Monte Solberg

[The Economy, March 17th, 1997]

Mr. Speaker, we eagerly await the member's retirement.

It is obvious government members are using creative accounting and tax increases including $3.7 billion in user fees to cover up their managerial incompetence. They are as guilty of fudging the books as the Tories before them.

How can Canadians trust anything government members say when it is obvious they have blown their spending reduction targets, just like Michael Wilson did, and covered them up with tax increases?

[The Economy, March 17th, 1997]

Mr. Speaker, according to a study by the C.D. Howe Institute, the government has been hiding about $9 billion in income and sales taxes that it has sucked

out of the pockets of ordinary Canadians. This represents about $1,700 per family.

In a related story the government has been busted for going $9 billion over target on the spending projections put forth in its 1995 budget. In the case of regional development it is about 50 per cent over its target, just like the money the minister announced.

Is cooking the books the Prime Minister's definition of fiscal responsibility?

[Excise Tax Act, March 17th, 1997]

Mr. Speaker, I appreciate the tough question. It is a broken promise which we could add to the long list of broken promises on taxation.

My friend mentioned the notional input credit. The removal of the notional input tax credit would mean that people would have to pay more for used books. Another broken promise is that the government was to get rid of the GST on reading material. It did not do that even though it promised to in a letter from the Prime Minister to the Don't Tax Reading Coalition and in a number of policy conventions. In many respects the government is penalizing people who read, which is flying completely in the face of what it said it would do.

My hon. friend has it right. The government has broken promises on the taxation issue and to people it thought would support it on the basis of its promise not to tax reading materials.

[Excise Tax Act, March 17th, 1997]

Mr. Speaker, I thank the hon. member for his most excellent question.

The question of what would happen with Alberta would ultimately be answered by Alberta. The whole amendment is contingent upon the province and the people of Alberta agreeing with what the federal government is proposing. It would ultimately be up to the people of Alberta to make that decision.

The people of Alberta believe that taxes are a cancer on job creation, to use a phrase the finance minister has used in the past. I would argue that high taxes are ultimately the reason for the country failing to meet its job creation targets. It is the reason the Liberal government has failed to make any real progress on the issue of jobs, jobs, jobs.

I spoke a minute ago about the Liberal promise on the GST. One of the biggest promises the government has broken for reasons that are worthy of our attention is that it would create jobs, jobs, jobs. There is such a tremendous tax burden on Canadians overall and particularly in payroll taxes that job creators, the small business people who create about 85 per cent of all jobs, simply do not have the incentive to create jobs. The federal government is proposing to increase premiums on CPP by 73 per cent, which will make it even more difficult for job creators to create jobs.

In Alberta we have very low taxes relative to the rest of the country. The people in my province have a tremendous incentive to make money. When they do that they know they will be able to keep most of it. That gives them the incentive to keep working harder and harder and harder.

In high tax jurisdictions, which I would regard Canada as a whole as being-and certainly relative to our G-7 neighbours that is true-it is difficult for people to get excited about creating jobs, knowing they will have to pay more and more in taxes the more money they make.

I hope that adequately answers my friend's question.

[Excise Tax Act, March 17th, 1997]

Mr. Speaker, once again I rise to speak to Bill C-70. It seems to pursue us like a bad dream, having returned with amendments from the other place.

I want to talk a bit about some general principles which most people would hold to be extremely important. They are ones people would normally expect the government to adhere to. Most people believe very strongly in the principles of honesty, equality and accountability. The government has ignored those principles in bringing about Bill 70 again, and in bringing it about in the first place. I want to elaborate a little on that.

During the last election campaign a great fraud was perpetrated in this country. The opposition at the time, the Liberals, criticized the government for years on end over the goods and services tax. It had gone on and on.

The rhetoric was extreme. The Liberals said over and over again that they would get rid of the GST when they came into power. I have all kinds of quotes. I will not run through them again but I have stacks of quotes from prominent members across the way who now sit in cabinet who said that the GST would be gone when they came into power.

The current defence minister was involved in this, the current finance minister, the Deputy Prime Minister, and of course the Prime Minister. There were many other backbench members as well. In their campaign literature many said they would get rid of the GST. That was the tone of the debate.

Hon. friends opposite will say that in the red book on page 22 they said they would replace the GST. Indeed that is true. I acknowledge that. However, what is important to point out is while they were saying that and distributing it in the red book, which went to about 70,000 people with about three weeks left in the campaign, they were saying something quite different on national television. They were using the mass media to communicate a very different message.

It is convenient that they could have both messages out there. They thought it would allow them to escape from a tight spot. In fact they did not escape. In the last few months we have seen this whole issue come back to bite them once again. I will touch on that in a moment.

The point I want to make is that the end can never justify the means. My hon. friend, the parliamentary secretary for finance, is arguing that there are some positive changes in this legislation that will aid business. I acknowledge that tax simplification is a good idea. To the degree that business can work together with government at all levels and with consumers to simplify things so that it is easier for everyone, we should all support that. However, the ends do not justify the means.

We have a situation here where the government set out quite deliberately in my judgment to take people down a course where they believe they were going to get rid of the GST. If we pass this amendment and legislation we are sending completely the wrong message. We are sending the message that they can dupe Canadians, that they can draw them in with what is nothing more than a huge mistruth and get them to vote for them, then turn around, do something completely different and it is okay. That is what the government is essentially saying.

I cannot go along with that. There is a greater principle at stake here than just simplifying the tax system. We have a problem in this country where we actually have the public so cynical about what governments say they will do in election campaigns that we have a lawsuit going on in British Columbia. Some people in that beautiful province have decided that they will not put up with it any more. They are actually suing their provincial government because they are tired of being mislead during election campaigns.

That is precisely what has happened to this point where we are now talking about passing legislation that would change the GST. There is a huge principle in that. There is far more at stake here. It is far more important than the one that has been talked about by the parliamentary secretary.

Simplification of the tax system is an important issue. No one really disagrees with that. However, the big issue is does one allow governments to go ahead and do things that they said they would not do simply to get elected. That is the big issue.

That is the issue that is more important to a great majority of Canadians. The government has, frankly, mislead Canadians over the last three and a half years.

I want to talk a bit more about that. Some hon. friends across the way are saying that is not the case. However, I would remind the chairman of the finance committee and other hon. friends across the way that the Prime Minister himself was caught in a trap on the GST at a town hall meeting on CBC just a few short months ago when he denied that he had said he would scrap the GST, get rid of it. When he was challenged by a young waitress from Montreal on this issue, he said "I did not say any of those things".

What happened? The CBC just happened to have all kinds of footage of the Prime Minister saying precisely those things. Again the trust of the public was undermined.

This is a far more important principle than whether we should go about simplifying the tax system. It was not just that. We had a byelection because the Deputy Prime Minister said on national television two weeks before the last election campaign that if the GST were not scrapped she would resign. She did indeed resign, and we were glad about that, but she took a poll first to find out whether it was okay to resign so she could run again.

The issue here is whether politicians should be allowed to go ahead and make those kinds of promises only to turn around and completely refute them and then expect to get re-elected and expect to have people jump up and down about legislation that they are bringing through to simply cover up what it was they were trying to hide in the first place.

I think people today are very cynical. It is interesting that this bill would come down on the eve of an election. To me this is the

poster child for the GST, for the broken promises that the government has been unable to fulfil since the last election. Of all the different promises that the government has broken, on things ranging from NAFTA, to the CBC, to day care spaces, to unemployment, this has to be one of the biggest broken promises.

I would certainly encourage Canadians who are watching to hold the government accountable to the greatest degree that they can on this issue in the upcoming election.

I also want to say a few words about equality. Equality is something most Canadians believe in very strongly. They believe that we should treat all the provinces equally. However, I would argue that by paying the Atlantic provinces, with the exception of Prince Edward Island, a billion dollars to go along with this deal, the government has done something that just flies in the face of what most Canadians believe to be fair and right, which is to treat all the provinces differently. It decided that it was going to pay a billion dollars to Atlantic Canada because that was the only way it could get it to go along with the deal.

If members remember the atmosphere leading up to the agreement with Atlantic Canada, Atlantic Canadian provinces simply were not coming forward to the government saying "boy, I wish you would offer us a harmonization deal". They did not say that. In fact, the government was caught at that time because it was facing tremendous heat from the Canadian public because it had broken its GST promise so it needed a way out. Therefore it went to the Atlantic provinces and told them it would give them a billion dollars if they would go along with the harmonization deal. Because the Atlantic provinces are of course strapped for cash they said they would take the deal. That is how it happened.

When the other provinces said they would be interested in talking about this too if there was that kind of money involved, all of a sudden there was no money left. The government could only provide for Atlantic Canada. The people of Quebec were asking for $2 billion in compensation. Ontario wanted over $3 billion. The government of course said it just could not do it. It points to how the government thinks differently about what the notion of equality is.

Most Canadians feel that equality should be equal opportunity. If it is offered to one then it should be offered to everybody. The government has a different notion. It thinks that equality means equality of outcome. It thinks that equality means that we take from some provinces and give to other provinces and that makes everyone happy. It really does not work that way. In fact, all it does is divide Canadians. That is precisely what this legislation has done. It has divided Canadians on the notion that somehow some provinces are more equal than others.

I want to say a few words on the whole issue of accountability. I have talked about honesty, I have talked about equality and I want to say just a couple of words about accountability. Accountability is a common theme through the whole sorry tale of this legislation, going back to 1993 when the Liberals raised this as an issue during the election campaign. At that point they said they were going to scrap the GST.

Unfortunately now Canadians would like to hold them accountable on that issue and they cannot, at least not until the next election campaign. In the meantime other things have happened that really raised the issue of whether or not we can properly hold our politicians accountable in this country, not just at the federal level but also at the provincial level.

We had a situation, as I mentioned a minute ago, where the Atlantic provinces took $1 billion to introduce harmonization in those three provinces. But when that happened there were no hearings between the provincial governments and their own people. We all know that was a huge mistake because the province of New Brunswick for instance had to back down from the tax inclusive pricing portion of the legislation. It saw that the public simply did not support it there. Those people would have known better if they had talked to their people beforehand when they were accepting the money from the federal government.

It does not just end there. There are all kinds of problems with the lack of accountability with respect to this legislation. It was not very long ago when other members of the finance committee and I sat here in Ottawa during the January break and we voted on an amendment that my party moved that we go to Atlantic Canada to have hearings on this issue. The Liberals voted against that. They denied the people of Atlantic Canada the chance to have a say on whether they wanted this legislation in Atlantic Canada.

In the United States people fought a war over taxation without representation. In Canada I guess we look at things a little differently. Newfoundland is going to be celebrating 500 years of history this year. We would think the government would say to the people of Newfoundland "after 500 years we think it is probably okay for you to have a little say in how your taxation system should be structured".

The Liberal government denied them that opportunity. It took the unelected, patronage filled Senate to do it. It took the Senate to show the government what it means to go and talk to people, to consult with people. To me, that is absolutely ridiculous that they would be denied the chance to do that before their elected representatives in the House of Commons, but that is precisely what happened. That is so fundamentally wrong. It is completely wrong.

The accountability issue again is notable by the fact that very few Atlantic MPs have risen to speak to this issue, even though we know it was a major issue in Atlantic Canada. It fact, 16,000 people signed a petition on the tax inclusive pricing issue alone. There were hearings before the provincial legislatures because there was such a public outcry.

Where were the Atlantic MPs? Why did they not stand up for their constituents? There were stores closing down in many of their ridings. Did they stand to protest before the finance minister, before the government to say that there are problems? They were silent because they were afraid of what would happen if the party whip was put in place. We have seen how the government has dealt with dissenters in the past.

There were a number of different occasions where the issue of accountability was raised and it was proven in this legislation that the government has no intention of being held accountable on an issue that is of vital importance to the people of Atlantic Canada.

I want to speak about some of the specifics now. During the hearings we had back in January my party raised over and over again the issue of tax in pricing.

At the time hon. members said that everybody in Atlantic Canada was on board. Now we know that was false. The government of New Brunswick said that it did not want tax in pricing after it had rethought it. Many businesses, almost entirely to the person, said that they did not want tax in pricing in one part of the country at one time, that it made no sense. We also know that consumers spoke out against it. Provincial politicians came forward to say that it would be a nightmare.

What did the government do? It did nothing. Again it took the unelected patronage filled Senate to push the issue. That is a sad commentary. It does not say much for the government. They are the ones who have to take the pulse of the public along with my party to get the government to change its mind. Nevertheless it happened and people can judge for themselves what it says about the government.

A concern with the legislation is how the government has over the years led physicians and providers of ambulance services on to believe that perhaps someday it would actually change the GST legislation to allow them to pass on the GST just like many small businesses pass it on, or at least to have it zero rated. Unfortunately the government has led these people on for a long time. It has basically slammed the door in their face over the last several months saying it was not on.

We have a situation where doctors cannot pass on GST costs. It is one of the aggravating factors that causes physicians to flee the country to other places like the United States, which leaves us with a shortage of physicians in rural areas. Again the government has misplaced priorities. It has lots of money when it comes to providing funds for its friends at Bombardier but not when it comes to providing funds to ensure health care across the country and that all people are treated equally in the taxation system. All of a sudden it cannot find the money. It should be criticized very strongly for that.

The final point I will make is with respect to the notional input tax credit. Over the last several days it has been interesting to watch the papers. There has been considerable discussion about how the government has been hiding millions of dollars of revenue. We need to point to one of the most least understood tax grabs the government has yet to bring about, one of the biggest tax grabs it is to bring about, that is the removal of the notional input tax credit on many different items.

It will mean the government will bring in hundreds of millions of dollars. Some people estimate that it will $1 billion year more in revenue for the government. The people it hits are low income people because the notional input tax credit applies primarily to used goods. People who buy used goods are paying tax on tax on tax. The beneficiary of that is the federal government. It brings in hundreds of millions of dollars more a year in tax.

For some reason the government has ignored this message and will push ahead with it anyway. The people who will pay the price are the people who can least afford it.

I will wrap up by simply saying that the government has broken some very big principles: the principles of honesty, equality and accountability. Therefore I move:

That motion be amended in the first paragraph by deleting all the words after the word "That" and substituting the following:

"this House agrees with the principle set out in the amendment made by the Senate to Bill C-70, an act to amend the Excise Tax Act, the Federal-Provincial Fiscal Arrangements Act, the Income Tax Act, the Debt Servicing and Reduction Account Act and related Acts, but would propose that the following amendment be amended to read as follows: pages 334 and 335, clause 242: replace lines 40 to 45 on page 334 and lines 1 to 4 on page 335 with the following: `Subsection (1) comes into force on a day fixed by order of the governor in council, which day shall not be before the first day on which all provinces have enacted laws requiring that suppliers include the tax under part IX of the act in indications of the prices of property and services supplied"'.

[Copyright Act, March 13th, 1997]

Mr. Speaker, it is a pleasure to once again address Bill C-32 and in particular the issue that has been discussed over the last several speeches.

I am concerned that not necessarily through malice but through neglect the government is placing an inordinate burden on young people today in many different respects. It is not limited to what we are discussing today. There seems to be a theme developing here.

We have 17 per cent youth unemployment in the country today. We have a situation where the government has just announced that it is going to drive CPP premiums through the roof. It will be young people who bear the great burden of that. They will be paying more and more to get less and less. We have a situation where the government reneged on its promise on the GST on reading materials.

I am going to mention it one more time for people who have not heard me raise this in the past. The government did promise before the last election to get rid of the GST on reading materials. It promised in policy conventions to do that. It has not happened, so students have to pay the GST on textbooks that they purchase.

We have tuitions that have gone through the roof as a result of cuts to transfers to the provinces. The government has cut $7 billion plus in transfers to the provinces. The result has been that tuitions have been raised for young people.

I would point out that my party would reverse that trend by putting $4 billion back in.

Now we have a situation where the government has snuck a clause into Bill C-42. In fact, it is a clause that a lot of its own members were not even aware of and there is a good reason for that. A lot of the changes that happened occurred this morning, so there was not adequate time for reflection on what was done. Nevertheless, it is in there. Now we have to contend with it. It is onerous. It is quite painful for students.

As the member for Vancouver North has pointed out, students, young people, in addition to all the other burdens they have to face because of what the government has done or has failed to do, are now going to be in a situation where they cannot resell their textbooks. They cannot get the money back that they would like to get and will be paying $3 million in extra costs because they will not be able to purchase used textbooks.

A $5 million hit for university and college students is unacceptable. The government has already nailed them on the GST. It has nailed them with tuition costs. It has nailed them with higher premiums on CPP. They have a 17 per cent youth unemployment rate. What does the government do? It turns around and gives it to them again. It is giving them one more shot.

Let me say as forcefully as I can that the government should rethink this provision of Bill C-32. It is completely wrong for students today.

A lot of my colleagues have talked about pages in this place. They work very hard both here and in university. Now they are going to be facing this additional burden. I would say that young people are our future. It is said by all political parties that we should cut them some slack, that we should find ways to make it easier for them, not hit them harder.

I want to urge hon. members across the way, including the parliamentary secretary and all other people who have shown an interest in this bill, that the government should truly rethink this section of the bill. It has demonstrated in a way that really deserves our attention that perhaps in particular case it has not thought out the implications for all Canadians.

That is unfortunate. This bill has been coming to the House for nine years. For nine years we have been dealing with this legislation. One would think that they would not have to force through pieces of legislation like this at the last moment with obviously little or no forethought. As a result young people are going to face very high prices.

I will conclude simply by saying that there have been a number of changes to the legislation which have penalized people who do not deserve to be penalized. Young people, in particular, seem to be picked on by the government.

As I pointed out previously, we do have an extremely high unemployment rate for young people, 17 per cent as the national average. It is much higher in other places. We have seen the big CPP premium increases that will impact young Canadians and hurt them the most. The government reneged on its promise of removing the GST from reading materials, textbooks et cetera. They already pay a much higher price than they would have if the government had kept its promise.

We have seen the cuts in the transfers that the government has enacted, driving up tuitions across the country. Now this amend-

ment which is part of Bill C-32 is going to cost students $5.4 million more a year for books.

I would urge all fair minded members of the House to vote against this amendment or, ultimately if it is not removed, to vote against Bill C-32.

[The Economy, March 13th, 1997]

Mr. Speaker, we are certainly not going to support a rinky-dink government with its rinky-dink budget.

A single income family of four making $30,000 will pay 90 per cent less in taxes under a Reform government. That is 1.2 million low income Canadians who will be lifted completely off the tax rolls under a Reform government. Those are Reform values.

Is it Liberal values for the government to tax the working poor so they can give money to their buddies at Bombardier which just announced a $400 million profit? Is it Liberal values to try to explain away one and a half million unemployed just like Brian Mulroney did?

[The Economy, March 13th, 1997]

Mr. Speaker, by trying to defend an unacceptably high unemployment rate, the Liberals are sounding exactly like Brian Mulroney: productivity up, interest rates down, low inflation, rosy IMF predictions and-listen to this-the best job creation record in the G-7.

These are exactly the same arguments that Brian Mulroney made in this place in 1992 to try to defend another government that promised and failed to deliver on jobs, jobs, jobs for 1.5 million Canadians. It is exactly the same rhetoric.

Instead of using Brian Mulroney's arguments from 1992, why does the government not actually do something for the 1.5 million unemployed? Why does it not lower taxes?

[The Economy, March 13th, 1997]

Mr. Speaker, the Liberal government is collecting more taxes than any other federal government in the history of Canada. It has the record.

Not surprisingly, Canadians have suffered a $3,000 pay cut in the last three years. What do they get in return? They get 1.5 million Canadians unemployed, 800,000 people having to moonlight just to make ends meet and the highest number of young Canadians dropping out of the workforce since the 1960s.

My question is for the finance minister. When is the government going to realize that high unemployment is a direct result of high taxes? When will it get the connection?

[Copyright Act, March 13th, 1997]

I will speak then.