Francesco Sorbara

[Business of Supply, October 23rd, 2017]

Mr. Speaker, the Finance Minister has announced that he established a blind trust for all assets held by him and his family. The minister is working closely with the Conflict of Interest and Ethics Commissioner and a trustee to divest all of his family's holdings in Morneau Shepell in an orderly fashion and as soon as practical.

[Business of Supply, October 23rd, 2017]

Mr. Speaker, the Finance Minister's ethics are beyond refute. We as members always must uphold the highest standards as publicly elected officials. Knowing the Finance Minister, I know that has been done.

[Business of Supply, October 23rd, 2017]

Mr. Speaker, I do like the word “tangent.”

I also like the fact that the finance minister has announced a number of additional steps, including establishing a blind trust for all assets held by him and his family. He is going above and beyond what is required and above and beyond what we want but he is doing the right thing and I applaud him for that. He is an individual for whom I have a lot of respect. He is an individual who has done a lot for his community. He has served on many boards, such as C.D. Howe, St. Michael's Hospital, and a number of others that benefit the broader community.

We cannot be indifferent when we find instances within our own federal tax system that give some people an advantage that others cannot access.

We have found that in some cases someone earning $300,000 with a spouse and two adult children can use a private corporation to get tax savings that amount to roughly what the average Canadian earns in a year. Such tax planning strategies are legal, but that does not make them fair. Tax fairness is a prominent issue for me. It is an important issue for our caucus. It is an important issue for all Canadians. I am glad to see our finance minister taking leadership with regard to tax fairness.

The need to level the playing field is at the heart of our current consultations on proposals to ensure equity in Canada's tax system while maintaining Canada's low and competitive business tax rates that support growth and job creation.

This summer the government put forward proposals that would address tax planning strategies that may be employed by wealthy and high income Canadians to pay less tax.

We inherited a system that encourages wealthy individuals to incorporate in order to pay less tax. That is a fact. This means someone making $300,000 can save about as much on tax as the average Canadian earns in a year, $48,000. That is not fair and we are going to fix it. Under the leadership of the finance minister, I am proud to say we are going to fix that. We are making changes to address tax advantages that only the richest individuals using high-priced accountants can take advantage of.

We have listened to small business owners, professionals, farmers, and fishers during the consultation and we will act on what we have heard to avoid unintended consequences.

I met with a number of tax experts in the riding that I represent and also with former associates who work in downtown Toronto on Bay Street, tax experts. I have listened to them and I have heard the unintended consequences that the consultation paper provided. I spent half of Labour Day and most of Thanksgiving Day on it.

We are listening, because that is what a government does. It does listen to its constituents and it does listen to stakeholders. That is what this government is doing.

We committed to reducing the small business tax rate in our platform and we followed through on that. By 2019, the tax rate will be down to 9%, saving businesses across this country up to $7,500, that they can use to reinvest in equipment, in salaries, in training, and so forth, whatever they choose to use it for.

That is why we see SMEs and formation rates for small business in Canada at robust levels. People have confidence in our economic platform. They have confidence in the finance minister and will continue to do so.

Right now there is upwards of $300 billion in passive savings sitting in private corporations not contributing to the fullest amount to the growth of the economy or business. Eighty per cent of this money is held by just the top 2% of the wealthiest corporate owners.

As we move forward, we will create a $50,000 threshold on investment income annually, or approximately $1 million in savings, to ensure business can continue to save for contingencies or future investments in growth.

Under our plan, 97% of businesses will see no tax increase on investment income. Changes will protect past investments and income from those investments.

We will also ensure that venture capital and angel investors are not impacted. We want to ensure that the next generation of innovation occurs here in Canada. The recent announcement in downtown Toronto with Google and Alphabet making their investment is literally going to transform the waterfront and create thousands of jobs—

[Business of Supply, October 23rd, 2017]

Mr. Speaker, I will be splitting my time this afternoon with my friend and colleague who I sit with on the Standing Committee on Finance, the member for Hull—Aylmer.

Before I begin my formal remarks, I want to discuss the concept of pensions in Canada. I had the pleasure of working in downtown Toronto for a number of years. I have an economics and finance background. I sat on the CICA user advisory council panel, which is the chartered accountancy panel, and provided continuous feedback for a number of years.

I also was a pension analyst at a ratings agency. I helped put together the annual study on pensions in Canada, how solvency ratios and pensions were performing, and what the coverage ratio was. With respect to pensions, we noticed over a number of years that the defined benefit pension plans of many firms were becoming fewer and fewer for various regulatory and economic reasons.

It was this government, under the current finance minister, the member for Toronto Centre, who, working with the provinces, achieved an enhanced Canada pension plan. The prior government was unable to achieve that in 10 years. This is important. If we look at the Canada pension plan, it is transferable, indexed to inflation, people can move it from one job to another, it goes to all Canadians, and it is actuarially fully funded. It was our government, under this minister, that achieved that result. That is remarkable. That speaks not only to the character of the finance minister, but to him as an individual. He understands complex issues with respect to finance and economics based on his career. It also speaks to his ability to bring the provincial and territorial ministers around the table to reach an agreement for an enhanced CPP that will benefit millions of Canadians today and tomorrow. It will benefit my children and all of the children in this entire country. We should be proud of that.

When we talk about pensions, I know that members have thrown about words like “defined contribution plans”, “hybrid plans”, “target benefit pension plans”, “RPPs”, and “RRSPs”. We will have that debate. I would have that debate all day if I need to, with everyone here, all my colleagues. However, when it comes to the facts and substance, it was this government that sat down with the provincial and territorial finance ministers and got the job done. We need to be proud of that.

Before I go into my formal remarks, I had the pleasure to host the finance minister this summer in my riding of Vaughan—Woodbridge. We had a great tour of an apprenticeship program. We met with the carpenters union in my riding. We had a tour of its facility and saw the great work its members are doing in Ontario and across the country. We also had a chance to meet with the local business owners. We heard the praise from local business owners about what we are doing for the economy, how we are investing in infrastructure and the middle class, and creating good jobs that will provide the benefits for my kids and for future generations. That is the finance minister I know, a finance minister who cares deeply about what is going on in our economy and about the future of all Canadians.

I am pleased to rise today in the chamber to speak on the recently concluded consultation that our government undertook regarding tax planning using private corporations. However, before I speak about our plan to make our tax system fairer, I would like to talk about what has brought us to this point.

Since we formed government about two years ago, we have always been clear about our priorities. We said that we would strengthen and grow the middle class. That is why our first priority was to make our tax system fairer by raising taxes for the top 1%, so we could cut them for nine million Canadians, providing over $20 billion of tax relief over a four-year to five-year period. That is why we introduced the Canada child benefit, the CCB, lifting hundreds of thousands of children out of poverty and making a difference for millions of families across this country. By investing in our people and our communities, we have made important strides toward a fairer Canada, a better Canada.

Today the Canadian economy is resurgent. Everywhere we look there are positive indicators that tell us that the wind is in our sails. Since the fall of 2015, 400,000 new jobs have been created, most of them full time. That is a great thing. Our economy is now growing faster than any other G7 country.

However, we know that as our economy grows, we need to ensure that all of the benefits of economic growth that accrue are given to every Canadian, so that all Canadians feel they have a stake in this economy and this country, and that their standard of living is rising. All Canadians, not just the wealthy few, should experience the benefits and opportunities that come with an economy that is firing on all cylinders. Therefore, we cannot be indifferent when we find instances within our federal tax system that give some people an advantage and that others cannot access—

[Business of Supply, October 23rd, 2017]

Mr. Speaker, we know that the finance minister has announced a number of steps to address his ownership of shares and so forth.

In my riding of Vaughan—Woodbridge, I know that constituents are talking about our cut in the small-business tax rate from 10.5% to nine per cent and what we have done for the middle class through the CCB and our infrastructure program.

What are my colleague's constituents talking about? Those are the important things we need to focus on: growing our economy and making sure people have good jobs and a good future for their children.

[Greenpark Group, October 18th, 2017]

Mr. Speaker, we all know that home is where the heart is. Today, I recognize a Canadian success story and an incredible organization, the Greenpark Group, which is celebrating its 50th anniversary.

In 1958, at the age of 19, Carlo Baldassarra immigrated to Canada from Italy full of ambition.

Through his entrepreneurial spirit, Carlo co-founded the Greenpark Group, which has built homes for over 72,000 Canadian families.

A home is where our children grow up, where we make memories, and communities come to life. Understanding this, Greenpark Group has established itself as one of the largest Canadian homebuilders and its generosity and charitable initiatives know no bounds.

Local businesses are the backbone of our economy and I am proud to represent a community full of success stories.

I invite my colleagues to join me in congratulating Carlo, his passion for success, and the entire team of Green Park Group for 50 years of building communities.

[Business of Supply, October 17th, 2017]

Mr. Speaker, I am sure that any suggestions the hon. member has about strengthening any rules should be brought forward to the pertinent individuals to whom that pertains. I would hope the member for Saanich—Gulf Islands does so.

My personal view is that we continue to work hard for all Canadians. We continue to hold to the values of integrity and hard work, ensuring that day in and day out we do what is right for our constituents, whether we represent a riding on the east coast, west coast, or in the middle.

[Business of Supply, October 17th, 2017]

Mr. Speaker, with regard to the Minister of Finance, the member for Toronto Centre, we have full confidence in the Ethics Commissioner and her recommendations. Obviously, every member of Parliament is willing to take any further steps to avoid conflicts, or any perception of conflicts, as deemed appropriate by the Ethics Commissioner.

Again, I go back to integrity and what it means. It means fighting for kids who are living in poverty, helping those who need skills training, and putting innovation into the economy and growing it so all middle-class Canadians benefit. That is how we strengthen the economy for today and for the future.

[Business of Supply, October 17th, 2017]

Mr. Speaker, I am proud to call the member for the beautiful riding of Brantford—Brant my friend and a colleague in the House. We did serve on the finance committee. We serve our residents as well.

When we call into question someone's integrity, we know that individually we all have personal responsibility, and I believe in that. I believe in integrity and in hard work. Those are my core values. I know for a fact that those are the same core values of the finance minister. I know for a fact that since the first day in office, the Minister of Finance has worked with the Ethics Commissioner to ensure her every recommendation and all conflict of interest rules are followed.

[Business of Supply, October 17th, 2017]

Thank you, Mr. Speaker, for your explanation. I thank my hon. colleague across the aisle for his intervention as well.

I have known the member of Parliament for Toronto Centre, the Minister of Finance, for a few years now. When I think about the integrity and hard work that goes into our careers as politicians and as members of a community, I look to, and I am glad to say that I am friends with and on the same team as, the Minister of Finance. I know his integrity. I know the core values that he represents. I am glad to be on a team with the hon. minister.

Going back to my comments today with regard to tax planning using private corporations, we as government and myself as an individual, always co-operate with all government bodies, including any meetings with the Ethics Commissioner and so forth. I would like to throw that back.

Our economy is growing well. Our government has created 112,000 full-time jobs and this is because of the policies that we have put in place.

Wage growth in this country is actually coming back. In September we saw an acceleration in wage growth and this is great for Canadian workers and great for Canadian families. It is also great for the people I represent. This too is related to polices that we have put in place and consultations that we have had and are having with regards to tax fairness.

Our government laid the foundation for economic growth the moment we took office. The first thing we did was to cut taxes for nine million middle-class Canadians, providing over $20 billion of tax relief to Canadians. We also raised taxes on the wealthiest 1%, which was the right thing to do. Single individuals who benefit from this are saving an average of $330 per year and couples who benefit are saving an average of $540 each year.

Our government has also made child benefits more accessible to Canadians, a simpler program, a tax-free program, providing on average $2,300 extra per year, per family. That is remarkable and again relates to the actions and the policies put in place by our finance minister. I am proud to be a part of that. I am proud to be a part of a team that cares for children who currently live in poverty, a team that cares for families who currently need a bit of assistance. That is what our party is about, again speaking to the integrity of the finance minister.

The member of Parliament for Toronto Centre came together with his colleagues at the provincial level and came to an agreement to enhance the Canada pension plan. Think about that. Think about the previous government. For 10 years it did nothing with respect to CPP. The finance minister worked in collaboration with the provinces and Canadians will get an enhanced Canada pension plan that will benefit millions of them going forward.

Yesterday, we announced the lowering of the small business tax rate. It has gone from 11% in 2015 to 10% in 2018 and will be 9% in 2019. This, part and parcel, involved listening to Canadians and small business owners, many of whom I represent.

I have had a lot of feedback in the last few weeks. I can say to my constituents and small and large businesses back home that they have a voice here in Ottawa, that this government understands their concerns. Each of us as members of Parliament have brought their constituents' concerns back to Ottawa. That is what we are obligated to do. That is our job.

This government is listening.

I am proud to say that we have cut taxes for small businesses and they will benefit up to $7,500. This will provide tax relief over a couple of years of approximately $3 billion. This action should be applauded by all sides of the House.

The Prime Minister made his intention clear yesterday during an announcement in Markham, and I certainly support it.

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 have a tax system that encourages wealthy individuals to incorporate just so they can get a tax advantage. This leads to a situation where someone making hundreds of thousands of dollars can get a lower tax rate than a middle-class worker making much less per year. That is not fair, and our government is going to fix it.

On July 18, the Minister of Finance launched a consultation process, otherwise known as tax planning using private corporations. We have heard lots of feedback.

I know I have spent numerous hours going over the proposal, looking at it. We need tax fairness and we need to get it right. We are consulting and listening to all Canadians. I spent many hours understanding this paper and ensuring there were no unintended consequences, that it was a proposed consultation paper. We absolutely are going to get it right.

We heard from business owners, professionals, experts, and our caucus on ways to improve our proposals to ensure we would not affect hard-working middle-class entrepreneurs, many who live in the city of Vaughan and many who I represent as the member of Parliament for Vaughan—Woodbridge, such as family businesses, farmers, and fishers. As someone who grew up on the north coast of British Columbia, I have many friends who are fishers. They still go out on their trawlers, seiners, gillnetters to try to make a living. I know how important it is that we protect and ensure they have a good livelihood. We have heard them and we are acting on what we have heard.

In the short term, the government intends to simplify the proposal to limit the ability of owners of private corporations to lower their personal income taxes by sprinkling their income to family members. The vast majority of private corporations will not be impacted by the proposed income sprinkling measures. An estimated 50,000 family owned private businesses are sprinkling income. This represents a small fraction, 3% of Canadian controlled private corporations. All we are doing is extending the rules that are already in place on income pertaining to dividends, which is the right thing to do. That is tax fairness, and I know Canadians agree with us.

Over the coming weeks and months,< we will announce the next steps in our plan to address tax planning using private corporations that take into account feedback received from Canadians during this consultation period.

In all cases, our changes will support small businesses and their contributions to our economy and, most important, our communities. I know first hand, having worked in the private sector for over 20 years in finance, that small businesses are the backbone of our economy. We will do everything we can to help them grow. This is seen in the numbers, in the formation rates of small businesses, in business earnings. Businesses and consumers are buoyant because we have a program in place that is working.

In this day and age, where there is so much misinformation, it is crucial that we set the record straight and stick to the facts. This is what I am doing here today. From the very beginning, we have been perfectly clear about our commitment to ensure that as our economy grows, the benefits go to the middle class and, yes, those working hard to join it, not just to those who are already successful.