Debates of March 7th, 2017

Opposition Motion—Tax Fairness

[Pierre-Luc Dusseault, NDP, Sherbrooke, QC]

Madam Speaker, I would like to thank my colleague for her remarks.

She began by talking about the Panama Papers. When I asked for information on this matter, I was told that 397 individuals had been identified and that 80 of them had come under closer scrutiny. In addition, none of the cases has been referred to the criminal investigations program of the Canada Revenue Agency. Obviously, no criminal prosecution has been initiated on the Panama Papers files.

Does my colleague think that the results obtained by her government have contributed to the fight against tax evasion when no criminal charges have been laid? Those involved in such schemes should be imprisoned. Denunciatory penalties would ensure that others understand there is a heavy price to pay and that they should not take part in such schemes. Is she satisfied with the record of her government, which has not instituted any criminal proceedings for tax evasion?

[Julie Dzerowicz, Liberal, Davenport, ON]

Madam Speaker, I mentioned the Panama papers at the beginning of my speech because that was actually a trigger for the residents in my riding, to say that they are very upset to hear of any individuals or corporations not paying their fair share of taxes in Canada.

Since then, on the international scene, Canada has worked very hard and very comprehensively with partners, internationally, to take coordinated action to make sure we are implementing enhanced reporting standards. We are signing key tax treaties with jurisdictions, which will help us to provide information to crack down on tax cheats worldwide. We are committed to our international obligations to bring common reporting standards into effect and to fulfill deliverables around base erosion and profit-sharing.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Madam Speaker, I would first like to thank my colleague for sharing her time with me. It is greatly appreciated. It is an opportunity for us to be able to talk about tax fairness.

For more than 15 years, the Auditor General has repeatedly said that the use of tax havens is the biggest threat to the tax base. While the government is repeating that it is working very hard to counter this, nothing ever happens. At some point, it will have to stop talking and start acting.

All day members across the way have been saying that the federal government is fighting very hard against tax evasion and tax havens. They may repeat it over and over again, but they are alternative facts. The fact is that Canada is the official spokescountry for tax havens. This is no joke: Canada is indeed the official spokescountry for tax havens, a role it performs openly and without shame.

It does so before the International Monetary Fund, the organization responsible for international financial markets. Canada clearly speaks for tax havens there. Twice a year, when he talks about the IMF world economic outlook, the Minister of Finance does not speak solely for Canada. No, he speaks on behalf of Canada and Barbados. Barbados is Canada's tax haven and has been since Paul Martin was finance minister and registered his ships in Barbados. Then we have the Bahamas, a tax haven whose insurance laws were written by the Minster of Finance's own consulting firm. I cannot name it in the House, because it contains the name of the Minister of Finance.

At the IMF, Canada defends and is the official spokesperson for Barbados, the Bahamas, Antigua, Belize, Dominica, Grenada, Jamaica, St. Kitts and Nevis, St. Lucia, and others.

It seems to me that the Liberals are thumbing their noses at Canadians by continuing to say that the government is cracking down on tax havens. Canada is one of the biggest users of tax havens in the world. That is particularly true of Canada's five largest banks. Their use of tax havens to avoid paying taxes costs the federal and provincial governments approximately $6 billion a year. We are talking about $6 billion for just five banks.

In June 2016, the IMF found that the Royal Bank, Scotiabank, and CIBC, these three banks alone, represented 80% of the banking assets in Barbados, Grenada, and the Bahamas. These three Canadian banks hold almost all of the banking assets there.

The government needs to stop saying that Canada is a champion in the fight against tax havens. That is not true. The reality is that Canada is an advocate, protector, and spokesperson for tax havens. In other words, Canada is a cheerleader for tax havens.

The KPMG fraud scandal is just the latest example of Canada's inaction. The CRA discovered the Isle of Man fraud over five years ago, but the government has still not filed any criminal charges against KPMG.

When it comes to talking and saying nothing, the government is always there, but when it comes time for action, it is nowhere to be found.

I will demonstrate what it means to fight fraud in tax havens. This happened in the United States. In 2003, a senate committee brought to light certain fraud schemes involving tax havens that were sold by KPMG, triggering an investigation by the IRS, the U.S. Internal Revenue Service. When KPMG tried to invoke professional privilege to refuse to hand over the list of its fraudster clients, the IRS threatened to obtain a search warrant and charge the firm’s executives with obstruction of justice. Contrary to what is happening here, KPMG submitted and put an end to its obstruction. The U.S. investigation demonstrated that 431 clients of KPMG had concealed $11 billion in revenue from the tax authorities, resulting in lost tax revenues of $2.5 billion between 1996 and 2003.

Giving the benefit of the doubt to the KPMG clients who said they thought the financing package was legal, since they had acted on the recommendation of their accountant, the IRS offered them a conditional amnesty. This was not at all the same amnesty as we have here. They were required to repay their debts within 90 days, including interest and a 50% penalty, or else go to prison.

All the clients agreed, and the IRS recovered $3.7 billion on the $2.5 billion owing, including the 50% penalty plus interest.

In the United States, an amnesty means that people have to repay one and a half times their debt. The Americans were not content with hunting down the fraudsters. They went after the source of the problem, the fraud barons, KPMG itself. Here we give them billions of dollars in contracts; there, they are prosecuted.

On June 13, 2005, two years after the fraud was discovered, the U.S. government laid criminal charges against KPMG. Nine of its executives faced charges of fraud and criminal conspiracy. The firm itself was accused of being a criminal organization, something that could have resulted in its dissolution.

Two weeks later, on June 27, 2005, the Internal Revenue Service, the IRS, announced that it had come to an out-of-court settlement with KPMG. In return for dropping the criminal charges which could have led to the company’s dissolution, KPMG agreed to dismantle three of its departments, to stop selling tax planning services, to pay the government $466 million, nearly half a billion, in damages, and to give an IRS agent unlimited access to all of its files for three years.

The above notwithstanding, the criminal charges were maintained against the nine executives. Two were found innocent, six had to pay fines totalling $25 million, and one was imprisoned. It was the defrauder-in-chief who ended up in prison.

Here in Canada, the government gives fraudsters contracts worth $92 million. Good for them! The government thanks fraudsters and shower them with gifts. They are all buddy-buddy. The fact is that the government does everything it can to facilitate the use of tax havens. That is the problem we have here. When it comes to helping its banker buddies, the government is happy to play an active role.

The Income Tax Act prohibits the use of tax havens. Parliamentarians never voted for that. A close look at the tax treaties shows that the use of tax havens is not allowed. For example, article 30 of the treaty with Barbados explicitly excludes all businesses with special tax benefits in Barbados. According to the treaty, profits sent to Barbados have to be taxed in Canada. The treaty is clear, and its implementation act is rock-solid. The act states that provisions in this treaty take precedence over incompatible provisions in any other act or regulation. In other words, under the act to implement the Canada-Barbados treaty, the government is obligated to tax repatriated profits.

As for the agreements that Canada has concluded with the other 22 tax havens, they are nothing but information sharing agreements. They too do not give anyone the right not to pay income tax in Canada. The tax treaties and the Income Tax Act are not the problem; the problem is the regulations which contradict the treaties and were adopted without a vote.

The government has passed regulations that facilitate tax avoidance. When I said that Canada was the protector of tax havens, I was not exaggerating. Not only does it speak on their behalf at the IMF, it secretly amends the tax regulations that authorize their use.

On this subject, I would like to point out an inaccuracy in the motion being debated today. The motion asks us to renegotiate these tax treaties when it should instead seek to abolish the tax regulations that permit the use of tax havens. It is not the treaties or the laws that are bad. The problem is the regulations that the government has adopted on the quiet. It is the regulations and the government that are bad, not the treaties.

I would therefore like to collaborate with the NDP on this subject so as to continue the fight against tax havens. At the end of my speech I will be proposing an amendment to the motion that will address this inaccuracy. I will return to this point in a moment.

I repeat: tax havens are the greatest injustice of our time. Now when the tabling of the budget is drawing near, now when everyone has a gun to their head and public services are jammed up, it is absolutely scandalous for the government to be giving billions of dollars in gifts to the wealthy. Tax havens must be eliminated.

I propose to amend the motion by modifying a few words in paragraph (b)(ii). It is a matter of replacing the words “renegotiating tax treaties that let” with the words “abolishing tax regulations that let”.

[The Assistant Deputy Speaker, NDP, Carol Hughes]

It is my duty to inform hon. members that an amendment to an opposition motion may be moved only with the consent of the sponsor of the motion. If the sponsor is not present, the deputy leader, whip or deputy whip of the sponsor’s party may give or refuse consent on the sponsor's behalf.

The hon. member for Beloeil—Chambly has the floor.

[Matthew Dubé, NDP, Beloeil—Chambly, QC]

Madam Speaker, as the deputy House leader for the NDP, I must inform you that, unfortunately, since we did not have the opportunity to see the wording of the amendment before it was proposed and because we are satisfied with the wording proposed by my colleague from Rosemont—La Petite-Patrie, we are saying no to this amendment.

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

Madam Speaker, I thank my colleague from Joliette for his speech, which could not be more on point. He is clearly much more of an expert on the matter than I. I will indulge in a question that is not directly taken from his comments, but will allow me to take advantage of his expertise and knowledge.

Every time we address the issue of tax havens or tax avoidance, most governments hide behind the argument that the problem is international and there is nothing we can do alone. I get the impression that Canada could be a leader instead of playing it safe, which seems to be the Liberals' modus operandi.

Can Canada really do nothing without being surrounded by its international allies?

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Madam Speaker, I thank my colleague from Trois-Rivières for his question.

Indeed, that is often the loophole the government hides behind; pardon the pun. We are told that if we cannot get all countries to work together, nothing can be done. I would remind the House, however, that a few years ago, the government used the same argument to say that there was nothing it could do about climate change on its own, that we had to wait for all countries around the world to be able to begin taking action. That was false. We can take action to protect the environment in Quebec and in Canada right now. We do not have to wait for China, the United States, or any other country. We can act immediately.

The same is true for tax havens. There are concrete things we can do here, such as eliminating regulations and following the American example and prosecuting firms like KPMG that set up fraud schemes. There are many ways we can act right now. The first thing the government needs to do is take off its dunce cap.

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Madam Speaker, for a number of years, I served in the Manitoba legislature. At times, we would hear the issue of tax evasion at the provincial level. My question underlines the importance for the national government to work with its provincial partners to look at ways in which we can improve that sense of tax fairness.

Would the member like to add anything with respect to taxation and fairness at the provincial level and the important role Ottawa could play in that or vice versa?

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Madam Speaker, I would like to thank the Parliamentary Secretary to the Leader of the Government in the House of Commons for his question and comments.

There are many things that we would like to ask the federal government to do for Quebec and the provinces. In matters of tax evasion and tax havens, the exchange of information happens between countries. Therefore, it is the Canada Revenue Agency that has the authority to ask other countries for information in order to conduct investigations. Depending on the wording of tax treaties, the federal government can also delegate this authority to provincial or national entities, such as Revenu Québec. This would allow the Government of Quebec to conduct its own investigations and to negotiate directly with other countries.

There seems to be unanimity in the Quebec National Assembly on tax evasion. This would allow it to move forward. I would remind members that when a tax scheme is discovered in Quebec, there is an automatic 30% penalty. In the United States, a penalty of 50% was levied in the case of KPMG. The Quebec government has a 30% penalty, but the federal government has no penalty. This is practically an incentive for businesses and the wealthy to invent ways to try to avoid paying taxes.

[Pierre-Luc Dusseault, NDP, Sherbrooke, QC]

Madam Speaker, I would like to thank my colleague for his intervention and his expertise on the matter.

In his riding of Joliette, does he get the impression that the public thinks there is a two-tier system? This term is often used to describe a system where there are rules for the average taxpayer and other rules for multimillionaires. The difference is that average taxpayers do not have the money for tax schemes or to defend themselves against the Canada Revenue Agency and its lawyers. In the other corner, multimillionaires not only have the money for such schemes, but they also have the money to defend themselves. They are told by the CRA that they are untouchable, that they have too many appropriate expenditures, so they will get to negotiate a settlement in order to avoid prosecution.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

MadamSpeaker, I fully agree. People are preparing their tax returns as we speak. They see what they are paying. They understand there is a double standard when companies help millionaires avoid paying their taxes. It is an injustice. Instead of punishing them, instead of putting them in jail, they are given $92 million in contracts. They are rewarded. The people of Joliette are not happy.

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

Madam Speaker, if there is one topic on everyone's lips these days, it is the one we are addressing today. Since time is running out and in order to allow as many people as possible to reflect the views of the citizens who live in each of the ridings, views that all point in the same direction, I am announcing that I will be sharing my time with the member for Laurier—Sainte-Marie.

Let me say from the outset that I am far from being a tax expert. I am not an expert in the matter, but one thing I am sure of is that I listen to the citizens in my riding and share their frustration on the issue.

I would like to be able to say that politicians are leaders in tax fairness and that they promote measures that improve the lives of all Canadians. However, the truth is that, once again, we are tagging along behind the simmering anger of our citizens.

The difference between the NDP and successive governments in Ottawa is that we hear the grumbling and we are doing everything we can to propose tangible measures to stem this rising tide.

For example, in the last election campaign, we were roundly criticized by some people for our proposal to balance the budget. Maybe we did not sell our own platform well enough. What is clear is that there were proposals in the revenue column that no other party in the House dared to make, that directly influenced the government’s capacity to seek out new revenue sources.

We need only think of the tax rate on large corporations that the Conservatives cut from 22% to 15%, as part of a job creation strategy, with very few results when it came to job creation. I will always remember that request, or rather that plea, by a former minister of finance, Mr. Flaherty, for whom I have great respect, even though we had different political allegiances. He pleaded with the big businesses to whom we had given tax cuts to reinject the money into the economy. That did not happen, and we know the rest.

At present, with wealth disparities continuing to grow, it is high time that we did something, that we stop talking and start acting. Instead of hiding behind the excuse that the problem is international in scope and we cannot do anything on our own, it is time for Canada to act like a leader and initiate the movement. Canada could be in the lead, as I was saying, instead of just saying “Canada is back”.

I am going to give a few statistics, just to provide a clear and precise picture in two or three figures, for everyone listening to us. We are talking about Canada, with Canadian numbers. The highest paid CEOs in Canada are paid 193 times the average Canadian wage. I am not talking about the median wage, even; I am talking about the average wage. Two billionaires own about one third of all personal wealth in Canada: $33.1 billion. The richest CEOs earn in a half day what the average worker earns in a year. We can see how urgent is is for us to promote greater equity, to hear and understand the discontent expressed to us from everyone in Quebec and Canada when they tell us enough is enough.

I am therefore pleased to rise today to speak on behalf of the taxpayers of Trois-Rivières who work hard to make ends meet and who are faced with this scourge of tax evasion and tax avoidance, which must be condemned, certainly, but which must also be combated with effective proposals.

To that end, the NDP is proposing very concrete measures. For the people who are following our debates, these are the main points of our motion. The NDP is calling on the Liberal government to identify the tax giveaways that benefit the wealthy and keep its promise, among other things, to cap the stock option deduction loophole.

For instance, what is the real issue with stock options, since most Quebeckers or Canadians cannot really afford to buy them?

A CEO can buy shares in the company he himself leads and sell them when he sees fit. Obviously, the right time for him will be when he will be guaranteed the most money. The resulting profit will be a capital gain taxed at half the rate of regular working income. The federal government is therefore encouraging large corporations to keep up this practice, since the CEOs who are benefiting from it pay 50% less tax on the profit from selling their shares.

As a result of this tax loophole, every year, the federal government and the provinces are losing $1 billion in revenue that could have been put toward a better employment insurance system, compensation for all the pyrrhotite victims in Trois-Rivières and Mauricie while we are at it, and upgrading our infrastructure, particularly in terms of Internet access since we know that many remote regions still do not have broadband service. In short, with $1 billion, just imagine what a finance minister could dream of. However, it seems that the minister has a stronger allegiance to the wealthiest than to the middle class he keeps talking about.

To make our tax system fairer, the NDP proposes three concrete measures to address tax evasion: tightening rules for shell companies, renegotiating tax treaties that let companies repatriate profits to Canada tax-free, and ending penalty-free amnesty deals for individuals suspected and potentially charged or convicted of tax evasion, should there ever be a prosecution some day.

I would like to briefly comment on the relevance of our motion. Many people are finalizing their income tax returns and doing their duty as citizens. However, for those for whom the T4 is everything, or in other words, those who file the simplest income tax return with just one source of revenue, there are no loopholes available. That is the case for most Canadians, but late filers beware because there will inevitably be penalties. That means that average Canadians, and I am not talking about those with an average salary, but most Canadians who file their income tax return using only a single T4, will have to pay penalties at even the slightest sign of an error. I am not talking about fraud but about mistakes. That is because it is easy for the government or the CRA to catch these errors and do something about them.

It is true that it may be more difficult to determine whether large corporations are evading taxes, but the government needs to put more time, energy, and money into doing so. When the Conservatives took office, it was the opposite. They cut a lot of positions at the Canada Revenue Agency, which made it practically impossible to conduct these kinds of major investigations.

Every time we see a pothole or wait forever for health care, we have to remember that the money meant to improve our roads and our public services is hidden on the Isle of Man or somewhere else.

Unfortunately, because I have only a minute left, I will jump ahead to the conclusion.

Despite not having had the time to say everything I wanted to say, I hope that the main takeaway is how emotionally-charged the issue is for me because of what I hear, day after day, when I travel in my riding and people say to me, “Enough is enough, thank you to the NDP for standing up in the House and fighting to put an end to tax evasion and tax avoidance.”

[René Arseneault, Liberal, Madawaska—Restigouche, NB]

Madam Speaker, as my colleague from Trois-Rivières did, I would first like to inform the House that I am not an expert in tax policy and tax loopholes.

My colleague has made three proposals, and I have a question about the one concerning amnesty. I think he was referring to people who may voluntarily report their true earnings. I think that is what he was alluding to. I have one burning question. Again, I am not an expert.

Does my colleague know whether studies have been done to see whether the proposal that a taxpayer voluntarily disclose “hidden” income has had a positive impact? Was it worth it to do that rather than come at those people with an army of lawyers and spend whatever it might cost on legal proceedings? Would my colleague know of a study that could tell us whether the option of making voluntary disclosures and obtaining amnesty was worth it for the Canadian government?

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

Madam Speaker, I thank my colleague for his question.

I welcome him into the club of non-experts and, I hope, into the club of members who are outraged at this practice.

One very specific example, taken from the report we saw on the Radio-Canada program Enquête, said, concerning KPMG, among others, that we have there a classic case that could set an example, if the government had gone ahead with a conviction or at least legal action. The fact that it was not taken to court, however, means that we are not developing any case law and we do not have the cases that could serve as examples and then be quoted in future cases.

Sometimes there are situations where even if the cost were to exceed what we would recover in taxes, it would be beneficial, because in the other cases that followed and were subject to those decisions, substantial amounts would be collected.

[Robert-Falcon Ouellette, Liberal, Winnipeg Centre, MB]

Madam Speaker, I was a member of the Standing Committee on Finance, where we discussed this issue at length. We even produced a report with about 14 recommendations, if I remember correctly. We studied this issue thoroughly.

Did the member have a chance to look at our recommendations and what can be changed? What did he think of our recommendations?

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

Madam Speaker, unfortunately, I am not a member of the Standing Committee on Finance. I am kept busy with the transport committee and occasionally replacing my colleague from Laurier—Sainte-Marie on the international affairs committee.

I have complete confidence in the NDP members of the committee and their recommendations. I analyze the situation with them, and the party's proposals on this opposition day are very clear. I am pleased that some of them are in line with some of the Standing Committee on Finance recommendations, but my experience so far suggests that opposition amendments are rarely given a warm welcome.

[The Assistant Deputy Speaker, NDP, Carol Hughes]

The hon. member for Sherbrooke for a brief question.

[Pierre-Luc Dusseault, NDP, Sherbrooke, QC]

Madam Speaker, I will be very brief.

I am surprised to hear the members opposite say that giving amnesty might be appropriate, when we are talking about files involving obvious and blatant tax fraud.

There is no doubt about it in the case of KPMG; it is clear. However, if we look at the figures, we see that since 2006, not one charge has been filed under section 163.2 of the Income Tax Act. That section allows for prosecution for misleading tax plans, in other words, prosecuting those who engage in tax planning.

Does my colleague think that accounting firms like KPMG should also be prosecuted, along with the individuals who use their schemes?

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

Madam Speaker, I thank my colleague from Sherbrooke who is the master of brief questions this afternoon. Obviously, I agree with him when it comes to accounting firms.

With regard to amnesty in general, I think granting amnesty is inconceivable, especially when people are asked simply to pay the arrears, without any penalties, when ordinary taxpayers automatically have to pay penalties.

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

Madam Speaker, I am very pleased to rise in the House today to speak to this motion. In my opinion, tax avoidance and tax evasion rank right up there with world peace and the need to save the planet. This is an extremely important issue.

In the riding of Laurier—Sainte-Marie, there are community organizations that are struggling to make ends meet and cannot hire the staff they need. I meet with young people who would like the government to invest in their future and in the green economy. Some immigrants need more services, and that includes French tests that cost the same as English tests.

Some organizations that help homeless women have to turn people away because they do not have enough room. There are families with children who have to choose between paying rent and paying for groceries because the government is not investing enough in affordable housing and social housing.

All across the country, people are waiting for reasonably priced day care spaces, workers want the government to invest in job retraining, children are living in poverty, and indigenous people want the government to keep its promises.

Far too often, there are not enough resources to accomplish all these basic things. However, the resources are there. In the meantime, we are losing hundreds of billions of dollars to tax evasion and aggressive tax avoidance.

There is no reason this lost money should not be recovered. Some tangible measures can be taken immediately. One clear and straightforward example would be to get rid of the stock options tax loophole for CEOs. When CEOs are paid with stock options, their salary is considered a capital gain and is taxed at half the regular rate. Through this option, roughly 8,000 Canadians have deducted on average $400,000 from their taxable income.

Someone who earns $40,000 does not have that option. They have to pay the regular tax rate that applies to that salary. However, CEOs are entitled to reduce a big part of their income by 50%. It is interesting because during the election campaign, the Liberals promised to cap it at $100,000. I think that is rather generous. However, once elected, they broke their promise. What a surprise.

There are other very simple things that can be done. We could amend the tax rules for businesses that are fond of using shell companies, which have no economic purpose. They only serve to protect the wealth of the ultra-rich. Therefore, we could ask businesses to provide proof of the economic reasons justifying the existence of foreign subsidiaries.

We could also review tax agreements that allow businesses to report their profits in tax havens and to return them to Canada tax free. In my opinion, this is vitally important. There are 92 such treaties with countries such as Barbados, Jamaica, and the Republic of Malta, among others, which allow people to commit tax evasion simply by sending billions of dollars to tax havens without paying taxes.

For example, between 1988 and 2001, direct Canadian investment in Barbados rose from $628 million to $23.3 billion, a 3,600% increase.

It is also crucial that we put an end to penalty-free tax amnesty deals for individuals suspected of tax evasion.

Case in point, recently a deal was made with KPMG clients shielding them from civil or criminal prosecution as well as fines and penalties.

If I file my taxes late, I have to pay a fine. Same goes for the guy next door and all other ordinary Canadians, but people who get caught evading taxes do not have to pay a fine. Worse still, a young teenager who shoplifts has to pay the price, but the super-rich do not have to pay anything back.

We also need a higher threshold for foreign subsidiaries' interest payments. That is another tax avoidance strategy. I do not have much time, so I will not go into detail, but meaningful action can be taken now.

The truth is, we do not really know how much money is involved because tax evasion and tax avoidance, by definition, hide money. Still, if we had that money, we could fund our social programs.

In the longer term, we need to work at the international level. I would like to see Canada take a leadership role because everyone has to pull together on this if we want things to change. The impact in places like Africa can be significant. We give a lot of international aid to African countries. Those countries lose much more to tax avoidance and evasion than they receive in international aid. There is a long-term benefit here because if we help them, if we all work together to do away with the schemes that individuals and big corporations are typically involved in, that can help African countries. We would not have to invest as much. There are a lot of knock-on effects to consider here.

Dealing with this issue would therefore allow us to recover those resources, and that is very important. However, I would like to point out in closing that this is not simply a matter of resources. It is also a matter of social justice. Taxes are the price that must be paid for living in a civilized world, a democracy with community spirit. Everyone must do their part to the best of their ability. It is therefore a matter of social justice. It is also about democracy because, sooner or later, this practice will jeopardize it. Societies are becoming increasingly unstable because they are no longer able to fund their basic social programs. However, it is almost as though there is a network of people who lives between one tax haven and another without any civic engagement toward the governments of the countries where they do business or toward society in general.

I want to close with a plug for the film The Price We Pay. I highly recommend it to those who have not seen it.

I am very proud to support this motion. I hope that all of my colleagues in the House will do the same.

[Robert-Falcon Ouellette, Liberal, Winnipeg Centre, MB]

Madam Speaker, I had the opportunity to participate with finance committee in looking at tax evasion in one of our reports. Our committee put out 14 recommendations. We asked the minister how her department could be more effective and what the experts themselves in her department actually do to improve this situation. It was just a simple request but sometimes we have to ask those things.

We also requested that all tax products with any tax advisers be registered with the Canada Revenue Agency to make sure that they are legal.

We also asked that CRA report back to finance committee around June 1, 2017, and tell us what is going on with the Panama papers and what is occurring with tax evasion.

There was one thing that I did learn about in our study and that is that Canada is not alone in this. We are not in isolation. We have to work with our allies around the world.

I am wondering how we can take this complicated issue that impacts many jurisdictions around the world, the United States, Europe, Africa, and Asia, and do something, not by ourselves to reduce our competitive advantage, but how can we work with them.

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

Madam Speaker, I thank my colleague for his question.

Yes, it is important to work at the international level. Some aspects of this issue cannot be managed or resolved unless we all work together with our partners around the world. However, there are also measures that need to be taken here in Canada. I will go back to the example of how Canada does not impose any penalties or sanctions on people who engage in tax evasion and aggressive tax avoidance.

KPMG is being prosecuted elsewhere. There are people who impose sanctions. In Canada, companies do this sort of thing and we tell them that, if they admit to abusing the system, that will be the end of it. These are measures that Canada itself can take. I think that a distinction needs to be made. We cannot just sit back and say that what happens is up to others. This government has a role to play and I hope that it will play it.

[Cheryl Hardcastle, NDP, Windsor—Tecumseh, ON]

Madam Speaker, I would like to thank my hon. colleague for her very intriguing and inspiring speech. We know that Harper's cuts to the corporate income tax rate did not boost investment in Canada. They did not lead to promised job creation, and they cost the government $12 billion annually. Now, in hearing my colleague say that Canada could be a leader I think of the countless Canadians who are hopefully nodding their heads and agreeing with that; Canadians in precarious work, persons living with disabilities, persons who are struggling with a diagnosis and trying to research Lyme disease. There are countless ways that we could be using this $12 billion. I would love to hear more about the member's ideas on where Canada can be a leader on the international scene.

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

Madam Speaker, indeed, my colleague is quite right about the amount of money Canada is missing out on thanks to corporate tax cuts made under the Harper government.

In fact, we have practically become a tax haven ourselves, right here. We have seen American companies move their head office to Canada in order to pay Canadian taxes, rather than American taxes, without having any real impact on job creation here or any real benefits for Canadians and Canadian workers.

I see my Conservative friends applauding. They are applauding a facade, a superficial measure that did not really change anything for Canadians. In fact, it is problematic. I know my colleague cares deeply about human rights. We also have similar problems regarding rules for Canadian companies operating abroad and their environmental and human rights records. We are almost becoming what Panama is for boats, that is, some sort of port of convenience.

I think that needs to stop, and although we need to work internationally, the first measures—

[The Assistant Deputy Speaker, NDP, Carol Hughes]

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 Laurier—Sainte-Marie, Foreign Affairs; the hon. member for Calgary Rocky Ridge, Finance; and the hon. member for Vancouver East, Immigration, Refugees and Citizenship.