Alaina Lockhart

[Taxation, October 16th, 2017]

Mr. Speaker, it is a pleasure to rise in the House on Small Business Week, as we celebrate the hard work of all of Canada's entrepreneurs and small business owners, including farmers. I thank the member opposite for this opportunity to discuss tax fairness.

Our government knows that when we have an economy that works for the middle class, we have a country that works for everyone. That is why two years ago, after we were elected, our government took the first steps to building a stronger middle class by lowering taxes for middle-class Canadians. We also introduced the new Canada child benefit that is simpler, tax free, more generous, and better targeted to those who need it the most. There are nine out of 10 Canadian families who are receiving higher benefits, and hundreds of thousands of children have been lifted out of poverty.

Earlier today, the Prime Minister announced the next steps in our plan for a stronger middle class. Our government intends to lower the small business tax rate to 10% effective January 1, 2018, and to 9% effective January 1, 2019. To support this change, the government will take steps to ensure that Canadian-controlled private corporation status is not used to reduce personal income tax obligations for high-income earners rather than supporting small businesses. We are committed to ensuring that unintended advantages are not being used by high-income and wealthy individuals to pay less than their fair share of taxes. Based on what we have heard from Canadians in a series of country-wide consultations on tax planning using private corporations, the government will this week set out its approach to better target strategies used by the relatively small number of high-income individuals who have the biggest advantage from the existing tax rules.

In addition to announcing its plan to lower the small business tax rate to 9% by 2019, the government announced earlier today its intention to simplify its proposal to limit the ability of owners of private corporations to lower their personal taxes by sprinkling their income to family members. The government is taking into account feedback from Canadians and is adjusting its approach to limit red tape and not interfere with genuine family business arrangements. In addition, in response to the comments we have received, the government will not be moving forward with measures that would limit access to lifetime capital gains exemptions. We would like to thank the tens of thousands of Canadians who took the time to share their views, their concerns, and their expertise.

We want to encourage people to invest in their businesses. Small businesses are a critical part of our economy, and the government is taking action to help them grow, invest, and create good, well-paying jobs. The government has listened to small business owners, professionals, and experts during the consultation on tax planning using private corporations, and will act on what it has heard.

The Minister of Finance and other members of the government will continue to meet with people in every region of this country, as we provide more details on the way forward for fairness, a strong middle class, and a thriving business community. Fairness in the tax system allows the government to keep taxes low while ensuring programs and services for all Canadians. Moving forward, changes to the tax treatment of private corporations will be informed by the many Canadians who contributed to these consultations.

[Business of Supply, October 3rd, 2017]

Mr. Speaker, it is important that we take a step back and realize that we are absolutely not targeting small businesses or farmers. This is about creating a tax system that is fair for all, including many small business owners and farmers.

The member asked why we would choose to do this first. Taking a look at corporate taxes was not our first act as a government. We actually began our mandate by focusing on increasing the taxes for the top one per cent and decreasing them for the middle class. We have also been very focused on maintaining a low business tax rate that encourages businesses to maintain their ability to invest in their businesses.

What we are looking at now is creating a system that really looks at the fact that 80% of passive income is held by 1.6% of corporations in this country. That is not fair, and we need to look at a way of making sure we have a fair tax system.

[Business of Supply, October 3rd, 2017]

Mr. Speaker, as the member mentioned, I live in a rural riding, and I have taken the opportunity to talk to many of my constituents, some of whom are doctors. There are a few things I would like to point out. First of all, only 40% of doctors are incorporated. This is not targeted at doctors at all, but it is looking at the tax fairness system.

Second, I had the opportunity to sit down with the recruiting team for my own community, the one looking at recruiting doctors to that area. Of course remuneration is one of the key factors they look at when choosing a place to practise, but they are also looking at quality of life. They are looking at all the things that make these rural communities viable and wonderful to live in. We talked at length about all of the other factors that cause a doctor to make the choice to practise in small communities.

I want to reiterate that we want to continue to support doctors in all areas of Canada and that their concerns have been heard as well, and we will be communicating those.

[Business of Supply, October 3rd, 2017]

Madam Speaker, I am pleased to rise today to speak to the issue of tax fairness and our government's efforts to bring greater fairness to Canada's tax system.

At its core, this is about a key commitment our government made during the election campaign, and has worked every day to deliver; that is to build a stronger middle class and help those working hard to join it.

Simply put, our government has always said that when we have an economy that works for the middle class, we have a country that works for everyone. That is why one of our government's first actions was to raise taxes on the wealthiest 1% of Canadians while cutting taxes for the middle class.

Our current proposals have the same objective, which is to make our system fairer for all Canadians and ensure everyone pays their fair share.

In our platform, we had a specific commitment to address the use of corporations to reduce personal income tax obligations for high income earners. Currently, an incorporated professional earning $300,000 can use the private corporation to get tax savings that amount roughly to the average Canadian's earnings for a year.

We understand these tax-planning strategies are legal. However, when we consider that these strategies are not available to all Canadians. it is clear they are not fair.

At present, a single woman with two children aged 12 and 14 and an incorporated business pays a tax rate that is higher than a married woman with two children aged 19 and 20 and an incorporated business bringing in the same revenue. That is not fair.

The changes we are proposing are aimed at eliminating the legal but unfair advantages that allow the wealthy to incorporate to avoid paying taxes on some of their income and to have a lower tax rate than individual taxpayers.

We do not believe that is fair, and most Canadians agree with this.

There is a lot of misinformation out there about these proposals and I would like to take a few minutes to address some of the more notable misstatements I have heard.

To begin, some have said that these proposals are an attack on middle-class small business. That could not be further from the truth. As the Prime Minister has said, as the Minister of Finance has said, and as so many others in this place have said before today, this is absolutely not true.

We know very well just how important small businesses are to our economy. Small businesses employ approximately 8.2 million Canadians, and this represents 70% of the private sector workforce and approximately 30% of GDP.

We are deeply committed to supporting middle-class small businesses so they do thrive and create good, well-paying jobs. We know just how hard these business owners work to provide for their families.

It is worth remembering that two-thirds of businesses in Canada earn less than $73,000 a year. These hard-working, middle-class small businesses are not our focus. We are supporting these businesses in many ways, as they invest, create jobs, and drive growth throughout our economy. For example, Canada's average tax rate for small businesses is the lowest in the G7 and the fourth lowest among the OECD. This allows small businesses to retain more of their earnings to reinvest, supporting growth and job creation.

Other commentators have expressed concern that our proposals are an attack on the family business. This is also not accurate.

Famliy is often crucial to the success of small businesses. I understand that, and so does the government. If a family member is paid for their work in a small business, the changes we are proposing will not affect them. Family members can continue working for the business without any repercussions.

However, we believe that high-income earners should not be allowed to pay dividends to adult family members through the corporation if those family members do not make significant contributions to the business, simply in order to avoid paying their fair share of personal income tax.

This type of tax planning is unfair because it is not available to all Canadians.

Our government understands that many small business owners save money in their businesses for the future, whether for a rainy day, future investments, or eventual retirement. When it comes to the actions that have already been taken, we have no intention of going back in time. Our proposals would only be applied on a go-forward basis. Our intent is that neither existing savings nor investment income from those savings would be affected. We are not going after the nest eggs. What is more, we encourage small business owners to continue using all available tax-sheltered savings plans, such as pension plans, RRSPs, and TFSAs.

Less than 3% of Canadians max out their RRSP, TFSA, or pension plan contributions. We are proposing to eliminate the legal but unfair advantages that allow some individuals to use unlimited tax-sheltered accounts that are beyond the means of most Canadians.

However, someone who saves money in their business with the intention of reinvesting it in the business or in a rainy day fund will be free to keep doing so. The proposed changes will not affect them.

Finally, I want to address the concerns of some doctors, who have raised concerns about their ability to take parental leave. Our proposals are about making the tax system fairer for everyone. All Canadians, employees, and small businesses can continue to benefit from pensions, employment income, and maternity leave, if they choose. However, our government has been clear since our election that we strongly support women entrepreneurs. The Minister of Small Business and Tourism has made it one of her priorities as minister.

We know that of small businesses in Canada, just under 17% are majority owned by women, and that is simply not good enough. That is why we have taken steps to create specific programs that support women entrepreneurs, and when it comes to these proposals, we are committed to ensuring that these changes do not affect women differently from men. Our government is committed to gender equality, and we will work to ensure that these changes support women's ongoing success.

It is worth reminding the House that our proposed changes will continue to protect businesses' ability to incorporate, make investments, save for downturns, and pay family members who work in the business.

They will protect and maintain small businesses' ability to succeed and create jobs, while ensuring that the wealthiest Canadians pay their fair share.

Our government is committed to building a fair tax system in Canada, and we want to get it right. Over the coming weeks, we will continue to listen to Canadians, including small business owners, professionals, and experts, on how to build such a system while avoiding any unintended consequences.

Although consultations have concluded, the work of the government continues, and we will continue to work with small business owners and professionals, like everyone else, to address their concerns.

Over the summer, a lot of misinformation has been spread, and I want to assure members of the House that our Prime Minister and the government are committed to listening to Canadians and getting this right. As the Prime Minister has said, better is always possible, and nowhere is that more needed than in creating a fairer tax tax system for Canadians.

When we have an economy that works for the middle class, we have a country that works for everyone.

[Taxation, September 28th, 2017]

Madam Speaker, we will carefully consider all the decisions we make. They will be guided by our main objective, which is to ensure fairness for the middle class and all those working hard to join it. We want to strike a balance, give everyone the chance to succeed, and put an end to certain injustices. That way, Canadians will be convinced that they have a fair tax system.

A fair tax system is pivotal in making sure our economy is really working for everyone, especially the middle class, and I am confident we are going to get this right.

[Taxation, September 28th, 2017]

Madam Speaker, I am pleased to have the opportunity to speak about the government's proposals concerning tax strategies involving private corporations. As members know, we are currently conducting consultations on proposals to address tax benefits for private corporations.

The government has asked stakeholders from across the country to provide their comments. It listened to what they had to say. The government found many of these comments to be helpful as they helped it better understand the impacts of its proposals. I can assure my colleague that we will report on what we heard and that, together, we will make decisions that will result in a fairer tax system.

It is important that we highlight some of the facts. To begin with, we are not increasing the small business tax rate. Canadian small businesses will continue to benefit from the lowest small business tax in the G7. Our proposals will have no impact on business's ability to save or invest for business. Our proposals will not affect individuals' ability to incorporate their businesses, nor will they prevent business owners from employing family members. It is also important to know that middle-class Canadians and small businesses are not the focus of our proposed changes.

We recognize that there are business owners and professionals who have saved and planned for their retirement under the existing rules. On this matter, I want to reassure everyone that our proposed changes to passive income taxation would only apply on a go-forward basis, not to existing savings, nor to investment income from those savings.

We will not introduce any measures that compromise this extraordinary advantage. That way, our businesses will continue to create jobs and to invest in their community. After all, Canada's corporate tax rates are among the most competitive in the world. For example, its small business tax rate is the lowest of all the G7 countries.

[Tourism, September 28th, 2017]

Mr. Speaker, I would like to welcome to Ottawa the ministers of tourism and indigenous leaders attending the meeting of the Canadian Council for Tourism Ministers.

Our government knows that tourism is an economic driver, representing almost 2% of GDP and supporting more than 1.7 million jobs across Canada.

That is why the Minister of Small Business and Tourism announced Canada's new tourism vision, our plan to support the growth of Canada's tourism sector, create jobs, and grow our economy for the middle class.

By working with our provincial, territorial, and indigenous colleagues, we are ensuring that the momentum we experienced this year celebrating Canada 150, and expect to continue in 2018 with the Canada-China Year of Tourism, continues for years to come.

[Regional Economic Development, June 14th, 2017]

Mr. Speaker, Atlantic Canada faces a number of unique challenges in growing our economy and encouraging businesses to innovate and export. One of those challenges is helping high-growth potential firms grow and stay in Atlantic Canada. These firms are generally small in size but their impact is significant. They are more likely to invest in their companies and people, while also exporting more than the average Canadian business.

Can the Prime Minister please tell the House how the government is helping these firms in Atlantic Canada?

[Salaries Act, June 8th, 2017]

Mr. Speaker, what I am hearing here today is another reflection of the disconnection that members opposite have with Atlantic Canada.

We have been very strong in advocating for the issues that are important to us and the things that our constituents are talking to us about. Just today, in fact, we talked very strongly about what has been going on in the immigration committee, the filibustering, and the disrespect of the witnesses who have appeared to try to make a difference in the economy of Atlantic Canada.

[Immigration in Atlantic Canada, June 8th, 2017]

Mr. Speaker, on November 2, 2016, I was proud to see every member of this House united and voting in favour of my Motion No. 39 to study the issue of immigration in Atlantic Canada. There was a mutual recognition of Atlantic Canada's important contribution to our country.

Sadly, it seems that the opposition's goodwill towards Atlantic Canada has since disappeared. Let me be clear: Atlantic Canadians are hard-working, unassuming people. Our region has known tough economic times, but we are working hard to find solutions. Immigration is definitely part of the solution, and the committee's study will be one more tool to help our region grow economically.

I am saddened to see members of the opposition filibuster this important study and show such disrespect for Atlantic Canada. The fact that the Conservatives and NDP are playing political games with the economic well-being of Atlantic Canada is nothing short of shameful.

I ask my colleagues opposite to end the political games, and let us all work together to support Atlantic Canada.