Mr. Speaker, it might be helpful, or perhaps even instructive, if I prefaced my remarks by sharing with my colleagues the definition of a tax. A tax is defined as 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”.
I would suggest that anyone with a reasonable outlook would know that hiking the CPP premiums is a form of taxation. It is in effect a payroll tax.
I would argue that raising taxes in times of a sluggish economy, in times of the weak economy we are experiencing here today in Canada, is absolutely the wrong thing to do. Raising taxes would have negative impacts on the Canadian economy. For example, it would restrict and reduce the ability of businesses to reinvest in their businesses. It would reduce the ability of Canadians to have more take-home pay, and it most certainly would reduce their ability to add to their savings. It would reduce the amount of of money they would be able to save.
It is simply the wrong approach to take. This payroll tax is regressive. It harms employers and employees alike. Most particularly, it is harmful to small businesses.
Let me share a small story from just a few weeks ago. I happened to be in Thunder Bay on some business. Since I had never been to Thunder Bay before, I went out for dinner to a restaurant that night with a colleague. I had a lovely dinner. Following dinner, the business owner and I engaged in a conversation. Once he found out I was a member of Parliament, he wanted to talk about the proposed hike in CPP premiums. He told me his profit margin was so skinny that any increase to the CPP premiums would result in only two things. One, he would be looking at a negative profit for the year, which might result in his closing his doors; or two, he would be forced to lay off employees. Neither of those two options was particularly attractive to this young employer. He said he had a business partner in another restaurant in Edmonton who was facing exactly the same situation.
I know it does not matter whether one is a small business owner in Surrey, British Columbia; Edmonton, Alberta; Winnipeg, Manitoba; Thunder Bay, Ontario; or Corner Brook, Newfoundland, because this is a problem for all small business owners.
The frustrating thing about this is there is no need to increase CPP premiums. The government's stated objective is to allow Canadians in their retirement years to retire more comfortably. However, the statistics do not indicate there is a problem today. Statistics indicate that fewer than 4% of seniors are living on a lower income, or below the poverty line. That is a great change from many decades ago. In fact, in 1970, 29% of seniors were living below the poverty line, so we have made great strides in the decades since 1970.
Additionally, statistics indicate that Canadians are saving more money today. In 1990, Canadians saved slightly more than 7.5% of their income. Today, it is almost twice that. Canadians are saving over 14% of their take-home pay, or at least their gross income, and putting it into savings vehicles like RRSPs, TFSAs, and the like.
We are making progress on that, so for the government to say it is doing this out of necessity is, frankly, disingenuous at the very least.
The government appears to be trying to create a solution for a problem that does not exist. The irony of all of this is that because of the government's reckless, out of control spending, the reality is that the government is creating a problem for which there is no solution, because of the billions of dollars of debt it is incurring and throwing upon the backs of taxpayers. It has no solution for getting out of debt. There is no plan to get back to balance.
It appears that the government's economic plan, if we want to call it that, is following very closely the path of the previous Ontario governments of McGuinty and, currently, Premier Wynne. That disastrous economic plan has resulted in the Province of Ontario, on a per capita basis, being more indebted than any jurisdiction in the world. What is even more frightening is the fact that two of the main architects of the disastrous economic policy of Ontario were Gerald Butts and Katie Telford, who are now two of the main economic advisers to the Prime Minister. I would hate to see these two do to Canada what they have done to Ontario, but that is certainly what appears to be happening.
However, I think there are alternatives to what the government is planning and proposing with Bill C-26. I have always thought it is instructive and helpful if opposition members, rather than just criticizing the government, offer alternatives or things the government could at least consider to replace flawed legislation—and Bill C-26 truly is flawed. My suggestions to the government would not cost the taxpayer a nickel.
The first suggestion I would make is this. Why does the government not work with its provincial and territorial counterparts and encourage them to add financial literacy to the K-to-12 educational curriculum? I think it would be extremely helpful for young people to learn why they need to save for retirement. It would helpful for them to learn how to save for retirement, to learn about the investment and savings vehicles that are available in Canada today, so that when they finally enter the workforce, they have a plan, or at least have charted out a course of action, to be able to work their lives and then retire with dignity. That no-cost item would, I believe, be extremely helpful.
The second thing is again a very simple concept. Of course, I believe it is totally alien to the government's thinking, but it would not cost the taxpayers a nickel, and it is simply to lower taxes. Do not raise taxes, but lower taxes. Allow Canadians to take more money home with them. Put more money in their jeans. Put more money into savings vehicles. At the same time, lowering taxes would stimulate the economy.
Our previous government had a low-tax, high-productivity agenda. It resulted in having the lowest tax regime in 50 years. What was the result? Well, we created 1.3 million net new jobs from the height of the recession until the day we left office. Why? It is because lowering taxes increases productivity. That is a concept the current government is totally unaware of. Bill C-26 is totally opposed to lowering taxes, because this bill would raise taxes.
For those reasons, and some of the others I articulated in the few moments I had for my address, my colleagues and I in Her Majesty’s loyal opposition will be vociferously opposing Bill C-26.