February 19, 1942 (19th Parliament, 3rd Session)

NAT

Thomas Langton Church

National Government

Mr. T. L. CHURCH (Broadview):

Mr. Speaker, I should like to ask the Minister of Finance a question in reference to the invasion of the municipalities' field of taxation. I shall supply him with a copy of it.
The city of Toronto is a municipality contributing huge sums of money in income and corporation taxes. Last June when the appropriation bill was under discussion here I
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suggested that the government should get the opinion of the supreme court of Canada as to whether the federal power has jurisdiction to take away these municipal and provincial revenues and raise moneys for provincial purposes by taxation, which under the British North America Act are allocated to provincial authorities. The point is open to much doubt. The city of Toronto is a large city, and its income and corporation taxes run into many millions of dollars. It is suffering the loss of these revenues, and municipal budgets are all upset, and also the province.
I would suggest that any agreement reached with Ontario herein, when made, be validated1. When it was under discussion last June I made that suggestion. There should be some procedure to validate the taking away from Ontario of these large revenues, especially from municipalities throughout the province. The words, or the definitions of them, are not clear in the appropriation act. I suggest to the minister that when he has the agreement with Ontario completed, he validate what has been done under the agreement; and he should also earmark this money so that the municipal share will go direct to the municipalities, such as Toronto, Hamilton, London, Ottawa and other places. The revenues of the municipalities have been taken away from them so often that we might just as well abolish our municipal institutions.
I would like to ask the minister if he is prepared to recoup Ontario and the city of Toronto for the taking away of the income tax and corporation tax revenues under the appropriation bill of last June. If the agreement based on it is to be validated, then the minister should earmark the money for the municipalities so that they can get the money either directly or through the province. I should like to ask the minister if he has any further statement to make in view of this and of Ontario's objections yesterday. He gave a statement yesterday that the first objection was last Friday, asking for validation. I raised this same question when the appropriation and unemployment insurance bills were being considered last June and argued that the federal government had no power to take away these provincial revenues or impose taxes for provincial purposes.

Topic:   TAXATION
Subtopic:   DOMINION JURISDICTION IN RESPECT OF INCOME AND CORPORATION TAXES
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