Mr. Deputy Speaker:

I have received written notice from the Hon. Member for Nickel Belt (Mr. Rodriguez), informing me that he is unable to be present to move his motion during Private Members' Hour on Monday July 25, 1988. Since it was not possible, in accordance with Standing Order 39, to arrange an exchange of positions in the order of precedence, I instruct the Table to put this item at the bottom of the order of precedence.

July 21, 1988

Since the notice will be withdrawn, Private Members' Hour will be cancelled, and pursuant to Standing Order 39, the House shall continue with the business before it prior to Private Member's hour.

There are no questions since we are into 10 minute speeches. On debate, the Elon. Member for Churchill (Mr. Murphy)

Mr. Rod Murphy (Churchill):

Mr. Speaker, I would like to support the amendment moved by the Liberals on the tax legislation, but I think you realize, Mr. Speaker, that I probably would not accept all the words of the previous speaker from the Liberal Party, especially those words which were critical of the New Democratic Party.

It is obvious to many in this House and across this land that there is a need for real tax reform. The sense of unfairness Canadians have with respect to our tax system is not just a feeling held by a small group of Canadians, it is a feeling held by many, many Canadians. During the last federal election campaign, there was a debate on a minimum personal tax. It was our Leader, the Hon. Member for Oshawa (Mr. Broad-bent), who raised that during the Leaders' debate. He pointed out that many of the richest Canadians were not paying one cent of income tax because we had created so many categories they could use for exemptions and so many investment loopholes they could use. They were not paying one cent in taxes. As a result of the debate that took place during the last election campaign, we finally had a minimum tax put in place for individuals. We have some problem with the tax that was put in place because we believe there are still some loopholes and ways that some Canadians can avoid paying their fair share of taxes.

One of the things that did not happen is we did not make the same provision for corporations. So we are now in a situation where corporations in this country which are making money- and we are talking about a significant amount of money-are not paying any taxes whatsoever. We do not believe that is fair. We know that other nations have looked at that situation and have said it is not fair. If we believe that individuals should pay their fair share, that those in the higher income brackets should pay their fair share, that there should be a minimum tax to guarantee they pay at least something, then the same thing should apply to corporations. That is something that many European countries and others have accepted as only natural. We believe that that is something with which this tax reform legislation should be dealing. The subamendment I will be putting forward in a few moments will deal with that aspect.

We believe that it is important that people pay their fair share. We also believe that corporations should pay their fair share. There are a number of problems with our tax system. One of the problems pointed out in my riding is the whole northern tax benefit. You are aware, Mr. Speaker, that until the end of April 1988 some communities in the North were

Income Tax Act and Related Acts

allowed to deduct a northern tax benefit which saved many families about $2,000 to $3,000 a year in taxes. However, other communities, such as the community of Thompson and Wabowden in my riding, communities in northern Ontario and communities right across this land, north of the 56th parallel, were not deemed to be northern communities. Because of an outburst of protest from these people that they are indeed northerners, the Government acted on an interim basis and the people of Thompson, which is a community of 15,000, and the community of Wabowden in my riding, which is a community of 1,000 people, are to be temporary northerners. For the next two years they will be treated as northerners in the tax system until the Government straightens out its act. There was a study of costs in northern communities, and there might be some new legislation brought forward at that time.

I bring this to your attention, Mr. Speaker, as an example because I think it points out the problems we have with our tax system. Over a period of time the Government has made decisions but has had to back down. It has ordered studies and has changed its tax system rather than come to grips with all the problems we have with our tax system.

In many ways, I think people who are filling in their tax forms every February, March or April must feel they are playing a shell game. They do not know what the rules are, what they should have done a year before when they received their pay cheques. They really do not know what they should do to look after themselves and their families in terms of paying their fair share of taxes, but not paying more taxes than their neighbours. In an ironic situation, a bank teller earning a very small salary finds out he is paying more in taxes as a bank teller than the bank itself is paying. How does he feel? He cannot belong to a union because every time a teller or someone else tries to form a union, the Canadian Imperial Bank of Commerce breaks that union by transferring people out. These people receive low salaries and then the tax system makes them pay a certain amount of taxes, but their employer has not paid a cent in income taxes for the last number of years. How do they feel about the fairness of the situation then?

In some ways the system the Government has presented is a step in the right direction. We are calling for a much fairer program. I know our finance critic, the Hon. Member for Ottawa Centre (Mr. Cassidy) has spoken before, and I am sure he will speak again this evening, to explain why the system is not fair and what we could be doing to improve the tax system to ensure fairness for the average Canadian family. Wealthy families will receive an average of $4,365 a year in tax cuts, 60,000 profitable corporations will continue to get away without paying any tax at all and the average Canadian family is left paying $1,000 a year more in income and other taxes than they did in 1984.

July 21, 1988

Income Tax Act and Related Acts

What has happened? We have tax reform. Many of the corporations, not all of them, are not paying any tax. Wealthy families are going to receive a very substantial tax cut. Elowever, when we take a look at the entire situation, we find that most Canadians will be paying more in taxes after this tax reform measure than they did in 1984 when the Conservative Government was elected.

I only have 10 minutes to try to cover the whole taxation field, and that certainly is impossible. However, in the few minutes I have left there are two things I want to point out. First, I want to put forward an amendment, as I indicated earlier, and second, I want to say that we have not dealt with the whole question of what the federal Government is going to do with the federal sales tax.

We know that a federal sales tax can be fair or completely unfair. We also know one additional thing, that is, that people with lower and average incomes will have to spend a larger percentage of their take-home pay on basic goods and commodities. If they are taxed on each and every good which they purchase and each and every service that they use, they will be paying higher taxes to the federal Government than they are at the present time. It will not do them very much good to have a low income tax if, when the second shoe falls, as the expression goes, they end up paying more when the new sales tax measures are introduced. I find it meaningful and scary that we will not know what the Government's plans are with regard to a federal sales tax until after the next election. Here we are on July 21 and the Government is moving quickly with what it calls tax reform because it knows that it is good news for it for the next election. But it will not tell the Canadian people what the total tax bill will be until after that election is finished. I find that basically dishonest. It is certainly advantageous to the Government, but it is basically dishonest in terms of what and how it is telling the people of Canada in terms of what it would do as a government.

I realize that my time is up. I would like to move, seconded by the Hon. Member for Ottawa Centre (Mr. Cassidy):

That the amendment be amended by deleting the word "Corporation" at the end thereof and substituting the following therefor:

"Corporations, and because the Bill fails to ensure that corporations make a fair and regular contribution to federal tax revenues by imposing a minimum corporate tax."

Mr. Deputy Speaker:

I will reserve on the admissibility of the amendment for a few moments. On debate, the Hon. Member for Edmonton-Strathcona.

Mr. David Kilgour (Edmonton-Strathcona):

Mr. Speaker,

I would like to speak against the motion.

Shame!

Mr. Kilgour:

The trouble with my friends opposite is that they are-

Mr. Murphy:

Reasonable.

Mr. Kilgour:

No. I know them too well. I know what they have done in British Columbia and in Saskatchewan, notwithstanding the Hon. Member for Regina West (Mr. Benjamin), and what they have done in Manitoba. They have managed in their periods in office in those three provinces to-and part of it had to do with the question of raising taxes on average-income individuals, low-income individuals and against the business sector-to drive thousands and thousands of jobs out of those three provinces while they were in office.

Mr. Benjamin:

Get off it!

Mr. Kilgour:

I remind the Hon. Member for Regina West that when Mr. Douglas was the Premier of Saskatchewan for many years from 1944-

Mr. Cassidy:

We balanced the budget.

Mr. Kilgour:

-until the sixties, Saskatchewan was the only state outside, I think it was, East Germany which had a drop in population. I ask the Hon. Member for Regina West to explain that when he gets up to speak.

The fact of the matter is, as he knows as a Regina Member, many people from Regina, Saskatoon, and young people from the North and vigorous people from the West of the province left to go next door to Alberta where the business climate was open and where taxation was not oppressive-

Mr. Benjamin:

More of them left Alberta.

Mr. Kilgour:

Some of them even went to Manitoba. Then we elected the Government of Mr. Schreyer in Manitoba. I know it sounds incredible but I am told that more than $2 billion in assets left the Province of Manitoba because of his taxation policies.

Mr. Benjamin:

Who told you that?

Mr. Kilgour:

I think that the Hon. Member can find out quite quickly how that happened. Companies, individuals and families simply moved their liquid assets, their mobile assets, out of the province, again to the advantage of the Province of Alberta.

Then we had Mr. Barrett, who was the Premier of British Columbia for three years, which was too long. At one point there was one mine-and we all know how important mining is to British Columbia-in the entire province that was profitable, I am told in part because of the taxation policies of Mr. Barrett.

What I am saying, of course, is that socialist Governments whether in western Canada, Europe or wherever have managed to remove so many incentives for people that they end up causing umemployment, causing people to leave and generally cause great problems for the economy.

July 21, 1988

Anyone who has a family believes in incentives. I do not know whether Members opposite have families, but I think you know, Mr. Speaker, since you have a family, that one has to have incentives. One has to have fairness. I fully agree with what has been said about the need for fairness in tax reform. I have written about the subject.

One thing is very clear. It is that if the people of Canada ever elect Members opposite to form the Government, the business climate will go straight down. Unemployment would go straight up and the dollar would go down. Taxation would go up for everybody. Very quickly the result would be that the good which the Government has done in the last three and a half years would be undone.

1 know how Members opposite talk before the election. They are all for everything that is good and against everything that is bad. All the people of Canada have to do is elect these people to office, and I am encouraged that that will not happen, and enough will be done to the business climate in Canada that we will all suffer. I refer to the young, the old, as well as to all regions of the country.

Members of the Party say: "We must get the corporations. Strangle them". That is what they did in Manitoba. They say that they should be got rid of.

Mr. Cassidy:

That is the law in the United States. What is wrong with that?

Mr. Kilgour:

The Hon. Member for Ottawa Centre used to be a financial writer. He should know that individuals ultimately pay taxes. Corporations, as he knows, just pass them on in increased prices.

Mr. Cassidy:

The Hon. Member for Edmonton-Strathcona wants no corporate taxes. That is what he is saying.

Mr. Kilgour:

I have never said that at all. In fact many companies should pay higher taxes. But if the Hon. Member thinks that the answer is to strangle the golden goose, whatever company it is, to the point that the goose expires on the floor and with it its jobs-