Mr. Speaker, I thank the hon. member for his excellent points and questions. He has raised a couple of very important issues.
First, the last significant overriding tax reform was around the time of the Carter commission back in 1971. The changes were introduced by the Carter commission which reported in the late sixties, approximately 30 years ago. Since then we have seen amazing changes in the Canadian economy. It is clear that we do need some level of reform.
The GST was a significant change as well. The Minister of Industry said in a speech at the BCNI that tax reform was a non-starter for the government because it could not get consensus on tax reform. There was a consensus on the GST. Unfortunately it went against the governing party and resulted in not just significant tax changes but significant political changes in 1993.
The question the hon. member had was relative to how we balance tax reduction and the other needs. Ideally, there should be tax reform and it should be based, in my opinion, on growth and not greed. We should be looking at tax reform from the perspective of what taxes can we reduce to create the greatest level of economic growth and opportunities here in Canada.
I can point to a few examples. In Ireland much of the tax reduction that has occurred has been in corporate taxes. By reducing corporate tax rates, Ireland has actually increased corporate tax revenue by attracting companies from around the world.
There are examples closer to home. I would argue that Quebec has been very successful under Bernard Landry with many of his tax policies, particularly those focused on the new economy. One of the most innovative aspects of the Quebec tax policy has been on the provincial income tax not being paid by research scientists, the Ph.D.s coming from other places to Quebec to participate in research. The new economy, whether it is in e-commerce or biotechnology, needs those Ph.D.s and researchers. As a result of the policy by the Quebec government, it has effectively been able to reduce the personal tax rates for these minds that Quebec and Canada need to U.S. levels, which has been very innovative.
I would argue that we can reduce some types of taxes without reducing revenue overall. Another example of that is capital gains taxes. When we reduce capital gains taxes there is often a resultant unlocking of capital which actually leads to a greater level of capital flow and a greater level of taxes being paid.
Unfortunately tax reform is usually based on political criteria as opposed to economic criteria. We often build tax reform around what is politically palatable or what is popular and do not think of what will lead to the greatest levels of economic growth. It is not always the same thing, but in many ways the Quebec government has pursued some policies that have been quite innovative in terms of attracting the type of industries that are necessary.
I would like to see the national government be a little more amenable to that kind of thing. Some of these successes have resulted of course in the recent move of NASDAQ to Montreal.
While I disagree with the policies of the Parti Quebecois in terms of its position on federalism, I have to express some level of admiration for some of what the Parti Quebecois has done on economic policy.