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Crucial Fact

  • His favourite word was billion.

Last in Parliament April 1997, as Reform MP for Capilano—Howe Sound (B.C.)

Won his last election, in 1993, with 42% of the vote.

Statements in the House

The Economy October 8th, 1996

Mr. Speaker, this government's fiscal restraint is a sham.

Fact one: the entire deficit reduction of $25 billion is matched by $25 billion extra collected from the taxpayer. Fact two: the cuts in program spending needed to pay extra interest on the debt were achieved mainly by downloading on the provinces. Soon cuts in transfers for health and education will account for 84.3 per cent of all the federal government's cuts.

Ontario's minister of intergovernmental affairs put it this way: "Well, Mr. Minister, it is time to come clean. You will reduce transfers to the provinces by 42.2 per cent while you have only reduced other federal program spending by 1.3 per cent".

Downsizing of government is largely a Liberal myth. Revenue grabs and deficit shifting are despicable facts.

Tax System October 2nd, 1996

Mr. Speaker, I have three points with respect to the government's policy initiatives just outlined by the Minister of Finance.

First, I am glad that in his statement he eliminated the criticism of the auditor general which had pervaded the finance committee's own report.

It makes no sense to distinguish criticism based on wasteful policies and the wasteful implementation of sound policies caused by faulty bureaucratic decisions. Waste is waste and the auditor general must fight it wherever he finds it.

Second, I agree with the minister that this entire controversy is not about the roll of family trusts as a vehicle for the evasion of taxes. The contemptible tax loopholes that once existed were closed by legislation some time ago.

I respect the integrity and goodwill of my colleagues from the Bloc Quebecois serving with me on the finance committee. However, after listening carefully for many hours to expert testimony on family trusts and capital gains taxation, I reluctantly and respectfully disagree with their continued allegations that family trusts have served recently and continue to serve as vehicles for tax evasion and avoidance.

Third, I want to raise a point of disagreement with the government's approach to solving the one clear and important problem identified by committee witnesses. This problem concerns the lack of data on real estate and private business assets left behind untaxed by emigrants. Under present rules the government taxes capital gains on these assets whenever they are sold and a fair value has been established.

Presently Revenue Canada has in place a rather unreliable system for assuring that the sales of these assets are recorded and taxed properly. Such sales are not brought to the attention of Revenue Canada automatically and emigrants avoiding the payment of these taxes are difficult to catch once they have moved abroad.

The government has chosen to tighten the net for catching all capital gains on such assets by a mandatory reporting rule and the payment of a security deposit. I find the latter provision to be an unnecessarily harsh and punitive measure. Many emigrants will not have assets acceptable to Revenue Canada as a security deposit and will be hard pressed to come up with some.

It would have been much kinder and more efficient for Revenue Canada instead to put contingent liens on real estate and ask operating divisions of the department to report the sale of privately held firms showing up in tax returns.

I regret that the government has failed to take the kinder and gentler approach to regulation and the treatment of Canadians. These emigrants deserve our respect and compassion even after they have decided to take up residence in another country.

The Deficit September 24th, 1996

Mr. Speaker, since the beginning of this Parliament the Minister of Finance has used Canada's fiscal crisis as a club to suppress caucus and cabinet pressures for more spending, but now the dam has burst. The Minister of Canadian Heritage has increased spending by $160 million.

My question is for the Prime Minister: How many more such spending increases are in the works? Has the Liberal government returned to its old ways of buying the next election regardless of the size of the deficit and debt?

Committees Of The House September 23rd, 1996

Mr. Speaker, I will continue with my debate. The latter type of criticism is seen to involve allegedly inappropriate second guessing of decisions reached by bureaucrats carrying out their assigned functions in good faith.

I believe this distinction between these two types of criticism made by the auditor general is inappropriate. Waste and inefficiency occur both because the government sets the wrong policies and because bureaucrats err in the interpretation of what might be ambiguous directions flowing from the laws that guide their actions.

For example, consider that the auditor general discovers that government policies have seriously damaged coastal fishing in Canada. In my view, it does not matter whether this damage has occurred as a result of a faulty regulation passed by Parliament or whether it is due to the judgment of bureaucrats in the field who have erred in the interpretation of empirical evidence.

Let me now turn to my personal interpretation of the validity of the points raised by the auditor general. He noted that the intent of the Canadian law on the taxation of all capital gains may not have been carried out as a result of faulty decisions made by bureaucrats in the Department of Finance.

I listened with great interest to the presentation of a number of complex issues by representatives of the finance department as well as a group of distinguished lawyers specializing in foreign taxation. In brief, here is what I have learned.

Whenever Canadians decide to move abroad permanently they have to pay taxes on accrued capital gains. This can be done easily and fairly for capital gains associated with stocks, bonds and other assets for which objectively determined prices exist. However, some assets, in particular real estate and privately held companies, can be evaluated reliably only when they are traded. In addition, the market for such assets may be depressed, and forcing a sale would not be in the interests of either the emigrant or the Canadian taxpayer.

It therefore seems to be fair and reasonable that the Parliament of Canada has permitted emigrants to declare such assets to be treated as so-called taxable Canadian property, which means that capital gains are taxable in Canada only when such property is sold. However, there is a complication. If the sale takes place 10 or more years after emigration, according to bilateral international agreements the sale of the property results in capital gains taxes payable to the country of the emigrant's new residence. Since Canada is a country of large net immigration, this provision appears to work in our country's favour though, to the best of my knowledge, this has not been verified empirically.

Family trusts in law are treated much like people. When the trust is shifted abroad, readily valued capital gains are taxed immediately and others are registered as taxable Canadian property. The trust at the heart of the controversy owns very large claims on privately held business in Canada which therefore escape the payment of capital gains taxes upon moving abroad.

The auditor general argued that the transactions surrounding the movement abroad of this trust violates the spirit of the law that capital gains taxes have to be paid on all accrued capital gains. However, this argument involves a narrow interpretation of domestic law and neglects the existence of international taxation agreements which always take precedence over domestic law.

I think Revenue Canada treated the trust in question appropriately. If it had acted differently, it would have violated the right of equal treatment under the law for all.

The Finance committee hearings brought up some other issues like the use and timing of some advance rulings and the shift of assets from publicly traded firms to privately held companies. I did get the impression that some of these actions were motivated by the desire to minimize tax applications of the trust upon emigration. This is disturbing in a sense. But given the complexity of taxation laws, I cannot blame owners of large assets for hiring the best lawyers available to help them minimize their tax liabilities.

I heard no evidence that the letter of the Canadian law had been broken by these transactions. The entire episode reinforced my conviction that Canada needs a simplified, flatter system of taxation.

Let me now turn to what I found wrong with the administration of the law pertaining to taxable Canadian property. Officials have acknowledged that they have less than complete information about the disposal of such property after the emigrants move abroad and that therefore some capital escapes untaxed.

To deal with this problem the committee report recommended that the immigrants be required to register their Canadian taxable property and to pay a security which would be applied to tax application whenever the property was sold.

I agree with the registration requirement recommended and frankly I am surprised that it did not exist in the past. If the imposition of this regulation is the only result of the inquiry, the auditor general can be proud.

However, to keep costs down and laws fair, I recommend that the government does not impose the requirement for security on emigrants. I suggest that instead the government use existing information and resources by putting a conditional lien on real estate held as taxable Canadian property.

Revenue Canada's operational division can be required to report when relevant assets change ownership in the case of privately held companies. These provisions would be very cheap since they involve existing knowledge and institutions. This recommendation is at the core of the Reform Party's minority report.

Let me note in closing that during the finance committee hearings I repeatedly listened to some people advancing propositions about deliberate tax evasion, collusion of the Revenue Canada officials and their political bosses with wealthy Canadians to avoid taxes, and biases in the technical testimony given by tax lawyers. In spite of serious efforts on my part, in no case could I discover any evidence of wrongdoing.

I may have a mental block on this issue or my intellectual capacity is inadequate to capture the intricacies of taxation laws and alleged conspiracies. I have similar problems with conspiracy theories about the assassination of President Kennedy, the current fiscal crisis of government and the death of Elvis Presley. Rationally I cannot rule out that these conspiracies exist, but I have accepted that I may have to die without ever knowing for sure whether or not they are true.

Committees Of The House September 23rd, 1996

Mr. Speaker, I move that the third report of the Standing Committee on Finance presented on Wednesday, September 18, be concurred in.

I would like to split my time with the hon. member for St. Albert. I was disappointed when I read in the report of the finance committee on the issue of Canadian tax property some harsh criticism of the auditor general's report.

While the report accepts as proper the auditor general's criticism of government policies, institutions and practices which lead to waste and inefficiency, it considers inappropriate any criticism which involves waste or inefficiencies due to the actions of bureaucrats.

The latter type of criticism-

Petitions September 20th, 1996

Mr. Speaker, the petition calls for Parliament to support Bill C-205. This bill amends the Criminal Code and Copyright Act with the objective of preventing criminals from profiting from their crimes through the sale of books, video tapes and other such means related to their crime.

Employment September 17th, 1996

Mr. Speaker, this government promised jobs, jobs, jobs. It has not delivered.

The unemployment rate remains above 9 per cent after three years of economic recovery. I blame this dismal record on the government's failure to deal with labour market problems.

Our employment insurance system subsidizes permanently seasonal industries. Premiums, known to kill jobs, are too high. Our high marginal income tax rates drive abroad the most skilled and entrepreneurial Canadians. Our high capital gains and corporate taxes push investment abroad.

Small business, the Canadian job creation machine, is held back by red tape and excessive taxation. Large business is discouraged from hiring labour by too much regulation and legislated wages.

High unemployment can be cured. The evidence from around the world is clear. Shame on this government for not acting.

Questions On The Order Paper June 20th, 1996

Mr. Speaker, over three months ago, on March 4, I submitted a question to the Order Paper. I wonder when the government would be able to answer my question. It is Question No. 15.

Petitions June 3rd, 1996

Mr. Speaker, I present a petition signed by over 50 of my constituents in Capilano-Howe Sound.

The petitioners urge the government not to amend the Canadian Human Rights Act or the charter of rights and freedoms in any way which would tend to indicate societal approval of same sex relationships or homosexuality, including amending the Canadian Human Rights Act to include in the prohibited grounds of discrimination the undefined phrase of sexual orientation.

Employment June 3rd, 1996

Mr. Speaker, last week the Minister of Human Resources Development claimed puzzlement about Canada's high unemployment rates. He does know that they cannot be lowered by more spending and deficits. He should know that we need to lower payroll taxes and government barriers to employment like Germany did recently and like they exist in the United States where the unemployment rate is only 5.5 per cent compared to Canada's 9.5 per cent.

Will the minister use this information for better Canadian policies, or will he continue to stand by in puzzlement while over one and one-half million Canadians look for work and become increasingly cynical about yet another Liberal broken promise?