Debates of April 15th, 2013

Opposition Motion—Budget 2013

[John Rafferty, NDP, Thunder Bay—Rainy River, ON]

Mr. Speaker, it is a question of convenience for the Conservatives. If we raise tariffs in the country, it will cost Canadians more for those goods, and as far as I am concerned, that is a tax. It is a tax when the goods come across the border. It is an increase in price. We are talking about millions and millions of dollars, particularly right to the end of 2018.

There really is no difference. Taxes increase the costs to consumers. Tariffs increase the cost to consumers. In fact, if we look at it that way, the tariff would increase the cost of that piano I was just talking about, and then there would be even more tax on that piano because the price of that piano would be even higher. Canadians get hit all the way around with this big increase, in this budget.

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

Mr. Speaker, I thank my colleague for his speech. As I said, Beauport—Limoilou has many low-income families and individuals.

Since we are specifically talking about problems that affect low-income individuals, I would like to know whether my colleague is as concerned as I am about his own constituents.

[John Rafferty, NDP, Thunder Bay—Rainy River, ON]

Mr. Speaker, one of the things we know on this side of the House is that if we want to make this a fairer Canada, we have to make the gap smaller between the richest and the poorest in our country. That is what we should be working toward. However, what is happening now with the budget, and with what the Conservatives have been doing since 2006, is that they have made that gap wider, meaning poorer families in my riding, just as in the member's riding and right across Canada, are the ones who suffer when the governments increase tariffs and taxes.

[Jinny Sims, NDP, Newton—North Delta, BC]

Mr. Speaker, I want to start today by acknowledging the amazing work that is being done by my colleague from Victoria on this file. He has been very diligent and has done his research, along with my other colleagues. I am so proud of the fact that he has put this motion forward.

We can start talking about credibility when we look at the wording of the motion. The motion asks the House to condemn the tax hikes introduced by the government in budget 2013 on hospital parking, bicycles, baby strollers, coffee makers, iPads and other goods and services, which break the promise the government made to Canadians during the last election. I am sure every member in the House would agree with that.

I have sat in the House today and heard the word “credibility” over and over again. Let me just throw out a few quotes here. In 2008, Stephen Harper promised Canadians—

[The Acting Speaker, Barry Devolin]

Order, please.

[Jinny Sims, NDP, Newton—North Delta, BC]

Sorry, that was my mistake, Mr. Speaker. The Prime Minister promised Canadians that “As long as I will be prime minister...there will be no new taxes”. The last time I looked, he is still Prime Minister. Talk about credibility.

In November 2012, Jim Flaherty promised Canadians—

[The Acting Speaker, Barry Devolin]

Order. I would remind all hon. members to be more careful.

[Jinny Sims, NDP, Newton—North Delta, BC]

I am sorry, Mr. Speaker.

Our Minister of Finance promised Canadians that there would be no tax increases in budget 2013. In his budget speech he said he would not raise taxes.

If we are going to talk about credibility, here are direct quotes from the Prime Minister and a minister of the Crown being absolutely categorical. I want to give them the benefit of the doubt. Being a teacher, I always want to see the best, to see the intentions. I thought we should take a look at the dictionary. The Oxford Dictionary is well renowned. It is used in schools and universities. I am sure many members of Parliament have this particular dictionary sitting on their bookshelves as well. This is the definition of a tax taken directly from the Oxford Dictionary:

a compulsory contribution to state revenue, levied by the government on workers' income and business profits, or added to the cost of some goods, services, and transactions

That seems fairly clear.

Then there is the definition of a tariff, “a tax or duty to be paid”. They are interchangeable, absolutely.

It is very clear that what Canadians would experience as a result of this budget are tax increases, which many colleagues across the aisle have said that the government is not going to do.

Let us talk about credibility and let us take a look at some of that. It is very distressing when we have this kind of thing happening. It is difficult for the public.

As I looked at all of this, I began to think surely so many of my colleagues across the way could not possibly have missed these tax increases. It is not that they are hidden in the budget; they are right there. The only thing is that we have to read to the end of the budget book because they are not at the beginning; they are a little bit later on. I hope all of my colleagues will revisit the budget book, which is quite thick.

Here is a quote from Aaron Wherry:

“I know the only way that we could ever get the NDP to support this budget is if we had tax increases in it,” Mr. Menzies continued, “but no one will find tax increases in this.” Mr. Menzies seemed to here to put his hope in the possibility—

[The Acting Speaker, Barry Devolin]

Order, please. This is the third time in five minutes that the member has read a direct quote in which she names a member. I believe she was referring to the Minister of State for Finance.

[Jinny Sims, NDP, Newton—North Delta, BC]

My apology, Mr. Speaker. I just realized I cannot even read it when it is quotation marks. I was reading a direct quote.

[The Acting Speaker, Barry Devolin]

I would remind all hon. members that they cannot do indirectly what they cannot do directly. If this rule could be circumvented by quotes, it would be done routinely. I would urge the member to be careful in what she says.

[Jinny Sims, NDP, Newton—North Delta, BC]

It states:

[He] seemed to here to put his hope in the possibility that no one—including perhaps the Prime Minister—will bother reading as far as page 325 of the budget book. But there they might find Annex 2: Tax Measures. And there they will find several numbers that are not identified as cuts, but, in fact, the precise opposite.

That is a quote from Aaron Wherry.

Once again, when we talk about accountability, it is right there, and when we talk about credibility, it is there for people to see.

What we are looking at in this budget are taxes, which is what they are, on a huge number of goods. They have been listed over and over again by a number of my colleagues, so I will not go through every one of them. Basically, what we are looking at is absolutely astounding because we are not talking about pennies or hundreds or thousands of dollars. We are talking about taxes to the tune of billions of dollars, $7.8 billion over the next five years. That is what Canadians are going to be experiencing in the way of tax increases. To me, nobody, not even my colleagues across the way, can argue that they are not tax increases, whatever name they want to give them.

That again raises the question of credibility. When we look at the budget, the process of modernizing Canada's general preferential tariff regime for developing countries is being done at the same time as the Conservatives keep saying there are no tax increases. However, going back to the dictionary definition, these are taxes. There is no other way to look at them.

Looking at the detailed examples, bicycles have been explained enough times, but let us look at baby carriages. Ninety per cent of baby carriages are made overseas. This is going to hit low-income and middle-class people the hardest because when people have babies, they need baby carriages, and these taxes are very regressive.

Let us look at school supplies. Single parents and low-income families are already telling me they are stretched to the limit in having to pay additional school fees and picking up the cost of supplies. What we are looking at are huge increases, from 3% to 6.5%. We are looking at almost double the taxation.

Another cost that absolutely has touched my heart is the tax on wigs. Those who suffer from alopecia cannot get wigs covered. They definitely cannot get them covered in my province of British Columbia. Now we have a tax on wigs. It breaks my heart to see that. I have a granddaughter who suffers from alopecia. I know the pain and agony that families go through and this is definitely an additional burden on families. When one thinks about it, it is very mean-spirited.

Let us put out there that my friends across the aisle do not understand tariffs being duties or taxes. How do they justify taxing credit unions? They have taken away funding from credit unions, which means it is going to cost credit unions more at the very time they are giving huge tax breaks to their big bank friends.

Let me talk about the last one, which is paid parking. What does this have to do with tariffs on imported goods? This is about people going to see their loved ones in the hospital. It was bad enough there were parking costs, but now there are going to be taxes collected on it. This is a tax on the sick and their families and it is unacceptable. As for credibility, I look across the aisle and say, “Look in the mirror”.

[Dan Albas, Conservative, Okanagan—Coquihalla, BC]

Mr. Speaker, certainly, this is a topic that I am very engaged on and I am glad to ask a question of the member.

In her speech she referenced some changes to the preferential tariff of $330 million. This is an area on which the government has been transparent. There is a preferential tariff that is given to certain countries, such as Brazil, Russia, India and China. Some of the places where we have seen the most economic development and growth are among many of the nations there.

I would like to ask the member to clarify her party's position. From my understanding, the NDP always seemed to support tariffs to encourage local manufacturing, meaning within Canada.

Second to that, by allowing this preferential rate, when would the member look at removing it?

Lastly, it seems that this government has always said that if we can have free trade agreements with many of these countries, we would have them.

That is the old fashioned way of taking away these tariffs.

[Jinny Sims, NDP, Newton—North Delta, BC]

Mr. Speaker, it always amazes me that my colleagues across the way never want to address the fundamental issue that is being debated here, and that being that the Prime Minister, ministers of the Crown and other members across the way said categorically that there would be no tax increases under their watch. They also said that there were no tax increases in this budget. They can try to redirect any which way they want, but at the end of the day there are taxes in this budget that will increase cross-border shopping, which will hurt communities closest to the border.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, I appreciate the member's passion when speaking to an issue, whether it is here or at the immigration committee.

When we talk about the increase in taxes, it is important that we make note of just how much we are talking about, which is hundreds of millions of dollars that will be generated through the 1,300-plus tariffs that will be increased.

Could the member expand on the kind of dollars we are talking about, the fact that it is a direct tax and that the consumers who will be predominantly hurt the most are likely to be the middle class or those who are striving to become part of the middle class?

[Jinny Sims, NDP, Newton—North Delta, BC]

Mr. Speaker, I want to stress that these kinds of tax breaks are going to affect the middle class, the working class and those who are already living well below the liveable wage. When we see the items that are to be taxed, it will affect everyone.

However, let me go over the kind of numbers we are talking about, which is $7.8 billion over the next five years. Then if we look at the actual increase, in 2013-14 it is $500 million and it increases to $2.3 billion annually by 2017-18. Therefore, out of this what we are looking at is a total of $7.8 billion of tax burden on maybe the most vulnerable, the working class and the middle class who are already struggling to make ends meet. How can this not be a tax increase?

[Claude Gravelle, NDP, Nickel Belt, ON]

Mr. Speaker, my colleague made a couple of mistakes in her speech. As a former school teacher she should know better. She used the words “credibility” and “Conservative” in the same sentence. From what I have been hearing from that side of the House today, the Conservatives have no credibility. Therefore, I would ask the member to please refrain from using those two words in the same sentence.

We have 1,200 items in the budget that were raised with so-called tariffs, taxes, or members can call them what they want. It is quite obvious that there is no credibility on that side of the House.

However, what the member touched on that really upset me is paying taxes on parking at hospitals. Could she explain that?

[Jinny Sims, NDP, Newton—North Delta, BC]

Mr. Speaker, I can remember when hospitals first started to charge for parking and I thought it was outrageous. Many times when people are going to hospital, they are trying to rush in and do not always have the coins in their pocket, et cetera. It was an extra burden on families which were struggling. However, now we have taxes on that parking.

We can give tax breaks to some of the wealthiest corporations in the country, but we are now going to charge taxes to people who are going to the hospital to see—

[The Acting Speaker, Bruce Stanton]

Order, please. Resuming debate, the hon. member for Markham—Unionville.

[John McCallum, Liberal, Markham—Unionville, ON]

Mr. Speaker, I am pleased to rise today to join in the chorus of condemnation of the Conservative government's attempt to hide a $330 million tax hike.

It is a bit weird, however, that we have the NDP, which is traditionally protectionist, pushing for lower tariffs and we have the Conservatives, who are traditionally non-protectionist, pushing for higher tariffs. We Liberals are the only consistent ones because we traditionally push for lower tariffs, which is what in fact we are doing today.

In general, if you meet someone and ask him whether he thinks tariffs are a good thing and he says yes, you are probably talking to a New Democrat. If he says no, you are probably talking to a Conservative or a Liberal.

Therefore, the NDP seems to find itself in a situation of some confusion, relative to its normal state of mind. Nevertheless, we agree with the NDP fully on this motion.

The decision by the Conservative government represents a massive broken promise and will have negative implications for middle-class Canadian families, Canadian retailers and even some of the world's poorest countries.

I was surprised to read about these tariff increases in budget 2013, as I clearly remember reading in the Conservatives' 2011 platform, in bold text no less, that they would “not raise taxes on Canadian consumers”. That is exactly what they have done here, a massive $330 million tax on consumers.

With all due respect to the sanctity of the House, I would make the general proposition that from a normal or intellectual point of view, this debate is totally ridiculous because everybody knows, as stated by our new Liberal leader in question period, the dictionary definition of a tariff is a tax on imports. Everybody knows the Conservatives have raised tariffs by $300 million, so they have raised taxes. That is clear and it is logical. I do not see any argument against it. If a tariff is a tax on imports, if imports go up $330 million, that is a tax hike.

Now it is true the Conservatives cut some tariffs, but by a much smaller amount. Therefore, net tariff revenue has gone up, ergo, a tax increase.

This ridiculous argument that if it is the tariffs on China and India that go up, then it is not an tariff increase is stupid. A tariff is a tariff.

The market does not care whether it is a justified tariff or an unjustified tariff. If the tariff goes up, the cost of the good and the price of the good goes up and it is a tax. It does not matter whether members will argue that China and India no longer deserve these low tariffs. It still is the case that if those tariffs go up, prices go up, and that is a tax hike.

Mr. Speaker, I hope you will not mind if I mention a bit late that I would like to share half of my with the member for Winnipeg North.

That is the first case. This tariff hike is a tax hike. Any normal person would agree with that.

A second example is these EI premium tax hikes that the Conservatives keep doing. They have had three increases in EI, coming to nearly $2 billion per year. Is that not a tax hike? If it is, how dare they say in the budget that they will not have any tax hikes. It is a tax hike. An employment insurance premium is a direct tax on jobs. Any increase in EI premiums is a tax hike, not just any old tax, but a tax on jobs, to the tune of close to $2 billion a year. That is the second case where they were wrong.

I suppose the Conservatives could muddle around and say the word “tax” is not there. It is employment insurance premium, so we will not call it a tax hike. That is just fiddling with words. EI premium is a tax, it is a tax on jobs and it has to be counted as such.

However, if they can pretend that a tariff increase is not a tax hike or an EI premium increase is not a tax hike, they certainly cannot pretend that an increase in the income tax rate is not a tax hike.

That is what the Conservatives did in 2006. They increased the income tax rate by half of a percentage point. This was published by CRA. It was a done deal. They tried to claim that they were lowering the tax rate by a half point.

What I am trying to say is that the Conservatives have increased taxes at least three times, whether we are talking about income tax or taxes related to employment insurance benefits or tariffs. Each time they denied what was obvious, but in each instance they increased taxes.

Why do the Conservatives play this game, which from an intellectual point of view appears to be ridiculous and evidently wrong? I think the only reason is that when we add the political element, they think they can get away with it. We all know that what they are saying is wrong. However, when they say repeatedly, again and again, that they are not raising taxes, even though it is evident that they are, the Conservatives hope that the public will not notice and that they can carry this message, even though it is untruthful, through to the public.

That is why we have motions like this today. It is to try to get the information out to the public that the Conservatives are doing what we all know they are doing, which is raising taxes. That is why, among other reasons, the Liberal Party is pleased to support this NDP motion in an attempt to help educate the public as to what the government is in fact doing, as opposed to what it says it is doing.

These taxes make it extremely hard for middle-class Canadian families to make ends meet. This is a tax directly on the items Canadians need to make their households run properly. It is a tax on bicycles, blankets, wigs, coffee makers, paint brushes, kitchen knives and iPods. Yes, the dreaded iPod tax is here, thanks to the Conservative government. This is the best part: the only way to avoid the iPod tax is to join the iPod registry. Does that sound like the gun registry? My goodness.

Some of these tax increases demonstrate a heartless disregard for Canadians. I have mentioned the tax on wigs. What group makes the greatest use of wigs? It is actually Canadians undergoing chemotherapy. I cannot believe that the Conservative government would willingly attack Canadian cancer patients like this.

What we are seeing is the end product of a hastily made policy done on the back of an envelope to meet an artificial deficit reduction deadline. In its 2011 platform, the government set an unrealistic deadline to eliminate the deficit. Now the Conservatives are scrambling to make it happen by doing calculations on the backs of envelopes and raising taxes on middle-class families when they said that they would not.

The government should understand that the Canadian tariff regime is a complex machine with many moving parts. To do something at the snap of a finger on the back of an envelope will obviously have unintended consequences, such as the example of chemotherapy. I do not think that the Conservatives deliberately set out to attack people on chemotherapy, but they did not think things through. That is one of the unintended consequences of this very bad legislation.

I will end with one last point. I am not sure if this is an intended or unintended consequence. There are negative effects on the least developed, poorest countries in the world. When those countries import inputs for the manufacture of clothing, for example, from countries that are now seeing higher tariffs, such as India and China, Canada, when it imports things from these least developed countries, will have to impose higher tariffs, which will impose a burden not only on Canadian consumers but also on the residents of these least developed countries.

In conclusion, from the point of view of government honesty, to deny that it is raising taxes is a travesty. Indeed, these measures have negative effects for Canadian consumers, for people living close to the border and for some of the poorest countries in the world.

[Peggy Nash, NDP, Parkdale—High Park, ON]

Mr. Speaker, I thank the hon. member for his comments on the Conservatives' efforts to raise taxes that are really going to hurt the average Canadian family. We have heard about taxes on school supplies, bicycles, shoes, iPads, iPods and hospital parking. I want to talk about the latter.

A few years ago, we had a family member who had a sudden illness and was in the hospital for about six weeks. Every family hopes to avoid something like that, but sometimes family members are in hospital for weeks or sometimes months. I know we were at the hospital every single day, and boy, the parking adds up. For an average family, paying that every single day as an unexpected charge can really hit a family hard at a time when they are already down with a family illness.

Could the hon. member comment on why the Conservative government would possibly hit Canadians while they are trying to deal with a family emergency like a major illness?

[John McCallum, Liberal, Markham—Unionville, ON]

Mr. Speaker, the short answer is because they are Conservatives. The longer answer is that I said earlier that I did not accuse them of deliberately going after people taking chemotherapy. I do not think Conservatives would that, nor would any other party in the House, but I think they knew what they were doing in imposing higher parking charges on people visiting loved ones in hospitals over an extended period of time, and I agree with the hon. member that it is not an appropriate action for people in such conditions. Savings should be found in other ways that do not bear down in such an unfair and strong manner on a select group of vulnerable Canadians.

[Dan Albas, Conservative, Okanagan—Coquihalla, BC]

Mr. Speaker, first I would like to ask the hon. member a question on preferential tariffs.

Preferential tariffs were given in 1974, the last time the program was reviewed, specifically to aid developing countries. I mentioned Brazil, Russia, India and China. It is in many of these countries that we see the most economic growth. When would the member support this policy being reviewed, if not now? Again, these tariffs have been around longer than I have.

Second, my understanding is that the Liberal Party has traditionally stood for free trade. If we do not have tariffs at some of these levels for some of these countries, there is no incentive for them to bargain and come to the table and enter into free trade agreements.

Finally, this government has reduced tariffs by over $590 million, particularly around manufacturing equipment, because we see manufacturers producing right here in Canada. I would ask the member to please look at supporting those kinds of measures, because they are going to keep our economy growing.

[John McCallum, Liberal, Markham—Unionville, ON]

Mr. Speaker, in this budget the tariff increases are $330 million a year and the tariff decreases are $76 million a year. I would remind the hon. member that 333 is bigger than 76, so it is a net increase in tariff revenue, which means a net increase in tax. The member's government said it would not have any increases in tax, and that is my basic point.

In terms of the member's other point, an increase in the tariff on goods from China, India or Brazil is an increase in the tariff as much as an increase on any other country in the world. It is equally a tax increase and would equally disadvantage Canadian consumers.

If the government thinks that low tariffs on China are a bad thing but does not want to hit Canadian consumers, it should raise the tariff on China and reduce the tariff on other countries so as to neutralize the negative effect on Canadian households. The Conservatives have deliberately created a strong negative effect on Canadian middle-class households. It is a tax hike, and that is wrong.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, I appreciate the opportunity that the member provided by agreeing to share his time.

It was just last week that a poll came out indicating that Canadians believe the Prime Minister is actually quite secretive and has failed to govern with high ethical standards. One only needs to reflect on some of the things that have been said today from the government benches to get a better understanding of why so many Canadians from coast to coast to coast have this feeling that they just cannot trust the Conservatives, that there is a hidden message out there, and that the Prime Minister is not being straightforward with Canadians.

There is some irony there. The Leader of the Liberal Party gave a specific quote. He quoted a dictionary, the Collins English Dictionary. He stated that the dictionary said a tariff is “a tax levied by a government on imports”. It is a tax.

If Canadians are asked what a tariff is at a breakfast nook or a Tim Hortons, or wherever it might be, or what it is when the government increases a charge on a product coming into Canada, chances are they will appreciate that it is in fact a tax.

The government needs to concede that it is in fact bringing in tax increases, yet it is spending huge amounts of tax dollars—millions—on advertising its so-called action plan, which many, including myself, would argue is a dud. The government will spend millions of public dollars, tax dollars, telling Canadians that it is not increasing taxes, when in fact the government is increasing taxes and using tax dollars to try to convince Canadians that it is not increasing tax dollars. There is some irony in that.

We in the Liberal caucus recognize that a tax increase is a tax increase, and that is what this tariff is all about. It is going to generate in excess of a quarter of a billion dollars. The number of $330-plus million is being used. We know for a fact that we are talking about at least a quarter of a billion dollars. That is a great deal of money.

Where is that money coming from? Who is going to be footing that bill? Who is going to be providing that additional revenue? It is going to be the middle class. It is going to be those individuals who aspire to be a part of the middle class. Those are the individuals who are going to have to pay for it.

We hear a lot about the iPods, and for good reason. At the end of the day, when we go back to the core of the question that the leader of the Liberal Party put to the Prime Minister today, what we are talking about includes tricycles, school supplies, and those little red wagons that quite often a child aspires to get, whether it is from the Canadian Tire department store or from the many other retail outlets across our land. These are relatively young parents who are trying to get the financial means to provide for their children in a productive fashion.

Many would argue that the middle class is a very important group of people, and the government is ignoring that group. It is ignoring this group because it believes it can take them for granted. On the one hand the government says it is not increasing taxes, but on the other hand it is using tariffs to garner $300 million plus, and that is going to have an impact on the middle class. There is going to be a tax increase through this budget 2013.

There has always been a price gap. I have raised this today in the form of questions to both government and New Democrats in regard to recognizing the importance of the price gap between the United States and Canada.

Our population in good part lives along that border. With regard to consumers and retailers, I can speak from Manitoba's perspective, but I believe retailers across this land recognize that one of the greatest frustrations they have is justifying to consumers in Canada why our prices are a little higher than those of the United States.

In good part, the new tax the government will implement this year will increase the price gap between Canada and the United States. We have independent economists who have acknowledged that will happen, that we will see a larger price gap. We have met with many different small business people throughout this country who are concerned about the price gap. The government has turned a deaf ear to one of the most important economic engines in our country today, which is small business. Small businesses are concerned about the price gap.

The government has done very little to address this very important issue. I would pose the question, and I am surprised that the government has not provided impact studies that have been done so that we would know first-hand the degree to which these tax increases will impact Canadians, both for consumers and for the potential jobs that could be lost because of the increase in the price gap.

I suspect, as in the past on many of the economic measures taken by the government, that it has not done its homework. My colleague from Markham—Unionville indicated that he does not necessarily believe that the Conservative government saw the impact of the increased tariff on wigs. We would like to think not. However, the government has now been made aware that the greatest consumers for wigs today are individuals who are receiving chemotherapy or cancer treatment. There are a good number of reasons why individuals require wigs. How will the government respond, now that the issue has been brought to its attention? We will have to wait and see.

It bears repeating that the government has a responsibility to be more transparent and accountable for the actions it is taking. There are tax increases in the budget. The middle class and our consumers from coast to coast to coast will have to pay more because of these tax increases that are being imposed upon them. Some Canadians will be affected more than others because of their need for many of the products on which the tariffs are being applied.

I heard the other day the spending on the promotion of the economic action plan, the one I referred to as the dud, will be literally in the millions of dollars this year, to tell Canadians that we are not having tax increases, which is just not true. There are significant tax increases.

I challenge members of the Conservative government to stand in their place and acknowledge the reality that the PMO follows the debates in the chamber, and if individuals mention the economic action plan in a positive way, they get a gold star. If they say there is a tax increase in our budget, they are in a lot of trouble from the PMO.

The Conservatives cannot accept or acknowledge the facts. If they do that, even if they are not true, they are going to be in the far back corners of the Conservative caucus. I suspect that is one of the greatest challenges they have today.