Debates of Feb. 27th, 2013

Technical Tax Amendments Act, 2012

[Mylène Freeman, NDP, Argenteuil—Papineau—Mirabel, QC]

Mr. Speaker, I do not think that my speech will be as amusing as the one given by my colleague from Burnaby—New Westminster. It was an excellent speech. I will try to make my points as interesting as possible.

As legislators, we have a duty to take a serious look at bills such as Bill C-48, An Act to amend the Income Tax Act, the Excise Tax Act, the Federal-Provincial Fiscal Arrangements Act, the First Nations Goods and Services Tax Act and related legislation. It is obviously a very large bill. We are seeing that a lot in the House.

The NDP and many key players and experts in the fields of finance and accounting agree on that point. The majority of the changes in Bill C-48 will protect the integrity of the tax law in force. But we have been waiting a long time for these technical amendments to be introduced as part of a tax bill in the House. The most recent review of technical amendments happened in 2001. That was a long time ago.

There are amendments that date back to 1998, so this should have been ready a long time ago under the Liberal governments or under the current Conservative government. There is some reluctance to ensure that our tax laws are up-to-date. All Canadians should be wondering why it takes so long to get these things sorted out.

For example, this fall, the Certified General Accountants Association of Canada stated in its pre-budget submission to the Standing Committee on Finance that:

[T]he key to sustained economic recovery and enhanced economic growth lies in the government’s commitment to tax reform and red tape reduction. Therefore, CGA-Canada makes the following...recommendations: Modernize Canada’s tax system—make it simple, transparent and more efficient; introduce and pass a technical tax bill to deal with unlegislated tax proposals; implement a “sunset provision” to prevent future legislative backlogs...

There are therefore three elements: modernize the system; introduce the bill that is before us today; and make sure that the major delay that has resulted in us having to examine a bill that is a few hundred pages long does not happen again. As CGA said: it is good for our economy.

The Conservatives are always saying that the economy is their priority, but one has to wonder if that is really true when it takes them so long to respond to a request from the Certified General Accountants Association of Canada, a basic request that is good for our economy. The Conservatives seem to agree on these elements but their measures do not live up to the rhetoric, such as what we heard today.

We can therefore truthfully say that the Conservatives are not meeting their responsibilities properly and that this bill is very late. This government took over seven years to remedy the chronic delay in passing technical tax amendments.

In 2009, former Auditor General Sheila Fraser pointed out that more than 400 amendments were outstanding, as they had not been enacted by legislation. She noted that:

If proposed technical changes are not tabled regularly, the volume of amendments becomes difficult for taxpayers, tax practitioners, and parliamentarians to absorb when they are grouped into a large package.

She added that it is advisable for such a bill to be presented every year in order to make routine changes to tax laws. That is what the Conservative government wanted to do, but it never happened.

Today, we have a huge bill that would enact more than 200 of these changes. There are still hundreds of changes that must be enacted by a technical tax bill and that await debate in Parliament.

Unfortunately, I am not surprised that it has taken so long to put these changes into a bill, which does not even cover all the changes. The Conservatives talk about good management and accountability, but they never take appropriate action. It is truly unfortunate, because their talk could almost be taken for propaganda. They say that they are good managers of the economy, but we see that it is not true at all. It takes them a long time to do things that are very routine, that should be done every year. They are incapable of sound financial management. That is evident from the supplementary estimates. It is truly unfortunate that the Conservatives do not walk the talk.

The reality is that the Conservative government's inaction has resulted in a huge backlog. We now have a gigantic technical bill of almost 1,000 pages, and we have not even addressed half of the changes.

We must use tax measures to combat tax avoidance and tax evasion and protect the integrity of our tax system at the same time. We support the changes in this bill, especially those that would curb tax avoidance. This is something the NDP has been focused on for a long time. However, the massive size of this bill shows that there is a lot of work to be done to turn these technical changes into legislative measures as quickly as possible. Otherwise, we are penalizing the business sector and making things difficult for Parliament. It is very complicated for Canadians when these measures are not included in a bill.

That is why, although we support the bill at second reading, we urge the government to do its homework, since Canadians should not have to wait a decade for the government to be accountable to Parliament by making tax amendments. That is simply not acceptable.

The Minister of Finance even admitted himself in a press release that the government had failed to take action. I quote:

It has been over a decade since Parliament last passed a comprehensive package of technical income tax amendments. This has created a significant backlog of outstanding measures that need to be addressed to provide certainty for Canadian taxpayers...

Why did he not do something sooner?

It is rather refreshing to hear a Conservative admit that members of his party have caused economic uncertainty. However, I do not think this admission shows that they are aware of their negligence or that they are committed to change. It has been four years since the Auditor General told the government to fix this problem urgently.

That is all I have to say about this. As I indicated, I will support this bill. It is a long time coming. It is unfortunate that it has been introduced in this fashion and I hope that in the future we will see something simpler.

[The Acting Speaker, Conservative, Bruce Stanton]

Before we move on to questions and comments, it is my duty, pursuant to Standing Order 38, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for London—Fanshawe, Veterans.

The hon. member for Edmonton—Leduc for questions and comments.

[James Rajotte, Conservative, Edmonton—Leduc, AB]

Mr. Speaker, I listened carefully to my colleague on the other side of the House. She mentioned in her speech how the Auditor General has called for these changes. She spoke about the Certified General Accountants of Canada who have called for the bill, have welcomed it, applauded it and in fact endorsed it. I am glad members on the other side are listening to that advice and will be supporting the legislation.

I just want to clarify this for the purpose of debate. The bill was tabled in November. The minister and the department offered in-depth briefings to any member of the House with respect to any section of the bill. In fact, the committee will be starting a pre-study on the bill tomorrow morning. We would love to have the bill passed by this chamber. Perhaps the member would comment as to why, when the NDP is supporting the bill, it is putting up so many speakers here rather than allowing the bill to be sent to committee.

Second, she says it does not contain all of the amendments that it should contain. Could she deposit with the House or with the committee what specific amendments the bill should be addressing? Perhaps she could address in her answer today what, specifically, should be in the bill that is not in the bill.

[Mylène Freeman, NDP, Argenteuil—Papineau—Mirabel, QC]

Mr. Speaker, it is funny for that member to say that we are in a hurry to get this done when a lot of these changes are outstanding since 1998. That is a pretty long time. Just to give everyone a nice little image, I was nine years old.

Therefore, to say that this has been in the House since November and why are we speaking on it is just ridiculous. This is a massive bill and we should be debating it in the House, like we should debate any bill. It is too bad that we had to wait since 1998 to see any of the amendments. As I mentioned in my speech, there are hundreds of outstanding changes that need to be implemented, that have been announced and have come into effect, but are not currently in the legislation, and that needs to be done. Therefore, where is that?

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, it is interesting to note that in any of the tax guides we quite often find asterisks or colour coding. That means accountants look at it and anticipate the legislation will change at some point in time, so in order to be compliant with that potential legislation, this how they calculate or interpret a particular tax law because the need for the change is so great.

It is a fairly thick document. We are talking about numerous changes that have been requested for a good number of years. As a result, the Liberal Party would like to see the bill ultimately go to committee.

Would the member agree that we need to have the bill come on a more regular basis? I believe I heard that from the member and a lot depends on the number of requests and the amount of time in between the last time we make a change. On both occasions the government has failed.

[Mylène Freeman, NDP, Argenteuil—Papineau—Mirabel, QC]

Mr. Speaker, Canadians are doing their taxes right now and it is nice to have some clarity as to what we are doing for businesses and for individuals. This is something that we should be doing every year, according to the CGA and the Auditor General. That is also how I feel about this. I think it would improve clarity for everyone.

The last bill of this sort was passed in 2001. That means there were five years of Liberal government where it did not manage to do that either, and some of these changes go back to 1998. Therefore, the Liberals are not a whole lot better than the Conservatives. They have fewer years of not having passed the bill. The NDP would ensure that bills of this sort would come through on a regular basis so there would be clarity for Canadians.

[Niki Ashton, NDP, Churchill, MB]

Mr. Speaker, I am pleased to stand in the House, following some excellent speeches coming from my colleagues in support of Bill C-48 at second reading. They have indicated the fact that it is time for Canada to get on with it and bring forward changes to our taxation laws, many of which have been practised informally but should be enshrined in legislation. We are saying that it is a long time coming.

The New Democrats believe in cracking down on both tax avoidance and tax evasion, while ensuring the integrity of our tax system. We support the changes being made in the bill, especially those that aim to reduce tax avoidance.

We note that this is an extremely lengthy bill, known as an omnibus bill. However, unlike the omnibus bills that the government has chosen to bring forward, this actually looks at an area of legislation rather than bringing everything in, including the kitchen sink. Not only that, the bill is focused on making technical changes and not the deep structural changes that we have seen time and time again from the government. If we are bringing in a bill that covers a lot of ground, it ought to be done in a specific manner, looking closely at related legislation like Bill C-48 does.

The massive size of the bill demonstrates that there is still work to be done in getting such technical changes legislated in a timely fashion. We believe that failing to do so in a timely fashion hurts the business community and makes it difficult for proper evaluation by Parliament. Therefore, we are here to truly ask the government to move forward in a timely manner on legislation that has been in front of us and certainly necessary for some time.

In 2009 a very highly respected Canadian, Sheila Fraser, the former auditor general of Canada, said:

No income tax technical bill has been passed since 2001. Although the government has said that an annual technical bill of routine housekeeping amendments to the Act is desirable, this has not happened. As a result, the Department of Finance Canada has a backlog of at least 400 technical amendments that have not been enacted, including 250 “comfort letters” dating back to 1998, recommending changes that have not been legislated.

This message comes directly from a respected Canadian, someone whose role continues to be one of ensuring that we are accountable, efficient and effective in the work we are doing as parliamentarians and certainly the work the government is doing. However, not unlike in other areas, we see that when it comes to moving forward in responding to the reality that Canadians face today, the government has been too slow to act.

While informal arrangements have been made all along the way, Canadians would like to see a strong framework of legislation when it comes to taxation so we deal with them fairly, ensuring that people are not falling through the cracks and that taxes are not being avoided or evaded. Therefore, this is a perfect case of needing to listen to people like the former auditor general of Canada and many others who have indicated that it is time to move on and implement the kind of legislation we have before us.

As well, this is more broadly about prioritizing the sense of fairness that Canadians ought to have when it comes to anything, even when we are talking about taxation. It is something that is at the core of our concept of citizenship and how we give back to society, how we give back to government, recognizing that Canadians do their part in working hard and returning back to the state part of their hard-earned money in order for us to have the kinds of programs, services and infrastructure that we all deserve.

Unfortunately, things are becoming more and more difficult for so many Canadians. This is in part because the social safety net that allows them to get out there and access gainful employment and make a dignified life for themselves is increasingly more challenging as the social safety net is weakened.

Just this week in the House, the NDP has raised a number of instances in which this is the case. Perhaps the best example is the weakening and the cuts to the employment insurance program. As we know, these changes will have a disproportionate negative impact on seasonal and cyclical workers. These are people who go out, do their jobs and support the economy in our regions all across the country. A good chunk of their money goes back into the coffers of the Canadian government to ensure we have the kinds of services on which we depend on.

Unfortunately, Canadians who are now being turned away from accessing employment insurance, who are being forced to move away, who are being forced to look at social assistance or welfare, will no longer be able to contribute to our system of taxation and return the kind of revenue that Canada depends on the way they used to.

Unfortunately, these changes will be felt first by the unemployed or by seasonal workers. Then those impacts will reverberate. They will reverberate once we start seeing communities suffer as a result of seasonal industries no longer being able to find people to work in them. Communities will suffer as we see the service and retail sectors not able to make a go of it because there is less income cycling through the community. We will also see communities and regions lose innovators and people who come to regions and benefit from the domino effect of many of these seasonal industries. That effect will snowball into an unfortunate situation where Canada will have less revenue coming back into its coffers from taxation to do the kind of work we need to do. Therefore, we will start seeing a weakening of essential services.

For the NDP, that is an unacceptable notion. After all, we as parliamentarians are here to guide Canada forward and to work with Canadians so we get better at who we are and so we can improve the standard of living that we all depend on. Unfortunately, the government has made some real structural changes and some severe cuts that will turn us back from the direction that we ought to take.

Therefore, when we are talking about the issue of fairness, it goes back to a fundamental Canadian value, and that is we all work hard and we all want to be part of giving back to our society, our community and our family. However, we need to ensure there are structures in place, like proper and fair tax legislation, like social programs that allow our seasonal industries and our regions to continue to contribute to our economy and our wealth and to ensure Canadians have the kinds of things that have set us apart from the rest of the world, whether it is investment in health care, education, housing or infrastructure. These are the kinds of things we do not see from the government.

I would note, particularly, that the legislation also refers to the First Nations Goods and Services Tax Act, again recognizing the issue of tax fairness when it comes to first nations people and recognizing treaty rights and the key role that first nations people have played in building the wealth of Canada and the need for the Government of Canada to be partners going forward when it comes to aboriginal people in our country.

There is a lot of work to do and I am proud to be part of a party, the NDP, that stands in the House every day and calls for fairness. Today, when we are showing our support for Bill C-48 and debating in the House, this is no exception. We hope the government will show fairness when it comes to Canadians in every other way.

[James Rajotte, Conservative, Edmonton—Leduc, AB]

Mr. Speaker, I appreciate my colleague's comments and her support for this bill at second reading.

One of the changes that was made in part 5 of the bill deals with section 116. It was a change that was made in the 2010 budget, which I supported very strongly at the time, and still do, dealing with taxable Canadian property. The amendment at that time was a measure in that budget to exclude from its ambit shares of corporations and certain other interests that do not derive their value principally from “real or immoveable property situated in Canada, a Canadian resource property or a timber resource property”, subject to a 60-month look-back rule.

I know the member represents an area that deals with a lot of resources. I would ask her to comment on this change that was made in the 2010 budget and her impressions of whether it has had a positive impact thus far in Canada.

[Niki Ashton, NDP, Churchill, MB]

Mr. Speaker, I can definitely say that our region, which does depend upon natural resources, has suffered as a result of recent government budgets. Our dependence on natural resources also means a dependence upon seasonal work, whether it is the forestry industry or development, including exploration. Cuts to EI certainly do not help our region, at all. It puts us back.

Another example where the government has failed our region is opening our region up to foreign investment without a clear indication of net benefit. The result is that the major mining company in our region has been bought by a Brazilian multinational, which has been slow to come to the table to find a solution for our community, after the Government of Canada sold us out.

Other examples are the continued failure for the government to invest in first nations infrastructure, meaning a massive portion of our region lives in third world conditions and is not able to access the kind of economic opportunities that exist in our region.

All in all, I am sad to say that the current Conservative federal government has certainly failed the people of northern Manitoba, and a lot of people across the north in general. We expect better.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, I think it is worth saying that there are numerous pages, in the hundreds, within this piece of legislation, and within those pages there are numerous amendments being suggested to our tax laws.

Quite often when we are into the second reading, we want to talk about the broader principle of the legislation and then go into the committee where we have the opportunity to get into some of the line-by-line, clause-by-clause, analysis of what has been changed.

I wonder if my colleague from northern Manitoba would be able to provide some thoughts on the committee stage. How important is it that we reflect on the different clauses and the impact they might have on our tax laws, believing that for the most part they are necessary changes, and that there could even be the possibility of new amendments because it has been a bit of time since it was drafted and brought into the chamber? I wonder if she would reflect on the possibility for amendments.

[Niki Ashton, NDP, Churchill, MB]

Mr. Speaker, there is no question that committee work is essential, in every way, particularly when we are talking about having to go through, in this case, very lengthy legislation, to ensure it is fair, timely, and that it deals with the kinds of loopholes and gaps that exist today.

What Canadians expect from parliamentarians is that due diligence will be given, whether it is in committee or in the House during debate. Unfortunately, what we have seen from the current government is a tendency to shut down debate and shut down opportunities to look closely at legislation coming forward. A great example is that the current government has brought in closure to critical debates in this House, I think almost 30 times.

We in the NDP certainly hope that this bill will be dealt with in a timely manner, but respecting the role that we have as parliamentarians to do the due diligence and ensure this is the best legislation going forward.

[Pat Martin, NDP, Winnipeg Centre, MB]

Mr. Speaker, I am pleased to have the opportunity to join this debate on Bill C-48.

I hope to use what little time I have to expand on the broader issue of how governments generate revenue, and the role of parliamentarians in being charged with the responsibility of the scrutiny, oversight and due diligence associated with generating revenue through taxation, and then, of course, the spending of that revenue. I do not suppose there is anything more important that MPs do than that. It is certainly the primary function and why our constituents give us their confidence to supervise the public purse.

At the outset, I was pleased to see that Bill C-48 deals with tax avoidance and tax evasion as well as a number of intricacies in the tax system itself.

Chartered accountants and virtually all of the tax lawyers and tax accountants advertise on their websites something called the “tax-motivated expatriation”. They call it that because it has a nicer ring than “sleazy tax-cheating loopholes”, which is what it is when tax avoidance and tax evasion allows one to be a tax fugitive by harbouring one's resources and taking advantage of what taxes buy in terms of a stable, safe community, with public services, policing and health care. It is putting one's money offshore to hide it from the prying eyes of the public and the taxman, and not paying one's fair share but getting the best of both worlds. I am glad that finally this Parliament is seized of the issue.

I was here years ago when the Liberals were in power. Ironically, they tore up a number of tax treaties with different tax havens. However, they left 11 in place, one of which, of course, was where the leader of the Liberal Party at the time, who became Prime Minister, had his 13 shadow company in tax havens, stashing his business away from the tax system, the very tax system that allowed him to live in a such a decent country. That kind of thing makes my blood boil. The tax-cheating loopholes through tax havens has always bothered me.

Another thing that has bugged me is that we focus so much on generating tax revenue, yet we overlook other obvious sources of bankrolling the social services we need. One that comes to mind is another Liberal invention, the corporate welfare program called “technology partnership loans”. Some who have been around here for a while will remember the TPLs, technology partnership loan system.

I did some research when we had been dealing with the paying back of student loans. During the estimates, we learned that the government had to write off $280 million, I think it was, in the supplementary estimates (C). However, 87% of all the money loaned in student loans is paid back, and 95% of all the individuals pay it back. The numbers are jigged because I guess some have larger loans, but 95% of all the people who borrow student loans pay back every penny they owe to that program. With the technology partnership loans under the Liberal government, it is entirely the opposite, with 5% being paid back and 95% outstanding.

When is a loan not a loan? Well, if one never pays it back, it is not a loan at all, but a gift, a handout. It is corporate welfare. It is dumping a wheelbarrow full of dough into somebody's business where one is obviously expecting some kind of a quid pro quo. Why we leave these outstanding technology partnership loans dangling there, I will never understand.

The Canadian Taxpayers Federation just did a big report on this in its latest monthly magazine. Members can look it up to see exactly how much which companies borrowed, and how much, if any, they have paid back. It goes on page after page with these hugely profitable companies.

One of my complaints about across-the-board general tax cuts to business is simply this. Any kind of a tax cut to business should be tied to some kind of quid pro quo, a performance, a job creation, some benefit to the taxpayer other than just helping to subsidize the activities of that company, with the exception possibly of SMEs.

When the NDP government was elected in Manitoba, the small business tax rate was 11%. The Conservatives of the day were gouging small businesses mercilessly, to the point where they were staggering under the load. They were crippled by over-taxation in the province of Manitoba. When the NDP was elected, it systematically and annually reduced the small business tax as much as it could afford, 1% at a time. Every year it went down by 1%.

Could you guess, Mr. Speaker, perhaps with hand signals, what you think the small business taxation rate in the socialist paradise of Manitoba is today? Are you willing to hazard a guess, sir? It is a great big goose egg: zero. The small business tax in Manitoba is zero because there is ample empirical evidence to show that when a tax break is given to small businesses, they hire people, expand their businesses, invest in their companies and generate wealth in the community. We know that every dollar spent in the community is spent at least four times before it finds its natural state of repose in some rich man's pocket, which he then invests offshore in a tax haven.

The economic game is not supposed to be like some shady ring toss on a carnival midway. However, that is the way people feel sometimes when it is stacked so heavily against ordinary working people who are simply trying to earn a living, pay their taxes and get decent services.

I used one example with regard to the Liberal regime. I am a little hostile toward the Liberals right now; I was just having a fight with my colleague from Manitoba. I have to remind people that a lot of the time that I spent here was under a Liberal regime. The Liberals chose to balance the books by three things that are still timely and topical today. They cut $50 billion in social transfers to the provinces. That $50 billion gave them a start, cutting and hacking and slashing through every social program by which we define ourselves as Canadians, in the most ruthless and irresponsible way one can imagine.

Where do members think the Liberals got the second part? People forget there was a $40 billion surplus in the public pension plan and the final parting act by Marcel Masse, the Treasury Board president at the time, was to scoop every single penny out of the surplus of the public service pension plan and take it unto themselves. They were not allowed to, and they had to pass legislation to do it. That surplus should have at least been divided among the beneficiaries and contributors, but the Liberals scooped 100%.

Where did they get the third part for their budget balancing? They got it from the EI fund: $57 billion that was not theirs. They did not contribute a single penny to it. They scooped $57 billion out of the EI fund. Let me talk about the impact of the cuts to EI. They created a program where nobody qualified anymore, but everybody had to pay into it. An analysis was done, and their changes to EI in 1997 caused $20.8 million a year of federal money for my riding to be sucked right out of that riding, with all of the corresponding beneficial spending associated with that $20 million. It was like night and day. That is how to not balance a budget. We are talking about revenue, how to generate revenue and how governments get the money they need to provide the services they are obliged to provide. That is not something we want replicated.

When we talk about taxation, we need to talk about the redistribution of wealth. It is one of the ways to redistribute the great wealth of a great nation so that we all enjoy the benefits of living in this society. We forget some of the big picture issues when we drill down and analyze these increasingly complex tax documents. If we are guided by the underlying motif that it is a way to fair taxes, leading to good public services, it is not something to be lamented, and tax avoidance by tax fugitives in sleazy tax-cheating loopholes is not to be tolerated.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, if nothing else I found that somewhat amusing. I find it interesting how the member for Winnipeg Centre makes reference to the NDP government in Manitoba and he talked about small business. I was inside the chamber when the New Democrats were reducing small business tax but at that time I was actually in favour of the reduction of small business tax. What the member did not crow about was that it was the provincial NDP that continuously reduced corporate taxes. This was at the same time that the New Democrats in Ottawa were criticizing the corporate tax cuts that were being made in Canada, so the member is very selective of what he chooses to say.

At the national level, the Liberals were against the corporate tax cuts that were being made in 2010 and the provincial Liberals were against the NDP corporate tax cuts that were made in 2009-10. Therefore we can both be selective in terms of what we want to—

[The Acting Speaker, Conservative, Bruce Stanton]

Order, please. I am just wondering if the Winnipeg caucus might want to take it outside and discuss this and get it sorted out.

The hon. member for Winnipeg Centre.

[Pat Martin, NDP, Winnipeg Centre, MB]

Mr. Speaker, it is important to correct the record because this is some of the great revisionist history of the Liberal Party. The Liberals still cannot believe they were thrown out of power. They are still mourning from the traumatic event here. They would have us believe that if we had just elected them one more time it would have been nirvana. It would have been Camelot. We would have a national daycare system and we would have a Kelowna accord.

However, in actual fact, every time the Liberals had a balanced budget and every time they did get a surplus, and there were seven or eight surpluses in a row, they gave it to their buddies on Bay Street in increasingly large corporate tax cuts. They were in a race with the Conservatives, a race to the bottom. They will not be happy until there are zero corporate taxes on the macro scale. Every single time they had an opportunity, instead of spending it on social programs and turning the tap back on that they had turned off to balance the budget, they chose to give it to their Bay Street buddies. Hypocrites.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Mr. Speaker, I appreciate the member for Winnipeg Centre providing his wisdom to the House. He talked about a race to the bottom between the Conservatives and Liberals to see who could be most incompetent and most ineffective in terms of administration. That was the race.

What we have with the bill here is the opposite. We actually have the Liberals and Conservatives competing to see who can be the slowest to bring in the necessary changes to the tax system. Between the two of them, they waited 14 years. The incompetence of both governments is incredible.

Could the member for Winnipeg Centre just tell us which government is more incompetent: the Conservative government or a Liberal government? Which one is most incompetent, according to him?

[Pat Martin, NDP, Winnipeg Centre, MB]

Mr. Speaker, that is a really tough question. I do not know if I can answer that.

After four majority governments in Manitoba of competent, capable public administration, we keep getting rewarded for the balanced budgets and for the fine work we do in the socialist party in Manitoba. It has been a long time since we have had a Liberal government in Manitoba. They were tossed on the trash heap of history.

It is overdue. If we were doing regular maintenance with some underlying principles of what we want our tax system to look like, it would not be getting increasingly complex and we would not have to wait for an omnibus bill that is going to bury tax accountants and tax lawyers in 1,000 pages once every decade. We could be doing this on an annual basis, guided by some fundamental principles of equality and the goal of fair taxation.

[Jean Rousseau, NDP, Compton—Stanstead, QC]

Mr. Speaker, I always find it amusing to listen to my two colleagues from Winnipeg. They have a very particular sense of humour. Unfortunately, I do not share that same sense of humour.

I will take 10 minutes to try and talk about a bill that I thought was a bookend when I first saw it. When I saw how big it was, I was taken aback. If you wait a decade to make changes to a system that so obviously needs them, it is clear that special attention needs to be paid once you do make them. This 942-page document is more like a pillow than bedtime reading.

As I said, there are nearly 1,000 very technical pages to be studied in Bill C-48, An Act to amend the Income Tax Act, the Excise Tax Act, the Federal-Provincial Fiscal Arrangements Act, the First Nations Goods and Services Tax Act and related legislation.

For many people, myself included, it will likely take another decade to analyze and understand what this mammoth bill, this huge document, is all about.

In all, Bill C-48 will amend close to 20 acts and regulations. That is a huge number and it shows that the Minister of Finance, the Prime Minister and others have clearly failed to take action in this regard over the past few years.

Basically, part 1 will implement amendments to the provisions of the Income Tax Act governing the taxation of non-resident trusts and their beneficiaries and of Canadian taxpayers who hold interests in offshore investment fund property. Parts 2 and 3 will implement various technical amendments, once again, relating to the taxation of Canadian multinational corporations with foreign affiliates.

As a result, many Canadian businesses will have to meet new tax obligations in order to abide by the new rules set out in Bill C-48.

Since other changes will be made to this tax framework, businesses will also have to deal with the International Financial Reporting Standards, the infamous IFRS, which require businesses to identify the impact of the changes to the tax legislation and to the tax rate for the period in which the legislation is in the process of being adopted. However, for the purposes of the United States' generally accepted accounting principles or GAAP, the proposals must be adopted.

Do Canadian companies that prepare their financial statements using the accounting standards for private enterprises in accordance with the tax method that has yet to be implemented also have to identify the impact of the changes to the tax legislation and to the tax rate for the period in which the legislation is in the process of being adopted?

If so, companies that present their financial information using the IFRS will have to take into account the changes set out in Bill C-48 when preparing their financial statements for the fiscal years ending after November 20, 2012. On the other hand, businesses that present their financial information using the United States' GAAP will not have to take into account the changes set out in Bill C-48 until the bill is passed or, more specifically, until it receives royal assent.

Needless to say, the CGAs and accounting firms of this world will be fairly busy in the coming weeks and months. What is more, the NDP sincerely believes that we must fight tax avoidance and tax evasion, while preserving the integrity of our tax system. I am sure that this is very important to all members of the House. We therefore support the changes set out in Bill C-48, particularly those that seek to reduce tax avoidance.

In my riding, when people come to see me about the Income Tax Act—which happens more often than one might think, especially middle income earners who are having a hard time making ends meet—they often talk to me about tax evasion. They are really worried about their future.

It is certainly not by weakening regional economies with repressive employment insurance measures, with measures that are no good for a social climate that is already deeply troubled by the Conservative government's inaction when it comes to economic development for the regions of Quebec, that the population will be delighted by or care about a document that is nearly 1,000 pages, like Bill C-48.

The main concern of the people in my region, which was once so prosperous in the manufacturing, farming and forestry sectors, is jobs, jobs, jobs. The Conservatives claim they have created 900,000 jobs. I am not seeing these 900,000 virtual jobs. People are beginning to recognize this sham, and they are disappointed.

This document is a perfect example of an omnibus bill, and that is the only thing my constituents will remember. This bill's massive size is proof that there is still work to be done in transforming such technical amendments into legislation, and in a timely manner, otherwise it will penalize the business community and complicate Parliament's work.

The most recent technical tax bill was passed in 2001. Since then, any changes made between the passing of the two technical tax bills have been made by the Department of Finance through comfort letters. Most of these changes become common practice afterwards, even if they are not enacted in any tax legislation. This was even confirmed by the Auditor General.

In 2009, the Auditor General expressed concern that more than 400 of these comfort letters had not yet been passed into law. As some of my colleagues pointed out, more than 200 of these letters are in the bill to amend various tax laws.

Most tax practitioners are pleased with the comfort letter process. However, the Auditor General's report indicated that they had expressed a need for the legislative changes that the comfort letters identified.

The vast majority of the amendments contained in this bill have already been announced in press releases, the finance department's comfort letters and the budgets for the 11 years that have elapsed since the last technical bill was passed.

The government says that it is worried about the economy. I would like to point out that it has shown a certain neglect and skepticism.

We believe that these amendments will result in increased revenues, which is a good thing, and that they are a good way to reduce tax avoidance. As I pointed out, the vast majority of these measures were put into practice several years ago, and tax measures usually go into effect as soon as they are announced.

The sweeping nature of this bill shows that the government must be more responsible in managing tax laws, and it must ensure that proposed changes to these laws are adopted on a more regular basis.

In closing, we nevertheless support this effort because, as I mentioned, most of these measures have been in effect for a number of years and they should increase government revenues.

What my colleagues and my constituents want is for tax dollars collected as a result of these measures to be invested in our communities that really need them.

[Mathieu Ravignat, NDP, Pontiac, QC]

Mr. Speaker, the fact that the Liberal and Conservative governments took so long to rework the tax laws has cost our small and medium-sized businesses.

The complex nature of these laws is a constant source of frustration, at least for the small and medium-sized businesses in my riding.

There is one element that cannot be overlooked. Who benefits from not paying taxes? What allows companies to not pay taxes? That question needs to be asked.

When companies or individuals are honest, they pay their taxes. I believe that the responsibility should be shared by all businesses. They should pay their taxes because it helps improve society.

I would like to know if my colleague could tell us who benefits from tax havens, for example.

[Jean Rousseau, NDP, Compton—Stanstead, QC]

Mr. Speaker, the bigger companies benefit, of course. The more complex laws are, the more small businesses will suffer.

Small business entrepreneurs must develop their products and their markets. If they have to take one day a week, four days a month, to deal with their taxes, meet with their accountant and put things in the hands of someone they trust, that takes time. However, they do not have that kind of time because they are small business owners. They need all of their time to develop their products.

It is not difficult for large businesses. They deal with numerous accountants, finance experts and lawyers, all of whom are highly qualified. They work with people who are capable of helping them. Small businesses do not have the same means, and that hurts them.

[François Choquette, NDP, Drummond, QC]

Mr. Speaker, I congratulate my hon. colleague on his excellent speech. All of the points he raised were very pertinent.

One thing I would like to say about this omnibus bill is that it is too long to examine as thoroughly as we should. At least this bill is a step forward in the fight against tax evasion. But it is not enough.

The NDP believes that fighting tax evasion should be given greater priority. The NDP has even organized information sessions on this. The Leader of the Opposition gave a speech to demonstrate that we support this fight, which should be a priority.

Unfortunately, the Conservative government did not work hard enough on the fight against tax evasion and I would like to hear what my hon. colleague would recommend in that regard.

[Jean Rousseau, NDP, Compton—Stanstead, QC]

Mr. Speaker, tax evasion is costing our economy hundreds of thousands of jobs. That money could be invested in our country and in our regions, which desperately need it, whether for small businesses or for environmental projects, in the manufacturing sector or in research and development.

Hundreds of millions of dollars lost to tax evasion could help Canadians, reduce unemployment in remote areas and help first nations populations. Loads of projects are awaiting funding. This bill is a first step towards fighting tax evasion, but it is extremely complicated. What can we do with all this?

Large corporations just have to hire an army of accountants who know tax evasion inside and out. We need to get tougher on those corporations and be relentless, because this is costing the Canadian economy hundreds of thousands of jobs and billions of dollars.

[The Acting Speaker, Conservative, Bruce Stanton]

Before I recognize the hon. member for Saint-Hyacinthe—Bagot, I want to inform her that I will have to interrupt her at 5:30 p.m. because the time for government orders will have expired.

There is approximately six minutes left. The hon. member for Saint-Hyacinthe—Bagot.

[Marie-Claude Morin, NDP, Saint-Hyacinthe—Bagot, QC]

Mr. Speaker, first, I want to say that we support Bill C-48 because it will have some positive effects on revenues, and the changes it makes will help deter tax avoidance, which is good.

I find it interesting that the bill talks a lot about tax avoidance. Members know that the middle class, which pays taxes, can rarely use tax avoidance tactics to pay less and have a little breathing room. The people who have the means to pay taxes also have the means to find ways to avoid them, while the middle class is suffocating under the weight of all of the government's cuts. I think it is good that this bill addresses the issue of tax avoidance. I wanted to share that with my colleagues. Our tax system must be managed much more responsibly, and we must ensure its integrity.

I have a question for the government. Why did it wait so long to legislate measures that have been around for 10 years? Some of these came into effect in 1998. I was 13 years old in 1998. That was a long time ago. The government opposite is not the only one to blame, because it has not been in power since 1998. Thank goodness, since who knows what the House would look like. I get the impression that they suddenly woke up and decided they needed to legislate some tax measures. I find that a little odd.

I do not claim to be a financial expert. I probably never will be. It is not a topic that interests me as much as housing, which I talk about all the time. I am no financial expert, but it seems to me that a competent government should have woken up a little sooner.

When I look at how long this document is, I pity the poor Standing Committee on Finance, which has to examine it. The word “omnibus” also comes to mind. I will certainly never approve of this way of doing things and neither will my party, obviously. The government has a tendency to put everything in one bill, and I do not agree with that practice. For example, Bill C-48 amends the Income Tax Act, the Excise Tax Act, the Federal-Provincial Fiscal Arrangements Act and the First Nations Goods and Services Tax Act.

Given the importance of these four laws, the length of the bill and the need for the measures set out in this bill, I am afraid that the committee will do a poor job of examining the bill, which would be too bad considering how important it is.

Honestly, I find that this bill, which is coming from a government that claims to be so concerned about the health of our economy, is really late, and I think that it should be examined in a different manner. The Minister of Finance himself admitted that the government failed to take action. I would not like to be part of the Conservative cabinet right now.

That being said, given the government's inaction on so many matters of vital importance to our country, I am not really surprised to see that it has been so negligent with regard to tax avoidance and the integrity of our tax system.

I am talking about inaction. I am talking about a government that does not understand the importance of homelessness and affordable housing programs, for example. I am talking about a botched EI reform at a time when workers need EI the most. I am talking about a government that barely makes any investments in the environment, thereby endangering the quality of life of future generations. I am talking about a government that neglects infrastructure to the point where I am now afraid to drive on the Champlain Bridge, and I believe that is a legitimate fear.

When this bill is passed and tax avoidance is being discouraged, can we hope to see revenue increase?

In my riding, there is a lack of affordable housing. Homelessness is on the rise and agricultural businesses are losing skilled employees because of the EI reform. What is more, many environmental organizations are fighting to give our children a habitable earth. Clearly, we also need health infrastructure, a commuter train and a tunnel in order to promote the economic development of our region. Once this measure is implemented, will others follow?

I will stop there.

[The Deputy Speaker]

The member for Saint-Hyacinthe—Bagot will have five minutes to finish her speech another time.