Mr. Speaker, I am pleased to rise virtually in the House today to talk about an issue that is so important to many of my friends in Quebec.
It is absolutely my pleasure to rise today on Bill C-224, an act to amend an act to authorize the making of certain fiscal payments to provinces, and to authorize the entry into tax collection agreements with provinces.
Before I get into the substance of my remarks, I would like to address the very learned comments of the previous speaker. When we talk about Canada and the great country that we are, yes, Canadians believe in a strong Canada. There is no doubt about that. However, that does not mean that we do not also believe in provinces having a certain amount of autonomy and freedom to do the great things they do.
I would be remiss if I did not address the provincial governments and the provincial workers who are also doing a fantastic job. I would particularly point out our front-line workers, many of whom work for our provinces and who are doing a fabulous job, including our nurses and doctors, keeping our country safe.
I would like to directly address the member's comments and say that Conservatives will always stand for a strong Canada, but we also believe in respecting provincial jurisdiction and provinces' right to a certain amount of autonomy.
Getting to the substance of my remarks, as the shadow cabinet minister for national revenue and having been a previous practitioner in the area of taxation, tax season is an extremely stressful and confusing time for many Canadians across this great land of ours. I can confirm that in my practice, and also in my role as the shadow cabinet minister for national revenue, Canadians have learned the hard way, unfortunately, many times, that the income tax system is far too complicated. If anyone doubts me, they should go online or better yet pick up a copy of the Income Tax Code. They will see that it is about yay thick or so. Average Canadians should try to open it up and read it. I defy average parliamentarians to try to grab that Income Tax Act and even understand the first 20 pages in it. It is incomprehensible. It goes from subcomponent to the subcomponent to the subcommittee of this to the subpoint of this, and ongoing. It is a difficult book.
Anyone who knows me knows that I have long since been an advocate of simplifying the tax code. We need to flatten it. We need to make it fairer and more compassionate for Canadians across this great land of ours.
One area in particular that I would call out would be the fact that in order to understand and comply with the income tax rules, people have to understand the various rules and exemptions, and exemptions to the exemptions, and exemptions to exemptions. It is incredibly difficult. I cannot say in strong enough terms that the Income Tax Code is burdensome to Canadians. It is in fact a competitive disadvantage to Canadians, to Canadian businesses and, perhaps most regrettably, to charitable organizations. We need a Canadian Income Tax Code that is better, flatter and fairer to Canadians.
COVID-19 has been a trying time for our country. I would like to agree with the previous member that the CRA has done many great things. I know for a fact that many of our public service workers literally worked around the clock to make sure that the CERB and other benefits came out. Even as the government dawdled, the public service was there to push out those important cheques that people relied on.
I have to say that I have a real concern that with the CERB originally, there was some miscommunication. It went back and forth about whether the CERB was taxable or not. The government has come out and clearly said that in fact the CERB is taxable. I have to tell all Canadians right now that there were no source deductions taken.
Some Canadians might not be aware that when they get a paycheque, the government takes a deposit against their future taxes, and that is called a “source deduction”, which is why, at the end of the year, they do not owe $2,000, $5,000, $10,000 or $100,000 in taxes. The government matches the deposit they pay versus what they actually owe. For many Canadians, it means they get money back in the form of a tax refund. Unfortunately, with respect to the CERB, the government did not take that source deduction, which means that Canadians will owe tax on it. They will effectively have to pay a portion of that CERB back.
I am surprised and, quite frankly, disappointed that the government has not gone out and told people about this. As people get ready to file their taxes, and tax season will soon upon us, I want to make sure that Canadians are aware of that. It is of critical importance, because it is estimated that throughout this pandemic 47% of the labour force turned to the CERB during the pandemic, which is one in four Canadians. Those Canadians who had additional income outside the CERB could very well owe additional money to the Canada Revenue Agency. We want to make sure that point gets out there.
I also want to mention that there are a couple of things going on right now with respect to the CRA and its audits. Like I said, the public service has worked hard to get benefits like CERB out to Canadians, and I am appreciative of that. Nonetheless, I would call upon them to exercise restraint with respect to audits, as we called for in our motion when the CRA attempted to audit small business owners on the wage subsidy during the middle of the second wave of the pandemic, which was particularly acute in some provinces such as Ontario and Quebec. Please, let us allow our Canadian business owners and Canadians get back to work without the fear of an audit coming to them.
Getting back to the substance of the issue, the challenges caused by the Income Tax Act are particularly acute in Quebec. In fact, Quebec is currently the only province in Canada where residents are required to submit both a federal and provincial tax return. On top of dealing with the pandemic and, of course, the devastating impact it has had on the provincial economy, the residents of Quebec also must file their income taxes, not once but twice.
Members who have filed an income tax return, and I am sure all of have, would know that it is a painful experience. I cannot imagine having to do that twice in one year. People in Quebec have rightfully, to my mind, expressed a desire to simplify their tax filing experience and file a single tax return. In fact, the Assemblée nationale du Québec adopted a unanimous motion calling upon the federal government to allow Quebec to administer a single tax return.
Some critics may present a strawman argument that if Quebec collects its income tax, it may not remit it to the federal government. Aside from the obvious insult to the Government of Quebec, this is a disappointing argument. Quebec has been a faithful member of our great confederation and remitting money to the Canadian government year after year for decades, including, notably, the HST and not once, to my recollection, has it missed a payment. I believe in the Province of Quebec, I believe in the civil service of Quebec, and I believe them to be more than capable of administering this.
My colleague, the hon. member for Joliette, has proposed Bill C-224 which would authorize provincial governments to collect federal income tax on behalf of the federal government, effectively simplifying the tax filing experience for residents of Quebec, but we do have some questions with respect to how the bill would be implemented. For example, we want to make sure that CRA employees are protected and that there would never be any job losses as a result of this legislation. We want to make sure that the Province of Quebec will do as great a job as the CRA will do in administering and collecting these taxes. We are more than happy to discuss this at committee. I look forward to a productive discussion with expert testimony.
As the shadow cabinet minister of national revenue, I am very happy to support Bill C-224.
We will always stand up for Quebec and the rights of Quebeckers.