Mr. Speaker, I have had several opportunities to speak on past Conservative budgets and every time I speak on them, the same problem comes up, and that is the lack of vision displayed by this government.
We know it takes months to prepare a federal budget. It involves many hours of research and consultation. However, what good is a budget if it contains no vision for the country? What good is it if it does not set out a plan for Canada's economic security?
As we debate the implementation of the Conservatives' latest budget, I will like to discuss some of the most problematic areas of this document.
First, I would like to talk about Canada's economic prosperity and our ability to be competitive in the future. These subjects are important to me, as a member of Parliament, because I believe that without a strong economy and prosperous citizens, our country cannot and will not be able to continue to sustain its generous social programs.
As deputy chair of the Standing Committee on Finance, my role is to ensure that Canadians are constantly informed and that we are advancing progressive ideas in order for this government to keep the economic prosperity of our country growing.
These various economic proposals are developed in different ways. The Standing Committee on Finance provides me with one of these opportunities, as we meet with hundreds of business leaders, non-profit organizations, environmental groups, artists, industry stakeholders and many others.
Over the last two years, overwhelmingly experts from these non-partisan meetings have told us that Canada's next major economic challenge will be to improve our productivity. Some of the economic solutions that have been suggested are to allow manufacturers the ability to write off assets in accordance with their useful lives. Other suggestions are to make all research and development credits earned refundable. However, cutting income taxes is at the top of almost everyone's list: first, corporate and second, personal income taxes.
However, no one advocates cutting the GST. Our leader, the member for Saint-Laurent—Cartierville, has been clear on this position. He is not advocating increasing the GST. His preference is to cut income taxes and has been on the record since last year. The only people who think cutting the GST will improve our economic prosperity are the Prime Minister and his Minister of Finance.
One may ask whether the Liberal Party has any credibility when it talks about the GST. The world has changed since 1993. The economic challenges are no longer the same. The world is changing faster and faster with increased trade. Technology has evolved and has transformed the way we do business.
Goods and services are exchanged more quickly and more efficiently than before. Fifteen years ago, income taxes were the main source of revenue for a number of countries.
The idea was to tax people and company profits. If the companies had physical infrastructures, governments knew that it was unlikely these companies would relocate, so they hit them harder with an endless barrage of taxes. They did not matter. Consumption taxes such as the GST were viewed as a deterrent to spending, so countries stayed away from that form of taxation. They needed spending to grow their economies internally.
When the Liberals came to power in 1993, they inherited a deficit exceeding $40 billion. They faced a dilemma because the country needed the revenue from the GST and from personal and business income taxes. The Liberal government had to make tough decisions, and all Canadians had to make major sacrifices.
Once expenses were brought under control, the next step was tax reform. Would it not have been a popular and politically smart move to reduce the GST then? Perhaps, but that would not have been the best way to proceed, nor would it have been in the country's best interest.
Let us not forget that our dollar was weak then. So why would companies invest here? Even though they would have had opportunities to make a profit, they would have been taxed on those profits, and the competitive advantage would have been lost because of the weak dollar. That is why the finance minister at the time, the member for LaSalle—Émard, chose to reduce personal and business income tax instead of the GST.
Was that the right decision? The proof is in the pudding. Today, in 2007, Canada has enjoyed a decade of annual surpluses, high employment, has paid down over $75 billion in debt during that same period and has become the country with the lowest debt to GDP ratio in the G-8.
The government now needs a vision to attack the productivity agenda. Instead of formulating a solid plan to improve productivity, the Conservatives have spent most of their time in office bringing in legislation to make short term political gain, never looking beyond the next election.
For 12 years, the Liberal government helped set the vision for our economic prosperity.
What has the present Conservative government done in the last two years? Has it presented a vision of any type? Yes, it has supported a combative role in Afghanistan. It has increased spending, the bulk of which has gone to the military, and in two years the Conservative government has become the highest spending government in the history of Canada.
Economically, Canadians have seen no vision. The finance minister says that Canadians are overtaxed but in budget 2006 he increased personal income taxes at the lowest rate from 15% to 15.5%. During his economic update, the minister announced that he would lower the tax rate back to the original Liberal rate of 15% and he had the audacity to call it a tax cut.
With regard to this bill's corporate income tax cuts, they merely match the ones proposed by the Liberal government in 2005. These cuts have been advocated by our party's leader, the member of Parliament for Saint-Laurent—Cartierville during the last year.
Furthermore, last year, the Minister of Finance decided to tax income trusts despite his campaign promise not to do so. Because of this, Canadians lost between $25 billion and $30 billion overnight.
A lot of Canadians were affected by that broken promise, but many had no idea what was going on because most of the losses were in pension funds. Individuals can ask the people in charge of their pension funds or their brokers to explain the situation.
The energy and resource sectors are looking for ways to finance expansion. Just a few months ago, our weak dollar encouraged foreign investors to buy up Canadian income trusts at fire sale prices.
We can take the example set by Nordic countries where social spending in these countries has always been a priority and now income taxes are being lowered to continue to attract foreign investors.