Jean Rousseau

[Technical Tax Amendments Act, 2012, February 27th, 2013]

Mr. Speaker, I always find it amusing to listen to my two colleagues from Winnipeg. They have a very particular sense of humour. Unfortunately, I do not share that same sense of humour.

I will take 10 minutes to try and talk about a bill that I thought was a bookend when I first saw it. When I saw how big it was, I was taken aback. If you wait a decade to make changes to a system that so obviously needs them, it is clear that special attention needs to be paid once you do make them. This 942-page document is more like a pillow than bedtime reading.

As I said, there are nearly 1,000 very technical pages to be studied in Bill C-48, An Act to amend the Income Tax Act, the Excise Tax Act, the Federal-Provincial Fiscal Arrangements Act, the First Nations Goods and Services Tax Act and related legislation.

For many people, myself included, it will likely take another decade to analyze and understand what this mammoth bill, this huge document, is all about.

In all, Bill C-48 will amend close to 20 acts and regulations. That is a huge number and it shows that the Minister of Finance, the Prime Minister and others have clearly failed to take action in this regard over the past few years.

Basically, part 1 will implement amendments to the provisions of the Income Tax Act governing the taxation of non-resident trusts and their beneficiaries and of Canadian taxpayers who hold interests in offshore investment fund property. Parts 2 and 3 will implement various technical amendments, once again, relating to the taxation of Canadian multinational corporations with foreign affiliates.

As a result, many Canadian businesses will have to meet new tax obligations in order to abide by the new rules set out in Bill C-48.

Since other changes will be made to this tax framework, businesses will also have to deal with the International Financial Reporting Standards, the infamous IFRS, which require businesses to identify the impact of the changes to the tax legislation and to the tax rate for the period in which the legislation is in the process of being adopted. However, for the purposes of the United States' generally accepted accounting principles or GAAP, the proposals must be adopted.

Do Canadian companies that prepare their financial statements using the accounting standards for private enterprises in accordance with the tax method that has yet to be implemented also have to identify the impact of the changes to the tax legislation and to the tax rate for the period in which the legislation is in the process of being adopted?

If so, companies that present their financial information using the IFRS will have to take into account the changes set out in Bill C-48 when preparing their financial statements for the fiscal years ending after November 20, 2012. On the other hand, businesses that present their financial information using the United States' GAAP will not have to take into account the changes set out in Bill C-48 until the bill is passed or, more specifically, until it receives royal assent.

Needless to say, the CGAs and accounting firms of this world will be fairly busy in the coming weeks and months. What is more, the NDP sincerely believes that we must fight tax avoidance and tax evasion, while preserving the integrity of our tax system. I am sure that this is very important to all members of the House. We therefore support the changes set out in Bill C-48, particularly those that seek to reduce tax avoidance.

In my riding, when people come to see me about the Income Tax Act—which happens more often than one might think, especially middle income earners who are having a hard time making ends meet—they often talk to me about tax evasion. They are really worried about their future.

It is certainly not by weakening regional economies with repressive employment insurance measures, with measures that are no good for a social climate that is already deeply troubled by the Conservative government's inaction when it comes to economic development for the regions of Quebec, that the population will be delighted by or care about a document that is nearly 1,000 pages, like Bill C-48.

The main concern of the people in my region, which was once so prosperous in the manufacturing, farming and forestry sectors, is jobs, jobs, jobs. The Conservatives claim they have created 900,000 jobs. I am not seeing these 900,000 virtual jobs. People are beginning to recognize this sham, and they are disappointed.

This document is a perfect example of an omnibus bill, and that is the only thing my constituents will remember. This bill's massive size is proof that there is still work to be done in transforming such technical amendments into legislation, and in a timely manner, otherwise it will penalize the business community and complicate Parliament's work.

The most recent technical tax bill was passed in 2001. Since then, any changes made between the passing of the two technical tax bills have been made by the Department of Finance through comfort letters. Most of these changes become common practice afterwards, even if they are not enacted in any tax legislation. This was even confirmed by the Auditor General.

In 2009, the Auditor General expressed concern that more than 400 of these comfort letters had not yet been passed into law. As some of my colleagues pointed out, more than 200 of these letters are in the bill to amend various tax laws.

Most tax practitioners are pleased with the comfort letter process. However, the Auditor General's report indicated that they had expressed a need for the legislative changes that the comfort letters identified.

The vast majority of the amendments contained in this bill have already been announced in press releases, the finance department's comfort letters and the budgets for the 11 years that have elapsed since the last technical bill was passed.

The government says that it is worried about the economy. I would like to point out that it has shown a certain neglect and skepticism.

We believe that these amendments will result in increased revenues, which is a good thing, and that they are a good way to reduce tax avoidance. As I pointed out, the vast majority of these measures were put into practice several years ago, and tax measures usually go into effect as soon as they are announced.

The sweeping nature of this bill shows that the government must be more responsible in managing tax laws, and it must ensure that proposed changes to these laws are adopted on a more regular basis.

In closing, we nevertheless support this effort because, as I mentioned, most of these measures have been in effect for a number of years and they should increase government revenues.

What my colleagues and my constituents want is for tax dollars collected as a result of these measures to be invested in our communities that really need them.

[Incorporation by Reference in Regulations Act, February 13th, 2013]

Mr. Speaker, once again, it is the NDP that is protecting the middle class and consumers.

The Liberals are unreliable; no matter how you slice it, they snuck $50 billion from the EI fund through the back door. It once again falls on the NDP to take a stand in defence of Canadians.

That said, I would like to thank my colleague for an excellent speech. There is a distinct lack of transparency here. We are quite concerned about the data access provisions and the minister's proposed discretionary powers. Could my colleague elaborate on that?

[Incorporation by Reference in Regulations Act, February 13th, 2013]

Mr. Speaker, I thank my colleague for his speech.

The work we do in the House must be transparent, particularly when it comes time to discuss a bill like this. The government is in no rush to talk about this subject. We have repeatedly seen it play this little shell game, at budget time, for example: the little hidden defect, the little Trojan horse.

Once again, my impression is that this bill is hiding things from us. Is the public going to ask what kind of bill of goods they are being sold?

I would like my colleague to say a little more about the fact that transparency must be uppermost in Parliament, in everything we do. As my colleague said a minute ago, this bill comes from the Senate; it does not even come from here. We are the ones who should have written a bill like this.

So in my colleague's opinion, why is the government exhibiting so little transparency?

[Safer Witnesses Act, February 11th, 2013]

Mr. Speaker, I want to thank my colleague for her speech and her bill.

My comments pertain primarily to the situation in Quebec. The Conservative government has been in office for nearly seven years now. During that time, there have often been requests from the RCMP and Sûreté du Québec in light of the growing violence in the province as a result of street gangs, organized crime and biker gangs.

The RCMP and Sûreté du Québec regularly ask for more money in order to detect these situations and run a witness protection program that is as effective and, more especially, as transparent as possible.

I would like my colleague to explain to us how this bill will help to achieve that objective.

[Fair Rail Freight Service Act, February 8th, 2013]

Mr. Speaker, my colleague has given a very good description of the situation in his region in terms of how to use all the networks for transporting and shipping goods in a remote region. I would like him to speak a little more about what would be particularly acceptable, as a mode of transport, especially in terms of the environment and the economic situation and life in his region.

[Employment Insurance, February 8th, 2013]

Mr. Speaker, if we can come back to serious matters. The Conservatives have returned to their attack on Quebec with renewed vigour.

In their vicious quota system for cuts to employment insurance, the target for Quebec is the highest of them all: 40% of the cuts are to be made in my province.

That is unacceptable. It is nothing more than an outright attack on Quebec and its regions.

Quebeckers have paid for employment insurance, and it belongs to them. The Conservatives want to take their money, attack their way of life and destroy their economy, which is so important in the regions.

Does the minister intend to listen to reason and abandon these destructive and irresponsible quotas?

[Fair Rail Freight Service Act, February 8th, 2013]

Mr. Speaker, because of a lack of investment in this infrastructure, there are sections of track that have been abandoned and can no longer be restored, unless millions of dollars are invested.

We must therefore continue to maintain the tracks we have left, and especially not make the provinces and municipalities, some of which have populations of only 500, bear the burden alone. They cannot carry the economic burden of restoring railway tracks.

[Fair Rail Freight Service Act, February 8th, 2013]

Mr. Speaker, I thank my colleague. Unfortunately, the government is not around to protect those regions whose economies are hanging by a thread or, in some instances, by a railway.

A region has been abandoned in the riding of Richmond, next door to my constituency. Before Sherbrooke, Sawyerville was the biggest port for goods in my riding, the biggest freight station in eastern Canada, and it was abandoned as a result of decisions made by governments in the 1940s and 1950s, and even in the 1930s.

Regions are being abandoned, and people have no choice but to come to our offices and ask for help. They say that we have the power, that we can help them and keep their infrastructure. We should invest in that infrastructure in order to create employment. When infrastructure is reliable and viable, it creates employment. And it is viable, since we are talking about agriculture, forestry and manufacturing, industries that are extremely important to the survival of those regions.

[Fair Rail Freight Service Act, February 8th, 2013]

Mr. Speaker, I thank my colleague. The problem is that we are no longer dealing with one carrier, but rather with two or perhaps three. So we are negotiating at several levels. These are small shippers in a remote region.

If, after taking the time to negotiate contracts with the big companies, you then have to go to the American parent company that owns a rail segment to negotiate—because they have no other choice but to negotiate with it as well—and if we have no standardized economic measures to assist these small entrepreneurs, they will once again lag behind the big companies, which negotiate as they see fit. The small entrepreneurs are being left to fend for themselves.

As I previously mentioned, some sectors, such as agriculture and forestry, have been left to their own devices.

[Fair Rail Freight Service Act, February 8th, 2013]

Mr. Speaker, in today's context of a free trade environment and a free and highly competitive global market—hardly anybody talks about globalization anymore these days, by the way—the key is to develop a healthy trade environment that is conducive to the development a modern, flexible, solid and reliable infrastructure.

Rail transportation in Canada represents a significant share of the economy. It contributes approximately 70%. In Quebec, the figure is slightly lower, and in the rest of Canada, slightly higher. This creates another problem too: more trucks on our roads are a threat to another infrastructure. Nevertheless, approximately 70% of all freight in Canada is shipped by rail.

It is consequently essential for these freight services to be profitable not only to the rail transport companies, but to shippers as well. The cost of rail freight services is a problem for Canadian shippers.

By failing to address some of the issues surrounding fees, the bill disregards the demands being made by some groups from the shipping community. As I mentioned in my preamble, in establishing a free, highly competitive market, the freight transport link in the chain is extremely important to the development of our economic strategy, and in particular for the prosperity of some regions in Canada and Quebec.

We are nevertheless going to support the bill at second reading today. The wording of the bill amends the Canada Transportation Act to require railway companies, when asked to do so by a shipper, to prepare an offer to enter into a contract that sets out the steps it must take to discharge its obligations to the shipper. It also establishes an admittedly rather rigorous process to set out the stipulations in such a contract if the shipper and the railway company are unable to reach agreement.

That was the gist of the question I asked my colleague from Notre-Dame-de-Grâce—Lachine a short while ago, and it may not have been particularly clear. What I wanted to say was that when you end up in arbitration in a negotiation, it is because something has not functioned properly in the prior discussions. This leads to legal proceedings in which there is often a winner and a loser. It is of course difficult to find a formula for dealings between a SME shipper and a multinational that would make everyone a winner, and this will not change. It would also have been useful to look into other options through which negotiation between the parties may have been facilitated.

The bill would also amend provisions concerning air transportation, with a view to rationalizing internal procedures, as well as a number of other provisions concerning the administration of the act, which are still, I might add, exceedingly complex. When the goal is to improve the situation and enhance a sector of the economy, it is important to make things easier.

However, given that the short title of the bill is the “Fair Rail Freight Service Act”, I am skeptical about its purpose. The ambiguous wording implies possible loopholes, as I mentioned, particularly in view of this government sense of equity, which is to give more to the big fish and less to the small fry.

Let us not forget that the Canada Transportation Act is an umbrella statute that governs a number of air and rail transportation markets, and that dates from 1996. Among other things, it bases the national transportation policy on establishing free competition between carriers and different modes of transportation. When a shipper in a remote part of Canada has to deal with a specific transportation company, that shipper has no choice but to find a way to negotiate a deal with Canadian National or Canadian Pacific.

An update was therefore both desirable and justified, because the players in this economic sector have been complaining for many years about chronic problems of service inefficiency and reliability from the rail network owners.

The fact is that 80% of clients and shippers say they are not satisfied with rail transport services in Canada. It is partly for that reason that they have asked the government to act, and introduce legislation requiring the main carriers, CN and CP, to reach agreements with shippers on the level and quality of services.

In reality, shippers have difficulty in obtaining fair, reliable and punctual rail transport services. Some of them cannot even get contracts with the large rail carriers, and those that do have contracts experience significant delays more often than not, only to be told that they do not have enough cars available to ship their goods and meet demands for service at the same time.

The level of dissatisfaction is high enough to prompt important questions about respect for business on the part of the major carriers, and here I am once again talking obviously about Canadian Pacific and Canadian National. As I have said, freight transport is a vital link. In remote areas and in the regions, it is important for rail transport to operate as a means of support for a number of sectors of activity, such as agriculture and forestry. In times gone by, in a neighbouring riding in the Eastern Townships, the municipality of Richmond had a port that was one of the most important transshipment points for freight in Eastern Canada. When market forces were allowed to operate without hindrance, Richmond suffered greatly from a limited choice of carriers and inferior infrastructure—it has to be said—and there was a striking decrease in population and, inevitably, a rise in the unemployment rate.

Nor should we forget that in some remote points in our great country, and now I am talking about my part of Quebec, we are often dealing with small carriers as well as American transport firms that move freight through border areas, as is the case in my riding. Some stretches of railroad have even been sold to American companies, which ship freight by rail as far as the Canadian border.

We therefore have to admit that we definitely need legislation to regulate and consolidate an economic sector that is not just important, but often vital in many rural regions of Canada. I am referring once again to remote regions. Since I became a member of this House, I have always defended the rural regions. It is those regions that give our country its identity. When they are vibrant and prosperous, they represent the very identity of Canada. I see no problem in letting market forces operate, but we must nevertheless help small companies, small carriers and small shippers, because they generate a large portion of the total freight volume in the regions.

The poor quality of rail transport services for freight thus costs the Canadian economy, particularly our many rural communities—as I have repeatedly said—that are already seriously threatened by the downturn in manufacturing and forestry, hundreds of millions of dollars every year, and hundreds of thousands of jobs.

Many industries in Canada have to deal day after day with losses caused by deteriorating crops that have languished too long in poor conditions waiting for transport services, with work interruptions in plants and mines for lack of parts, or with shipments that are missing or lost somewhere in the transport network.

Poor rail service hurts Canadian shippers who must meet the just-in-time standard. I do not know if my colleagues know what that means. It means that if I order it today, I want it yesterday. That is how it works in goods production and business in general. Poor service also hurts our global competitiveness and costs us hundreds of thousands of jobs. It can even cause corporations and SMEs to close their doors. It has also resulted in the rural exodus, which truly saddens me.

Having said that, a large part of the supply chain of our industrial, agricultural and forestry economy relies on a transportation system that must be effective and efficient if these economic sectors are to remain competitive in the global marketplace.

That is why shippers need measures that will reassure clients that this country's carriers will deliver on rates, fulfill their contracts and have the infrastructure needed for smooth operations.

In closing, I would say that the bill clearly does not go far enough. The government seems to believe that good faith will carry negotiations. However, I would like to point out that experience has shown that, when big business holds the upper hand, the small entrepreneur must be vigilant. That is not the right approach in some economic sectors.