Debates of March 8th, 2013

(Return tabled)

Question No. 1132

[Jean Crowder, NDP, Nanaimo—Cowichan, BC]

With regard to the role of Communications Security Establishment Canada (CSEC) as a lead agency in protecting the government's information systems: (a) how many requests did CSEC receive from other government departments to provide expertise or information regarding protection of information systems; (b) how many staff were assigned to each request; (c) how many of the requests received was CSEC able to satisfy and how many requests were not provided a response that satisfied the request; (d) if CSEC was unable to satisfy a request for assistance, what was the reason; (e) are there any significant staffing issues that CSEC is facing that would not allow CSEC to satisfy these requests; (f) for each year from 2008 to 2012, what products, including publications, and services did CSEC/Information Technology Security provide and to whom; (g) what plans, research and development activities have been undertaken from 2008 to 2012 and what is the current status; (h) what summative evaluations have been done of the services offered to other departments; (i) for each year from 2008 to 2012 how many staff were off on (i) sick leave, (ii) administrative leave, (iii) long-term disability; (j) for years 2008 to 2012 how many audits or performance reviews were completed; (k) what were overall staff numbers in fiscal year 2011-2012; (l) what will be the overall staff numbers after Budget 2012 implementation; (m) how many of those positions include senior staff with the ability to protect Canada’s information system from attack; and (n) for each year from 2008 to 2012, how much of the government’s bandwidth was taken up with spam or other malicious attacks, broken down by (i) incoming bandwidth, (ii) outgoing bandwidth?

(Return tabled)

Question No. 1133

[Hoang Mai, NDP, Brossard—La Prairie, QC]

With regard to the Export Development Corportaion, Business Development Bank of Canada, Farm Credit Canada, and the Canada Mortgage and Housing Agency, since January 7, 2007, how much has been spent on: (a) radio advertising; (b) television advertising; (c) cinema advertising; (d) internet advertising; (e) advertising in print daily newspaper; (f) advertising in print magazines; (g) advertising in print weeklies or community papers; (h) public opinion research; (i) advertising design and production?

(Return tabled)

Question No. 1134

[Hélène Laverdière, NDP, Laurier—Sainte-Marie, QC]

With respect to the Partnership with Canadians program at the Canadian International Development Agency (CIDA), for each year from 2006 to 2012: (a) how many calls for proposals were issued, broken down by year and type of call for proposal; (b) how many proposals were received, broken down by year and type of call for proposal; and (c) how many proposals were approved, broken down by (i) year, (ii) partner, (iii) type of call for proposal, (iv) total dollar amount contributed by CIDA, (v) total dollar amount contributed by partner, (vi) description of project, (vii) recipient country, (viii) CIDA priority theme or cross cutting theme, (ix) length of days of approval, (x) length of project, (xi) grant or contribution?

(Return tabled)

Question No. 1145

[Ted Hsu, Liberal, Kingston and the Islands, ON]

With regard to FedNor: (a) when did hospices become ineligible for FedNor funding under the Community Economic Development priority of the Northern Ontario Development Program; (b) when was the decision made to do this; (c) what were the last five hospices funded through FedNor; and (d) which ridings are these last five hospices located in?

(Return tabled)

Question No. 1147

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

With regard to the response provided by the Minister of International Cooperation to written question Q-972 on the Order Paper, in which the Minister states: “Since 2006, there has been (1) entity in receipt of CIDA funding while being under legal protection from creditors; however, this entity continues to meet its contractual obligations and is delivering results through its programming”: (a) what is the name of the entity referred to in this response; (b) what are all the projects for which this entity is receiving or has received funding from the Canadian International Development Agency (CIDA) while under legal protection from creditors; (c) what is the amount of funding that this entity is receiving or has received from CIDA while under legal protection from creditors; (d) what are the beginning and end dates for any projects this entity has undertaken with the assistance of CIDA funding while under legal protection from creditors; (e) what is the specific date on which this entity obtained legal protection from creditors; (f) what were the recommendations by CIDA to the Minister of International Cooperation with regard to any projects that this entity sought to undertake with funding from CIDA since 2006; and (g) what are all the decisions rendered by the Minister of International Cooperation with regard to any projects that this entity sought to undertake with funding from CIDA since 2006?

(Return tabled)

Questions Passed as Orders for Return

[Colin Carrie, Conservative, Oshawa, ON]

Finally, Mr. Speaker, I ask that the remaining questions be allowed to stand.

[The Acting Speaker, Conservative, Barry Devolin]

Is that agreed?

[Some hon. members]

Agreed.

The House resumed consideration of the motion that 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, be read the second time and referred to a committee.

Technical Tax Amendments Act, 2012

[The Acting Speaker, Conservative, Barry Devolin]

When this was last before the House, the hon. Parliamentary Secretary to the Minister of National Revenue had completed her remarks, but there are five minutes for questions and comments.

The hon. member for Beauport—Limoilou has the floor.

[Raymond Côté, NDP, Beauport—Limoilou, QC]

Mr. Speaker, I would like to thank my colleague from Kamloops—Thompson—Cariboo for her speech. I also salute her as a member of the Standing Committee on Finance. The only thing I deplore, obviously, is that she is not commenting on the criticism by witnesses at the Standing Committee on Finance regarding the government's negligence and lax attitude.

Let me remind this House that the Conservative Party has been in power for seven years now and could have taken much quicker action to resolve the issue of the mountain of comfort letters. This brings about an enormous amount of uncertainty.

I will not hide the fact that I spoke with a number of witnesses as part of the committee's work and in private after each meeting. Many of them confided in me that they could no longer stand hearing the government claim that the fact that it was a minority and there was a crisis created obstacles to incorporating these comfort letters into the Income Tax Act.

What does my colleague have to say about those comments from our witnesses?

[Cathy McLeod, Conservative, Parliamentary Secretary to the Minister of National Revenue]

Mr. Speaker, the fact is that every single witness who has come forward has said witnesses have been broadly consulted. They are very supportive of moving the legislation forward. They perhaps did not understand why there were so many speakers from the opposition rising and saying essentially very similar things. They encourage all members of the House to move forward.

Certainly, our minister has felt that, as we deal with this very important issue, we need to have regular and effective updates to our important tax amendment legislation.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, the Liberal Party indicated a while back that we are supportive of the bill ultimately passing. We feel there has been a fairly significant amount of time since we have had a law passed to deal with the tax changes that are required.

There is a very thick component when we look at tax guides. They have an asterisk or a grey faded colour to indicate that these are measures for which they are hoping to see legislation take place. That is what Bill C-48 would do. It would invoke a series of changes that are long overdue in their passage, and we do anticipate the bill will pass in a timely fashion.

My question to the member is: How often does she feel legislation of this nature should be brought forward on a go-forward basis?

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

Mr. Speaker, I want to acknowledge the support and thank the hon. member for indicating that he recognizes the importance of this piece of legislation and the importance of moving it forward.

We all recognize that, due to some very extraordinary circumstances, it is absolutely time to move forward. Certainly, all the witnesses who came before committee said they were supportive of the legislation, that they have been broadly consulted and that it is time.

We look forward to the quick passage of Bill C-48.

[Alain Giguère, NDP, Marc-Aurèle-Fortin, QC]

Mr. Speaker, as a tax lawyer, I am very pleased to speak to a bill that should have been introduced a very long time ago.

It has been 11 years and the Conservatives have not introduced a technical bill. Unfortunately, they are not the only ones to blame. The Liberal government shares that blame. We now have 200 amendments to the Income Tax Act in a 1,000-page document. We have only nine hours to debate a 1,000-page document.

I would like to know how many parliamentarians here in this House understand how important this bill is. I am sure that in nine hours of debate, no one here has been able to make it through 1,000 pages. Supporting this bill is an act of faith. We are putting our trust in the professionalism of the people who drafted this bill and the officials at the Canada Revenue Agency, because it is clear that parliamentarians are not sure about what they are voting for. That is serious.

The Income Tax Act is probably the most important statute in Parliament. Without this legislation, we are not able to pay police officers, public servants or nurses. It serves as a financial and economic foundation for the government, but the Conservatives decided that this act was not important enough to be addressed every year.

The purpose of this bill is to do nothing more than catch up on the backlog of comfort letters. This bill includes 200 of 400. We will still have to catch up on 200 letters, and we will also have to assume that every budget bill will lead to an amendment of the comfort letters. This should be done every year. Clearly, that has not been the case.

That is why we are blindly working our way through an obstacle course. No one can tell me that parliamentarians sat down and read 1,000 pages. In our legal system, ignorance of the law is no excuse. Unfortunately, the Income Tax Act is obviously an exception to that. Tax experts, who appeared in our committees, told us that they did not know what was in force and what was not.

How can we enforce a law that is not written or that will only be enforced at a given time? Can we say that we will enforce the law when we have the time? How wonderful. One of the main reasons Italy and Greece had financial problems was because these governments were not able to claim the taxes they were owed.

The European crisis is a financial and tax crisis. Those people were expecting their government to have money coming in. The money never materialized because their government did not implement measures to ensure that the ministry of revenue was able to collect the taxes owed to the government.

Here in Canada, there are tax avoidance problems. Tax avoidance is the use of means within the law to avoid or delay payment of taxes. It is legal. For example, RRSPs generally lend themselves to tax avoidance. By contributing to RRSPs, we avoid paying taxes. That is legal.

Unfortunately, the law is now so riddled with holes, confusion and contradictions that a good tax expert can find a legal way for a client to avoid paying taxes. It is legal. It was not planned or foreseen by the government, but the law is so poorly drafted that it allows a good tax expert to find loopholes, and that is legal.

We try to prevent tax avoidance by prohibiting aggressive tax planning. The abuse cannot be censured if the law is poorly drafted. The responsibility lies with the government.

There is tax evasion and tax avoidance. What is the difference? Tax evasion involves breaking the law, circumventing it by fraudulent means, and involves white collar criminals. We have to prohibit tax evasion and implement means to fight it. When a law is poorly written or when officials do not know what to do, it is difficult to put an end to these fraudulent practices. Tax avoidance entails finding legal means to avoid paying taxes that are owing. Tax evasion is a criminal offence. In both cases, and despite commendable efforts, the government is losing control of the enforcement of its legislation. That is a serious threat.

For many years, any tax experts who appeared before the Standing Committee on Finance, the Standing Committee on Public Accounts and all committees that are economic in nature indicated that the text of the Income Tax Act had areas that were underlined and shaded in grey. This indicates that a comfort letter was issued, but the change has not yet been incorporated into legislation. There are 400 examples of this. Understandably, people want this to be corrected, and quickly.

Imagine a tax expert who presents a tax plan. That person is told that these comfort letters might be adopted one day, or maybe not. Uncertainty reigns. When there is a change in government, the new government can decide not to approve a comfort letter and never to enforce it; it can reject it. For 11 years, a tax expert might not know if his or her carefully prepared plan is legal or not.

When a comfort letter is drafted, the corrections that it makes should be applied immediately in the months that follow. That is the main message. We are in favour of adopting all 400 comfort letters. The government has presented only 200, but another 200 are still to come. They must be incorporated into the Income Tax Act.

Our hope now is that, in the future, this government will have the decency to amend the Income Tax Act relatively quickly and incorporate these comfort letters any time it brings down a budget that includes comfort letters. This is an absolute necessity if we do not want to find ourselves in the same situation as Greece, Italy and Spain, countries that lost control of their taxes and can no longer collect them and pay their debts.

[Raymond Côté, NDP, Beauport—Limoilou, QC]

Mr. Speaker, I am very pleased to congratulate my colleague from Marc-Aurèle-Fortin, my seatmate, on his excellent speech. He enlightened us and imparted his great wisdom. I have probably said enough.

My colleague's expertise allowed him to point out several very important elements. I will focus on one particular aspect that was frequently raised by the experts we met with at the finance department, and that is planning.

Millions of Canadians are facing the threat of tax planning that is in no way fraudulent, but that is unclear because the government has been so lax. Sometimes people are faced with claims or find themselves in unfair situations.

I would like my colleague to talk about this very serious issue, which affects all Canadians.

[Alain Giguère, NDP, Marc-Aurèle-Fortin, QC]

Mr. Speaker, that is the tragedy of this situation.

Take, for example, a comfort letter from 11 years ago concerning airlines. These companies' tax situations have evolved and that comfort letter is now worthless. It does not apply. It no longer makes sense from a legislative point of view because airlines have legally restructured under international agreements with other airlines.

That is serious. A comfort letter is drawn up and when it is time to implement it, the situation it addressed no longer exists.

The government has clearly lost control of taxation in a situation like that.

[Robert Aubin, NDP, Trois-Rivières, QC]

Mr. Speaker, I do not have the tax expertise my colleague does, so I would like to benefit from his wisdom.

The Conservative government is always talking about cuts, particularly cuts to employment insurance. We could make a whole list.

Could my colleague tell me just how much the government loses to tax evasion?

How much revenue would the government be looking at if the problem was tackled head-on?

[Alain Giguère, NDP, Marc-Aurèle-Fortin, QC]

Mr. Speaker, this is obviously a serious case.

We have talked a lot about tax havens. Unfortunately, Canadian practices have been assessed at $9 billion by Mr. Lauzon, director of the socio-economic studies lab at the Université du Québec à Montréal.

We are talking about duly incorporated companies being used as tax havens. We are not talking about organized crime. This $9 billion involves duly incorporated companies and individuals who are using illegal methods, namely, tax evasion.