Madam Speaker, I have only a few minutes remaining in this debate but there is enough time for me to give you a number of reasons you can share with the government as to why it should step back and reconsider its new air travel tax.
I listened with interest to the previous speeches made by the government members and I think it is far too easy to rely on the events of September 11 to justify this decision. The government says that it was forced after September 11 to hurry up and implement security measures. It is too easy to refer to a tragic event such as this to justify the quasi-insane government policy of levying a new tax in an industry that, even prior to the events of September 11, was already experiencing a downturn.
Years ago it was clear that there was an obvious lack of competitiveness. To demonstrate this, since the mid-1980s until last year the cost of air travel in Canada has increased by approximately 10%. Some might say that over 15 years, this is not so bad. Yet while the cost of air travel in Canada jumped 10%, over the same period in the United States it dropped by 43%.
Already, due to this country's geography, population density and the populations requiring service in remote areas, the airline industry in Canada does not have the levels of profitability and operating costs that would allow it to be extremely profitable.
A tax such as this one would only adds to this situation. The government is saying to the industry “You are having problems being competitive, you are already experiencing problems maintaining service to remote areas, in particular, well, now we are going to saddle you with a new tax”.
Earlier, members were saying that it was not that much, that is was not a heavy tax. Yes, but it is enough to jeopardize the profit margins of a number of airlines, especially small and mid-size air carriers. It is also enough of a tax to put an end to air service in remote areas. It will no longer be profitable. It is also enough to lead to several economic development projects being dropped.
This government slaps on taxes willy-nilly, without even carrying out impact assessment studies. The general director of the Tax Policy Branch, in Ottawa, was candid in admitting to us that there were no studies carried out on the levying of such a tax. These people would do well to visit remote areas.
It is all very fine and well to ask small communities to take charge of their own lives, to develop tourist attractions using what is available to them and what they have but without an air link, which is often the most effective link and the only link in certain areas, their development is threatened.
They can be told to take charge of their lives, to work together, to invest, but, without an air link which is maintained, or which in many cases could be improved upon, in terms of the lack of frequency of flights, these communities are not being given a chance.
It cannot be that all the people who were with the opposition parties yesterday, the people representing all aspects of the airline industry, are wrong.
Yesterday, at the initiative of the Bloc Quebecois, the Tourism Industry Association of Canada, the Canadian Air Line Pilots Association, the Air Transport Association of Canada, and the Association of Canadian Travel Agents, joined forces here in Ottawa. All these people stood behind the opposition parties, and behind the Bloc Quebecois' initiative calling on the government to cancel this new tax in Bill C-49. All were unanimous that this tax made absolutely no sense and that it would not encourage economic development or put the economy back on track.
It is rather outrageous to have a government that is juggling with surpluses, even during an economic slowdown. In a few days, the government will be announcing a net surplus of over $9 billion. While it is already squeezing out of the taxpayers' pockets more money than necessary, it has the nerve to introduce this new tax, which will not bring in $2.2 billion over a five year period, as the government claims, but $1 billion more than that. This tax will bring in more than $3 billion to the government, which is already juggling with surpluses.
As we are launching the debate on tax imbalance, the government is creating additional pressure regarding surpluses, by accumulating hundreds of millions of dollars more annually, under the pretence of improving security. Let us face it: this is outrageous.
What we are asking the federal government—and the coalition made it clear yesterday—is to use its surpluses to invest in security. It has enough money to do so. The Minister of Finance is juggling with surpluses. It is incredible. But the government is adding yet another tax.
In conclusion, the government must come to its senses and give up this idea of imposing a new tax. It is not true that this tax will be reviewed in six months. It may be reviewed in six months, but Canada's tax history tells us that when a new tax is introduced, it is very hard to get rid of afterwards. Once it is in effect, forget it. The personal income tax collected by Ottawa was supposed to be a temporary measure. It was meant to finance the war effort. We have been waiting 60 years to see it abolished. Obviously, once a tax is in place, it cannot be removed.
I am seeking the unanimous consent of the House to immediately withdraw this bill.