May 31, 1984 (32nd Parliament, 2nd Session)


Douglas Keith Anguish

New Democratic Party

Mr. Doug Anguish (The Battlefords-Meadow Lake):

Mr. Speaker, I see I have only about seven minutes left, but I want to put some comments on the record in the debate today. I agree with much of what the Official Opposition has said regarding the taxation system. I disagree with other aspects which they have touched on from time to time. The most important point I want to bring out is that both the Liberals and the Conservatives have overlooked a large part of the problems in the system, and I would like to touch on that briefly.
Since I have been a Member of Parliament I have had many farmers and small business people come to me about their feelings of being dealt with unfairly by the system, by auditors and collectors from Revenue Canada. In some cases they have had very just complaints. The most common complaint seems to be about the aggressiveness with which Revenue Canada sometimes pursues audits and collections. At the same time, I think people feel a great deal of unfairness, especially those involved in small business and farming operations. An auditor from Revenue Canada can tell an individual that his business or farm is not a viable operation and therefore he cannot deduct the year's losses or the legitimate expenses which he

May 31, 1984
feels he is eligible to deduct. The Department is going to have to consider that case very seriously. I have some confidence that the pressure of the Opposition will cause the Government to recognize that there is a problem and that it will be rectified in the future. It had certainly better be or we will not have many farmers left in many areas of western Canada other than long-time established farmers or those who have very large and wealthy farming operations, which is not the norm.
The other problem is that in pressing economic times many people, especially young farmers, find themselves leaving the farm to earn income, when they are not involved in the farming operation itself, to put bread on the table and enable themselves to live at a standard of decency that is above the poverty line. The issue of off-farm incomes and the arbitrary assessments by Revenue Canada people that a business or farming venture is not viable must be reckoned with.
In the literally dozens of cases which have come to me in the past four and a half years I have found most of the public employees within Revenue Canada to be quite helpful. There are some who are not, just as in any other organization or government Department. The taxation office in Saskatoon has been helpful, as has the regional office in Winnipeg. I usually deal at these levels with problems which constituents have brought to my attention.
I will turn to what I think both the Liberals and the Conservatives have overlooked. Our taxation system has become a nightmare of complexity and unfairness. As the Hon. Member for Crowfoot (Mr. Malone) pointed out, very few people anymore fill out their own income tax forms. That is just one example of the complexity of the system. The unfairness is what many of the politicians and parliamentarians are overlooking. The Canadian tax system is based on a simple premise that one pays taxes on income earned. The more money you make, the more taxes you should pay. In 1981, 8,000 people earned more than $60,000 and paid no taxes. That is what the Hon. Member for Kamloops-Shuswap (Mr. Riis) refers to as the golden loophole award for the people in those brackets. In 1981, 239 Canadians earned an average of $635,000 and paid no income tax. There were another 1,200 Canadians who earned $100,000 and paid no income tax.
Some of the largest and most profitable corporations in Canada have been able to defer taxes. In 1980, $25 billion, which was more than the deficit, was deferred in taxes. They say they do not owe this money. During the committee meetings on Bill C-155 when the Crow rate was abolished, CP said that it did not owe those taxes. It said those were deferred taxes. I think that is a good indication that it never intends to pay them.
I only have about one minute left. Since the mid 1970s the tax breaks to corporations have more than quadrupled. They now total more than $25 billion and are equal to roughly $1,000 in lost revenue for every adult Canadian. These tax breaks mean lower tax rates and higher profits for corporations. The result has been higher rather than lower unemployment. I see your clock is about one minute different from the clock on the wall.

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