them: "If you want to buy books, you have to pay more because the federal government decided to tax culture, to tax reading. You must pay more to get that access to culture".

Those are the effects of the tax. Some will say: "The impact will be marginal. Why would they refuse to pay 7 or 7.5 per cent more to buy books, since they pay it when they buy other items?"

When the government wants to make a difference, guide consumers' choices, help some businesses, it offers well targeted subsidies. For example, a business that wants to get into the environmental sector will get a grant that it would not get in other sectors.

The same goes for education and culture. If we want to promote that product, if we want children, teenagers and adults to buy more books, we must help them and not grant this privilege only to educational institutions.

By granting this privilege only to educational institutions, elementary schools, secondary schools, colleges, universities and other non profit organizations, the government just wants to be able to say: "Here is what we have done with the GST; we have changed it. We even abolished the GST on books". Again, this bill does not abolish the GST on books. It is false to say that. It is not books that are exempted from the GST, but certain institutions.

Even the exemption of certain institutions from the tax can raise some questions. Is the government not opening the door to a situation where some people could put pressure on institutions to avoid paying the tax? I imagine myself as a teacher telling a class of 30 students to buy a certain book for a literature paper. Since the book is not available at the school, they have to buy it. If I ask them to buy the book, I am penalizing them. If I do not ask them to buy the book, I cannot ask them to do that particular paper. I am forced to restrict my teaching because books are too expensive.

These are a few examples I wanted to give. I will have the opportunity to rise again on the other groups of motions and continue this speech.