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House of Commons Hansard #126 of the 40th Parliament, 3rd Session. (The original version is on Parliament's site.) The word of the day was liberals.

Topics

Opposition Motion—Tax Rate for Large CorporationsBusiness of SupplyGovernment Orders

3:50 p.m.

Liberal

John Cannis Liberal Scarborough Centre, ON

Madam Speaker, I listened very carefully to the member from Saskatoon—Rosetown—Biggar. There are a couple of things to keep in mind.

She talked about Canadians not believing us, for example, about lowering taxes. I will give the member two examples.

First, the government says that it wants to lower taxes. When the Liberals were in government, the employers told us that we should lower EI premiums and they would hire. Instead of lowering them, the Conservative government has increased them to $13 billion. Is that an increase or a decrease?

The Conservatives said that they lowered the lowest income tax personal bracket. When the Liberals were in government, we had it at 15%. The Conservatives came in and increased it to 15.5%. Now they have lowered it to 15%. Is that an increase or a decrease?

The highest tax increase in Canadian history was the income trust at 31%. How dare the Conservatives do that?

Opposition Motion—Tax Rate for Large CorporationsBusiness of SupplyGovernment Orders

3:50 p.m.

Conservative

Kelly Block Conservative Saskatoon—Rosetown—Biggar, SK

Madam Speaker, why is the Liberal caucus against Saskatchewan and against small business people?

The Saskatchewan Chamber of Commerce says:

If parliamentarians renege on their commitment to continue with promised tax decreases, you can be certain that many businesses will not be able to pursue their plans.

We are not talking about billion dollar companies. We are talking about small and medium-sized businesses that are the backbone of Saskatchewan's economy.

Again, why are the Liberals against Saskatchewan and against small businesses?

Opposition Motion—Tax Rate for Large CorporationsBusiness of SupplyGovernment Orders

3:50 p.m.

NDP

Jim Maloway NDP Elmwood—Transcona, MB

Madam Speaker, the member is totally wrong. The government has to be competitive in corporation taxes, but in this case we are already much lower than our biggest competitor, the United States. There is absolutely no need to be any lower than we are right now.

The argument against the corporate tax cuts is a very strong one and I think the Liberals have realized that somewhat belatedly. Only a few months ago the Liberals were in the back pocket of the government, supporting the government's tax cuts.

I do not think the government position will sell very well when the public realizes that over the last 20 years or so it has gone from almost equal contribution between working people paying individual taxes and corporations paying roughly the same amount. Right now corporations are paying a tiny percentage of what hard-working taxpayers are paying.

I invite the member for Saskatoon—Rosetown—Biggar to go out and explain that to her constituents. They are not going to accept that.

Opposition Motion—Tax Rate for Large CorporationsBusiness of SupplyGovernment Orders

3:50 p.m.

Conservative

Kelly Block Conservative Saskatoon—Rosetown—Biggar, SK

Madam Speaker, I point out for the member opposite something that the NDP minister of finance for Manitoba had to say, “Well, if the federal government reduces corporate taxes, it will make a difference for our businesses and certainly they will take advantage of those cuts. If it means more jobs, we would be very happen with that. Do I think it will make a difference for Manitoba if the federal taxes are cut? Yes, it will make a difference for businesses”.

I remind the member opposite of what this government has done for families. The total savings for a typical family is nearly $3,000 annually. We cut the lowest income tax rate. We increased the amount Canadians earn tax-free. We introduced the $100 a month universal child care benefit to give Canadians choice in child care. We have reduced the GST from 7% to 5%. We introduced many important tax credits, like the child tax credit, the children's fitness tax credit, the public transit tax credit, the Canada employment credit, the working income tax benefit, and I could go on.

We know Canadians are taking advantage of these tax credits and they appreciate what this Conservative government is doing on this issue.

Opposition Motion—Tax Rate for Large CorporationsBusiness of SupplyGovernment Orders

3:55 p.m.

Kamloops—Thompson—Cariboo B.C.

Conservative

Cathy McLeod ConservativeParliamentary Secretary to the Minister of National Revenue

Madam Speaker, I appreciate the opportunity to rise and speak against this Liberal motion that would turn back Canada's fragile economic recovery through what the tax and spend Liberals understand best: tax hikes to help pay for more reckless deficit Liberal spending.

In 2007 our Conservative government introduced, and Parliament passed, a bold and broad-based tax relief plan for Canadian job creators. The aims of the low tax plan have been to make Canada more competitive, attract more investment and, more important, more jobs for Canadians. Indeed, over 110,000 Canadian businesses are benefiting from our low tax agenda.

This bold plan had almost immediate results. A short while later an icon of Canadian business returned to Canada, having fled the country due to the punishingly high taxes under the Liberals. In the words of a National Post editorial of the day, “Tim Hortons has announced that it wants to reorganize as a Canadian company”. This is good news.

We take even greater satisfaction in terms of why Tims has returned. Canadian corporate taxes are falling so significantly that Canada has once again become attractive as a site for corporate headquarters and plants. Let us meet at the drive-thru to celebrate with an iced cap and a maple glaze.

Unfortunately, while most Canadians were celebrating the return of Tim Hortons along with other new investments and jobs due to our low tax plan, the self-described tax and spend Liberal leader was finally coming clean on the Liberals' hidden agenda for higher taxes.

First, he admitted that a GST hike was on the table. Second, the Liberals refused to rule out the return of a job-killing carbon tax. Third, in the worst of the global recession, the Liberal leader told a stunned audience of business leaders in hard-hit southwest Ontario that federal taxes must go up, saying “we will have to raise taxes”. Fourth, and most stunning, the Liberal leader announced a massive tax hike on Canadian job creators still trying to deal with a massive global recession.

The litany of Liberal tax hikes does not include other bizarre proposals such as an iPod tax. Clearly the Liberal leader does not believe Canadians are paying enough taxes. He does not believe hard-working families, fixed income seniors and job creating businesses are sending Ottawa enough money to fulfill schemes for massive new big government programs like national daycare, 45-day work years and much more.

Under the Liberal leader, Canadians will have to pay more and more of their hard-earned money to Ottawa to fuel these tax and spend Liberal schemes. What the Liberal leader does not understand is higher taxes, especially on business, kill jobs and economic growth. I am a little amazed that the Liberals do not understand that.

I am even more amazed that the Liberal finance critic, the member for Kings—Hants, does not understand it either, especially considering his own words not so long ago when he said:

—we cannot increase corporate taxes without losing corporate investment. If we lose corporate investment, we have a less productive economy....That means fewer jobs. That means more poverty.

That is the Liberals words about their own plan to hike taxes on job creators.

However, maybe the Liberal leader should talk to other Canadians as well about our low tax plan, especially the private sector businesses that he demonizes, private sector businesses that employ the vast majority of Canadians.

For instance, we all know the difficulties that Canada's forest industry has had over the past few years and the impact that has had on our resource communities. Instead of helping the forest industry, the Liberals want to attack it with a massive and reckless tax hike.

In the words of the Forest Products Association of Canada, “the business tax reductions announced in 2007 are an important part of the industry’s recovery plan for the period ahead”. I have two sawmills in my riding of which one reopened last Monday and one is considering reopening. I am absolutely sure that the challenge of the dollar is one thing and it is the corporate tax cuts that are giving them the confidence. If the Liberals really want to help our forestry sector, maybe they should listen to it and keep its taxes lower instead of trying to hike them.

Maybe the Liberals should go and talk to Canadian small businesses that employ millions of Canadians and serve as the backbone of our economy. Listen to the Canadian Federation of Independent Business, representing the voice of business in Canada, as it speaks out against the Liberal tax hike on job creators, “Businesses don't just plan one or two years ahead. Once something has been put out there, it's usually very poorly received that the rug would be pulled out from under you”.

What about the Canadian Chamber of Commerce, representing 192,000 businesses of all sizes? It said:

--following through on the business tax reduction is critical to moving from government--and Canadian taxpayer-funded--stimulus to a private sector led recovery. The timing of the tax cuts allows a significant fiscal injection into the Canadian economy as fiscal stimulus winds down and the focus turns to the private sector to drive growth. The alternative is an increase in taxes. And raising taxes would be good for neither growth nor employment. [...] If MPs renege on their promise to continue with promised tax decreases, many businesses will be forced to reconsider their plans. Certainty and predictability are of paramount importance to business planning. Businesses across the country have invested for the future with the understanding that Canadian taxes would decline. All Canadians will lose if the jobs and well-being of Canadian families are held hostage by political manoeuvring.

What about the Canadian Manufacturers & Exporters Association, representing an industry hit about the hardest during the global recession? It recently released a study outlining the positive impact of our tax relief for job creators. This study came to some very interesting conclusions.

First, and most importantly, it concluded that the last stages alone of our low tax plan would add almost 100,000 good, high quality jobs to Canada's economy.

Second, it would increase per capita personal income by $880, an increase in income that would sure help a lot of Canadian families coast to coast to coast. I know in my riding it would be an enormous benefit.

The study also looked at the important effects it would have through increased business investment, increased productivity, and more research and development spending, something I had hoped the Liberal Party would agree is important for moving the Canadian economy forward.

I will quote the conclusion of that study. In the words of Jayson Meyers of the Canadian Manufacturers & Exporters:

The numbers show that corporate tax cuts are critical drivers of the Canadian economy. The question is not if we can afford corporate tax cuts; it's can we afford not to--

Or maybe the Liberals could read what the International Monetary Fund had to say about Canada and what is driving our positive economic outlook:

Canada has weathered well the global recession...The [government's] ambitious fiscal consolidation plans include growth-friendly measures to support Canada’s long-run economic potential, notably...cuts in corporate income tax.

If this is not enough for the Liberals, maybe they should listen to their provincial cousins, like Ontario's Liberal finance minister. Dwight Duncan said:

Scrapping... corporate tax cuts would hurt the fragile economic recovery by raising taxes on the struggling forestry and automotive sectors. It is about the most short-sighted, dumb public policy pronouncement one can envision.

Instead of constantly demonizing Canada's job creators, maybe the Liberals should talk to some of the people I have just quoted and realize what they are threatening to do to Canadian jobs and Canadian families with their short-sighted policies.

This is the worst time to raise taxes and kill Canadian jobs. This is the worst time for this Liberal tax hike motion.

Opposition Motion—Tax Rate for Large CorporationsBusiness of SupplyGovernment Orders

4 p.m.

Liberal

Scott Simms Liberal Bonavista—Gander—Grand Falls—Windsor, NL

Madam Speaker, I am amazed at this speech. One tries to elevate the debate and ask certain parties in the House to put their plan on the table, but in this particular case I think she said “Liberal” more times than any other party in the House. In the past four hours I have only heard about the Liberals. I begin to think that we deserve all the attention.

In this particular situation, the member quoted from many sources about all the benefits of having that lowest corporate tax. She did not quote anything from the government of Ireland, which also has a very low corporate tax rate. I wonder why.

The member quoted from the CFIB, but the part she did not quote was the fact that the CFIB has issues with the government's payroll tax increase.

That is not to mention the Conservatives talking about tax increases. A lot of people from my riding like to travel. What about that airport tax we are now saddled with? We never hear about that, of course, but that has only been in the last little while.

I would like to ask the member a specific question. She talked about having corporate taxes helping out certain industries. I would like one example of a business that has been compelled to reinvest in people in her area. Give us an example of how they went about this. How were they going to take this profit and not give it back to shareholders, but invest in the company and expand the number of jobs?

Opposition Motion—Tax Rate for Large CorporationsBusiness of SupplyGovernment Orders

4:05 p.m.

Conservative

Cathy McLeod Conservative Kamloops—Thompson—Cariboo, BC

Madam Speaker, that was certainly a lengthy preamble. I had to say “Liberals” so often in my speech because I am absolutely stunned at the Liberal turnaround on this particular issue.

At the end of his comments the member asked if I could perhaps give him an example in my riding. A mill in my riding has been closed for over a year and a half. An agreement has been reached and the sawmill will be reopened. About $25 million will be invested in that sawmill. I can bet it was the corporate tax cuts that made the difference in terms of the decision to reopen a mill in a hard hit place which will employ 125 people and support families with jobs.

Opposition Motion—Tax Rate for Large CorporationsBusiness of SupplyGovernment Orders

4:05 p.m.

NDP

Jim Maloway NDP Elmwood—Transcona, MB

Madam Speaker, the Conservative member should really think about this a bit more. It would make a lot more sense in terms of job creation for the government to offer funds to corporations for new technology, expansion of R and D, training, energy conservation, and the development of green technologies. That would make a lot more sense than just offering across the board tax cuts when we are already more competitive than our major competitor, the United States. These tax cuts are totally unnecessary.

The Conservatives are really upset today because they have been hoodwinked by their long-time partners, the Liberals. The Liberals have been keeping them in power for a couple of years. The Conservatives have finally awakened to the fact that the Liberals have bailed on them because they know the corporate tax cuts are not going to be popular with Canadians and they may end up in an election in a couple of months--

Opposition Motion—Tax Rate for Large CorporationsBusiness of SupplyGovernment Orders

4:05 p.m.

Some hon. members

Oh, oh!

Opposition Motion—Tax Rate for Large CorporationsBusiness of SupplyGovernment Orders

4:05 p.m.

NDP

The Acting Speaker NDP Denise Savoie

Order. Order, please. The hon. parliamentary secretary.

Opposition Motion—Tax Rate for Large CorporationsBusiness of SupplyGovernment Orders

4:05 p.m.

Conservative

Cathy McLeod Conservative Kamloops—Thompson—Cariboo, BC

Madam Speaker, we do not have anything to apologize for in terms of investments in technology. I have a whole bunch of big figures here showing that millions of dollars have been spent in a lot of areas.

I am going to take this down to again provide a specific example in my riding because that resonates with members.

The green transformation fund has invested $75 million in my riding. It is putting 6,600 homes or the equivalent into the grid and it is decreasing particulate emissions by 70%. At the same time, it is creating a future for the mills and all the small communities around this particular pulp and paper mill.

We have nothing to apologize for in terms of our focus on research, technology and green infrastructure.

Opposition Motion—Tax Rate for Large CorporationsBusiness of SupplyGovernment Orders

4:05 p.m.

Liberal

Paul Szabo Liberal Mississauga South, ON

Madam Speaker, I want to say how sorry I am that you have had to admonish so many members today for their interruptions and for their comments against each other. It really is a bad reflection on all of us and it is unfortunate.

Opposition Motion—Tax Rate for Large CorporationsBusiness of SupplyGovernment Orders

4:05 p.m.

An hon. member

You should apologize.

Opposition Motion—Tax Rate for Large CorporationsBusiness of SupplyGovernment Orders

4:05 p.m.

Liberal

Paul Szabo Liberal Mississauga South, ON

The member says I should apologize, Madam Speaker. This is exactly why we cannot expect--

Opposition Motion—Tax Rate for Large CorporationsBusiness of SupplyGovernment Orders

4:05 p.m.

NDP

The Acting Speaker NDP Denise Savoie

Order. I would like to ask for a little order from members at the end of the left side of the House. Canadians expect better from all of us. As parliamentarians we should be able to have a respectful debate without shouting at each other across the aisle. I would ask for a more respectful debate on everybody's part.

The hon. member for Mississauga South.

Opposition Motion—Tax Rate for Large CorporationsBusiness of SupplyGovernment Orders

4:05 p.m.

Liberal

Paul Szabo Liberal Mississauga South, ON

Madam Speaker, I have taken the time to listen to the debate, to hear what members were saying that were substantive to the motion before us. Ostensibly, the motion basically calls for a delay in rolling back the 2011 rate to the 2010 rate.

When the government introduced its five year program for tax cuts for large corporations, the circumstances in Canada were very good. The government inherited a large surplus from the previous Liberal government, $13 billion plus, something to work with. It did not take very long until we entered into a recession before the global crisis. The Conservatives squandered the $13 billion and put us in deficit. Where are we today? Today, we are looking at a deficit of $56 billion.

Canadians understand that. It started with a bit of money in the bank on an annual basis and, all of a sudden, we are in a situation where not only are we looking at a $56 billion debt but we have accumulated another $200 billion of national debt.

The circumstances have changed. The new government squandered the surplus and undertook a bunch of activities which tended to indicate to most observers that it was part of the problem and not the solution. Think of the litany of things that happened, whether it be squandering money on the G8-G20 photo ops or $1 million for screens. When members give speeches, they have to have expensive screens. I could go through the list.

The reality is that the world and Canada changed when the global crisis occurred. The government was in a hole before it occurred and since then it says it is going to move forward with everything it decided to do notwithstanding the significant changes in the economic climate in Canada. Is that fiscally responsible? Is it the right thing to do?

Earlier in a question I cited a quote I like very much, which is that the measure of success is not an economic measure but, rather, a measure of the health and well-being of the people. To calculate the success of a country, one has to look at what is happening with the people.

There is no disagreement in this place. A lot of people lost their jobs. We have an aging society and know the demographic. Think of how many people are over 55 years of age, and who will find it very difficult to get back into full-time employment at the same level of income they once enjoyed. It is going to be very difficult for many people. We have all seen them in our offices and received the letters asking us to please help them as people do not want to hire older folks. The level of personal debt is $1.50 for every $1 of income earned. It is a terrible burden and families are hurting.

We have a situation where the government can say the circumstances have now changed and it needs to assess what is in the best interests of the people. If it is going to assess the best interests of the people, it has to ask them what the government can do to help.

My mom is in a seniors home with pre-Alzheimer's. She is never going back to her own home and I know how long it is going to take to deal with this. It could be tomorrow or many years from now.

I forgot to mention that I will be splitting my time with the member for Westmount—Ville-Marie.

I could spend a lot of time talking about that, but the idea is for a reassessment. The government put the rates down from 28% to 21% and over the next couple of years it is going to go down to 15%. We know about economic lags and that there has been enough stimulus with a broad range of programs, not just tax cuts so far but other stimuli, to create jobs, promote economic growth, and all the things that people argue tax cuts do.

We have done that but anything that happens today will not affect 2011 or maybe even 2012. We will not see the payback. The one thing we do know is that we can include the tax revenue in there but we will need to include all the other expenses. We are losing right off the bat in this catch-up. We are hoping, so it is a matter of hope.

Governments have the responsibility to make those decisions and we respect their authority to make those decisions. However, the one thing we should not respect is a government that refuses to provide the information necessary to Canadians, to parliamentarians and to the facts underlining the decisions it makes to take certain actions, such as the income tax cuts.

The finance committee, of which I am a member, asked for the five years of corporate profits leading up to 2015. That is the period over which we can make that assessment. We need to have that information before we have the tax cut plan in place. We already had the information up to the history, so if we get the rest of the story, we can see the information based upon which the government made the decision to cut corporate tax rates for the full five years.

The world changed, though, and those numbers may have changed. The projections change. Even the finance minister has often said that if we go past two years we are really guessing. However, governments still need to make decisions.

What happened when the finance committee asked for the five year projections. The government came back and said that it could not given them because it was a cabinet confidence. Yesterday we told the House that we could not get the information and that we needed to have it. This is actually a breech of the privileges of the House, that being our powers to call for persons, papers or records.

The government has not responded yet. I think it will spend a lot of time thinking about how to respond because it is not the first time it has ignored persons, papers or records and our rights. It happened in the ethics committee with regard to the access to information abuses of the government that were admitted to. In fact, people have been fired and are under investigation. The then House leader wrote that the power to call for persons, papers or records had never been exercised to give a parliamentary majority access to such records and the internal communication of a parliamentary minority, which basically says that the three opposition parties are abusing their privileges by asking the government or ordering the government to produce papers.

I asked for an opinion from the law clerk and I will read it into the record because it is important in terms of the integrity and accountability of the government. When I asked for the law clerk's position on this, he said, “Whenever a House committee adopts a resolution to require the production of documents, the resolution is always adopted by a vote of the majority of the members present. Thus, it has always been the case that the parliamentary majority can, by resolution, demand access to records of the government or a minister. Secondly, resolution of the production of documents by a government or a minister is not made against the minority present at the vote on the resolution, but rather is directed at the government or the minister, as the case may be”.

He basically said that he could see no evidence of the assertion of the House leader that this in fact was a matter of cabinet confidence. It is nonsense.

If the government is not prepared to provide parliamentarians or the Parliamentary Budget Officer with all the information he needs to advise Parliament on these things, how can we make informed decisions? The government has, by its silence and its refusal to provide the data backing up the corporate tax cuts, basically said that it will not do it, that opposition parties cannot be trusted, so tough on them. That is obscene.

Opposition Motion—Tax Rate for Large CorporationsBusiness of SupplyGovernment Orders

4:15 p.m.

Nepean—Carleton Ontario

Conservative

Pierre Poilievre ConservativeParliamentary Secretary to the Prime Minister and to the Minister of Intergovernmental Affairs

Madam Speaker, the hon. member made a factual error in his speech. He talked about a government decision in the present tense to lower business taxes. In fact, there is no such plan to enact any additional reductions in business taxes. He might have been confused by the fact that, back in 2007, the government, with the support of the Liberal Party, enacted reductions in business taxes. Those reductions have been implemented and they are in law. They have actually been in the statutes of Canada for three years now with the full support and co-operation of the Liberal Party. In fact, the Liberal Party campaigned in the last election, after those reductions were implemented, in favour of going even lower. They were not satisfied with the previous decision to lower business taxes to 15%. The Liberals advocated going to 14%.

That decision, though, regardless of where the member thinks it should be, was made. There is not a decision of whether or not we should reduce business taxes. That decision was made in 2007. That debate is over.

What we are debating now is whether we should raise business taxes in the middle of an economic recovery on 110,000 employers in this country. Should we raise them or should we keep them the same is the debate. We say that we should keep taxes low. The Liberals want to raise taxes on job creators.

Opposition Motion—Tax Rate for Large CorporationsBusiness of SupplyGovernment Orders

4:20 p.m.

Liberal

Paul Szabo Liberal Mississauga South, ON

Madam Speaker, talk about double talk.

The 2007 budget laid out a five year plan to reduce the taxes from 28% down to 15% by 2012. Respectfully I would say to the member that it is clear in the motion that what is being called for is to return the 2011 rate to the rate that existed in 2010 and put that matter in the budget. It is not to increase taxes. It is to roll taxes back and put that in the budget. That will be the decision of the House.

We can hear the lack of clarity in the member's explanation. It is like the member for Burlington who says that we allowed pension income splitting for seniors. What the member did not say, just in terms of credibility of statement, is that if there is no spouse to split it with, if both spouses are at the lowest possible rate or if they do not have a qualifying pension there is no benefit. The percentage of seniors who benefit from pension income splitting is 14% and they are the highest income earning seniors in Canada. So much for the government's credibility.

Opposition Motion—Tax Rate for Large CorporationsBusiness of SupplyGovernment Orders

4:20 p.m.

Liberal

Michael Savage Liberal Dartmouth—Cole Harbour, NS

Madam Speaker, I was intrigued by a comment my colleague made when he said that the success of a nation should be determined by the well-being of the people.

There is an organization in Atlantic Canada called GPI, Genuine Progress Index, which looks at a whole series of things.

Yesterday, we had the Canadian Federation of Medical Students here saying that even though they were in medical school, we needed to get people who are not like them into medical school.

I know my colleague does a lot of work on education and I wonder what he thinks we could do if we could invest some of that money in education, particularly for those who cannot get to post-secondary education now?

Opposition Motion—Tax Rate for Large CorporationsBusiness of SupplyGovernment Orders

4:20 p.m.

Liberal

Paul Szabo Liberal Mississauga South, ON

Madam Speaker, the member is quite right. He has been a leader on the requirements for post-secondary education.

If I recall the figures correctly, in a matter of a few years about 75% of all the jobs in Canada will require a post-secondary education. We are a long way from that. If we really want to secure the future in terms of our competitive position, our abilities and high end innovation, a post-secondary education is absolutely essential. That is how we take care of people.

We take care of families. We take care of not only those students but our seniors and the people who need quality care for their children. That is what will make our people healthy and well.

Opposition Motion—Tax Rate for Large CorporationsBusiness of SupplyGovernment Orders

4:20 p.m.

Liberal

Marc Garneau Liberal Westmount—Ville-Marie, QC

Madam Speaker, I am pleased to rise to speak to the Liberal Party motion on the tax rate for large corporations.

In life, we often have to make difficult decisions. Under the circumstances, we often have choices to make and we all want to make the right choices, which might vary according to the situation. The best choice in some situations is not necessarily the best choice in other situations.

Take the issue of tax rates for large corporations, the subject of today's debate. When the Liberal Party was in power and we were in a fiscally advantageous position—in other words we had a budgetary surplus—the Liberal government decided to lower the corporate tax rate, which was then 29%. We recognized that our tax rates needed to be more competitive. Since we were in a surplus situation because of our sound management of the economy, it was the right time to lower those taxes.

In 2007, when the Conservative government decided to carry on with our initiative and we still had a budgetary surplus because of the healthy economy inherited from the Liberal Party, we, the Liberals, supported that measure.

What has changed in the meantime for the Liberal Party to be opposed today to the Conservatives' decision to continue lowering the tax rate for large corporations?

Of course, the answer is simple: circumstances have changed. The whole world has changed and an intelligent government must reassess how to spend the taxpayers' money intelligently. That is certainly what a Liberal government will do.

What should this government's priorities be when the unemployment rate is 7.8% and the economic recovery is fragile? Many jobs are part time and people are worried about their retirement or concerned about the aging population and the related health costs. Canadians want a caregiver program to get help at home. They want to send their children to university or help them get post-secondary training, but they do not always have the means. The national debt continues to rise and that puts our children's future at risk.

What should a responsible government do when families are calling for help, when last year's deficit was $56 billion and when this year's could potentially surpass $40 billion? It certainly should not be borrowing money to keep cutting corporate taxes.

Let us be clear: tax rates are already extremely competitive and there are other, far more important priorities, especially families.

Let us think about a typical family. Families must live within their means and must often make difficult choices. They cannot have everything they want. They must make intelligent and responsible choices about how to use their resources.

Of course, housing, clothing and putting food on the table come first and then come the other needs, in order of priority. Urgent matters top the list. That is how a responsible family acts. Why is the government not doing the same? Cutting corporate taxes now is irresponsible and unaffordable.

When these taxes were voted on in 2007, things were very different. Canada now has a $56 billion deficit and will accumulate more than $200 billion in new debt under this government. These additional tax cuts for large corporations will have to be paid for with borrowed money. Further corporate tax cuts are unnecessary. Last year the Bank of Canada declared that Canada's income tax rate was the most attractive in the world. In Canada, corporate taxes have been reduced by 35% in recent years, and they are now the lowest of the G7 countries, after the United Kingdom. Our tax rate is 25% lower than that of the United States.

In reality, the Conservatives are increasing taxes. At the same time that the government wants to give tax breaks to Canada's large corporations, it is increasing employment insurance premiums, and therefore it is increasing the fiscal burden on small businesses. The Conservatives have got it all wrong. They are increasing payroll costs, which eliminates jobs for all employers and employees, while reducing the rate of taxation for big business. The Conservatives are not providing tax relief for small businesses. In reality, their $6 billion in tax relief will not be available to 95% of the 2.2 million active businesses in Canada.

Cutting taxes is not cost-effective. The Department of Finance has stated that tax cuts are not an efficient way of creating jobs and contributing to the growth of the economy in the short term. Supporting infrastructure, housing and families is a much more effective way of encouraging growth and job creation.

The Liberals know that middle class families are experiencing tough times. They are having difficulty with their debt load, the rising cost of living, family care, retirement savings and saving for post-secondary education. These are the priorities that the Liberals are focusing on. The Prime Minister has ignored these issues, because his priorities are to spend billions of taxpayers' dollars for the untendered procurement of fighter planes, and to provide tax cuts for major corporations.

Families are being crushed by the cost of education. UNICEF has ranked Canada dead last in the quality of and access to child care services. Three-quarters of parents today believe that they will be unable to afford post-secondary education for their children. Federally-funded student loans have reached a record high. Sixteen per cent of low-income students now plan to delay studies because of debt.

Families are being squeezed by family care and health care costs. Canadian families are paying 29% more for an increasingly longer list of out-of-pocket health care expenses, such as prescription drugs and private insurance. In the absence of federal leadership in health, family members are increasingly relying on each other for care. Family caregivers provide 80% of home care services. Over 40% of family caregivers use personal savings to survive.

Families are worried about their retirement. At this time, 25% more seniors are struggling to live on low incomes. Some 75% of Canadians working in the private sector today are without a pension plan.

The Conservatives broke their promise to not raise taxes. Budget 2006 raised the lowest tax rate to 15.5%. We had reduced it to 15%, but the Conservatives have raised it to 15.5%.

Coming back to my original point, the government must govern in an intelligent, responsible manner and cutting corporate tax rates is not the right way to go about it. Taking care of families is the right way.

Opposition Motion—Tax Rate for Large CorporationsBusiness of SupplyGovernment Orders

4:30 p.m.

Nepean—Carleton Ontario

Conservative

Pierre Poilievre ConservativeParliamentary Secretary to the Prime Minister and to the Minister of Intergovernmental Affairs

Madam Speaker, the hon. member made a mistake.

He made a factual error in his remarks. He is talking about business tax reductions in the present tense. In fact, what we are really discussing is a historical debate. In 2007, over three years ago, the Liberals supported the government's decision to lower taxes on job-creating businesses, and those reductions have been in law ever since. That decision was made. There can be great historical debate as to whether or not it was the right decision, but we are no longer debating whether or not to lower business taxes. Those reductions have already happened. They are in the law; they are done. That debate is now over.

What are we debating today? We are not debating whether to lower the tax. No one is proposing any more tax reductions for businesses to be enacted now. We are debating whether or not, as the Liberals now suggest, we should raise taxes on employers. That would raise the taxes on 110,000 employers in this country and it would kill jobs for Canadians.

Our government has a low tax plan. The Liberals have a high tax agenda. There would be more jobs from the Conservatives. There would be fewer jobs as a result of their plan.

Opposition Motion—Tax Rate for Large CorporationsBusiness of SupplyGovernment Orders

4:35 p.m.

Liberal

Marc Garneau Liberal Westmount—Ville-Marie, QC

Madam Speaker, in 2007, we went along with the decision by the Conservative government because, at the time, we were in a very healthy surplus situation, thanks, of course, to the Liberal government which had put the Conservative government into a surplus situation.

Remember, we started the process back in the early 2000s because we felt that it was good to reduce the tax on corporations when we were in a surplus situation.

Today, we are talking about a question of leadership. We are talking about a decision by the government to adapt, in a Darwinian sense, to the reality of today, which is that families are hurting. I remind the hon. member that between 2007 and now, we have gone through the worst recession in 50 years. An intelligent government would take that into account and actually adapt. Otherwise, as we all know according to Darwin, it runs the very real risk of becoming extinct.

Opposition Motion—Tax Rate for Large CorporationsBusiness of SupplyGovernment Orders

4:35 p.m.

NDP

Carol Hughes NDP Algoma—Manitoulin—Kapuskasing, ON

Mr. Speaker, I think people need to change the channel on their televisions, for I cannot believe what I am hearing.

The Liberals supported the bill that allowed those tax cuts to come into force on January 1. That bill also adds 8% in HST to heating costs for those who cannot pay those bills.

The Liberal leader is releasing ads in which he says he is against his own reductions. The Liberals have either proposed or supported every tax reduction that has occurred over the past 15 years.

Their sudden flip-flop makes me wonder if they are really serious. Why did they change their tune? They have always supported these reductions. Why did they support the budget if they oppose them?

Opposition Motion—Tax Rate for Large CorporationsBusiness of SupplyGovernment Orders

4:35 p.m.

Liberal

Marc Garneau Liberal Westmount—Ville-Marie, QC

Mr. Speaker, I will try to explain. It is not very complicated. The NDP knows but one refrain: raise corporate taxes. The situation is very simple. When there is a surplus, taxes should be reduced. But in a record deficit, we must not lower taxes. It is not that complicated.