Mr. Speaker, I am pleased to speak to Group No. 3 of motions concerning the fiscal arrangements between the federal government and the maritimes, specifically Motions Nos. 118 to 124, which are of interest to us at this time.
There can be no sales tax reform without personal income tax reform, corporate tax reform, social security reform, nor without the participation of other levels of government.
Canada must undertake a tax reform which encompasses all forms of taxation and all the levels of government involved. Why, then, have the Liberals systematically refused, since they have formed the government, to carry out such a total reform of the Canadian taxation system, despite the numerous suggestions from the Bloc Quebecois which has just tabled a second document on tax reform, via my Bloc Quebecois colleague, the member for Saint-Hyacinthe-Bagot? That document was tabled this week and addresses personal income tax in particular.
Quebec harmonized its own sales tax alone and without financial assistance. The costs of this reform were assumed by Quebec businesses.
Quebec companies have yet to benefit from all the advantages of a fully harmonized sales tax. It is intolerable that the federal compensation formula should help the Atlantic provinces to compete fiercely with Quebec for new investment. The Maritime provinces are advertising in newspapers in Quebec and the other provinces that are not harmonized in order to attract companies from those provinces.
Furthermore, the $400 million in federal compensation paid to New Brunswick will be used to finance the tax cuts announced last December by the province's Minister of Finance.
If the federal government is really serious about wanting to boost Quebec's economy, it could put its money where its mouth is by giving Quebecers the amounts to which they are entitled. According to information provided by the federal government, Quebec would be entitled to compensation worth not $1.9 billion but $2 billion. And even if we apply the more restrictive federal formula to the data currently available, Quebec would be entitled to $1 billion in compensation.
Harmonization is costly for businesses in Quebec. At this time, the QST is not refunded on certain inputs of large companies, and it was necessary to increase corporate taxes in order to finance this reform. Harmonization will not cost Maritime companies a penny. They are entitled to a full tax refund on inputs, without any increase in income tax, since the federal government compensates these provinces through the harmonization agreement.
This may be a political ploy to make unemployment insurance reform as it applies to seasonal workers in these provinces more palatable to the Maritimes. Otherwise, why would Ontario, Quebec and the other provinces not be entitled to compensation?
The Bloc Quebecois is against the GST harmonization plan in the Maritimes. This bill was rushed through. It is based only on political and electoral considerations. It is poorly drafted, and is not the model of harmonization that citizens of the Maritimes deserve and asked for from the federal government.
If the federal government can come up with $1 billion for the maritimes, let it also find the $2 billion Quebec is entitled to. All the provinces must be treated fairly, and the federal government must stop funding New Brunswick's zealous raiding in Quebec with the tax money of Quebecers.
For all these reasons, the Bloc Quebecois is asking the government to redo its homework and this time take the time it needs to introduce a responsible bill and especially to listen to what people have to say on harmonizing the GST with provincial sales tax.
We are talking about an agreement between the federal government and the three maritime provinces, which account for some 15 per cent of Canada's population. This is the model they say they want to apply to all provinces in Canada.
Right now in Canada, most people oppose the minister's proposal and the establishment of a single 15 per cent tax, which would be managed by the Canada revenue commission the government intends to set up and which would result in an increased tax burden for Ontario, Alberta and Quebec. Everyone agrees that the Minister
of Finance is mistaken in thinking that all the provinces will agree to his harmonization proposal.
Knowing the history of Quebec and of its struggle for independence in tax matters, especially since the 1960s with Jean Lesage, I know Quebec will never agree to be part of a federal plan of this sort.