Mrs. Diane Ablonczy (Calgary—Nose Hill, Ref.)
Mr. Speaker, it is a pleasure to speak at third reading of Bill C-28, an act to amend a whole bunch of other acts with respect to tax measures. It is a massive bill containing over 1,000 pages including accompanying notes. I wonder how many members of Parliament have read those 1,000 pages and know what we are getting into. We do not need greater fiscal and social engineering by the government in any bill but that is exactly what we are getting.
I will give a broad perspective in my critique of this bill and of the approach being taken. The Liberals and the Tories, the two parties that have been responsible for managing our economic affairs over the past several decades, have brought us to this point. We have a legacy of massive overspending, a legacy of 30 years of never balancing our books which has led to a legacy of a $600 billion mortgage on our children and a legacy of regular and unremitting tax increases. Because of all this the federal debt is nearly 70% of GDP.
The GDP is the gross domestic product, the value of all the goods and services produced in our country over a year. Seventy per cent of everything we produce over a year is offset by this massive federal debt. If we add provincial debts, that percentage approaches 100% of GDP. In other words, we owe everything we make in a year to our huge national debt. If we were to apply it all to the national debt, that would just about pay it off. Obviously we cannot because people have to live.
What it does mean for people and for the average family of four is a share of the national debt of a whopping $77,700. Every family has been put in the hole by past governments to the tune of $77,000 plus. This same average family paid $6,000 this year just to meet the interest on that debt. If there were no debt presumably each of these families would have an extra $6,000 to work with. Most families could feel the relief if that were the case, but of course it is not.
Also our income tax burden as a result of this abysmal record of fiscal mismanagement is the highest in the G-7 nations. Of the developed nations our income tax burden is the highest. The latest figures available show that between 1989 and 1995 the average Canadian family suffered a decline in real income after taxes of $2,540. One of the reasons for the decline in real income is the incredible tax burden being placed on regular Canadians.
I have a letter from a regular Canadian that illustrates all too clearly the ridiculous lengths to which this tax system punishes Canadians:
My son attended Notre Dame school in Saskatchewan on a scholarship this past year. Last week, he received a T41A in the mail in the amount of $9,500. The scholarship represents his only income for the year (he does not even have a social Insurance number). He now owes income tax in the amount of $450 (and of course, our tax burden increases because he was removed as a dependant).
I have several questions:
How can the Liberals claim that they want to support youth education when there is a tax on scholarships?;
Where does the government draw the line in taking money from its citizens? If $9,500 is not below the poverty line, then what is? $5,000, or perhaps $2,500;
Is not the future of our nation, its educated youth, worthy of the same tax free allowances as MPs or MLAs?;
Just what kind of joke is the millennium fund going to be given the government's penchant for having its hands in our pockets?
My wife and I are lucky in that the tax owed by my son is something we can afford. But, I can easily imagine families and situations where this would not be the case. Please, if it is possible in opposition, point out this ludicrous situation to the Liberals and continue your efforts to remove the tax burden from those who can least afford it—in this case our students.
This is the kind of real life tax grab that our income tax regime imposes on regular Canadians, the youngest, the hardest working Canadians. This bill does absolutely nothing to address that kind of situation.
For the first time in 30 years the chief financial officer of this corporation we call Canada has finally managed to balance the books.
Far from apologizing for the fact that this is the first year of doing something every Canadian and every financial institution must do routinely, we have a finance minister who acts like this is the beginning of easy street for every Canadian. Of course, this is nonsense. We are not out of the woods by any means as Canadians and Canadian families.
It is important to note that this one balanced budget has been achieved almost 70% through increased tax revenues. Here we have a bill of over 1,000 pages that does not do one thing to reduce that horrendous tax burden on Canadians. Yet that is what allows the one balanced budget we have had.
An additional 16.5% of the measures that balanced our budget were through cuts in support to key social services such as health and education. Less than 1% was from actual decreases in other government spending.
Government is good at piling the tax load high on everyone but very poor at restraining its own appetite for spending those same tax dollars.
In addition, the government has adopted some suspect accounting policies that allowed it to manipulate budget figures with an eye to maximizing a surplus closer to the next federal election. This manipulation was so unusual and so blatant that, as members know, the Auditor General of Canada felt it necessary to challenge the government in a very pointed and public way.
It is critical that we not only refuse to put additional charges on the Canadian credit card but that we have a solid financial plan to start paying down the huge debit balance and make the kind of prudent budget and lifestyle choices that will ensure our future fiscal well-being.
Unfortunately the government has not taken that kind of big picture approach. A detailed study this month by the chief economist of Scotiabank says: “Aiming for balanced budgets and relying on an unprecedented stretch of solid growth and low interest rates to reduce the debt burden is a high risk strategy for a debt heavy government”.
I see the time has expired and so in closing I would like to say we cannot support this tax tinkering by the Liberals.
Subtopic: Income Tax Amendments Act, 1997