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Mar/21/22 1:08:44 p.m.
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Madam Speaker, what is true is that the government has spent $600 billion over the past six years. That is the reality, and no one can ever take that away from them. Unfortunately, they will be stuck with that legacy forever. That is why everyone is paying, and will continue to pay, more money in interest. It is beyond belief that the Liberals have more than doubled the debt in six years.

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Mr. Jean-Denis Garon (Mirabel, BQ)

Mar/21/22 1:09:07 p.m.
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Madam Speaker, I thank my hon. colleague for his speech. He did a good job outlining the cost of the paperwork that would result from this new tax increase. How many public servants does he think it will take to change a “5” to an “8” on a tax return?

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Mr. Bernard Généreux

Mar/21/22 1:09:26 p.m.
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Madam Speaker, knowing the federal government, it will surely take thousands of people to change a “5” to an “8” on tax returns. In reality, the math is not as simple as it sounds. The money collected will have to be redistributed, but how will that be done and who will receive it? The federal government has grown as big as an elephant. This measure will do nothing to stop it from getting any bigger.

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Ms. Lindsay Mathyssen (London—Fanshawe, NDP)

Mar/21/22 1:09:59 p.m.
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Madam Speaker, I am stunned, unfortunately, and so disappointed by the comments from the hon. member across the way. I do not think that he read the motion and I would hope that he looks at it more closely. In no way have we ever talked about increasing taxation on people. In no way have we talked about increasing taxes on small businesses. This is specifically for those large organizations and corporations that have made excess record profits. They do not pass those along to people. They already do not pay their fair share in taxes, and people are feeling that on the ground. Scotiabank had a net profit of $10.1 billion and it paid its shareholders, but it does not go into the pockets of people. They take that from people and they take that from their customers. Loblaws had $1.9 billion. They take that—

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The Assistant Deputy Speaker (Mrs. Alexandra Mendès)

Mar/21/22 1:10:58 p.m.
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I would ask the hon. member to ask a question, please. The hon. member for Montmagny—L'Islet—Kamouraska—Rivière-du-Loup.

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Mr. Bernard Généreux

Mar/21/22 1:11:02 p.m.
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Madam Speaker, my colleague and I have a totally different view of this. I do business. When I sell a product to someone, I try to sell it to them at the best possible price and under the best possible conditions. Inevitably, the tax or the surtax—I read it—proposed for banks, insurance companies and others will be passed on to consumers. It is completely ridiculous to think otherwise. Does my colleague really believe that these companies will not pass on the surtax to consumers? They will automatically raise their prices by 3%, there is no other way. The surtax will inevitably be passed on to consumers. The goal, however, is not to tax consumers directly, but the big banks.

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Ms. Elizabeth May (Saanich—Gulf Islands, GP)

Mar/21/22 1:11:52 p.m.
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Madam Speaker, I have another question for my colleague from Montmagny—L'Islet—Kamouraska—Rivière-du-Loup. I am not sure if the member for Kingston and the Islands already asked this. The Conservatives think the value of our dollar has dropped relative to other countries. Is that just because of inflation? I do not think I understood his response.

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Mr. Bernard Généreux

Mar/21/22 1:12:25 p.m.
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Madam Speaker, our country's debt has doubled over the past six years. It took 150 years for the debt to reach $600 billion. Now it is over $1.2 trillion. The size of Canada's debt is almost inconceivable. We have to pay all that borrowed money back, and that affects the value of our dollar.

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Mr. Jean-Denis Garon (Mirabel, BQ)

Mar/21/22 1:12:58 p.m.
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Madam Speaker, let me begin by saying I will be sharing my time with the member for Terrebonne. On this first day of spring, and I wish you an excellent spring, Madam Speaker, I see that the NDP is dedicating its opposition day to the Liberal Party's election platform. I wonder why. Part of the Liberal platform was to charge this surtax on the profits of the big banks. I think maybe the NDP no longer has confidence in the Liberals. However, the budget is coming up and I have seen the NDP declare its confidence in the Liberals several times. It even did so when it came time to support the emergency measures, even though several legal experts confirmed that those measures breached the fundamental rights of Canadians. I wonder what has the NDP so concerned on the eve of the budget. The Liberals themselves proposed going after the big banks to the tune of $10 billion over four years. I am thinking that it is probably because the Liberals are in the habit of listening to what Bay Street has to say. What happened when the Liberals suggested imposing this small surtax on banks during the election campaign? The banks made threats. Top bankers and their associations came out and started saying that they would increase consumer fees and eliminate jobs in the banking sector and that this would be catastrophic. We are all worried that the Liberals will listen to Bay Street bankers. Not so long ago, a former finance minister came from Bay Street. We understand that he is no longer talking to them, but he was so charming that he surely still has friends there. What surprises me the most is that we are discussing a surtax. The reality is that our banks are undertaxed. Our banks and the businesses that provide all manner of other goods and services are not on an equal footing. Do we pay the GST on financial services? No, because financial services are generally exempt from pretty much all taxes. However, when we purchase goods and other services, they are taxed, even in the riding of the member who just spoke about buying goods. Banks offer financial services and are funded in a somewhat underhanded way. We know what happens. When my constituents put their money in the bank, what kind of interest rate do they get? They basically get no return on their investment. However, the bank turns around and lends money at a rate of 22% on credit cards, 15% on lines of credit, 5% on other things and so on. The bank makes money because of this credit spread, but there are never any financial service transactions. That circumvents the principle of value-added taxation, which all other businesses support. Banks are undertaxed, but there are ways to tax them. Great Britain's Mirrlees Review, a major tax commission led by a Nobel prize recipient, explained that, in order to remedy this problem, banks' cash flow and financial services could be taxed. However, it is surprising that no tax is proposed when it comes time to collect from banks to level the playing field for our companies. When banks need funding, they turn to the Bank of Canada, which loaned them money at a rate of a quarter of a percentage point during the pandemic. This system is supported by the public trust and the taxpayer. Did banks complain when they were charging higher mortgage rates in a completely inflationary market? The answer is no. Bank lobbyists never told us that people were paying too much. When banks seek funding by issuing debt obligations or bonds, they pay less than all other companies with similar capitalizations, and this is because banks will not be able to declare bankruptcy. They are too big to fail. People purchasing obligations from banks know very well that if disaster ever strikes a bank and there are problems with the financial system, Canadian and Quebec taxpayers will come to their rescue through the Bank of Canada as the lender of last resort. This means that banks make more profit because they pay less for their debt certificates. We must stop calling this proposal a surtax. Our banks have access to many tax advantages based on the nature of the services they provide and on the fact that they benefit from a system that is less competitive than in other places, which means that they make more profit. For the sake of fairness, justice and efficiency, we need to get an additional contribution, in the absence of more appropriate tax reform. We hear them talk about the banks. We hear the Conservatives. There is no shortage of arguments against this tax. The first argument is that the banks are owned by large Canadian investment funds and those Canadian investment funds generate dividends. We hear them say that there will be fewer dividends if we tax the banks' profits a little more and that the big investment funds will pay, except that during the pandemic, profits were higher than normal. There were excess profits. No investment fund manager in Canada, whether they work for the Caisse de dépôt et placement du Québec, the Ontario Teachers' Pension Plan or private funds, had anticipated those returns and the difference in performance from companies whose security is not guaranteed by the Government of Canada. We are in a situation where, if we tax a portion of excess profits, we are not even getting back to the profits already anticipated by all Canadian investment fund managers. This is therefore a bad argument. Now we are being told this will affect housing prices. That is both practically and theoretically untrue. Why? The reason is that our banks structure their costs in such a way as to maximize profit. They have revenue and expenses, and their goal is to achieve the biggest gap between the two. That is called profit. However, whether the government taxes that profit at 15% or 18%, the bank's recipe is exactly the same. It will still maximize profit, the same as before. Higher tax rates will make absolutely no difference. In fact, this approach to taxing banks' excessive profits is one of the most effective and one of the least likely to create distortion and to be passed on to consumers. I have been listening to my Conservative colleagues. It almost sounds like they are talking about a sales tax. Taxes vary in the type of damage they can do, in their economic impact. This particular tax is justified and equitable. The Bloc Québécois has already put a similar idea forward. We proposed a retroactive tax because the situation with excessive bank profits was unusual. Our thinking was that, in a full-blown pandemic, what people need is health care and health transfers. Governments are under extreme pressure, and never before have we been in such dire need of government support. That is exactly why we suggested it. When I meet people in my riding, people who have lived through two years of a pandemic, and the hospitals are cutting staff, when the Quebec government is asking for transfers and the nine other provinces and the territories agree but Ottawa turns a deaf ear, I figure that at some point we will have to find a way to finance these services. Now the federal government has a way. I am tired of hearing that the banks will pass on the costs to consumers, and so on. What we are proposing is justice. Banks are undertaxed and are legally avoiding paying tax. Since the 2006 crisis, taxes on corporate profits have been significantly and systematically reduced for all businesses. We are now at a crossroads where we must reflect on this and decide whether all businesses should be treated equally or banks should be taxed differently. Are banks really different? Obviously, the answer is yes. Should we find other ways of taxing financial products and the credit spread? The answer is yes. Let us think about this logically. The government is under pressure. It had to increase service delivery. It has to increase health transfers, listen to the provinces and find new sources of revenue. It is not surprising that the Conservatives and some of my colleagues are against this. They are against everything. The only way they understand how to finance any service is through oil, oil, and more oil. However, because of their oil, before the last increase in the price of a barrel, the government of Alberta projected a $500-million deficit. It is obvious to me that taxes need to be fair and equitable. This is a motion that, in principle, supports this idea, and that is why I will vote in favour.

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Mr. Kevin Lamoureux (Parliamentary Secretary to the Leader of the Government in the House of Commons, Lib.)

Mar/21/22 1:22:52 p.m.
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Madam Speaker, I listened to my colleague and friend across the way, and I think there is some discontent within the coalition of the Bloc and the Conservative Party. At the end of the day, we hear a lot about banks, as we should. We want to ensure that everyone pays their fair share. However, one of the things that is important to recognize when we talk about banks is it is not one person who owns, for example, the Bank of Montreal. It is not the super wealthy who own our banks. It is often union members, pension funds and so forth, and they too are dependent on these dividends. I would just ask the member to follow up his comments with the best way to tax so it is most effective and not hurting the consumer. Could he provide further thoughts on that?

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Mr. Jean-Denis Garon

Mar/21/22 1:23:53 p.m.
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Madam Speaker, my colleague from Winnipeg North knows how much I admire him. I find it fascinating that the Liberals are forming a coalition government with the NDP and are now claiming that there is a coalition of the opposition. Perhaps they are a bit embarrassed. That being said, I have mentioned this before. It is true that large corporations pay out dividends. It is true for banks, which must observe minimum Canadian ownership tresholds. It is also true that profits have exceeded all projections. What the Bloc Québécois is asking is to consider the projections. No investment fund manager saw this coming. During the election campaign, the Bloc Québécois suggested seizing some of these profits, because they have nothing to do with our banks’ business acumen. They are the result of circumstances, not the banks’ actions. We should take some of these profits. It would be both effective and fair.

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Mr. Randall Garrison (Esquimalt—Saanich—Sooke, NDP)

Mar/21/22 1:25:05 p.m.
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Madam Speaker, I do have to make a comment at the beginning on the idea of a coalition. I mean, words have to mean something. The last time I checked, there were not any New Democrats in the cabinet meeting, and the last time I looked at the voting records, all three of the opposition parties voted with the Liberals from time to time in roughly equal proportions. However, I want to thank the member for Mirabel for pointing out the absurdity of the Conservatives' arguments. I think he must agree with me that the Conservatives are really saying that, since taxes to businesses are always passed on to consumers, we should never tax businesses. Is that not where the Conservatives' arguments are really leading today?

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Mr. Jean-Denis Garon

Mar/21/22 1:25:42 p.m.
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Madam Speaker, I have said this before. Taxing different businesses fairly means subjecting them to similar tax treatment. Right now, banks are not subject to similar tax treatment. That is what we need to change in the field of banking services. Some Conservatives could use a course in economics, and I am prepared to give one in the lobby. Not all taxes are passed directly on to consumers. It depends on the consumers' reaction and the size of the tax base to which the tax is applied. It is highly unlikely that this would happen with the tax on profits, much more unlikely than with other types of tax, such as consumption taxes.

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Mr. Simon-Pierre Savard-Tremblay (Saint-Hyacinthe—Bagot, BQ)

Mar/21/22 1:26:33 p.m.
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Madam Speaker, I enjoyed the speech given by my colleague from Mirabel. We can always count on him to identify the limitations of the market in a crisis. He would make the founding fathers of political economy proud, because they emphasized the importance of redistribution. My colleague is offering to teach a course in economics, so I suggest that he also offer a course in economic history. Historically, whenever there was a crisis, governments always opted for a policy of redistribution through taxes. Can my colleague tell me whether this is true or false, and provide more details?

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Mr. Jean-Denis Garon

Mar/21/22 1:27:07 p.m.
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Madam Speaker, there are two things I want to say. That is what happened in wartime, during World War II, when the debt ratio increased. The government collected exceptional contributions from the big banks and corporations, far more than is being asked for today. That allowed us to get through very difficult times. Now, my colleagues need to understand that, by its very nature, the Canadian banking system is less competitive than other countries' systems. Profits are higher than elsewhere, and the system is also more stable. We need to be able to take advantage of this stability when we need it the most. That time is now.

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Ms. Nathalie Sinclair-Desgagné (Terrebonne, BQ)

Mar/21/22 1:27:45 p.m.
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Madam Speaker, I would first like to thank my esteemed colleague, the hon. member for Mirabel, for sharing his time with me. We are here to debate the motion put forward by the hon. member for Burnaby South, highlighting several wealth gap issues that have been exacerbated by current inflation. Let me remind the House that, during the last election campaign, this government promised to levy a 3% surtax on the profits of banks and insurance companies. We agree with this measure. Let me also remind the House that, while the public finances recorded colossal deficits and the pandemic forced SMEs out of business, several sectors of the economy besides banks and insurers became richer. Today's motion seeks to leverage the huge profits that certain companies earned in spite of the crisis. Their support will essential. We are currently experiencing a period of high inflation. In December, the consumer price index rose by 4.8% on a year-over-year basis. This major acceleration of inflation significantly affects the purchasing power of Canadians and Quebeckers. The price of groceries rose by 5.7%, and the price of housing grew by 9.3% compared with December 2020. The simple fact is that inflation is affecting almost all goods. That in turn is affecting both individuals and businesses. The Russian invasion of Ukraine has had a significant impact on the price of energy. Even if the price of gasoline does go back down eventually, its current volatility and unpredictability are enough to worry Quebeckers. We were used to countering inflation by addressing surges in demand, but we are now also facing problems with supply, including increasing pressure on labour and energy costs. That being said, it is important to implement measures to protect the general public, especially the most vulnerable members of our society, from price increases. Let us look specifically at who could be doing more in this situation. In the past 12 months, several financial groups have earned record profits. National Bank, Laurentian Bank, Royal Bank of Canada, Bank of Montreal, TD Bank, Scotiabank, CIBC and Mouvement Desjardins collectively earned $60.68 billion in profits. That is 39% or approximately $17 billion more than the previous year, which was also a pandemic year. The year 2020 was a good year for some businesses, according to an analysis of the profits of the largest Canadian businesses published at the end of last year. According to Canadians for Tax Fairness, 111 publicly traded companies headquartered in Canada made profits of at least $100 million in the first nine months of the year, and 34 of them posted record profits. The top profit-maker was TC Energy, formerly TransCanada, whose Keystone project has been in the news for years. The company made $3.5 billion in profit on $9.7 billion in sales in the first three quarters, for a profit margin of 35.6%. This stands in stark contrast to what has been happening with our SMEs. Many went into debt to get through the pandemic, wagering that the economy would eventually get back to normal. Even if the economy recovers, they will still be in debt. There is a reason the Canadian Federation of Independent Business says that one in four SMEs could close down permanently in 2022 because they went into debt during previous waves. Small business confidence in Canada and Quebec remained especially low in January because of supply issues, the health restrictions and labour shortages. The Bloc Québécois agrees with the idea of implementing a tax on profits over $1 billion for banks and insurance companies, as well as oil companies and big box stores. The tax should be used for assistance programs, in particular for SMEs. Such significant measures require an explanation. They are aimed at increasing the government’s revenues to help it deal with the deficit and assist struggling SMEs. These measures would directly help those who are hardest hit by inflation. I can already hear our Conservative friends say that taxing corporate profits makes it more difficult for those that keep the economy rolling to reinvest. However, they are well aware that the large profits made by these companies mean that they already have considerable reinvestment power. In the final analysis, we would be taking 18 cents out of every dollar of the profit made by billionaire companies. They would still have a bit of a margin left. In the case of oil companies, we need to make sure that the plan includes programs aimed at reinvesting in the urgently needed energy transition. If we collect these funds, it will have to be to better guide the investments of corporations that have a significant societal impact. The purpose of taxes is to take a small portion of the surplus of wealth-creating businesses to correct market failures and thus redistribute wealth, while redirecting the funds with a plan and coherent vision aimed at improving Canadians’ well-being. Let us keep in mind that we are talking about 3% for businesses that make more than $1 billion in profits. We are in the middle of a climate crisis and economic tensions that often require state intervention to redistribute wealth. In short, we support the spirit of today’s motion. The Bloc Québécois will support any measure that effectively benefits the most vulnerable. We cannot just stand idly by while workers and businesses struggle with the effects of the pandemic. The objective of the proposed surtax is to get revenues from those who benefitted from the crisis to help those who suffered from it. That is why governments exist. We know that the extremely costly measures taken during the pandemic increased the deficit. Now it is time to take stock, and we must correct the failures of a market we know to be imperfect, especially when it is faced with the uncertainty of a pandemic. What is our purpose as members of Parliament in these critical times if not to propose and support measures aimed at protecting the most vulnerable and promoting a vision whose only goal is the well-being of society?

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Mr. Kevin Lamoureux (Parliamentary Secretary to the Leader of the Government in the House of Commons, Lib.)

Mar/21/22 1:35:03 p.m.
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Mr. Speaker, I will pick up on the member's last point. Back in 2015 when we had the federal election, we had made it very clear that the priority of the government was going to be Canada's middle class and those working hard to become a part of it. One of our first initiatives was to put a special tax on Canada's wealthiest 1%, and then to take that money and give the middle class a tax break. I say that because when I look at the resolution, I think Canadians and all of us expect that we have an obligation to pay taxes. The issue is a sense of fairness, and that is what governments, whether at the national or provincial level, need to strive for. Can the member provide her thoughts in regard to why it is so important that governments at different levels recognize tax fairness?

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Ms. Nathalie Sinclair-Desgagné

Mar/21/22 1:36:07 p.m.
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Mr. Speaker, I thank my colleague for his question. Equity and social justice are extremely important to the Bloc Québécois. In this particular case, we are talking about a 3% surtax, that is, from 15% to 18%, for companies that already have profits over $1 billion, so it amounts to a redistribution. Of course, every well-intentioned parliamentarian in this place should want those profits to be shared with our most vulnerable citizens.

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Mr. Don Davies (Vancouver Kingsway, NDP)

Mar/21/22 1:36:52 p.m.
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Mr. Speaker, I would like to thank my colleague for an extraordinary speech, one that displays a progressive view of politics that I think is refreshing to be heard in this chamber. It is funny. Anybody who understands history knows that in the 1950s and 1960s in this country we had a period of unprecedented growth and we had tax rates that were far fairer. Of course, then we had the 1980s and the right-wing neo-Conservative revolution with the absurd contention that the best way to help poor people is to cut taxes on the rich, and all of that has resulted in is incredible inequality in this country. I wonder if my hon. colleague has any comment on the failed experiment of neo-Conservative economics. Does she agree with the NDP that a fair tax system is a key way to address wealth inequality in Canada?

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Ms. Nathalie Sinclair-Desgagné

Mar/21/22 1:37:51 p.m.
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Mr. Speaker, I thank my hon. colleague for his kind words and his very pertinent question. Indeed, the prosperity gap has only increased over the last few decades, as economists like Thomas Piketty have pointed out. These prosperity gaps are getting wider and wider. The majority of the population is feeling a growing sense of injustice, which is not being addressed. That is why a fair tax system is needed. I absolutely agree with the NDP on this. I do want to stress, however, that taxation can also be a question of incentives, and we have to be careful when taxing certain companies that these incentives do not push companies to engage in tax avoidance, which is unfortunately legal, to divest or to simply leave the country. How taxes are collected remains important. However, in this case, as my hon. colleague from Mirabel pointed out, this tax will not be passed on to consumers. It will only redistribute wealth.

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