Mr. Speaker, I will be splitting my time with the member for Desnethé—Missinippi—Churchill River.
The subject matter before the House today is not only of pivotal interest to just about every Canadian from coast to coast, but it is of profound importance to members of the House because it fuses together two subjects that are of fundamental importance to the operation of the government and to the lives of Canadians, and that is tax policy and health policy.
For Canadians who are watching this or are interested in this issue, the motion before the House concerns the proposal by the current Liberal government to examine the possibility of ending the tax-exempt status of the extended health plans of Canadians, which include their dental plans, their prescription plans, their vision plans, their chiropractic and massage plans, any kind of extended benefit they may enjoy as a result of extended health care plans provided by their employers.
Currently, and for a significant amount of time in our country in just about every province except Quebec, which I will talk about in a moment, the provision of extended health plans to employees enjoys tax-exempt status, and there is a fundamentally sound reason for this. This represents a very considered approach of government to encourage the provision of these necessary and essential health services by employers to their employees and to ensure these very important parts of our health care program are incentivized and delivered to Canadians. The fact that this is very successful is borne out by the fact that some 13.5 million Canadians currently enjoy extended health plans from their employers and benefit from the tax-exempt status.
Canada's New Democrats believe that the proposed health benefits tax is a symptom of a government not only with the wrong priorities for health care, but also early on in its mandate displaying a rank incompetence in its ability to manage the finances of our country. This measure would do nothing to expand or improve services in health care. It would jeopardize coverage for millions of employees. It directly contradicts the Minister of Health's own mandate, which is “improve access to necessary prescription medications”.
Health policy analysts estimate that the proposal to tax Canadians' prescription, dental, and vision benefits would cost the average middle-income earner over $1,000 annually. Additionally, data show that Quebec, the only province that currently taxes these benefits, saw a 20% reduction in the number of employers offering extended health plans to their employees after the tax was introduced in 1993.
The government often claims to want to make decisions based on evidence. We have a very solid piece of evidence from a major province that shows that the result of this policy is very predictable. It would result in employers not offering extended health care plans to their employees. One out of five Quebeckers lost that benefit when this proposal was introduced in that province.
If imposed, this proposal would levy a heavy tax on 13.5 million working Canadians, result in lost benefits for millions of Canadians, and represent a tax grab of some $2.9 billion by the federal government.
In the view of the New Democrats, the goal of tax policy should be to encourage positive economic activity and promote social progress. The purpose of tax-exempting health benefits is to incentivize the provision of extended health benefits by employers to their employees. Clearly, taxing these benefits would remove this incentive and result in decreased coverage for Canadians. That is a lose-lose proposition.
I want to pause for a moment and think about what government would possibly do this. Why would any government possibly consider adopting a measure, like the Minister of Finance has repeatedly said is being considered right now by the government, that it knows would cost employees their benefits, cost the average worker making $45,000 a year an extra $1,000, and jeopardize the provision of necessary health services to Canadians? Why would a government do that?
I think we have 30 billion reasons for that. As Canadians will know, this week we saw an example of the government and the Prime Minister breaking yet another pivotal, clear, campaign promise to Canadians when he announced that the government was abandoning his solemn pledge to Canadians that 2015 would be the last election with first past the post.
Canadians will also remember, in that same election, after promising Canadians that he would balance the budget, right through July 2015, that suddenly, in September, he did an about-face and told Canadians that no, his government would run deficits. Specifically, the Liberal government, if elected, would run three successive $10-billion deficits and then balance the budget, magically somehow, because the Liberals never explained how, in the fourth year of their mandate. That was the promise.
What happened? In the Liberal government's first budget tabled in this House, it tabled a budget that indicated that the first deficit would be $29 billion. The Liberals also tabled in that document six successive years of estimates that showed that they would run deficits in every one of the next six years, totalling $120 billion in deficits over six years.
Actually, I correct myself. There are not 30 billion reasons why the government is considering grabbing $2.9 billion in taxes from ordinary working Canadians and jeopardizing their health benefits in the process. There are actually 120 billion reasons why, because the government, with its fiscal incompetence and its dishonesty during the campaign, is now scrounging, looking for tax revenue to cover up the fact that it misled Canadians and is mismanaging the Canadian economy.
Rather than imposing new taxes on workers who have been able to negotiate group insurance plans, the Liberal government instead should heed the call from New Democrats, medical experts, health economists, and concerned citizens to renew our public health care system for the 21st century.
Of course, in extended health care benefits, one of the most important aspects of benefits, besides vision care and dental care, is prescription coverage. I will focus on that for a moment.
Canada is currently the only country in the world that provides medicare for all while excluding universal prescription drug coverage. This has effectively created a health care system that will cover a doctor to diagnose the ailment, but not the medication to treat it.
Canadians also currently pay among the highest prescription drug prices in the industrial world, second only to the United States. Compounding this, 20% of Canadians, 7.5 million Canadians, are walking the streets of Canada today effectively with no prescription care coverage whatsoever. Consequently, nearly one in four Canadian households report family members who struggle and neglect to fill prescriptions due to cost.
Here is an opportunity to have a clear contrast between the NDP and the Liberals. The Liberals are actively considering a proposal to remove health care extended benefits from Canadians and tax Canadians, whereas New Democrats are working on a universal prescription drug plan that would actually look to expand health care coverage for Canadians to make sure that every single Canadian in this country has access to the medicine they need when they get sick.
The Conference Board of Canada study, I have a few figures here, suggests that someone earning $45,000 in full-time employment in this country, with family coverage, would pay an extra $1,167 in tax, were the Liberal proposal to go ahead. Those earning $60,000 would pay an additional $1,043, while workers earning $90,000 would pay $1,277 more. These numbers are reasonably consistent across the country, except maybe in Quebec, of course, where already this proposal is in place. Obviously, if two wage earners in the same family have coverage, the amount will double.
The New Democrats will stand against this ill-thought-out proposal by the Liberal government. We will make sure that Canadians know that the Liberals are considering taxing their health care benefits, and we will stand in this House and fight tooth and nail against this ill-conceived policy that will not only hurt Canadians' health care but will take money out of the pockets of hard-working Canadians at a time when they can least afford it.