January 25, 1958

PC

Donald Methuen Fleming (Minister of Finance and Receiver General)

Progressive Conservative

Mr. Fleming:

We demonstrated very

clearly, to the satisfaction of all the provincial premiers and those who accompanied them, at the conference which met here in the last week of November, that we were there to discuss common problems with them, as Canadians around a common table, and that is the spirit in which the present course of action has been prepared by the government. This has been carried out with due consideration of the fact that the provincial treasurers are at this moment faced with the problem of preparing their budgets, and that it is extremely difficult for them to proceed with those tasks until they know something of what they might expect to receive in this forthcoming fiscal year. Under these present circumstances we did not feel that it was fair to leave the matter in the air until-

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LIB

John Whitney Pickersgill

Liberal

Mr. Pickersgill:

Without discussing it any further-

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PC

Donald Methuen Fleming (Minister of Finance and Receiver General)

Progressive Conservative

Mr. Fleming:

-the dominion-provincial conference could be convened. I have made it clear that there is nothing final about the measure with respect to the benefits for all 10 provinces. It is an interim measure, and the purpose in reconvening the dominion-provincial conference will be to seek final fiscal settlements.

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LIB

Andrew Wesley Stuart

Liberal

Mr. Sfuari (Charloiie):

Mr. Speaker-

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PC

Daniel Roland Michener (Speaker of the House of Commons)

Progressive Conservative

Mr. Speaker:

II members are rising to ask questions on this statement, would they kindly defer them until we come to the question period.

On the orders of the day:

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L L

William Moore Benidickson

Liberal Labour

Mr. Benidickson:

Mr. Speaker, I should like to direct a question to the Minister of Finance. In view of the fact that he explains the failure to reconvene the dominion-provincial conference on the sittings of the house, has he overlooked the fact that many and perhaps the majority of federal-provincial conferences on fiscal matters since the war have been held while the house was sitting?

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PC

Donald Methuen Fleming (Minister of Finance and Receiver General)

Progressive Conservative

Mr. Fleming:

Mr. Speaker, I doubt very much if the statement of the hon. gentleman will bear examination. I doubt if he will find that dominion-provincial conferences have ever been held at times when the house was sitting morning, afternoon and night and all day Saturday.

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CCF

Stanley Howard Knowles

Co-operative Commonwealth Federation (C.C.F.)

Mr. Knowles (Winnipeg North Centre):

In

view of the minister's boast earlier this morning that the conference in November was such a success, and in view of the fact that the house was sitting at that time, does he not think it would be a good idea to reconvene it while the house is still sitting?

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PC

Donald Methuen Fleming (Minister of Finance and Receiver General)

Progressive Conservative

Mr. Fleming:

I think the answer I gave to the last question should be enough to satisfy even the hon. member for Winnipeg North Centre. In November the hours of sitting were not nearly so rigorous as they have been since.

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CCF

Stanley Howard Knowles

Co-operative Commonwealth Federation (C.C.F.)

Mr. Knowles (Winnipeg North Centre):

Who

changed them?

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PC

Donald Methuen Fleming (Minister of Finance and Receiver General)

Progressive Conservative

Mr. Fleming:

They were brought into effect by decision of the whole house, with no objection so far as I am aware from any party in the house.

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LIB

George Carlyle Marler

Liberal

Hon. George C. Marler (St. Antoine-Wesi-mount):

I should like to direct a question to the Minister of Finance. From the telegram the minister read when we were on motions in connection with increased payments to the provinces, are we to infer that this will put an end to the double taxation of corporation profits and of personal income such as exists in the provinces of Quebec and Ontario?

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PC

Donald Methuen Fleming (Minister of Finance and Receiver General)

Progressive Conservative

Mr. Fleming:

I cannot say anything about whatever action the provinces may take. In the measure proposed by this government there is nothing that increases federal taxation by one copper. This is a measure for further distribution as between the dominion and provincial governments of the revenues from what are commonly called joint fields of taxation. I know my hon. friend does not 96698-2401

Dominion-Provincial Relations need to be told the effect of the increase from 10 per cent to 13 per cent in the standard individual income tax which is included under the act in calculating the compensation to be paid to the provinces. The figures I announced this morning and the resolution preceding the bill carry forward the principle of equalization as now contained in the legislation.

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CCF

Stanley Howard Knowles

Co-operative Commonwealth Federation (C.C.F.)

Mr. Knowles (Winnipeg North Centre):

Is

it not under the tax rental section rather than under the equalization section of the act?

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PC

Donald Methuen Fleming (Minister of Finance and Receiver General)

Progressive Conservative

Mr. Fleming:

I dealt with both points.

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LIB

George Carlyle Marler

Liberal

Mr. Marler:

May I take it that there has been no discussion between the federal government and the governments of Ontario and Quebec as to the elimination of double taxation, despite the fact that there seems to be a substantial increase in the payments which the federal government is making to those two provinces?

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PC

Donald Methuen Fleming (Minister of Finance and Receiver General)

Progressive Conservative

Mr. Fleming:

There has been no discussion with the provinces as to what action they may choose to take with regard to their own legislation. When we are on the resolution this matter can be more amply dealt with. There will be legislation which there will not be time to introduce at this session but which will be introduced at the next following session dealing with the effect of this legislation on the deduction from federal income tax.

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LIB

George Carlyle Marler

Liberal

Mr. Marler:

From the minister's answer may I infer that it was not intended that any such provision would be contained in the bill to be based on the resolution to which he has just referred?

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PC

Donald Methuen Fleming (Minister of Finance and Receiver General)

Progressive Conservative

Mr. Fleming:

The resolution being one contemplating the introduction of a bill to amend the Federal-Provincial Tax-Sharing Agreements Act, the resolution cannot go outside the ambit of that act. But whatever amendments are required with respect to the Income Tax Act, it will be the intention of the government to introduce at the next session.

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CCF

Stanley Howard Knowles

Co-operative Commonwealth Federation (C.C.F.)

Mr. Knowles (Winnipeg North Centre):

May I ask a supplementary question of the Minister of Finance. In view of the fact that the resolution to which he has referred this morning seems to be in two distinct parts- one raising to 13 per cent the 10 per cent in the act already on the statute books and the other providing for the Atlantic provinces adjustment grants-could he say whether the government intends to bring in one or two bills as a result of the proposed resolution?

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January 25, 1958