Barry Campbell

[Excise Tax Act, February 10th, 1997]

Mr. Speaker, we have been debating these motions for many hours.

A number of themes have been repeated over and over again because they strike members of the opposition as good sound bites, ways to attack the government. Who can fault them for that? That is what they are here to do. The trouble is that it distracts this House and people who may be viewing this debate from considering the real issues at hand.

What we are doing in this harmonization agreement with the provinces that are coming onboard now is we are moving to a system of sales taxation that is coherent, is in the interests of consumers, and is more efficient and easier for businesses. It is a win all around.

It is interesting, particularly as I rise after a member of the opposition, the Bloc Quebecois, to hear the unrelenting criticism of harmonization from that side of the House. One has to ask why that might be. Consider that in the province of Quebec we already have harmonization. So how can it be that members of the official opposition have been in this House day after day attacking harmonization?

As I just said in English, Bloc members are against harmonization, which is very odd because they have harmonization in Quebec. Everyone knows that. Is it because they want to keep the benefits of harmonization for themselves, for their own companies and consumers?

Could it be that they want to preserve for their businesses and their consumers the benefits of a more efficient harmonized sales tax system? I looked at a map of Canada the other day, which one should do from time to time, to remember that Quebec borders New Brunswick. If New Brunswick goes to harmonization and has the benefits of that, then Quebec loses some of the comparative advantage it has had through harmonization. Those advantages will now be available in Atlantic Canada and eventually throughout the country. It is the right way to go for business and it is the right thing for consumers.

I travelled across the country with the finance committee. Members of all parties, even the third party, supported harmonization, but we would hardly know it from listening to the debate of the last few days. We travelled across this country and Canadians said: "While you are fixing the GST please do something about this anomaly. We are the only country in the world that has 10 sales taxes: nine provincial sales taxes and one federal tax". Travel anywhere in this world and try to find that. You will not.

I will speak to one other misconception that has been advanced in this Chamber, which is the issue of hiding tax. Consumers said to us overwhelmingly-and I will have more to say about this in later stages of the debate-that they wanted tax inclusive pricing. As for those who said they did not want the tax to be buried, I asked them if they had ever travelled outside North America and had looked at a cash register receipt in almost any country of Europe or if they had looked at a receipt from the gas pump, whether it was in Alberta or Quebec City and had seen the amount of tax indicated on the receipt. I did not hear a great hue and cry about hidden taxes in gasoline prices in this country. And I have yet to run into anybody in Europe who says: "The Government of France is hiding the tax from me". It is right there on the receipt, as it will be in Atlantic Canada.

I have taken these few minutes to come back to basics. I look forward to hearing what the members opposite have to say, particularly if it is something new and not something that has been said over and over again without looking at the substance of what is being done here, about the wishes of consumers and retailers in Atlantic Canada about what makes sense for economic efficiency in this country. It makes sense in Quebec where they have been doing it for years. It must make sense for the rest of the country as well, and indeed it does.

[Excise Tax Act, February 10th, 1997]

On a matter of clarification, Mr. Speaker, I am not sure if this is correct. There is another motion, Motion No. 120, and I want to make sure that we do not forget it because the government is in favour of Motion No. 120. It is a government motion.

[Excise Tax Act, February 6th, 1997]

On a point of order and I thank you, Mr. Speaker, in view of the hour.

On several occasions today you, Mr. Speaker, and others who have occupied the Chair have pointed out to members that the use of certain words in this House is unacceptable. If I heard correctly, what I heard was an attempt to use the same word by spelling it out rather than saying it. It amounts to the same word with respect to the Prime Minister of this country.

[Excise Tax Act, February 6th, 1997]

Mr. Speaker, I am pleased to speak on behalf of the government on these Group No. 3 motions.

Unlike some of my colleagues, I am going to try to stick as much as I can to the actual motions before us and talk about what they are rather than talking about everything else.

First, government Motion. No. 120 deals with clause 262. Clause 262 of Bill C-70 adds new provisions to the Federal-Provincial Fiscal Arrangements Act that set out the statutory authority for the federal government to make payments to the participating provinces equal to their respective share of the provincial component of the HST determined in accordance with the harmonization agreements. This motion amends new section 8.4 and 8.5 of that act to provide that, for government accounting purposes, the revenues from the HST shall be recorded net of these amounts payable to the participating provinces. I point that out in support of the government's motion.

I will respond to some of the remarks that have been made in the debate on this group of motions. I oppose the opposition motions that are a part of this group. My first comment is with respect to some comments made earlier this morning by the Bloc Quebecois.

As I said this morning in English, Bloc members are opposed to harmonization and this is very odd. It is odd indeed, since there is already harmonization in Quebec. Could it be that opposition members want to keep the benefits of harmonization all to themselves, their businesses and consumers?

The reality is that members of the Bloc Quebecois know the value and merits of harmonization. They are not suggesting that

Quebec cease, unravel and turn back the clock on harmonization in Quebec. They are not saying that at all. However, they are saying to the maritimes: "Don't harmonize, this is a terrible thing".

I wonder whether they want to preserve the advantages of harmonization for the businesses of Quebec, particularly because they border on other provinces, while they would deny those advantages of lower prices to consumers and the simplicity to retailers that would come from harmonization in provinces contiguous with Quebec. It is a little surprising to see the Bloc stand up hour after hour and attack harmonization.

I will turn to members from the third party and the spectacle we have seen in the House. They are from one regions of the country and they are once again saying to another region: "You don't want this. We know better. Don't do this. This would be terrible for you," while consumers are telling us overwhelmingly, "this is what we want," and the provincial governments agree.

We hear a great deal from members of the third party about respecting local governments and regional decision making. When regional governments have made a decision it is only okay if that decision agrees with the views of the members of the third party, but if they take a decision in the interests of Atlantic Canada, in the interests of business and principally consumers, that is not good enough for the third party.

I really do not want to get into this debate. I want to speak precisely to the motions before us. It is really incredible that they keep speaking about retailers but I have not heard them speaking for the consumers. This harmonization measure will benefit consumers immeasurably and enormously. People in those provinces know that, which is why they are going down this route.

No doubt this is a complex bill. There are adjustments in any tax legislation. That is why we are debating these motions, why we had very good and effective amendments at the finance committee and why we are debating a number of government motions again, to make the bill work better.

I welcome this opportunity to speak to this. This is a big and complex country. It is possible that one region of the country might decide for the moment that one course of action is more in the interests of their people than another. It is unfortunate when members from one region presume to tell the people of another region what is good for them. They are perfectly capable of making up their minds, and they have done so in Newfoundland, New Brunswick and Nova Scotia.

[Excise Tax Act, February 6th, 1997]

Mr. Speaker, on a point of order. I believe I heard the hon. member opposite say that this government has imposed closure. That is untrue. Nothing of the sort has been done. I would like the record to be corrected.

[Excise Tax Act, February 6th, 1997]

Mr. Speaker, I am under your guidance. When we group motions like this, it is a little bit confusing for us. The problem arises because within the grouping are some motions put forward by the government and some by the opposition. I would propose to speak now in favour of the motions we have put forward and in that same 10 minute allotment in opposition to some of the others, followed by my colleague opposite.

There are three things I want to say. First is in response to what the hon. Bloc Quebecois member has said with respect to adjustment assistance. As he well knows, there is no basis for the claim that Quebec would qualify for adjustment assistance based on the formula that is being applied for that assistance to the maritimes. Quebec simply did not incur any loss of sales tax revenue as a result of harmonizing and that is just a fact of life. The formula requires adjustment assistance if a province loses approximately 5 per cent in sales tax revenue in moving to adjustment. In fact Quebec made money. That is the way it was; there is no justification for adjustment assistance.

Second is with respect to harmonization.

Members of the Bloc oppose harmonization. This is very strange, because there is harmonization in Quebec. Is it because Quebecers want to keep the benefits and advantages of harmonization for themselves, for their businesses and their consumers?

There is no question that harmonization provides a comparative advantage. Provinces that are harmonizing will have a more efficient business sector and cheaper prices for consumers than ones that are not. I detect underlying this intense opposition to harmonization, striking the word throughout the bill as the opposition proposes, is an attempt to deny the benefits of harmonization to provinces that live right next door to Quebec and to preserve those advantages for Quebec. I hope I am not right, but I suspect that may underlie some of the opposition.

The government motions to amend clauses 150, 160, 198, 203, 204, 241 and 254 are related. They would ensure that the provincial component of the HST would apply to Nova Scotia and Newfoundland offshore areas in relation to activities to which the Canada-Newfoundland-Atlantic accord implementation act and the Canada-Nova Scotia offshore petroleum resources accord implementation act apply.

This treatment would be consistent with the terms of the existing offshore petroleum resources accord, Canada-Nova Scotia and the Canada-Newfoundland-Atlantic accord and the related implementation act under which taxes equivalent to retail sales taxes in Nova Scotia and Newfoundland currently apply.

Further, among the motions, subclause 150(6) of Bill C-70 enacts a new definition of basic tax content for purposes of part IX of the Excise Tax Act.

The concept of basic tax content is principally used to determine the amount of additional input tax credits that a registrant may claim when the registrant increases the extent to which capital property is used in commercial activities and the amount of input tax credits that are recaptured when the use of the capital property and commercial activities are reduced.

Generally, the basic tax content of the property is the tax that was payable on the acquisition after deducting rebates on certain other amounts that the purchaser was entitled to recover and after taking into account depreciation of the property.

The motion proposes to include in the calculation of a basic tax content a tax that would have been payable but for the fact that the purchaser acquired the property for use exclusively in commercial activities. This change will ensure that the correct result is obtained in determining the amount to be remitted or recaptured if there is a subsequent change in the use of the property.

Government Motion No. 63 proposes to amend clause 204 of Bill C-70, which adds new section 220.06 to the Excise Tax Act. This section ensures that goods delivered to a purchaser in a participating province do not escape the 8 per cent component of the HST when they are supplied by an unregistered, non-resident person who has not paid the tax on bringing the goods into Canada or into the province.

In this case, as a result of section 220.06, the recipient could be assessed a tax. The proposed amendments remove the references in the section to a "specified motor vehicle" that is required to be registered in a participating province. These references are inappropriate because a special regime is intended to apply to sales of registerable motor vehicles.

Where a registerable motor vehicle is sold by a non-registrant, in circumstances in which the 7 per cent GST does not apply, as in the case covered by section 220.06, neither should the 8 per cent component apply. Instead, a special 15 per cent provincial levy will apply to the vehicle which will be payable to provincial licensing authorities when the vehicle is registered in the province.

Therefore, section 220.06 should not apply at all to sales by non-registrants of motor vehicles that are required to be registered in a participating province. The amendments also clarify when the tax under section 220.06 becomes payable.

In conclusion, I apologize for that bit of reading into the record but it is required in order to adequately explain some technical amendments to the act.

I would only add that with respect to motor vehicles, yesterday we heard some suggestion of an unlevel playing field between people who sell vehicles privately and people who purchase used vehicles from dealers.

If members opposite understood the impact of the harmonization legislation, they would understand that in participating provinces there will be a level playing field because registrants' provinces, when purchasers register a vehicle, will be paying all sales taxes applicable. That will alleviate a situation that prevails and will continue to prevail in provinces that are declining to harmonize at this time.

It is a dramatic improvement in those provinces that are harmonizing.

[Excise Tax Act, February 6th, 1997]

Mr. Speaker, I would like to thank you and the hon. chief government whip for clarifying what I was trying to say. Given how sensitive everyone is in the House these days, I want to tell the hon. member opposite that I take no offence at what he said a few moments ago about my earlier attempt to explain what the government wanted to achieve.

[Excise Tax Act, February 6th, 1997]

Mr. Speaker, on a point of order, I wonder if in this renewed spirit of co-operation I might also ask that all votes could be deemed to have been taken as recorded divisions and put over instead of done individually.

[Excise Tax Act, February 6th, 1997]

Mr. Speaker, I would like to clarify it. I am afraid the hon. member opposite has now changed what I understood the member of the third party to have suggested. He suggested that in light of the inconvenience of your having to read through all of these amendments, we could take them as having been read. I am saying on behalf of the government that we would be agreeable with that and that is all I am saying.

[Excise Tax Act, February 6th, 1997]

Mr. Speaker, as much as we are enjoying the very fine job you are doing in reading these amendments, it is putting a strain on you. I regret that as a result of the wishes of the other parties opposite, that is what we had to do last night and this morning, riveting television though it may be. I am sure we would also be pleased to begin the debate on this group.

May I ask my hon. colleagues opposite, does this mean we would proceed to debating the motions in this group at this time? To clarify, my understanding is that we would take all the motions in this group as having been read and proceed to the debate.