House of Commons Hansard #202 of the 42nd Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was community.
Andrew Scheer ConservativeLeader of the Opposition
Mr. Speaker, while answering media questions yesterday, the Prime Minister described his “family fortune”, which is held in at least three separate numbered companies. It must be nice. Shockingly, he confirmed that he would not be affected by the tax changes he has claimed are intended to make wealthy Canadians pay more.
While the Prime Minister is going after local plumbers, mechanics, and farmers, he is bragging that he will not be affected. How is that fair?
Jim Carr LiberalMinister of Natural Resources
Mr. Speaker, not only do we on this side of the House defend the entrepreneurs and businesswomen, we also represent the integrity and respect women from coast to coast to coast. The Leader of the Opposition refuses to denounce the comments of his colleague in front of all members of the House and, indeed, in front of all Canadians.
Alain Rayes Conservative Richmond—Arthabaska, QC
Mr. Speaker, 35 organizations representing businesses, SMEs, professionals, self-employed workers, and farmers, with more than 1.2 million members between them, were never consulted about the Liberal government's tax reforms. These are not multi-millionaires we are talking about. These are people who work hard day after day to create jobs right across the country.
My question is simple: is paying $1,500 to attend a private cocktail party with the Prime Minister the only way for these people to make themselves heard?
Bill Morneau LiberalMinister of Finance
Mr. Speaker, we want to get rid of a system that encourages the wealthiest Canadians to incorporate so they can get a lower rate of tax than middle-class Canadians. That is what we are trying to do. We are listening. We are in the middle of consultations right now. We are listening to people across the country. I am visiting chambers of commerce all across Canada to hear what they have to say, and that is very important. We are going to continue to listen so that we can make sure our measures are the right ones to help us come up with a system that is fair.
Alain Rayes Conservative Richmond—Arthabaska, QC
Mr. Speaker, here is a real life example. Joseph, an entrepreneur and small business owner, wrote me a message yesterday on Facebook. He said, “I have struggled to stay in business for a long time, but this tax reform is forcing me to liquidate my equipment and shut down. The Liberal's vision involves helping the wealthy at the little guy's expense.”
That is the truth. The government is not going to help Joseph and families across Canada by raising taxes for SMEs.
Will the minister rethink his unfair, ad hoc tax reform?
Bill Morneau LiberalMinister of Finance
Mr. Speaker, the truth is that we currently have a tax system that encourages the wealthy to incorporate so they have a lower tax rate than the middle class. That is the truth. That is our situation. That is why we want to be sure that our system is fair. We listened to SMEs to make sure that the system works for them so that they can continue to make active investments in their businesses. That is very important.
We are listening.
Thomas Mulcair NDP Outremont, QC
Mr. Speaker, yesterday the Prime Minister left the door open to joining American ballistic missile defence, just one month after saying the Liberals would not change their position against such a system.
The system is dangerously unreliable, exorbitantly expensive, and it may well just spur a nuclear arms race. Just last week the Canadian Deputy Commander of NORAD warned clearly, “The extant U.S. policy is not to defend Canada.”
How has Trump convinced the Liberal government to keep this one on the table nonetheless?
Harjit S. Sajjan LiberalMinister of National Defence
Mr. Speaker, the security of Canadians and the defence of North America are of the utmost importance to the Canadian Armed Forces and to our government. Our new defence policy recognizes the growing threats of ballistic missiles and commits to continuing to work actively with the United States and looking broadly at all threats to North America, as we look at NORAD modernization. However, the policy has not changed yet.
Thomas Mulcair NDP Outremont, QC
Mr. Speaker, what is the government's logic?
The Liberals are opposed to the UN treaty for nuclear disarmament, but they are leaving the door open to participating in an ineffective, dangerous system that will precipitate an arms race.
Is that the Liberals' foreign policy?
Is it accepting Donald Trump's belligerent fire and fury policy rather than participating in the diplomatic efforts that more than 120 countries are making towards disarmament?
What kind of world do they want to live in?
Marc Garneau LiberalMinister of Transport
Mr. Speaker, you can be sure that our goal is nuclear disarmament. We are working hard to take real action toward that goal.
For the first time in 2016, Canada rallied 159 countries to sign the fissile material cut-off treaty, and countries signed that treaty, whether they had nuclear weapons or not. That is real action. We are working toward nuclear disarmament.
Nathan Cullen NDP Skeena—Bulkley Valley, BC
Mr. Speaker, New Democrats have fought for tax fairness for generations, so we welcome the Liberals to the conversation with open arms. Yet, in typical Liberal fashion, they have somehow managed to screw up the consultation and decided to focus only on small business. The New Democrats are calling on the government to extend and expand this review to get it right.
Billions in tax havens, hundreds of millions of dollars in CEO stock options, no wonder small businesses do not trust the Liberals when it comes to their affairs. The Minister of Finance is going after all the minnows but he keeps throwing back the whales.
Will the Liberals get serious about going after tax cheats even if it might hurt some of their wealthy and well-connected friends?
Diane Lebouthillier LiberalMinister of National Revenue
Mr. Speaker, during the election campaign, our government chose to tackle tax evasion. In our last two budgets, we invested over $1 billion, which enabled us to recover $13 billion. Now that we have started, we will not stop.
Alexandre Boulerice NDP Rosemont—La Petite-Patrie, QC
Mr. Speaker, if the Liberals were really serious about tax fairness, they would have kept their promise to eliminate the loophole available exclusively to CEOs.
We have all heard fishing stories. Here is a good one. Usually fishers throw back the little fish and keep the big ones. Strangely enough, the Minister of Finance is doing the opposite: he is throwing the big ones back into the lake and keeping the little ones.
Why are the Liberals attacking small businesses and doing nothing that might affect their Bay Street buddies, CEOs, billionaires, and tax havens?
Bill Morneau LiberalMinister of Finance
Mr. Speaker, as I said, we do not want a system that enables the rich to set up private companies so they can enjoy lower tax rates than the middle class.
Over the past two years, we have cut taxes for the middle class, raised taxes on the wealthiest 1%, introduced the Canada child benefit, and given the Canada Revenue Agency an extra $1 billion to work with. The NDP supported none of those measures. We intend to stay on track with a system that is fair.
Pierre Poilievre Conservative Carleton, ON
Mr. Speaker, the Finance Minister wants to double tax the investment income of small businesses for a total of 73%, but public corporations, those trading on the stock market, are exempt from this new double tax, so they will keep paying the current lower 55% on their passive investment income.
How is it fair for the pizza shop owner to pay a higher tax rate than the millionaire owners of public companies, like, say, Morneau Shepell?
The Speaker Liberal Geoff Regan
Order, please. I would remind colleagues that they are not to do indirectly what they cannot do directly. That is close to the line.
The hon. Minister of Finance.
Bill Morneau LiberalMinister of Finance
Mr. Speaker, again, what we are talking about here is a system that encourages wealthy individuals to arrange their taxes in an incorporated way so they can get a lower rate of tax than middle class Canadians. This is what we are trying to get after here.
We are working hard to make sure we listen to Canadians, to understand the concerns of those people who are looking at this measure and how it might affect them. However, we want to be absolutely clear. Our goal is to have a system that is fair, one that makes sure we do not encourage the wealthy to have a lower tax rate than the middle class.
Pierre Poilievre Conservative Carleton, ON
Mr. Speaker, actually, that is precisely the system the Liberals are now creating. In fact, while the Finance Minister and the Prime Minister have gone around accusing our mechanics, farmers, and pizza shop owners of playing games to avoid paying their fair share of taxes, in fact, they are imposing a much higher tax rate on those small business owners than is paid by the owners of much bigger companies on Bay Street.
If a 73% tax rate is so fair, then why is he only applying it to the little guys on Main Street and none of his big friends on Bay Street?
Bill Morneau LiberalMinister of Finance
Mr. Speaker, we want to make sure that we do not have a system that encourages the wealthy to take up an approach that is going to make sure they have a lower tax rate than the middle class. We are going to stay on top of this.
We are making sure that misinformation and inaccurate facts are dealt with. We are going to listen to Canadians and clarify what we are trying to achieve to make sure that everyone knows we are going to end up with a tax system that is more fair. That is our goal, and we are going to stick with that.
Gérard Deltell Conservative Louis-Saint-Laurent, QC
Mr. Speaker, let us talk about fairness.
The Minister of Finance's proposal is to tax small business investment income at 73%. This means that a businesswoman in my riding, Diane, who owns a garage in Louis-Saint-Laurent, will have to pay a 73% tax, while big financial corporations, such as Morneau Shepell, for example, will not have to pay the same rate at all.
Is the minister really saying it is fair for small business owners, for the businesswoman in my riding, to pay 73%, when even billionaires do not have to pay that much?
Bill Morneau LiberalMinister of Finance
Mr. Speaker, we want to make sure we have a system that is fair. We want to make sure that wealthy Canadians cannot choose the approach that is going to allow them to have a lower tax rate than other Canadians. We also want to make sure that small business owners have the ability to invest actively in their businesses, because we are seeking to ensure that our economy can continue to grow.
We are going to listen to people to make sure we get this right, but again, we are going to follow through with measures that will ensure that all Canadians can see that our system works for our country.
Gérard Deltell Conservative Louis-Saint-Laurent, QC
Mr. Speaker, the best way for that to happen and for the system to be fair is if small business owners were not penalized by this greedy government that just wants more taxes from small businesses.
Once again, the reality in my riding is that a businesswoman, Manon, who owns a restaurant in Loretteville, not too far from where I live, is going to have to pay a 73% tax, while Bay Street billionaires like Morneau Shepell will not pay 73%.
Does the Minister of Finance think that is fair?
Bill Morneau LiberalMinister of Finance
Mr. Speaker, as we know, there are situations in our country where wealthy Canadians find a way to incorporate so they pay a lower rate of tax than middle-class Canadians. We know that this is not appropriate.
I am happy to continue to talk with Canadians and listen to them. Over the course of the next week, I will be having a tele-town hall with Canadians so they can talk to me and give me a sense of their concerns and their issues. People will have questions. We are looking forward to listening, but we will move forward to make sure the system is fair and that it works for small businesses and for all Canadians.
Lisa Raitt Conservative Milton, ON
Mr. Speaker, for the last two weeks I have spoken with Canadians in Nova Scotia, New Brunswick, Newfoundland and Labrador, and Prince Edward Island. They have shared with me the stories of how they are going to be impacted by these tax changes.
I met Andrew, who is an apple farmer in New Brunswick. He explained to me that his problem is this. He will, at some point in time, because of this impact, choose between his employees and his family. I do not think, under the minister's plan, Andrew being in a case where he has to think about one or the other is very fair. I want to know why the finance minister is forcing Andrew to pay a 73% tax that not even millionaire owners of Morneau Shepell—
Bill Morneau LiberalMinister of Finance
Mr. Speaker, as I have said, we are looking toward a system that does not encourage wealthy Canadians to incorporate so they have a lower tax rate than middle-class Canadians. We are trying to make sure that people can invest in their businesses over the long term. That is our goal.
We are certainly listening to people across the country to make sure that they will continue to invest in business and to create jobs, to ensure that we have a healthy economy for this generation and the next. The next generation, like this generation, deserves a fair tax system.