Mr. Speaker, I rise to speak to today's opposition motion on internal trade. Issues relating to internal trade are important for the Canadian economy, as well as for consumer rights. Businesses and consumers have the right to have access to clear and fair rules.
By now, most of us are familiar with the case addressed by today's motion. In 2013, Gerard Comeau, a resident of New Brunswick, was fined about $300 for buying beer and spirits in Quebec and then taking his purchases home with him back to New Brunswick. According to authorities, he was in violation of New Brunswick's Liquor Control Act, which requires that residents of New Brunswick purchase their alcohol from the provincial liquor corporation.
Mr. Comeau challenged the fine, arguing that New Brunswick's rules violate section 121 of the Constitution Act, 1867, which reads:
All Articles of the Growth, Produce, or Manufacture of any one of the Provinces shall, from and after the Union, be admitted free into each of the other Provinces.
The judge in the case agreed with Mr. Comeau, and now the New Brunswick government is appealing that decision.
My colleague, the member for Central Okanagan—Similkameen—Nicola, is now asking fellow parliamentarians in this place to call on the government to refer the Comeau decision to the Supreme Court for constitutional clarification of section 121.
This strikes me as a pretty crafty move, pardon the pun. We know the Supreme Court has jurisdiction to hear constitutional order references and provide clarifications, but in this specific instance I have to wonder if this is the best avenue available to us or if it is just the most politically convenient tool at the moment.
I understand that my Conservative colleague who moved today's motion has done a lot of work over the years on liberalizing the interprovincial trade for beer, wine, and spirits. Interprovincial trade has always been a key element of Canada's economic development. The NDP is in favour of reducing artificial barriers and harmonizing regulations, because we know this is good for Canada's small and medium-sized businesses.
To clarify who we are talking about when we say SMEs, let me take a step back. Statistics Canada defines small businesses as those that employ fewer than 100 employees, and these made up a whopping 98.1% of all Canadian businesses that reported having employees in 2014. Medium businesses employ between 100 and 500 employees, and represent 1.7% of Canadian businesses. While large businesses, those that employ more than 500 employees, represent 0.2% of Canadian businesses.
Small businesses create local jobs, support our families, and drive economic prosperity. They are the backbones of our country and the hearts of small towns across Canada, small towns like those I represent in Essex.
It is important that we have this conversation about reducing trade barriers because there are actually a lot of barriers inhibiting Canadian SMEs from greater trade both interprovincially and internationally. We hear a lot about tariff reductions with international trade agreements, but it is also important to look at the range of non-tariff barriers that inhibit trade.
Last spring, the Standing Committee on International Trade undertook a study about the experiences of Canadian SMEs that are involved in international markets, and some of what they learned is also applicable to our conversation today about internal trade. I think Canadians would be surprised to hear of the challenges facing SMEs in accessing international markets.
The committee heard testimony about the strong entrepreneurial spirit that exists among Canadians. This is clearly evident when we look at the explosion of craft breweries operating in communities across Canada.
The committee also heard that the international footprint of Canada's SMEs has not reached its potential. Only 10.4% of SMEs exported in 2011, and most of this trade was done with the United States. They really have not penetrated the high-growth markets we see around the world. SMEs told the committee how they face challenges accessing capital, require deeper levels of support, and experience difficulties and inefficiencies with border clearance.
Many people in my riding of Essex have extensive knowledge of the challenges with moving goods across the U.S. border. This is just the tip of the iceberg. It is critical to the success of Canadian SMEs that the federal government act on this report, and that they address the trading challenges faced by SMEs.
Domestically, there is a lot the government can be doing to strengthen the competitiveness of SMEs, such as craft breweries, wineries, and distilleries. According to the Canadian Federation of Independent Business, internal trade barriers cost the Canadian economy more than $14 billion each year. These trade barriers add costs and discourage our businesses, mainly our SMEs, from doing business in more than one jurisdiction and from growing their presence in new markets in Canada.
In addition to addressing internal barriers, we should support talking about other ways the government can support SMEs.
The NDP is a strong proponent of several proposals to help our businesses and interprovincial trade, including restoring cuts to the tax rate for SMEs from 11% to 9%, restoring the hiring tax credit for small businesses, imposing a limit on credit card transaction fees, and facilitating the transfer of family businesses from parents to children. The Liberals' broken promise on reducing the SME tax rate is very disappointing to the many small business owners I represent in Windsor Essex. I urge the government to re-examine its commitment and seriously look at following through on that.
It is important to note that most Canadians support trade within our own provinces and territories. Canadians are quite favourable to the idea of removing internal trade barriers, particularly when it comes to alcohol.
This is an important issue to my riding of Essex, which is home to well over a dozen wineries, including distillers as well as craft beer brewers. They attract a significant level of tourism to our region. I have met with several wineries in my riding, as well as the Canadian Vintners Association. We spoke about the interprovincial trade issues and they are pleased to have an opportunity to export their wines to some provinces. However, only a few provinces have reduced regulations so far, so there is still a lot of work to be done on this file.
I think there is broad support among parliamentarians from all parties for the spirit of the motion. What I would really like to see now is some concrete action. We know what can be done to support Canadian SMEs. We know what can be done to increase internal trade. Now it is on the government to get the job done.
According to the Minister of Innovation, Science and Economic Development, issues relating to interprovincial trade, including discussions around the 1995 Agreement on Internal Trade, would be a priority. He said he has addressed this issue with his provincial counterparts, but once again we have seen no evidence of this.
Now the Conservatives are blaming the Liberals for not being able to reach a new agreement with the provinces and territories on interprovincial trade. It should not be forgotten, however, that the Conservatives had 10 years in office and were not able to settle this issue. I appreciate that some progress was made, but the fact of the matter is that these issues are still outstanding. Now they are trying to go through the Supreme Court for political gain.
I intend to support the motion, but in the same vein, I also want to encourage the government to follow through on concrete solutions for Canadian small businesses. As I discussed earlier, that means reducing the SME tax rate, restoring the hiring tax credit for small businesses, and limiting credit card transaction fees.
I would also like to emphasize that the public system for distributing liquor has been a largely effective model for both consumers and government. Crown corporations such as the LCBO provide significant revenue streams for the provinces, as well as good-paying jobs. The LCBO is globally recognized as an award-winning retailer of beer, wine, and liquor. Recognizing the success of provincial retailers in Canada and the incredible service they provide to consumers is important.
In conclusion, I support reduced restrictions on the interprovincial trade of wine, beer, and spirits, so I will be voting yes to the motion.