Jim Flaherty

[Income Trusts, November 7th, 2006]

Mr. Speaker, Sue from Calgary wrote, “I am writing to applaud your decisive action in taxing income trusts. It is about time the government took action to stop the hemorrhaging of our tax dollars”.

As Douglas from Kitchener, Ontario wrote, “Congratulations. This took some courage. As a small business owner, I agree with your decision to stop the mad rush to trust conversions. We need Canadians to invest and grow their businesses. I am involved with a number of U.S. companies that are aggressive and built for growth. We were turning Canadians into a nation of coupon clippers”.

[Income Trusts, November 7th, 2006]

Mr. Speaker, there are many letters and we have heard many of them, for example, from Thomas in Victoria. He said, “I'm a senior and a pensioner. I want to congratulate you both on the courage you had to impose a tax on distributions from income trusts. It had to be done but previous governments lacked the resolve to do it”.

We also heard from Alice in Guelph, Ontario. She said, “I know we are more inclined to write when we oppose something a member of our government does. It must have taken a lot of courage to face up to the affected big businesses. You did good. We little people are proud”--

[Taxation, November 6th, 2006]

Mr. Speaker, yes, I have heard that figure and I have heard other figures from various provinces. I have heard figures from Quebec with respect to the issue of fiscal imbalances. We are on track. We are continuing the discussions vigorously with the various provinces on the fiscal balance issues. We said that we would continue these discussions into the autumn and we are. The finance ministers intend to meet, probably in December, and then moving toward a resolution in budget 2007.

[Taxation, November 6th, 2006]

Mr. Speaker, the information we used with respect to decision making on the income trust issue was the information that was available about the growth of income trusts, about the reality that we were seeing income trusts being chosen as an instrument of conversion by companies in the telecommunications business, that there were many more to come, and the kind of economy that we would end up having in Canada, not to mention the tax fairness issue where large telecommunications companies could avoid taxes in excess of $1 billion.

[Income Trusts, November 6th, 2006]

Mr. Speaker, I would remind the member opposite that the provisions with respect to changing the tax rules for income trusts do not come into force for some four years for trusts that were trading on October 31, 2006. This is a long period of time. There will be time for context and perspective. It was done similarly to what was done in other places because other places, including the United States, the United Kingdom and Australia, have made it clear that this type of economic instrument was not in the best interests of a competitive, productive economy going forward. That is in the best interests of all Canadians.

[Income Trusts, November 6th, 2006]

Mr. Speaker, what can I say? Many sources in Canada disagree terribly with what the member opposite has just said. For example, the Toronto Star editorial board said:

But the [Finance Minister] nevertheless deserves much credit for doing the right thing by plugging a tax-avoidance loophole that he rightly described as “a very bad thing for Canada”.

I invite the members opposite, if they truly believe it is the right thing for Canada to have an income trust economy, to go ahead and vote against the motion. Those members know and I know that when--

[Income Trusts, November 6th, 2006]

Mr. Speaker, Canadians, and I am sure even some of the members opposite, saw what was happening in 2006. We saw the income trust sector increase by some $70 billion. We saw the telecommunications sector, first one and then another company, decide in a capital intensive section of the economy that it felt obliged to go the income trust route.

We were going to see more. There were more that were being talked about. If members opposite and the member for Wascana truly believe that an income trust economy is in Canada's best interests, then go ahead and--

[Income Trusts, November 6th, 2006]

Mr. Speaker, if we look back one year and see how this issue was not addressed and then was attempted to be addressed, we would see that it was bungled by the party opposite. I do not expect the party opposite to understand that a government, albeit a minority government, is obliged to look after the best interests of the country.

As commentators from coast to coast have said, what is in the best interests of Canadians? What is in the long term interest of Canada and the next generation? What is in the interests of our Canadian economy? Do we want to become a sleepy economy? The answer has--

[Income Trusts, November 6th, 2006]

Mr. Speaker, if it is the position of the Liberal Party, then I say to the member for Mississauga South that I gather it is the official position of his party, which is as follows:

It was absolutely the right thing, and we had started on this track to protect the tax base, to ensure tax fairness and to work for the productivity of the nation.

The member for Mississauga South is wrong. He should turn around and say it to the author of that statement, the official critic who is sitting behind him, the member for Markham—Unionville.

[Income Trusts, November 6th, 2006]

Mr. Speaker, I know that the Liberal Party thinks that large corporations should not pay taxes in Canada. I know that the Liberals apparently plan to vote in favour of the position that this economy should increasingly put the burden for health care, education and infrastructure that we need on individuals and families in Canada.

We do not share that view. We do not share the view that is apparently the view of the party opposite. We think all Canadians, including corporations, should pay their fair share of taxes.