Mr. Speaker, I will be splitting my time with the member for Sherbrooke.
I am pleased to participate in the debate. I know the member for Carleton started this discussion and talked about a number of different things, including the issue of Dalton McGuinty, the Ontario Liberals and taxation policy. What has been left out of that is the history which is so important when we talk about fairness for consumers, accountability for Canadians and how we continue to deal with debt from the former Harper government bringing in the HST.
In fact, the HST was not just a harmonization of the sales tax by the Conservatives, agreed to by the Liberals in this chamber, to get through a minority Parliament. It was also done with Dalton McGuinty and the Ontario Liberals and the Liberals in British Columbia as well. We are still paying the interest for that tax as we continue to run deficits. The Conservative government borrowed around $6 billion to bribe Ontario and British Columbia. The absurd reality is that Canadians are paying interest on a new tax put on other Canadians.
For those who want to say that the HST was just a simple harmonization of taxes and that there were no new taxes, there were. There were new taxes for a number of different things, such as car repairs, hair cuts, school supplies, retirement savings and even on parking fees at a hospital. When someone visited a loved one in the hospital, the Conservatives added a new tax to that visit. There are many more examples of that harmonization, but I want to focus a little on the economics behind it.
In particular, Stephen Harper and his government arranged a $4.3 billion transfer to Dalton McGuinty, despite all of their banter and rhetoric about the hatred toward the McGuinty government and its behaviour. However, the former Conservative government found a co-operative partner with the McGuinty government to bring in this new tax. They knew it was not popular.
It was the same thing in British Columbia, which led to a number of different votes and measures. The government borrowed that money to bring in new taxes on everything from car repairs, hair cuts, school supplies, retirement savings and even visits to loved ones in the hospital.
The member for Carleton may have forgotten about those new taxes his government implemented, but I and Canadians have not. In fact, requested an analysis of it. It was not done by a left-wing think-tank, which the member always likes to embellish upon in the House. It is called the Library of Parliament. The Library of Parliament has economists, lawyers and researchers who serve all members, including the member for Carleton. These people provide members of Parliament with good advice and good materials every day.
The report, which we requested from the Library of Parliament, said:
In 2009, the federal government agreed to transfer about $5. 9 billion to the provinces of Ontario and British Columbia to help fund the provincial costs of transitioning from their current retail sales tax systems to a harmonized sales tax (HST) that would be collected concurrently with the federal Goods and Services Tax (GST). With respect to these proposed transfers, the province of Ontario would receive two transfers from the federal government : the first, valued at $3.0 billion, upon implementation of the HST or Ontario Value-Added Tax... and the second, one year later, valued at $1.3 billion. The province of British Columbia would receive a single transfer of about $1.6 billion upon implementation of the HST or British Columbia Value-Added Tax...The federal cost of these proposed transfers - including the principal and associated interest cost is almost $ 10 billion dollars...
The amount of value that we have over interest and the subsequent cost is closer to $10 billion that we are currently paying for this new sales tax.
That is a problem because it occurred at the time when we were entering a recession. At a that time, the Harper government, which had co-operation with then Liberal leader Ignatieff, was able to bring in this new tax in a minority Parliament. We are still paying for it to this day. The $10 billion that we have now incurred between the payout and the interest will still continue to accumulate and snowball. It will be the lottery money that Canadians will never receive as taxpayers. They will never collect any of the earnings, but they will get all of the negativity of it. Unfortunately, they have already bought their tickets over and over again. It is the worst type of lottery system that one can imagine, yet we are in it for the long haul.
I would like to transition to sales tax, which is also about affordability and the protection of Canadian consumers. The HST was added to things like car repair. This was done at a time when some automotive companies were doing an improper thing by blocking or conditioning people to choose certain service models when they had to get their car repaired. The Conservative government was introducing a new tax to people while rewarding the companies.
I had a bill called the “right to repair” bill, which was adopted by the Conservatives as a voluntary agreement. I thank them for that and for their support. As a result, companies had to follow laws similar to those in the United States. My specific point on this is that we were taxing Canadians on consumer goods for companies that were engaging in bad behaviour.
That goes to my next point, which is with respect to the pipeline that the government has purchased. We have a government that has reduced corporate taxes in the past. We have seen the continuation of this policy. At the same time, the Liberals have been willing to turn away from the fact that we are paying for a bailout with respect to the Kinder Morgan pipeline and we are going to continue to pay for it.
There is an important message regarding the HST that marries with the current financial investment we have. It is interesting to use the car analogy with regard to the purchase of the pipeline and it being problematic. We purchased this pipeline but when we drove it off the lot, the cost of it, or the price we could get back, depreciated because there was a small market for getting rid of it. The warranty on that pipeline was poor at best, if not non-existent. We have already seen not only in Canada but also in the U.S. that it requires extensive repairs and maintenance. The return for those repairs will be very minimal.
Moreover, at a time when the government is saying “no” to housing and to equality on a number of different issues, we are paying interest in perpetuity for a pipeline that somewhat exists. We have the land rights for expanding it, but we know we will never see that happen. We also have all the legacy of that to pass on as debt.
There is a lesson that should be learned with respect to the Conservatives' HST debacle, for which we continue to pay. There was supposed to be a cascading effect that would be passed on to consumers, that by harmonizing the tax, things would get easier and better, and Canadians would get the break. We were supposed to see that benefit, but where is it? We have not seen that. Have cellphone prices become cheaper? Have insurance prices gone down? Has electricity pricing and other pricing related to things for houses and repairs gone down? No. Where is all the economic benefit that was promised through the HST? It has never materialized?
The other argument was that it would magically improve manufacturing. This has not been the case. We just had the announcement that General Motors was pulling out of Canada. Supposedly, the HST was added to help manufacturing but it never helped. It never swayed the day.
I could make the same argument with respect to this pipeline. Supposedly it is magically going to open up new economic and other opportunities that we are supposed to benefit from, but we have not seen them in a concrete way. Furthermore, no cost-benefit has been done with respect to the borrowing that will take place. We have invested billions of dollars and we will pay in perpetuity for it and for the interest incurred on it.
To conclude, when we look at taxation policies and a motion like this, we should be getting some value back if Canadians are going to give something up. Something has to break, be it health care, education or the environment, and we are going to pay for it and pass it on to our young people. Unfortunately, the motion again reinforces a broken record of the Conservatives, who say that they are fiscally accountable and responsible, but the reality is an example like the HST.