Mr. Speaker, I would first like to mention that I will be sharing my time with my highly esteemed colleague, the member for Algoma—Manitoulin—Kapuskasing. I wish her well with her speech.
I have already told the House that I was a member of the Standing Committee on International Trade for one year. During that time, I observed what I hoped was a certain naïveté on the part of government members. It would have been touching, insofar as international trade is concerned, except for the very serious ramifications for our communities. The reality is that it is not naïveté, but a stubborn desire to stick with the old ways.
That is truly unfortunate because if the government were more open to dialogue—or at least a bit more open—we could work in a constructive manner and sign free trade agreements that would benefit all Canadians. Unfortunately, that is impossible. That is what I observed directly and that is what we see every time the government presents a free trade agreement to the House.
There is another very important aspect to consider and that is a very serious consequence of hastily signing free trade agreements and blindly entering into commitments without taking into account the relationships that exist between the countries involved, particularly the countries with which we are doing business. With regard to international relations, we must act very carefully. Every move Canada makes on the world stage is closely scrutinized by our closest neighbours and by the community of nations, not to mention independent research institutes throughout the world.
Canada has an excellent reputation that the Conservatives are unfortunately in the process of very quickly destroying. Because of this reputation, the eyes of international observers are always on Canada. When we do something as significant as giving a country such as Panama status as a favoured nation, we are sending a very important message, which is that we respect the practices of the country in question. With regard to Panama, this raises many questions.
As a courtesy to the members opposite, I will not confuse them by touching on too many different topics since the implications of a free trade agreement are obviously extensive. Instead, I will focus on a single topic, and that is the fact that Panama is a tax haven. I hope that members of the House will listen closely and understand that signing such agreements causes Canada to wander far along a path or become deeply involved in an activity that is widely condemned throughout the world.
Before I begin talking specifically about tax havens, I would like to provide some statistics from UNICEF on income inequality. For the period from 2000 to 2010, 40% of the poorest households shared only 11% of the wealth in Panama, whereas 20% of the richest households—only a small portion of the population—shared over half or 57% of the country's wealth. This gives an important indication of the social situation in Panama and shows just how inequitable this country is. That is one of the reasons why we must be very careful. Obviously, these statistics are not necessarily directly related to the fact that this country is a tax haven, but no doubt they are fairly closely related to it.
Lacking a precise definition, the OECD tried to set some criteria for a tax haven. I will briefly mention the four criteria: very low or no taxes; no exchange of tax information with other nations; lack of transparency regarding its tax system; and no substantial activities of the taxpayer in the country in question.
Since Panama excludes a large part of its population from political, social and economic activities, as demonstrated by the UNICEF figures, we must be careful not to condone practices that are simply reprehensible.
Tax havens are characterized by a lack of transparency, banking secrecy and shady financial operations. The Tax Justice Network ranks Panama 14th on its financial secrecy index of the world's most opaque nations. What is very interesting is that, in addition to ranking countries, that organization asks a number of questions related to Panama's practices.
Regarding banking transparency, it said, “Panama does not adequately curtail banking secrecy”. Regarding trusts and foundations, it said that “Panama does not put details of trusts on public record”. Lastly, regarding corporate transparency, it said that “Panama does not require that ownership of companies is put on public record.... Panama does not require that company accounts be available on public record”.
Here we can see just how much impunity corporations can enjoy, especially in the Panamanian banking and financial systems. Unfortunately, when an organization like that takes a stand, the government tries to discredit it. So I will lead the government into territory that it should be more familiar with and should find more credible.
I found a European website called “the best tax havens in 2012”. The information on that website is very up to date, which is good. I mentioned it briefly earlier, but the website says:
Thus, there is no single, definitive answer to the question, “what is the best tax haven”, especially since it is often better to combine several offshore jurisdictions. If you are an entrepreneur or a manager of an SME in Europe and especially in France, we would recommend the following tax havens:
Then it lists just under 10 countries, including Panama. So that is wonderful confirmation that Panama is an ideal place to shelter one's money from taxes.
I am going to talk about another aspect that I mentioned earlier. CCP Inc., a company that can be found online, basically claims that it can create any type of offshore company in the five tax havens. In order not to spread itself too thin, the company chose the countries with which it is easiest to do business, namely, Antigua, Belize, Dominica, Nevis and Panama. In the case of Panama, CCP Inc. encourages people to allow it to help them create a foundation by telling them to feel free to contact the company or to use its online form. I will not put the link on my website because I in no way condone this.
If we sign the various agreements that will link us to Panama, we will send a message to the world that Canada condones tax havens and tax evasion. Clearly, everything is negotiable. CCP Inc. suggests that people create a foundation to shelter their assets from taxes, saying “Security and Privacy are Your Rights!”
When I first ran for election in 2006, this government said that it wanted to be transparent. I am going to ask my colleagues to be consistent and not to condone banking secrecy or questionable practices, such as those in the Republic of Panama.
I would like to thank you, Mr. Speaker, for the time I have been given. I await my colleagues' questions.
