Guy Caron

[Business of Supply, April 15th, 2013]

Mr. Speaker, the Minister of Finance mentioned several times that Budget 2013 would have no new taxes. The Minister of State for Finance gave the same answer when he was asked about Budget 2013 in the House.

When the Conservative government creates tax credits—the so-called boutique tax credits—for arts or sports for example, it talks about tax cuts that benefit Canadians. When tax credits are scrapped, it pretends not to notice.

The hon. member for Westmount—Ville-Marie asked a very relevant question that the government member did not answer. What is considered a tax credit or a new tax? In the budget, there is $8 billion in new taxes and in reduced or cancelled tax credits. The member said that there were no corporate tax increases, but there is an increase of $2.3 billion over the next five years, and that is only from scrapping the dividend tax credit for small and medium-sized businesses.

Can the Parliamentary Secretary to the Minister of National Revenue look us in the eye and say that there are no tax increases? If she cannot, what is her definition of a tax? The government does not seem to know, even though it governs a G8 country. That makes no sense at all.

[Business of Supply, April 15th, 2013]

Mr. Speaker, I have a very simple question for my colleague. I heard the speeches from government members who completely denied that there are any new taxes in this budget. However, we can see that over five years, there will be $8 billion in new taxes that will be taken directly out of Canadians' pockets.

The government seems to be focusing on one thing in particular, and that is the fact that 72 countries will no longer be covered by the general preferential tariff, which is an import tax that is lower for certain countries. The government is focusing on China, India and Brazil, but it is also considering many other countries—such as Kazakhstan, Thailand, the Dominican Republic and Namibia—as being fully developed.

Could my colleague tell us why the government is focusing on certain countries, which we could very well debate, but is denying the fact that it is amending the general preferential tariff for other countries that are not fully developed?

[Business of Supply, April 15th, 2013]

Mr. Speaker, I would like to talk about a topic to which the hon. member devoted only one minute of her 20-minute speech on budget 2013. The question before the House is whether the Conservative government has increased taxes by $8 billion over the past five years.

I assume that the Parliamentary Secretary to the Minister of Finance has read the budget. It is interesting to see that a table on page 331 lists all the budget 2013 tax measures. The table is entitled “Cost of Proposed Tax and Tariff Measures”. The word “cost” applies to the government, given that tax cuts lead to a drop in revenue.

Some figures are in parentheses. For the hon. member's sake, I would like to explain that costs in parentheses are negative. That is the revenue that the government makes from tax measures. Among others, there is a dividend tax credit with an amount in parentheses of $2.3 billion over five years. There is also a measure that would scrap the labour-sponsored venture capital corporations tax credit, with an amount of $355 million in parentheses. Similarly, the general preferential tariff has an amount of $1.2 billion in parentheses. If we add up all the figures in parentheses, we end up with a total of $8 billion over the next five years.

Could the Parliamentary Secretary to the Minister of Finance tell us, with a straight face, that there are no tax increases, as she said in her speech?

[Business of Supply, April 15th, 2013]

Mr. Speaker, that is open to debate. If we talk about the fact that we need to increase the economic performance of developing countries, not only for humanitarian reasons, but also to improve international trade, the general preferential tariff has its place.

Countries like Kazakhstan, Venezuela and the Dominican Republic are not currently in a position to compete with Canada. They must secure access to our markets to be able to develop. However, the government's reason for placing those countries in the same category as developed countries such as South Korea or China is not valid.

[Business of Supply, April 15th, 2013]

Mr. Speaker, the hon. member for Winnipeg North has perfectly summed up the Conservatives' position on their fiscal policies: smoke and mirrors. They deal in illusions designed to fool people, especially after they table their various budgets or their budget implementation bill.

For instance, in our opinion, there was an orchestrated leak before the budget was tabled, to brag about the elimination of customs tariffs on some products that are popular with Canadians. The sole purpose of the leak was to fool consumers. Tariffs are being reduced by $30 million to $40 million, but more than $300 million a year in import duties are being imposed. Those measures clearly show that the Conservative government is neither serious nor credible when it comes to fiscal matters.

[Business of Supply, April 15th, 2013]

Mr. Speaker, we want to talk about the 2013 budget, but the Conservatives want to talk about the 2006 budget.

We have a Conservative government that promised not to raise taxes. However, taxes will go up by $8 billion over the next five years. I would have liked my colleague to respond to the arguments already presented here, but she will not. The Conservatives are again harping on about carbon taxes and the GST, which they increased, a measure that has been criticized by most credible economists in Canada.

If the Conservative government wanted to increase and improve economic growth, and make the economy more stable, it could have done so in a number of other ways. At the time, increasing the GST was the least effective means, but that is what the government went with.

For our part, we do not have an official policy on increasing the GST, despite the government's fearmongering. However, we do want the government to discuss these increases.

[Business of Supply, April 15th, 2013]

Mr. Speaker, I am very pleased to rise to speak to this very important issue, especially after the hon. member for Victoria. He is relatively new to the House, but he gives a really good impression when he talks about financial matters, particularly regarding the Conservative government's hypocrisy when it comes to fiscal matters.

That is why we are standing up here today and why we are having this opposition day. We want to talk about the Conservative government's hypocrisy when it comes to fiscal matters, particularly regarding its statements on finances, which do nothing to enhance its credibility—quite the contrary.

I am sure everyone remembers the now-famous phrase spoken by George Bush Sr. in the 1990s, just before he became the President of the United States. He had just won the Republican nomination and said the following simple phrase: “Read my lips: no new taxes.”

The Conservative government, the Minister of Finance and the Minister of State for Finance had their own George Bush moment here in the House. At least they saved themselves the embarrassment of saying “read my lips”.

However, just this past February, at the Economic Club of Canada, the Minister of Finance said that there would be no new taxes in this budget. The day after the budget was presented, the Minister of State for Finance said that Canadians would not find any new taxes in it. We went over it very carefully, and there they are, clearly set out in annex 2 of budget 2013 tabled by the Conservatives.

We clearly see an $8 billion increase in taxes over the next five years. We can debate the validity of some of these measures, but that is not what the Conservative government wants to do. It wants to deny the fact that it plans to increase taxes for Canadians to the tune of $8 billion over the next five years.

There are so many tax hikes that I cannot address them all. However, I would like to mention four in particular. My colleague clearly described how approximately 72 countries will no longer benefit from the general preferential tariff, which applies to the customs tariffs paid by various countries. This measure applied to 72 countries, most of which are developing countries. Over 1,200 products from these 72 countries will no longer benefit from this tariff, which means that the government will be taking between $1.5 billion and $1.7 billion more from the pockets of Canadian taxpayers over the next five years.

The Conservatives presented two arguments. First, they said that they are removing from the list countries that should no longer be there, such as China, South Korea and Taiwan—countries that have now reached a point where they are more developed. In such cases, the measure might be justified.

However, the government is also removing from the list countries that it now considers to be fully developed, such as Kazakhstan, the Dominican Republic, Cuba and Venezuela. The Conservative government is justifying the removal of these countries from the list by saying that they are now fully developed and that they no longer need the general preferential tariff.

Yet, the general preferential tariff helps these developing countries, which need markets in order to export their products and further promote their economic growth. The only way the government can justify this measure is on the pretext that the GPT was a form of foreign aid for these countries. That is an interesting rationale.

If Canada wants to develop these new markets, it must work with countries that have the means to purchase our goods. In order to do that, we have to help these countries to improve their economy, particularly through these tariffs.

What is more, it is not just these countries that pay the price. Canadian consumers are also victims. I would like to talk about a few of the examples mentioned by the hon. member for Victoria. Take bicycles and tricycles. Right now, 50% of the bicycles sold in Canada come from these 72 countries. The government is proposing a 4.5% increase in taxes or duty on imports. This represents a tax hike of over $6 million, which will come from consumers' pockets.

Take baby strollers for example. Ninety percent of Canada's baby stroller market is supplied by these 72 countries. It will therefore be difficult for us to avoid these taxes on imports.

That is the equivalent of taking an extra $1 million or so out of consumers' pockets. Plastic school equipment fares no better in a market where 61% of it is imported. That tax hike equals $1.3 million.

Ninety per cent of wigs typically used by cancer patients undergoing treatment are imported. The wigs never used to be subject to a tariff, but the proposed increase is equal to about 15.5% of their price. That will rob Canadians of $4.6 million. It does not end there, though. Prices of 1,200 products are going to increase significantly.

Before I move on, I would like to mention, as my colleague did, the dedication of Mike Moffatt, who is an assistant professor and part of the Business, Economics and Public Policy group at the Richard Ivey School of Business at the University of Western Ontario.

This budget contains more than just import taxes, however. It also contains tax hikes because it eliminates tax credits that are crucial to economic development. As I mentioned during debate on the budget, the Conservative government will gradually eliminate the tax credit for labour-sponsored venture capital corporations.

If the Conservative government claims that creating tax credits for sports, the arts and so on is a tax cut, then believe me, eliminating a tax credit is a tax hike for Canadians. This tax hike is worth $355 million over five years, and it will be particularly detrimental to economic development in Quebec, where approximately 90% of these tax credits were claimed. That is an extremely important point, because labour-sponsored funds have been a model in Quebec and an extremely useful tool for economic development. These funds were created in the 1980s, during a time of financial hardship, when venture capital did not really exist in Canada. That is when the Fonds de solidarité FTQ was created. In the past 30 years, the Fonds de solidarité FTQ has invested $10 billion in the Quebec economy. In recent years, the Fonds de solidarité FTQ has created or maintained 500,000 jobs.

This tax credit exists because it fulfills a specific need that other venture capital firms—specifically private-sector ones—do not, and because it makes it possible to invest in companies that are starting up or struggling. This explains why the return is lower with these funds, but that does not prevent small investors from contributing to the funds to save for retirement—since these are a type of RRSP—and also to help develop the local economy.

In my region, the Lower St. Lawrence, the Fonds de solidarité FTQ assists 25 different businesses that have received absolutely nothing from private funds. On the one hand, the Conservatives are getting rid of this $355 million in tax credits, and on the other hand, they want to give another $400 million for private equity funds. This is absolutely ridiculous, and even Canada's Venture Capital and Private Equity Association, which represents private funds, is opposed to the elimination of the tax credit for labour-sponsored funds.

The Conservatives have messed up, since this 15% tax credit is not going to the Fonds de solidarité or the CSN's Fondaction, as some may have believed. Small investors—the people who reinvest and who can benefit from this tax credit—are the ones who are being cheated here.

With this measure, the Conservatives will not only damage a tool that is essential to Quebec's economic development, but they will also discourage people from saving, which is extremely important, especially in Quebec. Of course, the other provinces are being encouraged to step up and create this type of fund. These funds invest in different businesses, and they also invest heavily in private venture capital firms.

I will talk about two other measures quickly, since my time is running out. First I want to talk about the $205 million tax increase over five years, because an additional credit for credit unions is being eliminated.

Once again, the government is going after credit unions with specific mandates to invest in small rural municipalities. It is making it hard for them to compete with the banks. This represents another tax hike for business.

Second, we can debate the elimination of the tax credit for dividends that specifically affects SMEs and owners of SMEs that are not publicly owned or publicly traded. This represents a significant tax hike. We are talking about a tax grab of $2.34 billion over five—

[Taxation, March 28th, 2013]

Mr. Speaker, I hope that in the future the Conservatives will demonstrate a bit of humility before giving lessons on how to behave on the world stage. This is a disgrace.

Yesterday, the Minister of State for Finance also put on a sorry spectacle in the House. He was unable to admit the truth, that the Conservatives' budget raises taxes on almost everything. From labour-sponsored funds to caisses populaires, hospital parking lots to bicycles, life insurance to small business, no one is spared.

Why is the Minister of State for Finance denying what is written in black and white on pages 331 and 332 of the budget?

[Hydroelectric Project, March 27th, 2013]

Mr. Speaker, it is pleasure to rise in the House to speak to this motion. Just like my colleague from Kingston and the Islands, I have to wonder why we absolutely had to debate this motion now, given that the government has already announced its decision to extend a loan guarantee to the Muskrat Falls project in Newfoundland and Labrador. I have to wonder about that.

Our position on this issue has been known for a long time. We stated it during the campaign. Our leader at the time, Jack Layton, publicly voiced our support for loan guarantees, under certain conditions, one of which being that such guarantees be extended equally to all provinces for the purpose of promoting renewable energy.

I would like to talk about what the Newfoundland and Labrador agreement is not. The agreement is not a loan from the federal government. The agreement is not a subsidy from the federal government for Newfoundland and Labrador. The agreement is not funding for the project. It is a loan guarantee. Newfoundland and Labrador and Nova Scotia, which is a partner in the agreement, will finance the hydroelectric project. The federal government will simply provide a loan guarantee, which is similar to what happens when we apply to a bank for a loan and ask another party to provide a guarantee for that loan. That is all that will result from the federal government's announcement.

We have to be clear that the federal government is not committing any funds. Taxpayers' money will not go to this project unless—and this is not very likely—the Province of Newfoundland and Labrador or Nalcor Energy, a crown corporation and owner of the Newfoundland public electricity company, goes bankrupt. There is virtually no likelihood of that happening. In that sense, there is virtually no risk to the federal government.

The Muskrat Falls project is a hydroelectric project on the Lower Churchill River. The project will generate an estimated 824 MW of electricity. It is not a huge project compared to some in Quebec, such as the mega projects we have become accustomed to seeing with Hydro-Québec. This is the first phase of the project, and it will be followed by phase 2 on Gull Island. The two projects combined will generate 3,074 MW of electricity.

Once again, it is an important project that will help meet the needs of the Atlantic provinces, even though it is not anywhere near the size of the projects we are used to seeing from Hydro-Québec. We consider this to be an important project for Newfoundland and Labrador and for Nova Scotia, the two provinces party to the agreement.

I should note that energy is presently being produced in Labrador. This will be the first time that energy produced in Labrador is transmitted to the island of Newfoundland, which presently receives no hydroelectricity from outside the island. It is important that we understand this in order to realize the impact that the project could have on the Atlantic provinces, especially Newfoundland and Labrador and Nova Scotia.

The project would create a maritime link to the island of Newfoundland and then a maritime link between the island of Newfoundland and Nova Scotia. At that point, if Nova Scotia thinks it is necessary, it would have the opportunity to enter into an agreement with New Brunswick, as well as opportunities for export to the United States.

However, we must be careful. Not all the electricity that is produced at Muskrat Falls or eventually at Gull Island will go to the United States. Right now, under the existing agreement, 60% of the electricity produced at Muskrat Falls and Gull Island will be used by either Newfoundland or Nova Scotia. That is a minimum because the percentage will increase over time since there will be greater domestic demand. This will mean that there will be less electricity available for export, possibly to the United States. One thing is certain: by virtue of the agreement, Nova Scotia will always have 20% of the hydroelectric production.

What reasons are there to support this project other than the fact that it is beneficial for Newfoundland and Nova Scotia? There are also environmental reasons. This project will make it possible to decrease dependence, particularly Nova Scotia's dependence, on coal-fired plants, which emit a lot of greenhouse gases. This will make it possible to eliminate or greatly reduce the production of four coal-fired plants in Nova Scotia.

I am talking about the plants in Lingan, Point Aconi, Point Tupper and Trenton. There is also a plant in Tufts Cove that generates electricity using oil and natural gas. The project would also make it possible to eliminate the Holyrood oil-burning power plant in Newfoundland. This project therefore has many environmental benefits.

Once these plants have closed, it is estimated that the project will decrease these provinces' greenhouse gas emissions by 16 megatonnes a year. By way of comparison, that is equivalent to 3.2 million cars on the road.

Most of the parties in the House are in favour of reducing greenhouse gases in order to mitigate the effects of climate change, which are already being felt. We have to put words into action. We have talked a great deal about the need to eliminate greenhouse gases, but now we need to support measures that go in that direction. Hydroelectric plants go in that direction, particularly the one in Muskrat Falls, which is the subject of the hon. member's motion. That is why we will support this motion.

I would now like to talk about the misinformation surrounding this project. The federal government is interfering in a provincial jurisdiction. I do not see any interference in the Muskrat Falls project or in the loan guarantee that the government is giving Newfoundland for that project. Newfoundland and Labrador and Nova Scotia will always own these projects. Newfoundland and Labrador and Nova Scotia will manage the production and transmission of hydroelectric power. The federal government has no control over the project itself or how it is managed. All it is doing is offering a loan guarantee.

I am truly surprised to hear this argument. I am also surprised to hear that it is not necessarily the best project available and that the government should not give the loan guarantee. There are still debates about this in Nova Scotia and in Newfoundland and Labrador. Some people think that the loan guarantee should not be given.

The decision has been made. The two provinces conducted environmental studies and studies to find better alternatives to the proposed measures, to the construction of Muskrat Falls and the power transmission. The provinces determined that it was the project that best met their needs and their objectives. Nova Scotia has significant targets in terms of reducing greenhouse gases. It is not up to the federal government to decide what project is the best for the provinces. The work has already been done.

The second element directly affects Quebec, and members from Quebec talk about it often. I am talking about competition or the argument that Hydro-Québec would have competition. As I said, Hydro-Québec has done a great job and truly built the Quebec we have today. Every Quebecker is grateful for the role that Hydro-Québec played in the province's economic development. There will be no competition, because Hydro-Québec has no connection to Newfoundland. There will be no competition because Quebec does not do business with Nova Scotia. There will be no competition—or there will be very little—with regard to exporting electricity, because the project will export no more than 300 megawatts of electricity from Muskrat Falls to the United States. Hydro-Québec exports 27,000 megawatts a year. Competition cannot be the only reason to oppose this bill, which will have a positive impact on the environment.

Jack Layton supported this project. The NDP included it in its 2011 election platform, and we did not shy away from that. For once, we are proudly supporting a Conservative government decision, namely a loan guarantee for a project that will clearly be managed by Newfoundland and Labrador, in partnership with Nova Scotia.

I regret not having the opportunity to respond to my colleagues' questions. I know that that is not the tradition for private members' bills, but I was pleased to speak to this very important issue.

[Taxation, March 27th, 2013]

Mr. Speaker, I was wondering how the Minister of State would be able to defend the indefensible. He does so by talking about anything but the 2013 budget.

The Minister of State for Finance is repudiating the work done by the Minister of Finance. He is repudiating the taxes in the 2013 budget. He would rather make up stories about a future NDP government's policies than talk about the tax hikes his government put in this budget.

The Conservatives owe it to Canadians to be honest. Will they have the courage to do so, or will they continue to deny the truth?