Mr. Speaker, I am pleased to rise today to speak at report stage of Bill C-70, an act to amend the Excise Tax Act, the Federal-Provincial Fiscal Arrangements Act, the Income Tax Act, the Debt Servicing and Reduction Account Act and related Acts.
This bill is a collection of various amendments to the GST, which will become the HST, or the harmonized sales tax. Let me tell you right now that this tax is very unpopular in my riding of Bourassa, in Montreal North, especially among business people. I must add that I support the motions put forward by the member for Saint-Hyacinthe-Bagot, which are included in Group No. 2.
This Liberal government is highly embarrassed by the broken promise of the Prime Minister and the Minister of Canadian Heritage to abolish, scrap, and kill the GST. As we all know, the member for York South-Weston even left the Liberal Party over this broken promise among other things.
The Liberals are bent on reaching an agreement with the maritime provinces for harmonizing this tax, which will cost Quebecers and Canadians nearly one million dollars. Moreover, the government intends to ram this legislation through, which undermines the quality of democratic life in Canada.
By the way, the Liberals allowed only three days of public hearings on this crucial, essential, very important bill. The opposition asked that the consultations be extended, but their request was rejected by the Liberal majority on the Standing Committee on Finance. The government wants to put an end right now to this embarrassing issue of the GST, even though Bill C-70 is a very bad bill.
During the 1993 election campaign, the Prime Minister kept repeating: "We will scrap the GST. Nous allons éliminer la TPS". Later, on May 2, 1994, he said: "We hate this tax and we are going to eliminate it". This broken promise will be very costly for the Liberal Party of Canada in the next election.
In a minority report dating back to November 1989, Liberals, when they were the opposition, stated: "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". What the Liberals are doing now with Bill C-70 is nothing but a repair job, a cosmetic make-over.
GST remains as it is, at the same rate, whereas the provincial tax is the one doing the harmonizing. There can be no sales tax reform without a reform of personal and corporate income taxes nor without the involvement of other levels of government. Canada has to undertake a tax reform encompassing every form of taxation at all levels of government.
Like the Bloc Quebecois, I demand for Quebec a $2 billion compensation for having harmonized the QST with the GST. It is unacceptable that the federal compensation formula should help Atlantic provinces compete fiercely with Quebec in the quest for new investments. When I see in Quebec newspapers ads by maritime provinces seeking to lure away Quebec businesses, to me thats provocation.
The $400 million federal compensation paid to New Brunswick will be used to finance the income tax reductions announced in December by the finance minister of that province. I condemn the raiding campaign launched by Premier McKenna against Quebec.
The federal government is showing a lack of openness and fairness in that matter. It refuses to communicate detailed data on the maritimes. This refusal is unacceptable considering that a $1 billion compensation will be paid to those provinces from the income tax and other taxes paid by all Canadian taxpayers.
If the federal government really wants to help boost Quebec's economy, it will have to give Quebecers the money coming to them in all fairness. On May 21, 1996, the Quebec government asked for a $1.9 billion compensation under the adjustment assistance program. Quebec harmonized its tax with the federal tax and is in charge of its administration. It is easy to see that co-operating with the federal government is not very profitable.
I take this opportunity to mention that yesterday, my party, the Bloc Quebecois, has made public an excellent report demanding an overhaul of our personal income tax. In 1996, it had a similar report on the corporate income tax, a report that drew compliments from the finance minister.
I hope the federal government will implement recommendations and proposals from those two reports in its upcoming budget. It should be bringing some order back, and a higher degree of fairness, in our tax system. For example, we know that Canadian banks do not pay their fair share of taxes when they are hoarding staggering profits of over $6 billion. We have the same problem with the chairmen of these banks. They are paid huge salaries but do not contribute a fair amount to government revenues.
The Bloc Quebecois report contains a number of suggestions to make our tax system more stable and fair. Rich taxpayers should pay more, and the poor should pay a little less. Taxpayers with big salaries could end up paying about $1,500 more each year, and those in the middle class as much as $800 less. Extra federal revenues would amount to $2.5 billion. This is an remarkable proposal by the Bloc Quebecois.
We should also be closing loopholes available to the rich. I congratulate the hon. member for Saint-Hyacinthe-Bagot on the excellent job he has done in this matter, and more particularly concerning his RRSP-Employment proposal. The Bloc Quebecois report suggests something extremely innovative, that is, to create an Employment RRSP program, which would allow the unemployed to start their own businesses with funds from their RRSPs. According to this report, maximum withdrawals of $25,000 would be repaid over 13 years. This tax initiative is very fair and should create many jobs.
I have seen the response of the labour movement, in particular the CLC, which is demanding more fairness in tax system. They say that the current tax system is not fair, that average income earners must bear a disproportionate tax burden. This view is shared by the whole labour movement.
However, the government in its last budget cut part of the tax credits for the workers' fund, in particular the Fonds de solidarité of the FTQ. As a former unionist, I cannot accept the government making cuts in this outstanding job creation tool.