Mr. Speaker, millions of Canadians are struggling to make ends meet. We have a cost of living crisis and an economy that is seeing an ever-widening gap between the wealthy and the rest of us. A few stark facts bear this out. According to Statistics Canada, nearly half of Canadians report that rising prices are greatly affecting their ability to meet day-to-day expenses. Rent has increased by over 21% and grocery foods have increased by over 20% over the last three years. According to Equifax Canada, 50% of Canadians are now living paycheque to paycheque.
Income inequality in Canada has hit the highest level ever recorded. The top 20% of Canadians hold more than two-thirds of our country's wealth. By comparison, the bottom 40% of Canadians account for only 2.8% of our country's wealth. According to the Salvation Army, one in four parents cut back on their own food consumption this year to ensure their children had enough to eat. Eight in 10 Canadians, or 80%, believe that owning a home in Canada is now only for the rich. Seven in 10 say they have given up on ever owning a home.
A majority of Canadians say that thinking about holiday spending causes them financial anxiety and 80% plan on cutting back on spending during this holiday season in a few short weeks. That is why the NDP recently pledged to permanently remove the GST from daily essentials and monthly bills, such as grocery store items, including pre-prepared meals, diapers, children's clothing, Internet, home phone and cellphone bills, and all types of home heating. We will note that all of these items are unavoidable expenses. Everyone has to heat their residence and buy food at the grocery store; cellphones and Internet are now essential utilities.
We estimate that our plan would save an average family over $500 per year. This commitment stands in stark contrast to the Conservatives' proposed cuts to essential programs, such as dental care, child care and pharmacare. Losing that support would cost families thousands of dollars per year. That is money they cannot afford.
We would finance this permanent tax cut with an excess profits tax paid by very large corporations that abuse their monopoly market power and unjustifiably hike their profit margins. Canadians should know that excess profit or windfall taxes are used worldwide, including in the United Kingdom, Spain and Australia. In fact, Canada has a history of using excess profits taxes. During both world wars, excess profits taxes were implemented to help fund the war effort and ensure that companies did not engage in profiteering. The Parliamentary Budget Officer has estimated that an excess profits tax would have generated almost $8 billion in federal revenues for 2020.
The Liberal government responded to the NDP's tax-free essentials plan but, in true Liberal fashion, did so only partially. Instead, it proposed a two-month GST holiday on certain items, starting December 14, and a one-time payment of $250 delivered in spring 2025 for individuals who reported net employment income of up to $150,000 in 2023. It has completely ignored the NDP's call for an excess profits tax on large corporations, which are making huge, historic profits. This is far from the substantial, fair and permanent relief the NDP wants to give Canadians.
As usual, the Liberals are letting people down with their choice to make this a short-term tax holiday on a limited list of items. By leaving out things like home heating and cellular and Internet bills, their scheme also largely fails to capture the life essentials that the NDP plan captures. New Democrats are profoundly disappointed that the Liberals have chosen to exclude the most vulnerable Canadians from their one-time payment proposal. Perversely, the Liberals have chosen to send cheques to individuals earning $149,000 or couples earning $298,000 a year, but not to seniors on fixed incomes of $25,000 or people with disabilities so severe that they cannot work. That completely defies logic and fairness.
This plan was announced without consultation or negotiation with the NDP. Our position is that everyone under the income threshold should receive the $250 payment, and we will not support the Liberals' rebate payment unless this support is expanded to include everyone in need. The NDP forced the Liberals to split these two measures into two, so we could proceed with the GST holiday right away to give people immediate relief, while we continue to pressure the Liberals to fix the $250 benefit to include all vulnerable Canadians.
New Democrats will vote for the GST holiday proposed in the legislation before us today because working and middle-class families are desperate for relief, even if it is temporary and less than ideally aimed. We will continue to campaign hard on permanently scrapping the GST on daily essentials and on monthly bills. We will continue to fight for a fair taxation system through which the rich pay their fair share and all working and middle-class Canadians can live comfortable lives with dignity.
I have a few words with respect to the bill before the House. This legislation would amend the Excise Tax Act to implement a temporary GST/HST holiday between December 14, 2024, and February 15, 2025 on qualifying goods. This would help Canadians by lowering the cost on a range of products that are particularly needed during the upcoming holiday season. These would include children's clothing; footwear and diapers; children's car seats; food and beverages in grocery stores and restaurants; children's toys, including games, building sets, puzzles and video consoles; print newspapers; printed books; and even Christmas trees or similar decorative trees.
Removing the GST from these goods for two months would provide an estimated $1.6 billion in federal tax relief. A family spending $2,000 on qualifying goods would realize GST savings of at least $100 over the two-month period, but in provinces where the HST would also be removed, such as Ontario and the Atlantic provinces, further savings would be realized. The same $2,000 basket of qualifying purchases would realize a savings of $260 over a two-month period.
The Liberals' plan to only offer temporary GST relief would not only provide to families less than half the relief that the NDP's plan would have provided, but also present a significant burden on business owners, especially small business owners, who would have to adjust their cash registers and payment systems twice in two months. That is yet more reason that the NDP plan to permanently eliminate the GST on these essential items would be better for business owners and better for consumers.
I would like to address one of the major reasons that Canadians are feeling such economic pressure, and that is corporate price gouging. New Democrats understand that the inflation over the last two years was not caused by unreasonable wages, increased demand by consumers or even excess government spending. It was caused by corporations who inflated prices.
Canadians are eating the same food they did before inflation. They are driving the same cars the same mileage they did before inflation. Frankly, people are probably eating and driving less. Governments have been running large deficits for almost 20 years by both Conservative and Liberal administrations without causing rampant inflation, so that cannot possibly explain why grocery prices are through the roof, suppliers are shrinking their portions and oil companies have jacked up their gas prices.
Here are the real facts: Profit margins surged in early 2022 following the COVID pandemic, when many sectors used the cover of the pandemic as an excuse to raise prices. Despite the normalization of supply chains, easing of shortages and weaker consumer demand, aggregate corporate profits hardly changed in 2023. Last year, corporations in Canada recorded $644 billion in pre-tax profits, which are 54% higher than they were in 2019, the last prepandemic year, and over double the average profit level of the prepandemic decade.
A quick look at three highly concentrated industries, the grocery, telecom, and oil and gas sectors, revealed this clearly. Coming out of the pandemic, operating profits in the oil and gas sector increased tenfold from $6.6 billion in 2019 to $66 billion in 2022. That is the highest profit ever recorded in Canadian history. Grocery giants' profit margin doubled from 2% prepandemic to 4.1% in 2023. A 1% increase in gross margins at grocery stores adds over $1 billion to Canadians' food bills. The telecom sector reported total revenues of $66.8 billion in 2022, which is another all-time high.
Why do we have high prices in Canada? It is because large corporations raise them. Why do we have a problem with productivity in Canada? It is because corporations are not investing in machinery, equipment, technology and employee training. The NDP will continue to fight for working and middle-class Canadians and bring a fair taxation system in for this country so everyone has a real shot at a good life in this country.
