Jim Flaherty

[Taxation, September 27th, 2006]

Mr. Speaker, the issues of equalization and fiscal balance and moving toward fiscal balance in Canada are of vital importance to the country. We issued a paper with the budget this year about restoring fiscal balance in Canada. We have had meetings of the various ministers responsible and their provincial colleagues. These discussions continue.

We will be talking about it more in the fiscal update to come this autumn and then in budget 2007. It is a very active file and is very important for all Canadians.

[Housing, September 26th, 2006]

Mr. Speaker, I am very disappointed that the member is not reflecting the warmth that I am extending to him in the new session. It is very disappointing.

Having said that, I want to congratulate the member for his continued opposition to the GST. He was the president of the save the GST club. We reduced the GST by a full percentage point. Now he is the president of the raise the GST club for the next federal election.

[Government Programs, September 26th, 2006]

Mr. Speaker, I hope the increased distance between our seats will not interfere with the warmth of our exchanges in the new session. It is good to see him again.

I was trying to educate myself on the position of the Liberal Party. I checked on what the position apparently was when it was the government. It stated, “As stewards of the taxpayers' money, we the government have the duty to continuously shift resources from the low to the high priorities, to continuously spend smarter and spend more efficiently, to put the money in areas where Canadians really are”.

That was the member for Markham—Unionville. That is what we did yesterday.

[Government Surplus, September 26th, 2006]

Mr. Speaker, I am not sure what the question was. I am sure the NDP is in favour of debt reduction. I am sure most hon. members are in favour of debt reduction. Debt reduction means we pay less interest. Canadians understand that. Many Canadians have mortgages. Many Canadians have credit cards.

We will pay about $650 million less in interest this year as a result of the reduction in the debt. That is money that can be used for social programs and other important priorities for Canada.

[Taxation, September 21st, 2006]

Mr. Speaker, what it will take is a modern approach, not an approach that is confused and dithering, which we saw for years from the other side of the House. We need a principled and fair approach to restoring equalization and fiscal balance. That is our intention and we are on track to do that.

[Taxation, September 21st, 2006]

Mr. Speaker, we are following our plan with respect to restoring fiscal balance in Canada. As I announced in the budget and in the paper that we released with the budget for restoring fiscal balance, we will continue with that process.

We have been having extensive consultations among ministers with our provincial colleagues. We intend to continue that process through the fall, moving toward resolution and budget 2007. The hon. member should not believe everything he reads in the National Post.

[Questions on the Order Paper, September 18th, 2006]

The Government of Canada does not regulate the pricing of goods and services in the Canadian marketplace. Canadian suppliers and consumers are well informed that the rate of the GST changed to 6% from 7% on July 1, 2006. The competitive aspects of the marketplace determine the pricing of goods and services, including the price of products with GST included.

Canadian consumers are aware that the rate of the GST changed to 6% from 7% on July 1, 2006. Given the competitive aspects of the marketplace, consumers should realize real savings from the tax rate cut. For consumers, savings from the GST reduction will amount to approximately $8.7 billion over the next two years.

[Questions on the Order Paper, September 18th, 2006]

The proposed solvency funding relief regulations, the regulations, provide four options for temporary solvency funding relief, including extending the payment period for making solvency payments to 10 years from five where buy-in is achieved. Where an administrator of a plan seeks the buy-in of its members and retirees, the regulations require plain language disclosure to ensure that all interested parties have the necessary information to be fully informed of the decision they have to make. The disclosure would include, for example, the solvency funding status of the plan, that plan improvements would be restricted for the first five years of the 10 year funding period unless pre-funded, and an explanation of the potential implications of paying off a solvency deficiency over a longer period of time. The disclosure would also include an explanation that buy-in would be achieved where less than one-third of members and one-third of other beneficiaries object to the proposal, and that in order to register a disagreement, an objection would need to be sent to the administrator at a particular address and by a particular date. In the case where a beneficiary has a representative, such as a union that represents its members, the administrator must provide the information to the beneficiary representative, who could act on behalf of its members. Where the buy-in had been achieved, the administrator of the plan would be required to file a written statement with the Superintendent of Financial Institutions that the disclosure had been provided to all parties as required under the regulations and that the buy-in requirements had been met.

[Questions on the Order Paper, June 22nd, 2006]

Mr. Speaker, the budget tabled in the House of Commons on May 2, 2006 outlines the government’s commitments with respect to Bill C-48, An Act to authorize the Minister of Finance to make certain payments. Contingent on sufficient funds being available above $2 billion from the federal surplus for 2005-06, the Government will provide provinces and territories one-time additional funding of $1.4 billion to address short-term pressures in affordable housing.

In deciding how funds are to be allocated under Bill C-48, the government has balanced its priorities against its available resources, taking into account both existing levels of financial support and where it intends to dedicate its resources in the future.

The funding authority provided under Bill C-48 is discretionary. By providing $1.4 billion for affordable housing the government has chosen to meet a substantial part of the funding authorized through Bill C-48.

[Questions on the Order Paper, June 21st, 2006]

Mr. Speaker, the answer is as follows: a) It is estimated that federal tax revenues in 2004 were $300 million lower than they would have been if FTEs flow-through entities, which include income trusts and limited partnerships, were structured as corporations. These estimates were based on financial statements of FTEs for 2004 and involved many other parameters that are outlined in the Department of Finance's consultation paper: “Tax and Other Issues Related to Publicly Listed Flow-Through Entities” released on September 8, 2005 (see http://www.fin.gc.ca/toce/2005/toirplf_e.html). Comparable estimates are not available for years prior to 2004 because of the significant data and estimation requirements including the need to review FTE financial statements for prior years. Data and methodology issues are outlined in detail in Section 5 of the consultation paper.

b) A reliable projection for future years is not available because such an estimate depends on a number of very important factors that are difficult to forecast. The challenges with making projections are outlined in Section 5d) of the consultation paper. These include, among other things, the potential growth of the FTE market and the proportion of FTEs owned by Canadian tax-exempt investors such as pension funds.

c) Budget 2006 estimates the cost of the enhanced gross up and dividend tax credit for dividends paid by large corporations to be $375 million for 2005-06 and $310 million for 2006-07.