This week, I changed much of the tech behind this site. If you see anything that looks like a bug, please let me know!

House of Commons Hansard #99 of the 39th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was seniors.

Topics

The House resumed consideration of the motion that Bill C-40, An Act to amend the Excise Tax Act, the Excise Act, 2001 and the Air Travellers Security Charge Act and to make related amendments to other Acts, be read the second time and referred to a committee.

Sales Tax Amendments Act, 2006Government Orders

3:50 p.m.

NDP

Peter Julian NDP Burnaby—New Westminster, BC

Mr. Speaker, I listened with great interest to the presentation by the hon. member for Joliette on Bill C-40. He talked about the GST relief for foreign banks. There is another very important element: the situation currently experienced by school boards.

In my riding of Burnaby—New Westminster, the school boards in Burnaby and New Westminster have spoken out about the need to get the same GST exemption as municipalities and governments. It is fair and wise to give these school boards the opportunity to reduce their costs and devote more resources to students. In fact, what is at stake here is our children's education, hence the importance of this issue. GST relief should be provided to school boards, thereby freeing up more resources for the students.

My question to the member is very simple. Does he support this idea that school boards should be exempt from GST so that they can devote more resources to the students, our children?

Sales Tax Amendments Act, 2006Government Orders

3:50 p.m.

Bloc

Pierre Paquette Bloc Joliette, QC

Mr. Speaker, I thank my colleague from the NDP for his question and also for having listened to my speech. I was somewhat under the impression that only some of my colleagues from the Bloc were listening. So, I am glad to know that at least one other person was also listening.

The Bloc Québécois and I totally support the demand made by school boards, including by Quebec school boards, to be treated like municipalities with regard to the GST. In fact, that is included in the recommendations that the Standing Committee on Finance made to the Minister of Finance. There was a consensus. I would not say that all parties voted in favour of the measure, but the majority of them did.

I take this opportunity to underline a pending problem. The Federal Court made a decision on the application of the GST to school transportation. Many municipalities in Quebec and Ontario won their case at that time. Unless I am mistaken, about $12 million was to be paid back to municipalities. As far as we know, it is the only court decision that has been overruled by legislation. The former government had decided to tax the school boards retroactively.

I introduced a motion in the Standing Committee on Finance asking it to recommend to the Conservative government that it not impose the GST on school transportation since the Federal Court had ruled in favour of Ontario and Quebec school boards. It is not all school boards that are affected, but some of them. We also hope that the Minister of Finance will make a positive decision in his budget.

As the hon. member said, it is money that comes from the taxpayers' pockets and that should be used for education. There is something illogical about paying taxes to school boards if they must send that money to the federal government.

Sales Tax Amendments Act, 2006Government Orders

3:55 p.m.

Bloc

Christian Ouellet Bloc Brome—Missisquoi, QC

Mr. Speaker, I too want to congratulate my colleague from Joliette on succeeding in making such a brilliant presentation on such a technical bill, as he mentioned earlier.

I want to go back to a point he raised at the very beginning of his speech when he talked about the tax rebate to foreigners who visit our country.

In my riding, some tourists get their tax rebate just before crossing the border.They always spend the money right then and there, often buying regional and even local products. So there is a multiplying effect. Our riding benefits a lot more economically than if that money was not reimbursed.

I want to ask my colleague if this multiplying effect is real and if he believes that the same phenomenon could happen in places other than at the border, for example in airports or in hotels—I do not really know. Could this happen elsewhere?

Sales Tax Amendments Act, 2006Government Orders

3:55 p.m.

Bloc

Pierre Paquette Bloc Joliette, QC

Mr. Speaker, I thank the hon. member for his question. I think he is absolutely right. In fact, the Standing Committee on Finance heard witnesses regarding the government's intention to abolish the GST visitor rebate program. This is what we were told, not only at the border, where there are often private counters that give refunds. Indeed, one third of the program is administered by private firms that collect a certain percentage for their services. These facilities are often located in shopping malls, so that tourists who find themselves with cash in their pockets will use it to buy products in the surrounding stores.

This does have a snowball effect, not only for shops located at the borders—such as duty free shops for example—but also in all the shopping malls that have such counters. Let us not forget that we are talking about $80 million here. I should point out that the federal government has revenues totalling close to $2.350 billion. I think there is a disproportion here, and it costs about $8 million to administer the program. We are told that it is not being used enough. Then, let us integrate it into a strategy to promote tourism.

As I mentioned, it is unacceptable that this measure would come at a time when the value of the Canadian dollar has increased significantly in recent years, and at a time when authorities want Canadians who travel by land to the United States, and people who come into Canada from the United States, to carry a passport. It seems to me that the Conservative government should act responsibly and not add yet another hurdle for our industry, not to mention the cuts affecting Canada's tourism strategy. For all these reasons, common sense should again make the government reconsider its decision, or else propose a more effective plan to consolidate the tourism industry, which really needs it.

Sales Tax Amendments Act, 2006Government Orders

4 p.m.

Bloc

Robert Bouchard Bloc Chicoutimi—Le Fjord, QC

Mr. Speaker, I too would like to congratulate the member for Joliette for his explanation and presentation on Bill C-40. I will not speak directly to the bill, but rather will deal with the GST.

The Bloc Québécois has intervened on this subject in the House on many occasions. When the Conservative government was in opposition, it was in agreement with us that the GST related to school transportation should be refunded to school boards.

In Quebec, this matter concerns 26 school boards, and in my region the Lac-Saint-Jean school board would be able to look forward to receiving about $300,000 if the GST were refunded.

I would like to know what is the justification and motive behind the government’s position in refusing to apply a judgment rendered by the court that orders the government to refund GST to school boards in Quebec and in Ontario.

Sales Tax Amendments Act, 2006Government Orders

4 p.m.

Bloc

Pierre Paquette Bloc Joliette, QC

I thank the member for his question. As I had mentioned, this is a battle that we began with the previous government, with the support of the Conservatives. They were not officially involved. I know that school boards in Quebec and Ontario brought pressure on the Minister of Finance and the Conservative party to get to the bottom of this matter and settle it once and for all by not seeking to re-collect the GST that the federal tribunal finally ruled belonged to the school boards.

Since there has been no movement, I tabled a motion on behalf of the Bloc Québécois with the Standing Committee on Finance, asking that this matter be reconsidered and that an official recommendation be made to the government. I hope that will be done quickly so that the Minister of Finance can include it in his next budget. As the member has said, we are talking about millions of dollars that should remain in the hands of the school boards.

In conclusion, I would remind members that the Standing Committee on Finance also requested that the full amount of GST paid by school boards and educational institutions should be refunded on the same basis as for municipalities.

Sales Tax Amendments Act, 2006Government Orders

4 p.m.

Bloc

Mario Laframboise Bloc Argenteuil—Papineau—Mirabel, QC

Mr. Speaker, I congratulate my colleague from Joliette for his excellent speech.

I am pleased to speak to Bill C-40, first of all to tell you that the Bloc Québécois has given its support to this legislative change to the Excise Tax Act, the Excise Act, 2001, the Air Travellers Security Charge Act and other acts. Following my colleague's speech, members will have understood that there are two major parts in the act, even though we say that it was divided in four parts. There are two major parts: the GST rebate, that is the cancellation of the GST on certain goods, and changes in the application of the Excise Tax Act to other goods.

I will not repeat what my colleague has said about all the services on which the GST will no longer apply. First I will talk about what is not in Bill C-40 as it pertains to the GST rebate. My colleagues have talked about this. First, the GST rebate for visitors has been abolished. This rebate used to be there. Theoretically, in Bill C-40, we should not have seen a new paragraph, we should simply have seen: “The existing act continues to apply”. However, the Conservative government has decided to go back and to abolish this GST rebate for visitors. This is directly affecting tourism, especially in Quebec.

When Europeans discovered America, Quebec was where they first settled. It is no coincidence that this is where we find the most beautiful cities, the oldest cities, in North America. It is a very hospitable land. When you arrive in the Gulf of St. Lawrence, you have the Gaspé, the North Shore, the Magdalen Islands, all of the beautiful ancestral sites that are worth visiting and that play host to many tourists. This industry is continuing to develop. Continuing up the St. Lawrence River, you come to Quebec City, which will celebrate its 400th anniversary in 2008 and is therefore the oldest city in North America. There you see everything it has to offer, including the beauty of the history it has bequeathed to future generations. This is the reason why so many visitors come to see Quebec City every year, and the city benefited from their spending and the GST rebate given to foreign visitors. Obviously, this affects all of the regions, because when people come to Quebec City they go on to visit the Saguenay and Lac-Saint-Jean. These are beautiful regions, with lakes and mountains; they are home to hospitality businesses where conventions and business meetings from around the world can be held.

Next you come to the Mauricie region and Trois-Rivières, and on the other shore, the Centre-du-Québec region. Of course, there is history in Trois-Rivières, the second oldest city in North America, and its representative, who is fortunate to sit in the House of Commons, is one of our colleagues. The Bloc Québécois represents all of these ridings along the river. And then you come to Montreal, with all its attractions, which is now internationally recognized. You should not forget to stop and see the Beauce and Appalaches regions. Next come the Eastern Townships, where you can see Lake Memphremagog and part of Lake Champlain. There are also the Laurentians, Mont-Tremblant and part of the Outaouais, where a portion of my riding is. I have one foot in the Laurentians and the other in the Outaouais, where you find the Château Montebello and everything you see here on the other side of the river.

Once again, Quebec has more to lose than other regions of Canada from this elimination of the GST rebate. For members of the public listening to us—Quebeckers and Canadians—it will be clear that before the Conservatives came to power, foreign visitors could get a refund of the GST they paid on tourist products. This was to assist in the development of that industry. The Conservatives have cut the GST to 6% from 7%, but still they have eliminated the refund. Foreign visitors have therefore had to pay 6% more since the Conservatives came to power. This is the Conservatives' gift to foreign visitors. Obviously, the damage, the harm, to the Quebec economy from this is enormous. I do not want to go on and on about this, but Quebec is increasingly seeing an industry that it wanted to prosper being affected by climate. The weather is also playing nasty tricks on the industry.

We see the winter we have with global warming. It is a phenomenon that the Conservatives do not want to recognize. We are not meeting our Kyoto commitment. We saw how the Liberals wasted time before getting behind Kyoto. That is the harsh reality. The result is that now we have this kind of weather that affects the tourism industry.

The tourism industry, in winter, spring, summer or fall, depends heavily on foreign visitors and the 6% refund they received, which they often spent in our region. That was the reality. I believe my colleagues referred to that previously. Before leaving, visitors obtained a refund of the GST that they had paid on their purchases or on what they used as tourism products. They got that money back and they often invested it in the local economy. That money they left behind represented significant investments in the local economy.

The Conservatives have said that the system was too expensive to administer. Obviously, we know that there has been a succession of Conservative and Liberal governments since Canada became a country. Indeed, there have been no other governments than Conservatives or Liberals, with the result that the machinery of government has grown so large that it is now expensive. In fact, they can not even give refunds to the public. That is the reality of successive Liberal and Conservative governments.

Now, the Conservatives have decided to eliminate this refund. The residents of Quebec who operate tourism businesses are badly in need of this revenue at present. Considering that they have been sorely affected by the Canadian dollar and by the fluctuations of climate change, we must support the industry in some way. One way would be to maintain the refunding of GST. The Conservatives have decided instead to increase the bill for foreign tourists by 6%. That is a choice they have made and they will have to live with it.

It is fortunate that members of the Bloc Québécois are here to try to make the Conservatives understand that what they think are good ideas are often very costly for industry. That is certainly the case for the tourism industry.

My colleagues have previously highlighted what we do not find in Bill C-40. My colleague from Chicoutimi—Le Fjord presented a strong argument concerning the GST paid by school boards. Personally, I find that outrageous. I come from the municipal sector. There are many refunds to municipalities, including a full refund of GST. They do not have to pay it. Recently, the Government of Quebec did the same thing. To help overcome their problems, municipalities no longer have to pay the Quebec sales tax.

Municipalities are faced with infrastructure problems and outdated equipment. Cuts in federal funding for the provinces have led to cuts to municipalities, which now must do more with less. The governments have finally understood this and have not bled them dry. They have refunded the GST and the QST to the municipalities. But they have not given rebates to the school boards.

Quebec has given a QST rebate, but the federal government has not given a GST rebate. The government thinks that when it cut provincial funding and the provinces cut municipal funding, they also cut education transfers. That is the hard reality. At that point, the municipalities are not on an equal footing with the school boards. It is time the Conservative woke up. As for the Liberals, they were always asleep when it came to this issue and never woke up. They will never wake up to this issue. But the fact remains that the education sector needs this 6% it pays on purchases of goods and services. As hon. members are aware, the GST is a tax on goods and services. It does not apply just to purchases of goods, but also to purchases of services, including maintenance contracts and any contracts that are awarded.

There was a court decision. My colleague from Chicoutimi—Le Fjord was right to mention it. The court ruled in favour of the school boards. Yet the Liberal governments, and the Conservatives after them, do not want to comply with that judgment. The government is still not repaying the school boards the phenomenal amounts of money they need to keep up their buildings and provide their students with a few more school supplies. The boards need this money. Once again, the federal government is turning a deaf ear.

That was the part of Bill C-40 that applies to sales tax and is not included in this bill. Obviously, there were many rebates. I will not repeat what my colleague from Joliette said about sales tax breaks under Bill C-40. I will perhaps talk a bit about what my colleague did not mention and what he said briefly about excise tax.

There are several measures in Bill C-40 that apply to excise tax. I will go over them. They are in Part II of the bill.

They implement minor refinements that improve the operation of the act and more accurately reflect current industry and administrative practices. They also implement related and consequential amendments to the Access to Information Act, the Customs Act, the Customs Tariff and the Excise Tax Act. I will summarize the content and what will be changed.

Let us talk first about tobacco. Tobacco measures are aimed at clarifying certain provisions pertaining to the Excise Act, which will make it easier to fight tobacco product smuggling, while facilitating tobacco tax collection. To this end, the bill extends the requirement to identify the origin of tobacco products to all products, including those for sale at duty-free shops or for export, consistent with the Framework Convention on Tobacco Control, an international treaty, and it clarifies that cigarettes, tobacco sticks, fine-cut tobacco or cigars, but not packaged raw leaf tobacco, may be supplied to the export market or the domestic duty-free market.

This helps to clarify the situation. Tobacco smuggling is a plague that must be countered. I know this because, in my riding, there are many itinerant sellers of tobacco—if I may say so. People who use highway 344 will know that several individuals have opened shops. We often laugh about this, but it is very hard for the businesses. Within 500 feet, there are 18 or 20 smoke shacks selling tobacco, which directly affects businesses and corner stores. People who used to making a living selling tobacco products in my riding have been severally affected. Consequently, everything that will attempt to restrict and hinder the smuggling of tobacco products will be well received in the riding of Argenteuil—Papineau—Mirabel, especially around Oka and the districts of Deux-Montagnes.

As for alcohol, the bill has two objectives. First, it authorizes provincial liquor boards and vintners to possess a still or similar equipment for the purpose of analyzing substances containing ethyl alcohol without holding a spirits licence. That will relieve the provincial liquor boards and vintners of all the red tape and the costs related to that licence.

Of course, you know that there are more and more vintners in Quebec and that they are developing more and more wine products. Climate change, which is often mentioned, has a negative impact for many and for the tourist industry, but it seems that more and more regions are seeing new wine producers. Thanks to milder temperatures, the grapes grow better.

The measure will allow vintners to save on costs. Moreover, to stimulate the growth of the wine industry in Canada, the government will allow the deferring of the payment of duty by small vintners selling wine on consignment in retail stores operated by an association of vintners until the wine is sold.

Thus, when vintners supply their products to a store operated by their association, they will not have to pay the GST until the product is sold. That will be beneficial to the marketing of local products.

In a growing number of regions—and this is the case for the vintners of Saint-Benoit, Saint-Joseph-du-Lac, Saint-Placide, Oka, Pointe-Calumet and Mirabel, in my riding—we are seeing wine producers sell their products on the farm or in small shops or with the support of a regional association.

They form an association and sell their goods through various middlemen. Rather than being obliged to charge GST when the product leaves their farm, or their winery, the GST is paid once the wine has been sold in the shop. These shops are now often part of the tourism infrastructure.

With regard to agri-tourism, increasing numbers of citizens from the greater Montreal area, or elsewhere in Quebec, tour the stands that sell fruits, vegetables and local products in the fall, summer and even spring. These shops are often supported by regional associations. I repeat, this will enable producers to sell their goods without paying the GST and Quebec sales tax as soon as their goods leave the farm.

To provide some background for our colleagues from other Canadian provinces, Quebec wine producers have formed the Quebec vintners' association. In 2006, this included 42 vineyards located in the regions of Quebec City, Lanaudière, the Eastern Townships, Montérégie and the Lower Laurentians. More than 100 hectares are cultivated producing almost 300,000 bottles of wine every year. The main products are white wine, ice wine and fortified wines sold by Quebec producers as part of the agri-tourism trade . The wine industry is a growing industry and the government is supporting it in this case.

There is also the matter of law enforcement. As in the previous section—my colleague from Joliette mentioned it—the new legislation will authorize the Minister of National Revenue to exchange information on excise tax with foreign governments that are signatories to the Convention on Mutual Administrative Assistance in Tax Matters. This must be done, of course. In the matter of tobacco and smuggling, we must be able to exchange information with other countries. That is as it should be.

We are able to better monitor production. Recently, some large quantities of loose leaf tobacco were seized in Quebec ports, among others. Authorities seized huge quantities of tobacco bales that were intended for smuggling. They were able to make these seizures because the GST had not been paid on the products. The individuals involved were not properly registered.

So, these are measures that allow us to counter smuggling at the source. In this case, the tobacco came from various countries around the world, including Bangladesh and other countries that we might not even think of. This means that we must be able to counter smuggling activities that originate from all parts of the world. The purpose of these tax measures is to provide customs officers and all those who monitor these imports with a new tool, a tax tool. It allows them to see that the taxes were not paid, and they can then seize the whole shipment, because they know it does not belong to bona fide merchants, since the individuals involved are not registered. This automatically means that they are not allowed to have this product. This is in addition to the fact that they did not pay tax on it. This is a hard blow to smugglers. We cannot stop our efforts in this regard, if we want our merchants, who pay their taxes and part of our salaries, to continue to make profits. One way to help them is to fight smuggling. Hon. members can count on Bloc Québécois members to do that.

Next, there are measures concerning the air travellers security charge. As the Bloc Québécois transport critic, I would like to summarize what this is about. The measures concerning the air travellers security charge are in part 3 of the bill. They include previously announced tax relief measures and minor amendments to the Air Travellers Security Charge Act.

In a nutshell, the government is proposing tax relief. The bill would relieve, in particular circumstances, the air travellers security charge in respect of air travel sold by resellers or donated by air carriers. Obviously, a lot of trips and gifts are given to tour operators. Tax relief would be granted so that these parties, which advertise to encourage people to travel, do not have to pay GST on donated products and services. I think this makes sense. The industry appreciates this relief. To encourage Quebeckers and Canadians to travel by air, companies often have to offer package deals, some of which are given away by lottery. This measure will encourage them to keep doing this by not making them pay the GST on these products and services.

The bill also states that the Governor in Council may, by regulation, amend the schedule by adding, deleting or varying the reference to an airport. The bill removed the La Grande-3 and La Grande-4 airports from the list of airports that must collect the ATSC. As you may know, some airports that were required to charge the ATSC will no longer have to, nor will they have to charge GST. Once again, this will promote development in our beautiful regions. La Grande is in northern Quebec, and we would be delighted to help that vast region's economy.

I hope I have made it clear that although the Bloc Québécois supports these amendments, we think there are some major flaws, such as cancelling the GST visitor rebate, a decision we deplore immensely.

Sales Tax Amendments Act, 2006Government Orders

4:20 p.m.

Conservative

The Acting Speaker Conservative Royal Galipeau

It is my duty, pursuant to Standing Order 38, to inform the House that the question to be raised tonight at the time of adjournment is as follows: the hon. member for Sault Ste. Marie, Homelessness.

Sales Tax Amendments Act, 2006Government Orders

4:20 p.m.

Liberal

Larry Bagnell Liberal Yukon, YT

Mr. Speaker, before I ask my question, I want to congratulate the Midnight Sun Rotary Club for becoming the third Rotary Club in Whitehorse, Yukon.

Sales Tax Amendments Act, 2006Government Orders

4:20 p.m.

NDP

Pat Martin NDP Winnipeg Centre, MB

Relevance. Relevance.

Sales Tax Amendments Act, 2006Government Orders

4:20 p.m.

Liberal

Larry Bagnell Liberal Yukon, YT

It was short. The hon. member can call relevance on my next question too, though. I want to ask about the effect of the bill on seniors. While the member is preparing to answer, I will just give a quick preamble.

I received an email this morning from a constituent named Jennifer, who was indicating the devastation that the backtracking on the income trust had on her, and specifically, a point that has not been raised much, in relation to RESPs, the educational RSPs. Her son, who is just graduating from high school, lost 25% of his money for university on the day the Tories broke their promise and went back on the income trusts. She then said that income splitting will not help single women. Many seniors are single women and it will not help them.

I would like to ask the member, first, about the effects of the bill on seniors. Second, during question period, the Conservatives boasted that they did more than anyone for seniors. Does the member agree that the Conservatives are doing more than what the Bloc has proposed or what other parties have done?

Sales Tax Amendments Act, 2006Government Orders

4:20 p.m.

Bloc

Mario Laframboise Bloc Argenteuil—Papineau—Mirabel, QC

Mr. Speaker, the hon. member for Yukon is right. It is not a bill made for seniors who wanted a financial break. Canadians are subject to all kinds of cost increases but the incomes of seniors and of retired citizens in general are not going up accordingly.

In Quebec, the Liberal government decided to raise the cost of electricity. In the last three years, the cost of electricity has gone up by 15% to 20% but the incomes of pensioners have not kept pace. In the measures proposed, we do not see a lowering of the GST applying specifically to seniors' purchases. The measures are of a slightly more general nature. The hon. member is perfectly right when he says that the Conservative government does not help our seniors. They often find themselves in dire situations because their incomes do not increase as fast as their expenses. The cost of their housing increases, the cost of their medications increases, the costs of heating and electricity increase, as does the cost of gasoline.

Seniors never get rebates or an increase in their income to make up for increases in the cost of living. Their purchasing power is diminishing year after year and the Conservative government is not helping them. It is up to the Bloc Québécois yet again to offer good ideas to the parties in power in this government.

Sales Tax Amendments Act, 2006Government Orders

4:25 p.m.

Liberal

Paul Szabo Liberal Mississauga South, ON

Mr. Speaker, I thought I would follow up on this question. We seem to have a little more latitude on the bill. We can talk about income trusts and a whole bunch of other things, but we do not want to at this time.

Sales Tax Amendments Act, 2006Government Orders

4:25 p.m.

Conservative

Jim Flaherty Conservative Whitby—Oshawa, ON

You don't want to. You already lost that once.

Sales Tax Amendments Act, 2006Government Orders

4:25 p.m.

Liberal

Paul Szabo Liberal Mississauga South, ON

If the Minister of Finance wants to talk about it, maybe he will rise and ask a question as well.

The member is quite right and I think it bears repeating that seniors have a very unusual situation. Most are on fixed incomes. They have no opportunity to increase their income by their own efforts. They cannot go out to work some more. There are no escalators. Many of them do not even have pension plans that would be indexed, et cetera, so the member is quite right. We have a situation where the income levels do not tend to follow normal inflationary pricing or cost measures.

It raises the question about the GST implications. As the member knows, the GST reduction really is a function of how much we spend, and that if we wanted to get a better break on that, we would actually have to spend more. The more that we are consumers of GST taxable goods and services, the more the savings, so it tends to be a GST cut, I think the member may agree. It tends to be more to the benefit of those who have higher levels of disposable income, and that is generally not what the member has been talking about: seniors in need and seniors on fixed incomes. Certainly, we do understand that.

Generally, in terms of an approach to addressing some of the needs of seniors, should we look more at a programs based or subsidy based type of delivery of the needs for seniors as opposed to general income taxation or commodity taxation measures, which do not seem to hit seniors very effectively?

Sales Tax Amendments Act, 2006Government Orders

4:25 p.m.

Bloc

Mario Laframboise Bloc Argenteuil—Papineau—Mirabel, QC

Mr. Speaker, I was listening to my colleague and he has part of the solution. Nonetheless, as I was saying earlier, when his party, the Liberal Party, had the chance to reduce the GST or give the school boards GST rebates, it did not take it.

We must not forget that seniors own property or they are renters. They pay rent. To help them we could, among other things, accept the rulings of the Court of Quebec and the Ontario Court. These rulings call for GST rebates for school boards, which could have alleviated the pressure of school taxes that are often paid by retirees and seniors. They see their taxes go up, but they never see their income go up. They often have to give up their property and go to a home. The next thing they know, the cost of housing increases because the school taxes and municipal taxes have increased.

When the Liberal Party was in office, it should have adopted a measure to reduce expenses for seniors. For example, in the case of those who own a residence and those who pay rent, it could have been to accept that school boards be refunded the GST. Then, there would not have been a direct transfer of the GST costs to the taxes paid by citizens.

Of course, when they had the opportunity to do so, the Liberals did not do it. And the Conservatives carry on. Should there be a measure to deal directly with the issue of what seniors can afford to pay? Bloc Québécois members think so. Seniors' income and pensions will have to be adjusted, or else these people should get tax credits.

We are always talking about the cost of living. However, the cost of living for a senior is not the same as for a family. The cost of living is often determined by calculating the costs of a family of two adults and two children. Let us not forget that the expenses incurred by seniors are not the same. It is not food that is an issue for them, it is the cost of drugs and housing. It is costing increasingly more to live in a place that is safe and secure. At some point, we will have to adjust credits for seniors or their income, so that they can pay for their own expenses, which are increasing at a faster pace than the cost of living of ordinary citizens.

Sales Tax Amendments Act, 2006Government Orders

4:30 p.m.

Bloc

Robert Bouchard Bloc Chicoutimi—Le Fjord, QC

Mr. Speaker, I would like to congratulate my colleague for his excellent explanations of this bill. Since we are talking about the GST, I would like to ask him a question.

We know that the government decided to reduce the GST from 7% to 6% in July and that it intends to reduce it by another percentage point, to 5%. If, in the context of the fiscal imbalance, the government decided to use this one percent in a comprehensive proposal, does my colleague feel that the government would be reneging on its commitment, thus misleading taxpayers?

In fact, when it made that commitment, we really saw a cash register that showed the reduction to 5%. Would it really be going back on its commitment? By bringing some relief by lowering the GST and by incorporating that into the fiscal imbalance and transfer payments, would it be going back on its commitments?

Sales Tax Amendments Act, 2006Government Orders

4:30 p.m.

Conservative

The Acting Speaker Conservative Royal Galipeau

The hon. member for Argenteuil—Papineau—Mirabel has less than one minute to respond.

Sales Tax Amendments Act, 2006Government Orders

4:30 p.m.

Bloc

Mario Laframboise Bloc Argenteuil—Papineau—Mirabel, QC

Mr. Speaker, the Bloc Québécois has always defended the transfer of tax points to the provinces to correct the fiscal imbalance. The problem with the Conservative Party is that it had already promised Canadians that it would reduce the GST and put that money in their pockets. It could therefore not make use of that money, which it had already promised to taxpayers, to solve the fiscal imbalance issue. When the government wants to solve the problem, it must transfer tax points or the entire GST to the provinces. It is as simple as that. It must decide but, in my opinion, it would be reneging on one of its promises if it uses that money to correct the fiscal imbalance.

Sales Tax Amendments Act, 2006Government Orders

4:30 p.m.

Conservative

The Acting Speaker Conservative Royal Galipeau

Is the House ready for the question?

Sales Tax Amendments Act, 2006Government Orders

4:30 p.m.

Some hon. members

Question.

Sales Tax Amendments Act, 2006Government Orders

4:30 p.m.

Conservative

The Acting Speaker Conservative Royal Galipeau

The question is on the motion. Is it the pleasure of the House to adopt the motion?

Sales Tax Amendments Act, 2006Government Orders

4:30 p.m.

Some hon. members

Agreed.

On division.

Sales Tax Amendments Act, 2006Government Orders

4:30 p.m.

Conservative

The Acting Speaker Conservative Royal Galipeau

Accordingly the bill stands referred to the Standing Committee on Finance.

(Motion agreed to, bill read the second time and referred to a committee)