Mr. Speaker, it is a pleasure to rise and speak to the report stage of Bill C-28, the budget implementation act. I have had the opportunity to speak to this budget bill over the last few stages as it has been going through the House. Today we are dealing with a few motions, Motions Nos. 13, 14, 15, 17, 18 and 19, and I will try to do my best to address them as I continue with my speech, but I want to try to address a few of the things I talked about just quickly in the previous stages and how this particular budget has failed Canadians.
We hear over and over again from the government that it has reduced taxes. In some areas I will have to admit it has, but overall personal taxes for Canadians are still far too high and they leave us out of the loop when it comes to being able to compete effectively, let alone leaving more money in the hands of Canadians at the end of the day. That is something more and more Canadians are getting frustrated about, especially when they see the amount of personal taxes they pay on their paycheques. It is still something that they really would like to see the government move on.
Because personal taxes are too high, let us look at certain areas where the government could have done more to help Canadians directly. The government could have looked, as we proposed, at reducing the GST. It is a tax that the government actually said it would kill, abolish and scrap before it came to power. Now it seems that the Liberals have not met a tax they do not like, because they surely have not done that. Reducing it would have been great. It would have helped Canadians, even in light of the fact that we have had rampant problems with GST fraud. We have dealt with that in the House and talked about it. We know that Canadians would like to see some of that money left in their own pockets, not the government's.
In the area of payroll taxes, the government has said that it has reduced its overall payroll taxes. Even though we have seen some reductions in EI, unfortunately those reductions have been completely offset by the increases in CPP. At the end of the day Canadians are finding that payroll taxes tend to kill jobs. At a time when we need to support the economy and do more to stimulate growth, clearly payroll taxes would be an area in which we could reduce the overall cost to businesses and employers.
We know that at the end of the day there is a huge surplus in the EI fund. It would have been great to have been able to leave some of that money in the hands of the workers who deserve to keep that money, and not, unfortunately, spend it on programs where the government has thrown it away, like the gun registry, sponsorship, and a number of other things where there has just been a complete management bungling on the other side of the House.
Also we have heard it proposed that RRSP limits be increased, although not as high as we would have liked. In the finance committee the suggestion was to raise it to $19,000 but in fact the government over the course of the next four or five years is slowly going to be raising it to $18,000. Clearly that is something we need to address in the future. It is unfortunate that the government has not done more for Canadians to be able to address that.
The last time I addressed the budget, I talked a little about the customs agents, about the problems that have affected some of our customs agents and officers and the challenges they are facing on a daily basis. I know that the minister disagrees with me and we often get into heated debate, but she has not treated customs agents the way that they deserve to be treated. It is almost shameful. We have had comments in this place where the minister actually has referred to them, and I know she denies this, as bank tellers; she has done that in the past. She has even said that if they were armed there would be 3,000 accidents waiting to happen. She has used that here in this place and she has even gone so far as to refer to me as Charlton Heston.
I do not mind being compared to Moses, and quite frankly, sometimes when I look across the aisle I do think we live in the world of Planet of the Apes , but her slurs continue. It is unfortunate that she does not step up to the plate, try to take care of the problems at customs and resource those customs agents the way they deserve to be resourced given the fantastic job they are going and being stretched to the limit.
I talked about that in great detail the last time so I will not go back down that road right now, but we still have problems at customs. We have not dealt with the 40% of border crossings that still do not have the proper resources for computers and that are unable to stop and detain people entering Canada who may be dangerous, and obviously there is the issue of firearms, with which we know the minister does not agree at all.
Today we are dealing with Motion No. 13, the issue of GST on school buses, Motions Nos. 14 and 15 that deal with the disability tax credit issue and Motions Nos. 17 and 19 that deal with some overall tax changes. I wanted to talk a little about the GST on school buses issue, especially seeing that Motion No. 13 calls for Bill C-28 to be amended by deleting clause 64. We are going to be taking a position against the motion, but I wanted to talk about this particular issue seeing that we had to deal with it most recently in committee. Some of my colleagues in the House today will remember that.
We on this side of the House are concerned about this. Obviously we do not want to have a bias against contracting out to private services, especially if it means more efficiency, especially if it helps school boards to transport and do a better job for the students using the services, but obviously we need a system that works when it comes to the GST rebate system for public service bodies such as school boards.
The courts cannot decide Canadian tax policy. We should get that straight. That is the prerogative of the government and the House of Commons. Unfortunately we are seeing more and more that the government defers to the courts when it should actually be dealing with the issues right here and we should be making changing to the tax codes in the House rather than tying up the courts in determining what in fact should be fair and what should not be.
As I said, the issue came up in committee. The amendment to the Excise Tax Act is basically an amendment that would clarify the amount of GST input rebate that school boards would be entitled to with respect to school transportation. The amendment was made in response to a 2001 Federal Court of Appeal decision that school boards or provincial governments that contracted out school bus services to private companies were entitled to a 100% rebate of their GST costs rather than the 68% they are entitled to under the legislation.
The purpose of the 68% GST rebate is to match the tax rate under the old manufacturers' sales tax. The federal amendment in Bill C-28 would ensure that a school authority's supply of transport to and from school for students is exempt regardless of how the supply may be funded or provided. This is a prudent move. If we had left the court decision to stand, it unfortunately would have discriminated against school boards that supply their own student transportation rather than contracting out and would have opened the floodgates for other public service bodies to claim 100% rebate on the GST they spend. There could be an unfortunate snowballing effect and that was raised at the committee.
Exempt supplies are supplies on which there is no liability for the GST and therefore the tax is not charged to the end user or collected from the supplier. However, the tax on the portion of a public service body's total expenses used in exempt activities would qualify for a partial GST rebate. There are different percentages that vary depending on the services that are being provided. I know that for hospitals it is 83%, for schools, as was mentioned, it is 68%, municipalities 57%, and the list goes on. There are different levels. We know that municipalities are currently trying to win in getting that 100% rebate on their GST as well. We know that there have been huge costs associated with municipalities even when it comes to their transportation systems. I know that in the end the Toronto Transit Commission pays, even after the rebate, close to $50 million in GST, I think, since the amalgamation in 1998.
These are the kinds of things the government could do more in trying to help, especially for the challenges the municipalities are facing when it comes to infrastructure. We have seen such a drop in investment on that side of things. If they can actually claim back these rebates and reuse them, then I think there is no doubt it would help deal with some of the challenges municipalities have.
On the other amendments, I will say quickly that I believe we will be opposing almost all of them that we are debating even though there are positive merits in some of them, such as specifically the motion trying to ease the definition of the disability tax credit from feeding and dressing to feeding or dressing. We do support a portion of that, but ultimately there still are concerns about how much that would open up and what sort of negative effect it could have.
To wind up, I want to mention the issue of capital tax. The government has moved on this particular issue and will be reducing capital tax. We on this side of the House have always believed that if more money is left in the hands of the economy it will do more good. We would like to be able to eliminate the capital tax completely. That would give support to a lot of businesses and people who invest and get the economy going. I think it has been proven that in the long run governments actually benefit from that because more economic activity results in more government revenue. That is something we wish the government would have moved on also; we know that it is reducing this over a five year period, but it would have been great to see that reduction right now, helping businesses, individuals and society to be more productive.
