Mr. Speaker, the member spent quite a bit of time talking about the flat tax approach. In my experience as a chartered accountant, if it sounds too good to be true, it probably is.
The member's approach and what he has been proposing to the House time and time again is overly simplistic and unfair. He seems to think that if one takes a tax return and shrinks it down to one piece of paper that somehow helps the situation. The method of reporting is only bookkeeping and paperwork. It does not impact the amount of taxes collected.
The member will know that if Canadians have medical expenses they have to provide an itemization of the expenses for deductibility. If they have charitable donations, and many Canadians have a lot of charitable donations, they have to be itemized. Nowhere on his proposed form is their room for detailing eligible expenses.
The member will know that unincorporated businesses with sole proprietors must have a set of books and must report the detail from those books as to various sources of revenue and legitimate deductions against business income on their personal tax return.
Similarly rental properties, which many Canadians have as investments for the future, must also have a set of books and must report in some detail so that revenue is properly accounted for and eligible rental property expenses are claimed.
I heard a contradiction in the member's speech. In the first part he insinuated that the rich were not paying their fair share. In the conclusion of his statement he argued that the wealthy and the rich were paying their fair share.
The member is quite right in the latter case. The top 10 per cent of taxpayers in Canada make $50,000 a year or more. They pay 37 per cent of all taxes in Canada. What is more important is that they also pay 42 per cent of all charitable donations. If the tax burden on Canadians who are fortunate enough to earn higher incomes is increased, the first thing to suffer will be their level of contributions to charitable donations, which will definitely hurt all Canadians.
The flat tax notion has to be dealt with here and now. If the member thinks that the U.S. has the answers to all Canadian problems, he is absolutely wrong. Let us give one very important example considering that last night in the House the member stood and said that members of Parliament should be paid a salary of $12,000 a month or $144,000 a year, an $80,000 salary increase. He is saying in the House that they will make things better. That is not the way to do it.
Under his flat tax system a member of Parliament who makes $64,400 a year pays income tax at 37 per cent on his average marginal rate. That equates to some $24,000 a year. Under his system of a flat tax with no deductions of 30 per cent, a member of Parliament would only pay $18,000 of taxes or a reduction in taxes of $6,000.
Persons making $25,000 a year pay $6,000 today. Under his system they would pay $7,500 a year, a $1,500 increase to a low income Canadian. Could the member explain why his flat tax actually hurts poor Canadians?