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Crucial Fact

  • His favourite word was tax.

Last in Parliament September 2016, as Conservative MP for Calgary Midnapore (Alberta)

Won his last election, in 2015, with 67% of the vote.

Statements in the House

Justice February 4th, 1999

Mr. Speaker, I guess the Minister of Justice did not hear my question. The question was not about the attorney general pursuing charges, it was about the effect of the Askov decision which says that a reasonable delay in the appeal process can result in convicted criminals walking free, as happened with a child molester in B.C. last year.

How can she assure Canadians that this will not happen again with respect to those now before the courts on charges of possession of child pornography? How can she assure us of that?

Justice February 4th, 1999

Mr. Speaker, the question is simply this. How can the minister assure Canadians that the Askov ruling will not let those convicted of these crimes walk free?

Justice February 4th, 1999

Mr. Speaker, as my colleague said, the cancerous effects of the Shaw decision on kiddie porn are spreading.

In Alberta, William Eric Hughes refused to enter a plea at court. Because of the effect of the Shaw decision, his trial has been delayed until March 3.

As my colleague said, the Askov decision makes it clear that as long as these appeals are delayed we get closer and closer to the possibility of these people walking free, as a convicted child molester did in British Columbia last year.

My question to the minister is—

Tax On Financial Transactions February 3rd, 1999

Madam Speaker, I was delighted to hear my colleague from Bruce—Grey. I have not heard him speak often, as he mentioned, but I wish he would do so more often. He certainly provides an excellent view on this subject. I also enjoyed his member's statement yesterday. He was on all the national networks mourning the loss of the rodent in his riding.

I am here this evening to talk about the motion of my hon. colleague from Regina—Qu'Appelle on the financial transactions tax, that in the opinion of this House the government should show leadership and enact a tax on financial transactions in concert with all OECD countries.

Like many ideas that come from my colleagues in the aging New Democratic Party this is a noble one I think with a good purpose and a thoughtful objective in mind, to find some way of governments imposing some discipline on the increasingly unwieldy currency and financial exchange markets which really seem to many of us to be out of control at times. I think we, like all Canadians, share at times a feeling of helplessness as we are adrift on the sea of trillions of dollars being exchanged daily across the world electronically, affecting our standard of living, affecting the value of our currency, affecting our international purchasing power and yet to a very large extent beyond the control of us as individuals or as communities or as government. So I recognize the frustration which gives way to the kind of impetus we see behind this motion.

It would be wonderful if we could find a fiscal policy lever, a tax if you will, to slow down the sometimes destructive and irrational nature of these speculative currency markets. That I admit. It would also be marvellous if we could live in a world where everybody had a marvellous standard of living where there was no poverty, no unemployment and no economic inequities. But unfortunately that is not a world we live in and it never will be. That is a Utopian world. There are some things which government simply cannot do. One of the iron laws of economics is that people will generally act in their own self-interest and maximize their own returns. This is an irrefutable fact of economic history.

Essentially what I am saying is that the imposition of a financial transaction tax proposed by this motion would be unworkable, impractical and would create unintended consequences that would be far more devastating on developed countries like Canada than are the current vagaries of the currency exchange markets.

One example springs to mind about the kind of perverse unintended consequences that result from governments when they choose to establish certain outcomes through tax policy. In the 16th century in England the crown was looking for an efficient way to tax people based on their wealth.

The tax collectors then noticed that wealthier people tended to have homes with a relatively new luxury of windows. Lovely Tudor homes with windows were being built throughout the land. The tax collectors decided to advise the crown that they should impose a window tax. It was a brilliant idea to soak the rich. The 16th century version of the NDP said “Let's soak the rich and redistribute that income. Let's have some Robin Hood economics here in jolly old England”.

They imposed this punitive tax on windows. The tax collectors went around from town to town and county to county and counted how many windows people had in their homes and assessed a levy based on how many windows they had. Inevitably we can imagine the consequences which tax collectors could not possibly imagine in their linear minds. What happened was that everybody throughout the land boarded up their windows and darkened their homes to avoid the taxes they would otherwise have to pay.

This marvellous new innovation of Renaissance architecture, the window, became blackened and covered up because of a punitive tax which was designed to achieve some kind of equity. To this day in some small villages in England we can see what were once framed as windows covered up by plaster. To this day we still see the unintended consequences. That is the kind of natural, inevitable, historical, human reaction to the effort by the state to impose taxes on people to penalize them for certain activities.

We have seen this in more recent history where other developed economies have tried to impose financial transaction taxes such as the one contemplated in this motion. We have seen that jurisdictions such as Brazil, Sweden, Japan, Germany and Switzerland, all in the past five years or so, have removed or eliminated financial transaction taxes which they had at one point levied principally on the trading of equities and other financial instruments. The United Kingdom, while not yet having eliminated the FTT which it imposed on the registration of securities, cut it in half back in 1986.

Why did all these countries that were theoretically generating revenue from this painless small levy on financial transactions end up eliminating it? What they found was much like the window tax, that these financial transaction taxes were counterproductive.

By imposing a levy on securities and equities and the trading of those instruments there was less activity in their equities market, less securities were being registered. Why? It was because investors acting rationally in their own self-interest moved their financial investments, their equity tradings and so forth into other jurisdictions.

The tax base which these governments had sought to derive revenue from began to diminish. By imposing a tax not only did the revenues from that source decline year after year as investors moved more capital trading out of the country, but it became completely counterproductive because all the FTTs in various jurisdictions had a dampening effect on economic growth.

There is absolutely no doubt that we would see a similar unintended consequence were Canada and other OECD countries to impose an international tax along the lines proposed by economist James Tobin in his now notorious Tobin tax. There is no doubt that it would be impossible to compel every national jurisdiction in the world to comply with such a tax. It would also be impossible to impose sanctions on those sovereign jurisdictions that refuse to do so.

Even if we could persuade all 26 OECD countries and all G-7 countries to impose a 1% or .5% levy on financial transactions, of which I am highly skeptical, we would still have some 130 international sovereign jurisdictions to persuade to participate in this kind of tax.

Inevitably some would do what banking havens like the Grand Caymans, Bermuda, Switzerland and the Channel Islands do today, that is act as havens for investment. We would find that capital would flow to the point of least resistance. We would end up with an enormous distortion in international financial markets which would be devastating to equity markets and the prosperity and economic prospects of countries like Canada.

With respect to my colleague from Regina, it is a nice idea but it is impractical. It would not work. It could not work. Let us not hamper Canada's economy by imposing such an unworkable international tax regime.

Questions On The Order Paper February 3rd, 1999

How many federal income tax returns have been transferred between Revenue Canada offices for the years 1990, 1992, 1993, 1996 and 1997 from; ( a ) Jonquière to Shawinigan; ( b ) Shawinigan to Jonquière; ( c ) Sudbury to Shawinigan; and ( d ) Shawinigan to Sudbury?

Finance February 2nd, 1999

Mr. Speaker, I can understand why the member would regard the assumptions we have made as being unrealistically optimistic given that his government has followed a deliberate policy of under projecting growth in order to politically manage the political aspects of the surplus problem.

Clearly the Minister of Finance does not want his spendthrift Liberal colleagues such as the distinguished lady who manages the heritage department grappling for dollars in a pinata contest for the next Liberal leadership.

I am sure he has a hard time getting to sleep imagining what would happen if he were to tell his cabinet colleagues the real truth about the surplus.

We know from his treatment over the last two or three years that the government has overshot its surplus projections by an enormous amount. I do not think it is an entirely bad thing. I think it is good that the government has used very conservative projections.

I think that for political purposes it has been a prudent approach generally. I also think it is good to include a contingency amount, as this government has done, of $3 billion a year.

In constructing our own projections we consulted with all the private sector forecasters and indeed the government's own forecasts and we chose assumptions for future growth which is slightly less than the average projection among private sector economists.

Furthermore, we did include a contingency provision. I am trying to find the precise amount. I will have to take that under advisement and get back to the hon. member. However, we did include a contingency amount and we did try to select projections for growth, inflation, employment and revenue growth which were reasonable and prudent.

The point is well taken. We can have an argument I suppose about whose projections are more prudent but I think frankly ours are more accurate. In the last two or three years the projections that Reform has made have been closer to the actual outcome than those made by the government in its own budget documents.

Finance February 2nd, 1999

Mr. Speaker, in this prebudget debate we have heard every aspect of fiscal policy conceivable addressed. Many of my colleagues have quite adequately spoken to our critique of the government's misplaced fiscal priorities with respect to taxes, health care and debt reduction. We have also articulated our view about different priorities to place greater emphasis on health care, tax relief and debt reduction.

While I recognize the Reform Party is fallible, nevertheless we have worked hard as an opposition party, harder than any other opposition party that I am aware of in my political experience to present constructive details on substantive alternatives to the government on fiscal policy.

In that respect we have released a lengthy paper “Taxes and Health Care: A Critical Prebudget Submission of the Official Opposition”, of some 60 pages, that complements the paper we released last year “Beyond a Balanced Budget” which analyses in some detail the fallacious claims of the government to fiscal prudence. It goes into some detail into offering the kinds of tax relief we would like to see, ideas like legislated debt reduction, legislated balanced budgets and an increase in health care funding by reallocating spending from lower priority areas. I encourage people interested in these issues to give us a call and receive a copy of this paper.

The government has claimed that it is about to provide tax relief to Canadians in the upcoming budget. I am more than a little skeptical when I hear the comments of the Right Hon. Prime Minister who in 1996 said in response to a question on whether he preferred across the board tax cuts: “I do not think it is the right thing to do in a society like Canada”. He did not believe it was right to provide Canadians with tax relief in a society like Canada.

I do not know what he meant by that, but perhaps we got further clarification last week when the Prime Minister was at the economic summit in Switzerland and said that he agreed with the previous Conservative government's policy of steeply raising taxes in the midst of the 1991-92 recession.

This was the same Prime Minister who as Liberal leader castigated the then Conservative government for having raised taxes, for having deindexed the tax system and putting into play the vicious logic of bracket creep. He criticized that same Conservative government for having introduced the goods and services tax and for having raised taxes on corporations, businesses and individuals through the various 3% and 5% so-called high income surtaxes. That very same Liberal leader who six or seven years ago went across the country criticizing the then government for raising taxes, we now discover, secretly admired the deadly tax and fiscal policies of the then government.

It does not surprise us when we look at the record of his own government, a government which is rhetorically committed to the notion of tax relief but has committed itself to a policy of tax increases. We know, as the hon. parliamentary secretary admitted in questioning earlier this evening, that about three-quarters of the fiscal progress, the deficit reduction achieved in the government's mandate is attributed to revenue increases.

A fair chunk of that is attributable to higher tax rates through the pernicious, invidious tax of bracket creep which sucks about a billion additional dollars out of the pockets of middle income Canadians every year; through the $10 billion 72% increase in CPP payroll taxes, the single largest tax increase in Canadian history; and through some 36 other tax increases levied by the government on individuals and businesses. Yet the government still claims that it is committed to tax relief.

The government has perpetuated in Canada a shrinking standard of living, a shrinking level of disposable income. Never before in Canadian history have individuals worked harder and longer. Never before have we had more families with both parents earning two or more incomes. Never before have we had individuals, according to Statistics Canada, working longer hours and longer work weeks under greater pressure reflected in many of the social problems we are experiencing. Never before have we had Canadian families earning more in gross pre-tax dollars.

Yet, while people are working harder to get ahead, they are falling behind, not because of their own lack of effort and diligence and fortitude, but because federal tax policy keeps taking more of what they earn. We now have the atrocious situation where Canadian middle class families have seen their after tax disposable incomes on the decline for over 15 years, working harder year after year to try to get by economically and falling further and further behind. They are powerless to change it because only the government has the ability to undo the damage.

That is why the OECD says that Canada has the worst record among its 26 member nations with respect to per capita GDP growth, the worst record in terms of standard of living. Imagine that a country that ought to be the most prosperous, the most productive nation in the world given our enormous resources, human and natural, finds itself falling further and further behind. Relative to our G-7 partners, the personal income tax burden in Canada is a full 56% above the average. The corporate income tax burden in Canada is 9% higher than the average of our G-7 partners.

If we were to roll back the personal income tax burden to the level where it was when the government took office in 1993, it would require an $8 billion reduction in federal income taxes. Canada has the highest property tax burden in the OECD. We have the highest total tax burden in the G-7 when we remove social security taxes, with a total tax burden 28% higher than the average of our major six economic partners, a whopping 48% higher than our single major competitor, the United States, where we conduct 85% of our trade.

In 1996 the average Canadian family paid a total tax bill of $21,242 or 46% of income. The average family was paying 46%, not the high income families. It was more than they paid for food, shelter and clothing combined. However in 1981, in constant dollars, the same family paid only $11,000 and change in taxes.

In the first six months of 1997, just a couple of years ago, governments in Canada took 67% of the increase in the personal income of Canadians. Of every $3 in additional income received by Canadians that year, governments took $2, leaving one for the individual who earned them. Since the government took office the average Canadian has lost 155% of the increase in real income to taxes.

These may sound like just figures and statistics to you, Mr. Speaker, but I know you have a heart and understand the very real frustration many people feel because they work harder and yet fall further behind and the government takes two and a half times the actual increase in their real income.

The top marginal tax rate in Canada kicks in at about $60,000 Canadian, whereas in the U.S. the top tax rate kicks in at about $420,000 Canadian. This is an enormous discrepancy. When the Americans tax the rich they are taxing people who earn over $420,000 Canadian. When we tax the rich we hit middle class people who earn over $60,000, and hence such an enormous drain of human capital from our country in the brain drain. As I mentioned the CPP is going up, consuming any relief we see on employment insurance premiums and then quite a lot again. That is why we are proposing an ambitious program of tax relief which would provide an average taxpayer with an annual $1,300 pay raise and more than $2,500 for a one income family of four.

I would like to focus for a moment on a particular issue that is of increasing concern to me. That is the question of the inherent unfairness in the tax system for families who make the choice to raise their children at home. I cannot understand for the life of me why the government would adopt such a policy. It is not a partisan matter as the government is continuing the policy of the previous Conservative government. It is a policy which says that if Canadian families decide to make an economic sacrifice to forgo a second income and have one of the two parents stay at home most of the time or all of the time to raise young preschool children, they will be penalized. On the other hand, if they decide to raise their children in part through third party institutional day care and go off to earn the second income or extra income, they will receive a benefit from the federal government.

This is an absolutely perverse social and fiscal policy. It gets Canadian families all wrong because the vast majority of Canadian families want to have the option to stay at home and raise young children.

I know some members from other parties will say that this view is just some antiquated neanderthal view of Reformers who do not understand that the state of the family has changed and so on and so forth. I would submit that it is those folks who do not understand the nature, the desires, the longings and the dreams of Canadian families.

I refer to public opinion research recently undertaken on the issue. Compas Research recently did a poll indicating that 92% of respondents say that families with children today are under more stress than families 50 years ago. Most Canadians attribute this increase in the level of stress to economic pressure and consequently the impact the stress has on family breakups, rates of domestic violence, divorce, child abuse, et cetera. Many of the social pathologies with which we attempt to deal in our criminal justice system and our social programs are caused by economic stress in families.

What about the family tax burden? Eighty-two per cent of Canadians, not Reform Party members, felt it should be a priority for the government to change the tax law to make it easier for parents with young children to afford to have one parent at home. Eighty-two per cent is about as close as we get to unanimity in public opinion polling. Seventy-nine per cent felt it should be a priority to allow couples with children to pay lower taxes by filing joint income tax returns. Nearly eight out of ten Canadians say “Let us file our taxes jointly so that we are not discriminated against if we are a single earner in our family”. Eighty-one per cent felt it should be a priority to change the tax law to make it easier for families to take in and care for elderly parents.

To quote the pollster, he summarized it by saying that by an overwhelming margin Canadians wanted governments to slash the tax burden on families. They call for more favourable tax treatment of families supporting the elderly, joint tax returns and especially adequate cuts in family tax burdens to allow one parent to stay home with the children.

It is not the only interesting finding. We have seen that other polls have reached similar conclusions. Ninety per cent in a Compas poll indicated that a family setting was preferable to day care when raising a preschool child. Again it was not some crazy ideological agenda but the near unanimous majority of the Canadian people.

A 1991 poll conducted by Decima Research of working women indicated similar findings: 70% said that if they had the choice they would stay at home to raise their children as opposed to 27% who said they would rather work outside the home.

By a margin of seven to three Canadian professional working women say they would rather have the choice if they could afford it to stay at home and raise their preschool children.

What happens when these very same families look at the tax code? What do they see? They see that if they give up that second income and the father or mother decides to stay home with two or three young children and raise those kids at home, they will be forgoing the child care tax deduction. That deduction is available to people who take their kids out to third party institutional day care. The government increased it in the last budget. I think it amounts to $7,000 per preschool child. That is a huge subsidy that family is giving up. At the same time it is giving up the second income.

Similarly, if that father stays home while the mother is working, he will only be able to claim a spousal tax deduction as opposed to the full personal amount. The spousal amount is $2,000 less than the full personal amount.

If the same family were to divorce and reconstitute itself as a common law couple, then both parents could claim the full personal amount. That is a penalty against marriage, while the child care deduction is a penalty against rearing children at home, which 90% of Canadians and 70% of professional women would like to do. It makes no sense. It really is bizarre.

All sorts of credible organizations have spoken to this issue. The National Foundation for Family Research and Education, an organization on whose board I once served, has publicized the results of some very interesting academic research. After having conducted a lengthy meta analysis of child rearing researchers Violato and Russell in their 1994 paper on the effects of non-maternal care in child development concluded that non-parental care for more than 20 hours per week has a negative effect in three areas of social pathology, social-emotional development, behavioural adjustment and bonding. Furthermore, 20 hours per week of non-parental care such as institutional daycare has a minor negative influence on the cognitive realm, learning. These are significant findings.

They are telling us that the explosion we have seen in our society in the past three decades in youth and teen suicide, the second highest level per capita in the developed world, the explosion in youth violent crime which has increased by 150% since 1986, all the related pathologies and social problems can at least partly be traced to the increase in non-parental care which this parliament chooses to subsidize through the child care deduction and other similar inequities in the tax system.

These subsidies add up. Let us imagine a scenario where a married couple has two wage earners. The husband earns $40,000 and the wife earns $20,000 per year and they have a relative who takes care of the kids. They pay a combined total of over $6,000 in federal income tax.

A similar couple across the street with one income earner bringing in $60,000 will pay $10,000 in income tax. That is $4,000 more than the two income family. That is a significant difference.

Finally, a two income couple earning $60,000 and paying for third party care outside the home will have to pay $10,000 less in federal taxes than the single income family raising their children at home.

In effect, couples who choose to marry legally and raise their children at home seem to be signing a guarantee of tax discrimination when they put their names on their marriage certificate.

What then is the solution? The solution is very simple. The solution is for parliament to decide to allow the practice known as joint filing of tax returns so that single income families can split right down the middle the income of the one main earner, thereby moving their total taxes into a much lower marginal rate and allowing them both to claim the full personal exemption.

This would make an enormous difference in the taxes paid by single income families. Another major change would be to create equity in the child care system by converting the current deduction into a refundable credit which would be very progressive. It would be available to all families, regardless of how they choose to raise their kids, whether at home or through institutional care, and regardless of their income.

I close by inviting the government to look much more closely at the need for family tax fairness. I know that in the last parliament the member for Mississauga South had Motion No. 30 passed which called for the same kind of tax treatment that I am proposing. It was actually passed in this House by a majority of members.

There is a consensus in this parliament and a consensus in this country. There is no good reason to continue to discriminate against Canadian families working so hard to do best by their children.

Finance February 2nd, 1999

Mr. Speaker, I thank my colleague for Vancouver East for her remarks. She articulates a very serious concern about poverty, child poverty and its social consequences. Whether she believes it or not, all members of the House share her concern. We may disagree on the remedy but we all share the concern.

However, one often hears from this hon. member and members of her party statistics and figures about 1 in 4 Canadian children living in poverty and a huge percentage of the adult population living in poverty. She went on to suggest that the government somewhat cynically could change these numbers by redefining poverty.

I would like the member to comment on this issue because I think it is not a flippant one, it is a serious one. If we want to solve the problem, we need to know what the problem is. We need to define it. We need to know what we are dealing with and that means getting a proper and accurate measure of poverty in Canada.

My understanding, and the member could correct me if I am mistaken, is that the poverty measure to which she refers is actually not the poverty measurement at all but is rather the low income cut off measure of Statistics Canada, LICO.

I am sure she could confirm for me that the low income cutoff is calculated as a relative percentage of family expenditures on necessities such as food, shelter and clothing. This is calculated as a percentage of the average family expenditure on these items.

In other words, would she not agree that as a relative measure it would be literally and mathematically impossible to ever eliminate poverty or substantially decrease poverty in Canada as long as there is any degree of income disparity? Would she not therefore agree that absolute poverty as it is understood in common language and common parlance by common folks is not measured by the LICO? Would she agree that it might be helpful to come up with a fair definition of what the basic necessities of life are while understanding there are contingencies, differences by region et cetera?

Would she agree that the case she and other social advocates make would be stronger, more compelling and convincing if Canadians could really define the number of folks who really do go without the basic necessities of life, if we could get beyond a relative measure of poverty which is a permanent measure because it will always exist as long as there is even an infinitesimal income inequality?

Finance February 2nd, 1999

Mr. Speaker, I would like to commend the parliamentary secretary for being the last dog here as it were on the government side. He is a very lonely advocate of the government's policy this evening but a persistent one nevertheless.

I have a question for the member for Stoney Creek. When he speaks about the government's purported success in balancing the fiscal budget, I think all Canadians will admit, as do I partisanship notwithstanding, that some credit is due this government, but I say only some credit.

Would the member not admit that about three-quarters of the deficit reduction to date is attributable directly to higher revenues, a large portion of which is attributable to higher tax rates partly through bracket creep, partly through the CPP payroll tax and other things such as the capital taxes on businesses.

Would he not furthermore admit that the percentage of cuts in the CHST for health care to the provinces was far higher than were the actual cuts to the government's own operating budgets for its departments?

Would he not fairly admit that revenue increases were the principal source of deficit reduction and that the government for whatever reason chose to cut health care transfers to the provinces to a far greater degree than it cut its own program spending here in Ottawa?

Supply February 2nd, 1999

Madam Speaker, I did not imply that the members opposite value freedom of expression over the responsibility of the protection of children from pornography. I did suggest that some of the members opposite may value the authority of the courts contra the balance versus the authority of parliament. I think that is a legitimate debate.

She knows she is being disingenuous when she suggests the Reform Party supports the judgment and believes that it is constitutional. She knows that is absurd.

I do not think there is a member in the House who believes this judgment is constitutional. But the point is this. The appeals process can work on track. We can invoke the notwithstanding clause in this place and protect these children immediately by reinstating the law. We can do that and allow the attorney general of British Columbia to pursue the appeal.

The hon. accountant opposite seems to disagree with the judgment of the lawyers I have spoken with. Let me make it clear that we can put this to the supreme court and let it have its say. It is nice that members opposite seem to have an absolutely unmitigated faith that the Supreme Court of Canada will undo this unjust, unconstitutional, outrageous decision. I am not entirely sure based on some of the precedents I have seen come out of that court.

But we can allow the appeals process to work and allow that to take the years and millions of tax dollars that it will to satisfy this British Columbia pervert's desire to tie up our court system. We can allow that to happen but at the same time protect the children by invoking section 33. The are not mutually exclusive. They are mutually compatible.