Mac Harb

[Cultural Property Export And Import Act, September 28th, 1995]

Mr. Speaker, it gives me great pleasure to speak on Bill C-93. As a background to this legislation, the purpose of the bill is to amend the Cultural Property Export and Import Act with consequential amendments to the Income Tax Act and the Tax Court of Canada Act, to establish an appeal of determination by the Canadian Cultural Property Export Review Board of the fair market value of certified cultural properties.

Going back a little, in December 1991 the responsibility for determining the fair market value of cultural property donated to designated Canadian museums, art galleries and libraries was transferred from Revenue Canada Taxation to the review board. The review board assumed this new responsibility at a meeting which was held sometime in January 1992.

There was no provision for appeal of review board decisions included in the legislative amendment despite the fact that the right of appeal existed when this responsibility was with Revenue Canada.

Donors and custodial institutions expressed serious concern about the lack of an appeal mechanism. As a result the Department of Canadian Heritage, in co-operation with the review board, undertook a series of consultations with the community about the need for an appeal process. As a result of these consultations it was agreed that a legislative amendment should be prepared to establish the right of appeal to the Tax Court of Canada.

The bill gives a donor or a custodial institution the right to request that the review board reconsider its initial determination of fair market value. If after receiving a redetermination from the board the donor is still not satisfied, he or she may take the second step of appealing the board decision to the Tax Court of Canada.

There are a number of items in the legislation I would like to share with my colleagues. The Cultural Property Export and Import Act provides tax benefits to encourage donations to public institutions of objects and collections of outstanding significance and national importance.

It is the only program of the Government of Canada that provides financial support through tax credits for donations to museums, art galleries, archives and libraries. Museums, art galleries, archives and libraries in every province and territory of Canada will benefit through the receipt of donations of cultural property as a result of the tax credits.

Cultural property valued at approximately $60 million is donated to Canadian institutions each year. The fair market value of cultural property certified by the review board as a result of the legislation will become eligible for a tax credit of 17 per cent on the first $200 and 29 per cent on the balance if it is over $200.

The donor can claim the fair market value of the gift up to the total amount of his or her net income, and there is no tax payable on any capital gain resulting from the gift. There is a cap and the cap is the total income of the individual on an annual basis.

Because a donor receives a tax credit the amount of money realized as a result of the donation is approximately 50 per cent of the fair market value. The donor does not therefore receive a tax refund equivalent to the fair market value of the gift.

Donors, museums, art galleries and professional associations have been lobbying for the right to appeal review board decisions as it was perceived that the lack of an appeal was a denial of natural justice. To that end the government has taken action.

The establishment of an appeal should be viewed as a reinstatement of the right of appeal that was lost when the responsibility for determining fair market value was transferred to the review board back in 1991. The amendments will ensure that donors who disagree with determinations of the review board will have the right of appeal to the court and will not be denied natural justice.

The announcement of the establishment of an appeal process was received positively by donors, museums, art dealers and the media. These amendments therefore enjoy a high level of public support.

The amendments are technical in nature and respond to strong concerns expressed by the heritage community. Their passage into law should be seen as part of the ongoing commitment of the Government of Canada to ensure the preservation of Canadian heritage.

Bill C-93 has dealt with all the concerns in communities and all wishes of different art galleries, museums, libraries and similar institutions. All those concerns have been studied and legislation that responds to them in a positive way has been brought forward.

It is a perfect example that the government is willing to listen to the concerns of the people, that the government is willing to take action, and that the government has taken action on an issue of national importance and of great concern to the art community of Canada.

I congratulate all those who have made representations to the Department of Canadian Heritage, my colleagues in the House of Commons, the committees and the administration through direct communication. I also thank all those who worked tirelessly to ensure the legislation would come before the House in a timely fashion.

I am sure my colleagues on both sides of the House will stand to speak in support of the great initiative taken by the department of heritage. We truly believe that if somebody is willing to do good and give to a national institution such as a gallery, a library or a museum, the individual deserves the right to be recognized and to be given an incentive.

This is why we made provision in the legislation to give a tax credit for any Canadian citizen, or for that matter a landed immigrant in Canada, who might have something of national significance to give as a gift to the crown. The individual will be given a tax credit of up to 17 per cent if the gift is worth less than $200 and up to 29 per cent of his or her annual income. I think that is fair. I call on people from coast to coast to coast who might have valuable items to consider giving them to museums and so forth.

Some of my colleagues might have some points to make. This would be a most opportune time to put their points on the table so that we can deal with the legislation in a timely manner.

[Corrections And Conditional Release Act, September 28th, 1995]

Mr. Speaker, the hon. member for Bonaventure-Îles-de-la-Madeleine made a very eloquent presentation. I was surprised that my colleague on the other side did not listen to the parliamentary secretary. All that Bill C-45 does is close some of the loopholes which exist in the present system.

Does the hon. member have a problem with the government making it easier for the parole board to keep people in the penitentiaries until the end of their offences if they are sex offenders or repeat offenders? Does he have a problem with the parole board being able to keep people who have committed violent crimes until the end of their sentence? Does he have a problem with those two recommendations? If he does not, does that mean he will support the bill when it comes before the House for the vote on third reading?

[Petitions, September 28th, 1995]

Mr. Speaker, I have another petition signed by Canadians from Quebec, Ontario and elsewhere. These petitioners call on Parliament to allow people to use the grounds of Parliament Hill for the purpose of public interest.

This petition is signed by people from all over the place. I really do not understand the motives behind it but nevertheless I would like to table it.

[Petitions, September 28th, 1995]

Mr. Speaker, pursuant to Standing Order 36, I have the pleasure and the honour to introduce a petition signed by Canadians from New Brunswick, British Columbia, Ontario and elsewhere.

The petitioners call on Parliament to institute complete recycling, waste reduction, energy and resource conservation and clean-up and air pollution programs.

[United States Sugar Import Restrictions Retaliation Act, September 25th, 1995]

Mr. Speaker, when Canada and the United States negotiated the free trade agreement that came into effect in 1989, both sides reserved their GATT rights. As such the United States retained its ability to take action under section 22 and Canada retained its quantitative restriction under article XI of the GATT.

The reservation of GATT rights was also incorporated in the North American free trade agreement five years later. In effect both sides, the Americans and the Canadians, agreed that a negotiated settlement on bilateral agricultural trade would be best achieved in the Uruguay round.

From 1982 to 1990, Canadian exports of refined sugar to the United States were subject to an absolute quota representing 1.1 per cent of the total U.S. imports. This roughly amounted to about 12,000 tonnes per year. Producers of raw and refined sugar from other countries were also limited to various shares of total U.S. imports.

In 1989 a GATT panel, at the request of Australia, concluded that the United States mechanism for imposing sugar import restrictions was in violation of the GATT. In 1990 the United States implemented the panel recommendation by converting its absolute quota on sugar into a tariff rate quota that essentially had the same effect as the quota it replaced.

For Canada, implementation of the GATT panel recommendation had an unexpected effect. The United States decided that due to the existence of the recently signed free trade agreement it would not apply the tariff restriction to Canada. That was a unilateral decision.

As a result, our exports of refined sugar, which had consisted exclusively of sugar made from Canadian grown sugar beets, have increased since 1987 from the previous annual level of 12,000 tonnes to an average of approximately 35,000 to 38,000 tonnes per year in the last three years. In fact we were able to triple the exports of refined sugar to the United States following the unilateral interpretation of the free trade agreement.

With respect to products containing sugar, the United States had an absolute quota in place as far back as 1983. Canada, like other countries, has always been subject to these quotas. During the last three to four years Canadian producers, for example, due to the high quality of their products and very competitive prices, have accounted for the vast majority of U.S. imports of sugar.

In 1989 the United States converted its old tariff schedule to the harmonized tariff schedule. In the process a U.S. custom service reclassified powdered drink bases, commonly known as crystal drink mixes, into a non-quota item. That has caused the Canadian exports of crystal drink mixes to the United States to increase rapidly.

In the case of refined sugar, the United States will apply a tariff quota of 22,000 metric tons, as of October 1, 1995. Canadian exports of refined sugar will be subject to that quota. As well, a tariff quota of about 64,000 metric tons has been in effect since January 1 of this year and includes crystal mixes for drinks and other products containing sugar.

The government has pressed the United States to allocate to Canada a specific share of both sugar and sugar containing product tariff rate quotas but the United States has decided not to do so. We regret this decision but it must be recognized that the United States is under no international trade obligation to allocate the tariff rate quota by country.

The imposition of unilateral retaliatory measures as requested by the bill would be a violation of Canada's international trade obligations as contained in the NAFTA and the agreement establishing the World Trade Organization.

International trade agreements define the circumstances which can justify the taking of retaliatory measures, as well as the specific procedures to be followed before a party can invoke the right to impose such measures. A party must first ask that consultations be held to find a solution to the problem. If such consultations do not bring mutually satisfactory results, the aggrieved party can ask that a dispute settlement panel be set up. If the panel concludes that the contentious action violates the contractual trade obligations of the other party, and if that party refuses to amend its action or to provide satisfactory trade concessions then, and only then, can retaliatory measures be taken. Moreover, the panel must be convinced that the proposed retaliatory measure is not disproportionate, given the prejudice suffered. By proposing unilateral retaliatory measures, Bill C-311 goes against the arbitration procedure.

Consequently, the United States might decide to challenge our action under NAFTA, or under the agreement establishing the WTO. Moreover, Canadian exports of sugar, and possibly some non-sugar products, might be adversely affected.

Bill C-311 does not take into account Revenue Canada's anti-dumping duty investigation into imports of refined sugar from a number of countries, including the United States. The investigation was initiated following a complaint by the Canadian Sugar Institute earlier this year and a preliminary finding of dumping was announced on July 7 of this year. As a result, Revenue Canada assessed provisional anti-dumping duties on imports of refined sugar from the United States.

The investigation is following its due course in accordance with Canadian trade remedies. The investigation has until October to make a final determination of dumping. This will be followed by the decision of the Canadian international trade tribunal on whether the Canadian industry is being injured by such imports. The decision of the Canadian international tribunal is also expected some time in November of this year.

I would also like to mention an important development currently taking place in the United States that could further complicate the U.S.-Canada trade in sugar and products containing sugar. I am referring to the proposed U.S. legislation to expand the U.S. embargo on Cuba, the Cuban Liberty and Democratic Solidarity Act, 1995, also known as the Helms-Burton bill.

There were serious concerns earlier this year that the proposed legislation would lead to a ban on imports of Canadian sugar and possibly products containing more than 35 per cent sugar on the grounds that Canada imports raw sugar from Cuba. This would have affected over $500 million in Canadian exports of sugar and products such as confectionery, chewing gum, jams, jellies, gelatin mixes, as well as products already subject to U.S. quotas.

Canada has been actively registering its opposition to the proposed legislation with the U.S administration in Congress. A strong diplomatic note was delivered to the United States administration and ministers have raised Canada's concerns with their U.S. counterparts on numerous occasions. Furthermore, the Canadian ambassador in Washington has written to many congressional representatives on the issue. The government has emphasized that if legislation is passed banning the import of sugar and products containing sugar, Canada would have no option but to respond firmly.

We are pleased to see that subsequent revisions to those proposed bills have been made by congressional committees in the weeks prior to the summer recess of Congress as a result of Canadian interventions. Changes to the legislation are now being proposed that could reduce the impact on Canadian exports in sugar and products containing sugar. Most of the sugar provisions in the House bill were removed before the bill proceeded to the floor.

Unilateral retaliation not sanctioned by either the World Trade Organization or NAFTA dispute settlement mechanism would therefore not be helpful at this time.

Finally, on behalf of the government I would like to recognize the enormous work and valuable effort of the sugar caucus led by my colleague, the MP for Fundy Royal. I assure the House as well as my colleague from Fundy Royal that the government is fully seized of the importance of resolving the issue.

[Agreement On Internal Trade Implementation Act, June 19th, 1995]

Mr. Speaker, the hon. member made a number of comments and I would like to respond to some of them.

He clearly stated we have to invest more in education. When he stated that I hope he did not mean we have to put more money into education because that is not what is needed. The reality is that Canada invests more than any other country in the world in the area of education. We spend close to $50 billion annually in the area of education. What we have to do is spend wisely when it comes to the resources we are putting into education. We have to look at the educational system as a whole and bring all three levels of government together so they can better manage the resources they have at their disposal.

I quite agree with the hon. member that we have deficiencies in terms of the number of people who are going into the area of science and technology. We need to see more people going into the area of science and technology. We have to involve the industry more, that is true. We have to do all of that. We have to embark on co-operative programs. We have to get the parents involved. This is exactly what the minister responsible for human resources is doing in terms of his initiative. In the area of literacy, for example, this government has reintroduced the literacy program. It has put back into the program the $20 million that was supposedly going to be taken out of the program.

I also wanted to say for the record that this government has not only addressed the issue of interprovincial barriers but it has moved many steps forward in that area. On the external front, the government is on record as being on the leading edge when it comes to opening trade barriers and signing trade agreements with other countries.

In fairness to this government and to the Minister for International Trade, perhaps we have a Minister for International Trade who has travelled the world more than any other minister for international trade anywhere in the world. I would say it has paid dividends. If we were to look at the results, it has put Canada on the map internationally. The figures speak for themselves. Canada in 1993-94 has been on the leading edge. It has more economic growth than any industrialized country.

Would my colleague not want to correct the record and clearly state that this government has put Canada back on track in terms of its economic growth? Would he not want to give this government credit for making sure Canada is the leading country in the industrialized world since we took office in 1993?

[Petitions, June 19th, 1995]

Mr. Speaker, pursuant to Standing Order 36 I should like to table three petitions.

[Peacekeeping Act, June 19th, 1995]

Mr. Speaker, I am pleased to respond to the concerns of the hon. member.

As announced in the finance minister's February budget, the postal subsidy will be reduced. This cut follows earlier cuts already announced in the previous government's December 1992 economic statement and in the finance minister's April 1994 budget.

These cuts have been planned as follows: 10 per cent in 1993-94; 10 per cent in 1994-95; 15 per cent in 1995-96; and 20 per cent in 1996-97.

This breakdown explains the difference between the 8 per cent reduction reported in the latest budget and a 24 per cent reduction mentioned in some newspaper articles.

Despite the extent of these cuts, we are happy to point out once again that the postal rate increases for 1995-96 have been restricted to 5 per cent for paid circulation periodicals and to 10 per cent for small community weekly newspapers.

Also, we have successfully participated in the effort to reduce the deficit while protecting minority language weekly newspapers and ethnic newspapers. It is a success that deserves special recognition.

With regard to the overall evolution of the budget for the postal subsidy, it was first reduced from $220 million to $110 million by the previous government by excluding certain categories of beneficiaries and by moderately increasing the rates for the existing beneficiaries.

The previous government had decided to eliminate all foreign publications, periodicals distributed free of charge and dailies from the program. In April 1993, $25 million was devoted to the creation of a replacement program for the Canadian book trade. Access to the postal subsidy is now reserved for paid circulation periodicals, for library books and for small community weeklies.

I hope this response will reassure the hon. member for Kamouraska-Rivière-du-Loup regarding the short and medium term future of the postal subsidy.

[Cuba, June 16th, 1995]

Mr. Speaker, I agree with the statement of my colleague.

The government is already on record as communicating with the American administration our opposition to the Helms bill. We will continue through the proper channels both through the World Trade Organization and through NAFTA to deal with this issue. It is our hope that whatever resolution will come out of it will be in the best interests of Canadian businesses.

The American administration is already on record as having some concerns with reference to the Helms legislation. That is very encouraging. It is our hope this bill will go down the tubes.

[Employment Equity Award, June 16th, 1995]

Mr. Speaker, this being National Public Service Week, I would like to congratulate the Department of Canadian Heritage, which recently received an employment equity award for its contribution to the promotion of women in public institutions.

The employment equity awards board was impressed with the significant contribution made in 1994 by the National Advisory Committee on Women's Issues and their positive accomplishments, including the annual women's conference held in June 1994.

Moreover, they recognized that women's noticeable presence in the management category, as well as the support showed to the national advisory committee by senior management, confirm that the Department of Canadian Heritage recognizes the contribution of women in the public service.

Mrs. Marie Trudeau was delegated by the deputy minister to accept the plaque from Mr. Eggleton, on behalf of the department. Congratulations to the Department of Canadian Heritage.