November 25, 1953 (22nd Parliament, 1st Session)

PC

William McLean Hamilton

Progressive Conservative

Mr. Hamilton:

When the Minister of
Finance spoke in Montreal some time ago he attempted to show that our taxes were really not very high after all. Of course he admitted they looked high in relation to past history, but then when you deducted the cost of defence, they were lower, and when you deducted the costs of social security measures they were still lower; in fact, if you deducted enough items you finally reached a point where the federal government's share of the tax dollar was less than it was in 1939. To me, this comes close to the story of the farmer who decided to teach his horse to go without eating; he just had it properly trained and down to one straw a day when the horse died.
The man who collects my taxes, and those of both the citizens and the corporations of Canada, however, seems never to have heard of the finance minister's teachings, and some of us horses who never got onto anyone's payroll are finding that we, too, are pretty well down to our last straw.
The effect of this policy of high taxation, bitter as it is at the present time, will not be fully felt until such time as our Canadian economy encounters a period somewhat less prosperous than at present; then serious difficulties for which this government will be directly responsible are certain to arise.
The reason is simply that this government has denied us, both as individuals and as private enterprise, the opportunity to lay aside adequate reserves to carry us over an adverse period. High taxation-continuing, cruelly heavy taxation-has taken away from us much of the money which normally we would have salted away for a rainy day. When that day arrives-and arrive it must- we will have nothing to cushion the shock.
Some consideration for business and industry in this regard is especially important, for unless the government is going to continue the long strides it has already made in invading the field of private enterprise, and socialize us completely, it is to private enter-Drise that Canada must still look for her
The Address-Mr. Hamilton future development and her continuing prosperity. If this is so, then we must allow the businessman a reasonable measure of freedom to prepare himself for whatever the future may bring.
One measure which I would recommend to the Minister of Finance for his consideration in preparing his budget is a provision allowing corporations to set aside a portion of their profits, before taxation, in a reserve fund to be used in subsequent years for sales promotion, advertising and the like. Time and again it has been shown that lagging sales can be revived and increased with additional emphasis on the marketing side of the business. As sales pick up, so does employment, so do purchases of materials, and soon things are going well again.
Therefore I suggest that we try to direct a portion of the company's profits, or shall we say make it possible for them to use a portion of their profits in work of this kind. Such a procedure does not of course deprive the government of any tax revenue over a period of time. While they may lose it this year they will pick it up in subsequent years when the fund is used. Not only will they pick up the revenue from such a fund, but they will have the additional advantage of increased sales and profits; and heaven only knows that the day is far distant when this government will not take a generous bite of whatever profit any of us manage to make in our business.
In the years to come, with the tremendous productive capacity we have built up in this country, and with our steadily growing industrial complex, the people who move merchandise from the end of the production line into the hands of the consumer

the salesman, the advertising man, and those associated with them-are going to play a vital part in ensuring prosperity. As someone has said, nothing happens until somebody sells something to somebody. If this is so, then surely we should do all in our power to see that our marketing effort continues at a high level and I would like to think that the suggestion I have offered is perhaps one way of ensuring that.
Indeed I think my party, with its foursquare stand in support of free enterprise and its realization that the people of this country are better able to develop their own destiny if they are unhampered by stringent government controls and restrictions, holds a solution to the problems of our day which will be supported by Canadians long after the socialist philosophies to which we are now subjected have passed into history.

Topic:   EXTERNAL AFFAIRS
Subtopic:   SPEECH FROM THE THRONE
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