Crucial Fact

  • His favourite word was billion.

Last in Parliament April 1997, as Reform MP for Calgary Centre (Alberta)

Lost his last election, in 2000, with 22% of the vote.

Statements in the House

Income Tax Act April 10th, 1997

Mr. Speaker, I am going to argue against this non-votable bill. Based on words and the ideology of the Bloc Quebecois member and the Liberal member who moved the motion, they are out to lunch when it comes to corporations. Do they not realize that corporations pay taxes and lots of taxes?

They talk about how this being a tax deductible item and the corporation getting it at half price while the person who takes his lunch to work has to pay full price. The corporation or business has generated the revenue to have the right to buy season tickets, to have the right to spend $50,000 for a box.

Why do the government and the current income tax system allow these businesses to write that off against their incomes? It is for a very good reason.

They are sizeable corporations. They are movers in the business world. They are growing and expanding and they wish to communicate their message. The best way to get the attention of others who might possibly buy their product is to mix and mingle with them at times when they are not busy producing their product, from the hours of 8.00 until 12.00 and the hours of 1.00 until 5.00. The noon hour and evenings become prime time for people to spread their message.

Having a box at a hockey game can be a legitimate deduction because of expectation of profit. Companies in Canada cannot afford to buy a box if they are broke. Companies in Canada cannot afford to spend that money unless they are generating the money against which they can deduct the cost of the box from income.

Even at 50 per cent it is a good compromise. At 50 per cent the company has to think about how it is spending its money, whether it is justified and whether it will get a return through this contact and through this sales pitch.

It is a good compromise. It reduces the abuse. It legitimizes the expense. When it was 100 per cent I agree there was a lot of abuse. The 80 and 20 was not enough to ensure that companies thought twice about it. The 50:50 rule should not require a motion like this. It makes a mockery out of people going into business.

Profit leads to more tax revenue for the government than it loses through the tax deduction. That is another point. If the company

has a box which leads to more business, for example a high tech corporation with a box at the Corel Centre, the company makes more money. The bottom line increases. The tax revenue increases. I bet it is more than the 50 per cent deduction on the $50,000 box. What they are arguing against is less revenue for government, if it is taken away.

It would not apply to food. That is good. I was pleased the member made that clarification.

I do not understand how everybody seems to think we have to tax, tax, tax the rich and the corporations. We have to make sure that they pay their fair share. There is no question. People with lower incomes should pay less taxes than people with higher incomes. The simplified tax system I recommended would be progressive. It would have the same level of generous personal deduction. Everybody would pay the same rate with none of the tax exemptions. They would be eliminated. People would pay the single rate and maybe a dual rate on incomes up to a certain level and then a higher rate on incomes above $30,000, say 17 per cent and then 25 per cent.

The point is that what sets a country apart from less fortunate and less expanding countries is how it handles its tax regime. Is it a punitive tax regime or is it an inducement tax regime? Do people get to keep more of their money when they make more money?

Our system is getting pretty iffy. We seem to punish incentive and successful people by taxing them more and more. The levels are higher than they should be. We are at the maximum in terms of taxes. The finance minister knows that. That is why he has not raised personal tax rates in the four years he has been here. He has been very smart not to do that. Had he done that, the Liberals would be a lot lower in the polls than they are right now.

With respect to corporations, the tax regime is important because we are now in a global economy. If the separatists want to have their own country, they had better learn quickly that if they punish their corporations by taxing the heck out of them, there will not be very many jobs. Who creates the jobs? It is the corporations. Do corporations really pay taxes? No, they do not.

We could say that the banks contribute $8 billion in taxes. We could look at any financial statement of a public company to see how much it paid in taxes. Do they really pay those dollars in taxes? No. It is the consumer who pays the taxes. The tax cost is built into the corporation every year. It is built into a price increase to protect the bottom line. It is the people who pay. It is the consumers who pay the taxes.

The whole argument that we should tax corporations more is bogus. On the surface we must have a tax regime for corporations. I am not one who says corporations should not pay tax. That is what some people say. They think costs would be lower and product costs would be lower and they would pass it along to consumers. No, I do not think so. I do not agree with that. They should pay some tax.

It is important to have the right incentives in place, a tax regime that is properly thought out. If there is expectation of profit it is a legitimate expense. If corporations are investing in hardware or investing in people, how do they get their message out there? They advertise. They advertise in a lot of ways. It is not just a media buy in the electronic media or the print media. Word of mouth sometimes is the best form of advertising.

If I just started a brand new restaurant, one of the better ways for me to increase clientele and sales so I can hire more people and end up paying more taxes is to start bringing people there. That is a legitimate deduction if I bring people there to introduce them to my product, my place of business, and show them what we have.

Both the Bloc member and the Liberal member who have just spoken do not understand the corporate environment. They do not understand what corporations really do. They do not understand how much of a contribution corporations make.

It is government's role to create the right incentive and the right environment for the private sector to create jobs. We are slowly getting the Liberals to accept that. They are talking the talk now. Maybe they will start walking the walk.

A bill like this one is draconian. It is dinosauric. It is from the past. We must create incentives for businesses to stay in Canada. We must give businesses the legitimate opportunity to deduct their expenses. Those expenses that are clearly and legitimately intended to increase their profitability should be deductible.

The 50 per cent rule legitimizes, reduces abuse and allows corporations to have the respect they have when they spend this kind of money. If these corporations did not spend this kind of money, does the member know how many rinks there would be in the country? Does the member know how many sporting venues or other venues would exist if there was not an inducement for companies to spend these moneys? There would be a lot less. How many jobs would be lost? I do not think the whole psychology has been thought out by the two members. They see high profits.

I would rather go after Bombardier. Lending money to Bombardier as the government has done is shameful. It is a profitable company with a profit of $400 million last year. Over the last 10 or 12 years it has received over $1 billion. We do not know when it will be paid back or how much will be paid pay back. How much of the $400 million is the government getting back. We do not know those things.

Those are the ways in which I would increase revenues. That is how I would go after corporations. I would not subsidize businesses to that extent. If they cannot survive on their own they should go broke.

If Bombardier with its huge profit this year wants to buy a box at the Molson stadium, it should be allowed to deduct that against its income because it generated that $400 million. A company does not generate $400 million profit unless it hires a lot of people and has a lot of clients. It is a worldwide company. It needs to show the kind of operation it has. The member should rethink his position on going after corporations and not allowing deductions of this nature.

While I have the floor is it proper for me to move third reading?

Income Tax Act April 10th, 1997

Mr. Speaker, to satisfy the parliamentary secretary to the finance minister, as the member from the Bloc Quebecois pointed out, this is a non-votable motion. There will be no ways and means required to do anything because the House does not have to vote on this.

Income Tax Act April 10th, 1997

Mr. Speaker, once again I find myself disagreeing with the parliamentary secretary on this issue. He well knows that we have a committee that reviews private members' bills. It is the job of that committee to determine whether or not private members' bills should go forward.

The scrutiny and review of the principles and objectives of that bill, whether or not they conflict with government policy, whether or not they should be allowed to proceed, is determined in that committee. Members well know that.

This bill is at second reading. It was presented to the House. The government House leader had ample time and opportunity to ask the member to withdraw. This gentleman has worked hard to put forward some ideas in his suggestion. Whether we agree with it or not is another issue.

This gentleman is a member of Parliament. He has followed the proper course and if you rule in favour of the point of order of the parliamentary secretary to the finance minister, you will be stepping on the toes of another hon. colleague.

We should just proceed with this debate as planned and let this thing play itself out. The proper procedures have been followed.

An Act To Amend Certain Laws Relating To Financial Institutions April 10th, 1997

Mr. Speaker, I would like to thank government members for giving me the opportunity to finish my remarks.

I would caution those members of the Standing Committee on Finance who will be considering this bill, especially with respect to the issue of tied selling.

For greater certainty, we have to ensure that there is a level playing field for financial institutions. We have to be concerned that investment dealers, trust companies and insurance companies do not have the same rights to provide all of the services which banks do.

For instance, all those money machines out there are only banks, Mr. Speaker. You have to have a bank account in order to use them. These other institutions do not have that right. If a clause is put in which says that the more services that one uses with the bank the better deal one can get on one's rate for borrowing the money, that is giving an unfair advantage to the banks. To me that is very clear. It is unfair to the other institutions.

For the individual consumer in that particular case it might be fair. As my colleague from the Okanagan pointed out, there are two schools of thought concerning what happens when one bank or one institution ends up getting all the business and knows everything about that person. Either that is good or that is bad. If it wants to pull the plug it can pull the plug.

Clause 3 states that for greater certainty a bank or one of its affiliates may offer a product or service to a person on more favourable terms or conditions than the bank or affiliate would otherwise offer where the more favourable terms and conditions are offered on the condition that the person obtain a loan from the bank.

I am confused or call me stupid, but one clause says we get rid of tied selling, then it is replace with this type of tied selling. That allows tied selling. That is not cross selling. The banks can offer more services, thereby if they are allowed to give discounts they can give greater discounts than the other institutions. Therefore, it becomes tied selling and people will end up dealing more with the banks and it is a loss of revenue or business for the other institutions.

Cross selling is fine. I have applied for a business loan, they have approved it and then they ask me questions like "Jim, do you need a mortgage? Do you need something else?". When I tell them no, they say "Okay. If you did you know we could look at it favourably". That is suggestive selling. Or I just bought a house and they ask if I would like to get insurance on that house. Then I ask what is the rate. At least I get my mortgage and I am approved. It has nothing to do with my mortgage being conditional upon me also getting insurance. If they just suggest it, that is okay.

We do not know what goes on behind closed doors, but we did have witnesses come before the committee and say that this kind of thing is done by certain bank managers who are more aggressive than other bank managers. The law may say one thing but the application of the law by individuals in the workplace might allow them to do another thing. If they do another thing, then we end up with coercive tied selling and that concerns me.

I do not want to be a part of a 35th Parliament that passes something like this without proper debate, proper discussion, lots of witnesses in the committee so that we know exactly whether we are talking about cross selling or tied selling.

Maybe somebody should put forward an amendment that would allow insurance companies, trust companies, investment dealers that want to merge to go into the banking business as well. In that way they can compete with the banks and we will not have these kinds of debates. Then whatever the bank offers as a volume discount for having more and more services, these other companies would also be in a position to do the same thing.

Mr. Speaker, I want to thank you for your patience in listening to the different points of order. I want to thank the chief government whip for conceding the extra five minutes and the Parliamentary Secretary to the Minister of Finance for also agreeing to allow me

these few more minutes so that I can get the points across that I wanted to make. I thank everybody in the House.

An Act To Amend Certain Laws Relating To Financial Institutions April 10th, 1997

Mr. Speaker, I do not disagree with what the parliamentary secretary to the finance minister said. I just want to have it on the record and make it clear that when we continue government orders I will have the floor to finish my speech.

An Act To Amend Certain Laws Relating To Financial Institutions April 10th, 1997

Mr. Speaker, I was present when the negotiations were going on. If there is some confusion, then of course you will proceed to Private Members' Business, but I would like to make it clear and put it on the record that I still have five minutes remaining when this debate resumes.

I know that the parliamentary secretary to the House leader is busy with other matters, but I wish he was here to clarify the situation because I do insist, because that was the deal, that I be allowed to finish this point. That is one of the things which is wrong with sending this stupid bill off to committee after only three hours of debate.

An Act To Amend Certain Laws Relating To Financial Institutions April 10th, 1997

Mr. Speaker, I vehemently disagree with the Parliamentary Secretary to the Minister of Finance.

In his speech he indicated that the bill on financial institutions had been debated and was pretty close to moving forward. Those words mean they are not sure what they should be doing on tied selling. That is the clause members of the Reform Party are most concerned about. It is the clause that is potentially extremely dangerous for consumers if the bill is allowed to go through without clear definition and for competitors in the financial world.

The bill affects the four pillars of the financial industry: trust companies, insurance companies, investment dealers and the banks. By far the most powerful institution of those four are the banks.

The Parliamentary Secretary to the Minister of Finance should know it is the job of government to protect those who cannot protect themselves, to protect against monopolies and to protect against unfair intrusion into competitive areas where single suppliers of a service are not held at a disadvantage.

I submit that clause 45 deletes the current section in the act that prevents tied selling. Subsection 459.1(1) reads:

A bank shall not impose undue pressure on, or coerce, a person to obtain a product or service from a particular person, including the bank and any of its affiliates, as a condition for obtaining a loan from the bank.

That makes sense. I agree with that. It is the clause that basically says that no tied selling, no coercion and no undue pressure on the consumer. It protects other institutions that offer insurance and investments and the bank does not have the advantage.

Then it goes to clauses 2 and 3 which my colleague from the Okanagan wants deleted. I support that amendment. Section 459.1(2) confuses things more. It reads:

For greater certainty, a bank may offer to make a loan to a person on more favourable terms or conditions than the bank would otherwise offer to a borrower, where the more favourable terms and conditions are offered on the condition that the person obtain another product or service from any particular person.

If that does not give the banks unfair advantage, these people do not know what they are talking about. The bill is advocating volume discount. I have five products. You are coming to me for a mortgage. I approve your mortgage, but I say: "Listen, I can give you a better rate on the mortgage if you buy an RRSP. I will give you an even better rate if you buy insurance on your house". Those are three products. But wait a second. A trust company cannot provide all of those products. Insurance companies cannot provide all of those services. Investment dealers cannot provide mortgages. That is unfair.

Mr. Speaker, you are giving me a sign, but I believe the agreement made by the House leaders was that we would be given two ten-minute speeches on this today and that would be it. That is what the parliamentary secretary to the House leader told us. I believe that the Bloc agreed to that, as did the Reform Party. I thought I had five more minutes.

Budget Implementation Act, 1997 April 10th, 1997

The finance minister?

Budget Implementation Act, 1997 April 10th, 1997

Three years.

Budget Implementation Act, 1997 April 10th, 1997

Mr. Speaker, I rise on a point of order. Our member would like to speak.