Mr. Speaker, I do not think I will be as voluble as my Reform Party colleague. I did appreciate his speech.
I am pleased to speak today on Bill S-16, which was passed by the Senate on June 2. This bill will implement agreements between Canada and the two following countries: the Socialist Republic of Vietnam and Croatia and a convention between Canada and the Republic of Chile for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income.
The Bloc Quebecois does not oppose treaties between Canada and other countries insofar as they ensure fair and equitable tax treatment for persons and encourage trade and investment between countries. I would mention that the term “person” includes physical persons, corporations, trusts and all other groups of persons.
Since the tax rate in the countries concerned in this bill is similar to Canada's, I will not oppose the bill. However, I do want to take the time accorded me to speak in this context of tax conventions in effect between Canada and certain other countries.
While the tax conventions do avoid double taxation of corporations and individuals, they are in many cases the source of problems, and they encourage tax evasion.
Great care must therefore be taken to ensure that these treaties do not open the door to excessive tax evasion. They must therefore be restricted to countries with tax rates comparable to Canada's. While the tax conventions do avoid double taxation of individuals, as defined earlier, they are in some cases the source of problems, and they encourage tax evasion.
Although the most recent treaties, which take their inspiration from OECD models, are relatively standard, Canada does have some older tax conventions with countries known as tax havens because they have low or no taxes on the incomes of individuals and corporations.
Under the tax treaty between Canada and these so-called tax havens, the Canadian taxation system closes its eyes to these amounts, treating them as if they had already been taxed at a comparable rate elsewhere, and not taxing them when they are brought back into Canada. Let us bear in mind that the auditor general has raised this matter on a number of occasions since 1992. I could also point out many cases to the government, but that would be like talking to a brick wall.
There is another danger to certain tax treaties, the ability to change Canadian tax rules to suit the friends of those in power, or those in power themselves. I am referring here to Bill C-28. The Minister of Finance is in a clear conflict of interest in this case because, if the bill is passed, it will mean millions of dollars for Canada Steamship Lines, a scandalous trick discovered by my colleague from Saint-Hyacinthe—Bagot.
We would remind you that all opposition parties supported the Bloc in this CSL business. The minister ought to defend the interests of the Canadian taxpayer as staunchly as he defends his own. Tax treaties and manipulation of the law cost our taxpayers billions of dollars. Those billions are lost to us, and the public suffers as a result.
What should be done instead is for a serious and responsible government to devote considerable resources to assessing, adjusting and renegotiating problematical tax treaties, particularly those with countries that represent the greatest risk to Canada as far as loss of taxation income is concerned.
What we have here is a government turning a blind eye to the potential exodus of hundreds of millions of dollars in unpaid taxes. What we also have is a government that probably spends more money on a one-week visit by the Queen of England than it spends in a whole year on enforcing and improving tax conventions.
This is a serious issue because it undermines the overall integrity of our tax system. It also makes Canada look like a country where wealth means bigger loopholes. It is very troublesome. And given the billions of dollars the Minister of Finance has cut in transfers to the provinces for hospitals, schools and social assistance, honest citizens who pay their taxes to Canada want their government to at least ensure that everyone pays his fair share. It is not such a lot to ask, but it seems to be too much for this government.
In conclusion, I recognize that tax conventions have the advantage of preventing double taxation of the operating revenue of companies in two countries with branches or dependent companies in one country or the other.
Another advantage is that, in some cases, tax conventions apply to travel by Quebec and Canadian artists who perform abroad, or even to travel by those involved in sports, such as hockey players and other athletes. On the other hand, we know that tax agreements are nothing new. They have always existed and will always exist, and will even increase in numbers with globalization.
Tax agreements establish what we call reciprocal taxation, insofar as Canada's corporate tax rates and those of the countries with which Canada signed these agreements are equivalent or comparable.
In closing, I repeat that the Bloc Quebecois is in favour of tax agreements signed between Canada and other countries when these treaties are aimed at ensuring fair and equitable taxation of residents and non-residents, and encouraging trade and investments between countries. But make no mistake, these treaties should not open the door to excessive tax evasion.