June 13, 1922 (14th Parliament, 1st Session)


Alexander Kenneth Maclean


Hon. A. K. MACLEAN (Halifax) :

Mr. Speaker, I know it is a very doubtful adventure on the part of any hon. member to engage in the discussion of the budget at the present time. So much has been said concerning it, and so little has been left unsaid, that really it is difficult for one to justify himself in asking the attention of hon. members to a further consideration of that subject. However, I avail myself very gladly of the opportunity of presenting some remarks to the House this afternoon. I do not intend discussing the budget with any great particularity, I wish to address to the House some general observations regarding it. I desire to say a few words in connection with the changes in the taxation resolutions, as announced by the Minister of Finance (Mr. Fielding) last night. These taxation resolutions have been in force since May 23 or May 24, I believe. In the meanwhile, actual experience has demonstrated tha'. these taxation proposals were not in the interest of trade or of revenue, and the Minister of Finance, in his good judgment, has seen fit to vary them. I have no doubt that if, later on, he finds that experience does not justify the tax proposals in their amended form, he will exhibit that same good judgment in announcing to the country and to parliament his willingness to make ^further 'amendments if necessary, in the commercial interests of the country and of the public revenue. There is a lesson, perhaps, to be drawn from our experience of the operation of these tax proposals during the past two or three weeks. We see how quickly and markedly taxation affects trade. When taxation is carried beyond a certain point, not only does it diminish business and commerce, but also it does not bring into the treasury the revenue it was designed to bring. We see further, that the framing of taxation
schemes is not, after all, an easy matter; it is not as easy as some hon. gentlemen think. From the way in which taxation proposals are suggested in this country to-day by many people,-yes, and even in this Parliament-one would fancy that this question was accompanied with no difficulties or complexities whatever, that almost anybody could suggest a scheme of taxation that would be workable and practicable in Canada.
I do not wish to say anything in particular concerning the amended resolution in relation to the depreciated currency of European countries. I favour the widest trading between this country and the countries of Europe; but while giving my adhesion to that principle, I do not mean to say that, in certain circumstances due to disrupted international exchanges, certain results must not be corrected, as the Minister of Finance (Mr. Fielding) proposes correcting them by his amended resolution in relation to the depreciated currencies of Europe. The free trader likes fair trade. Fundamentally, he means that he believes in what we know as barter. But the depreciated currencies, of Europe to-day prevent what is or was usually heretofore known as barter. Not only are conditions abnormal in this respect; but they are unnatural, and however in theory we may view them, there is a practical side to these questions, they must be dealt with in a practical way. German exporters of goods are able to establish for themselves credits in foreign countries, and these credits are of great advantage to them in disposing of their productions. I am perfectly satisfied with the efforts of the Minister of Finance in seeking to control this in a practical way, and in some degree.
The statement of the Minister of Finance in his budget in reference to our debt and to our revenue necessities make very plain the serious financial obligations confronting us to-day. Our debt is alarmingly high; it cannot go very much higher without endangering everything in the country. Our actual revenue necessities are also very large; they may continue to grow higher, but I hope not. It will, however, be difficult, as the Minister of Finance has stated, to secure further revenues. We have reached almost the limit of taxation; we cannot proceed in this direction much further; and it is becoming more difficult day by day to discover new sources of revenue, or to ex-
The Budget-Mr. A. K. Maclean
plore new avenues through and by which additional revenue may be secured. There is no ideal form of taxation known to us in Canada or to men in any other country. The income tax is regarded the world over, I think, generally speaking, as the fairest form of taxation; but it itself works many hardships. All revenues which come to the treasury of any country come only through taxation; all forms of taxation are more or less of a burden, and they come from earnings and savings of the people generally and from nowhere else. It has been remarked on two or three occasions by some hon. gentlemen that the British government have reduced their debt and that their income tax is declining. I think it was the leader of the Opposition (Mr. Meighen) who discussed this particular point, and, I think, with perfect accuracy. The reduction in the British income tax was not due to the fact that they were reducing their debt by taxation; because the truth is that the British debt has been reduced by war salvages and from no other source. The income tax was reduced in Great Britain because it was thought it was becoming a burden upon business, that it was destroying business initiative and enterprise. It was thought that in the end revenues would be encouraged and the economic security of Great Britain better maintained by a reduction of taxation. I refer to this only to impress this point upon hon. gentlemen, because we hear, too frequently I think, expression of the idea that there is no limit to the amount of taxation which this country can impose upon certain people and certain industries. We must all agree that it is morally wrong to impose excessive taxation upon people who cannot afford to pay any taxation whatever, upon poor people. In Great Britain, the idea behind the reduction of the income tax is that it is economically wrong to impose excessive taxation upon people who earn large incomes, and that we should not, in these days of confusion and problems, allow ourselves to be possessed of the idea that business can be indiscriminately taxed, or that men of a certain class can be excessively taxed. I agree with the general proposition that taxation must be imposed upon those who can best afford to pay it; but I wish to emphasize the idea that this can be carried too far, and by excessive taxation, we may destroy the very sources from which we obtain our revenues. Our debt is exceedingly high to-day; our [Mr. A. K. Maclean.)
revenue necessites are extremely burdensome upon the people, and the man who can devise a more suitable scheme of taxation than that which we have to-day will deserve the gratitude of the nation. The hon. member for East Calgary (Mr. Irvine) a few days ago presented to the House some scheme which I understood to mean that, if put into operation, it would, within a year or two, wipe out the public debt and would practically avoid the necessity of further taxation. If the hon. gentleman can produce such a scheme and make it practicable, I am sure there is nothing this country would not do for him. Personally, I would favour withdrawing from the British Empire altogether and establishing a new kingdom here, and I would consent that he be placed upon the throne and the crown placed upon his head.

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