44th Parl. 1st Sess.
November 18, 2022 10:00AM
Madam Speaker, only in an alternative reality would the Conservatives think that they are fiscal stewards. They ran nine straight deficits. They tried to balance the budget by throwing in the sale of stock and an EI rainy day fund in 2015. We all know, and Canadians know, that is not true.
In the fall economic statement, there are three things my constituents love: first, the doubling of the GST rebate for six months; second, the top-up for rent; and third, the waiving of interest on student loans. Which one of those programs will he actually tell his constituents he does not support?
104 words
All Topics
- Hear!
- Rabble!
- add
- star_border
- share
Mr. Speaker, I am proud to rise today and address the fall economic statement, as delivered by Canada's Minister of Finance over a week ago, but I want to go through some things in this speech. I have to limit my comments, because there is a lot to go through here, and I think the House will appreciate that I am going to focus on only a few things.
Number one is that there is some good news here. That good news, of course, is that Canada collected $30 billion in extra tax revenue over the last year. We can call that good news, but there is a dark side to it as well. However, $30 billion more arrived in government coffers than we thought was going to be there last year, and that is really good forecasting, on behalf of the Department of Finance and the minister herself. I give her my congratulations. However, not to be outdone, of course, the minister decided to spend an additional $16 billion of that $30-billion windfall that she put onto the backs of Canadians.
Let us think about how government revenue goes up. Government revenue goes up in an inflationary environment because the price of everything goes up, and therefore its collection of revenue on everything goes up. Do people's paycheques go up? They absolutely do not. The government's revenue has gone up, in GST, in collections on excise tax, and on income tax. All of this has gone up, and corporate taxes have as well, but the one main factor here that contributed $30 billion extra to the government's coffers was an increase in resource revenues.
Revenues from the resource industry, because of a scarcity of resources around the world, went up in Canada, as they did everywhere else around the world, and Canada's resource industry provided more revenue to government, along with Canadians, who were taxed more and gave more to the government.
Inflationary taxes are one thing. Resource sector contributions are quite another, but Canadians need to realize that the government is getting more revenue because they are not doing as well. They do not have as much take-home pay. More of it is going into the government's hands, and still it forecasts a deficit of $39 billion after a resource windfall that landed in the government's pockets.
We can forget about the effect that continued spending will have on inflation, because government spending is the number one cause of inflation. Over the past two and a half years, $500 billion has caused excessive inflation in the Canadian economy. The overspending has been rampant. Our debt is double what it was before the government got into power. It is an anomaly in the world, and we need to address it.
The effect on Canadians in that respect, if we think of an average Canadian in an average house with an average mortgage, and I am speculating that the mortgage is on a variable rate basis, will be an extra $7,000 per year because of the higher interest rates caused by the inflationary environment the government has produced. That is $7,000 a year more on top of more taxes being paid by Canadians and more going to the banks. Who is doing well in this inflationary environment, and who is not doing so well? I can tell members right now that Canadian taxpayers are not doing that well.
However, the minister has to acknowledge as well, as she does in her document, and I need to point it out very clearly to her here, that there will be $24 billion this year in debt service payments and $34 billion next year in debt service payments, and the year after it will be $44 billion going from Canadians' taxes into debt service payments. It will go from $24 billion to $44 billion because of an adjustment in interest rates and continued government overspending. That $44 billion is more than the federal government gives to the provinces for health care, so this has become a major item in the government's balance sheet and income statement.
It is something we are going to have to address. I suggest we address it sooner rather than later. Perhaps that extra $16 billion the minister found under her pillow could have been used for some debt reduction, so we would not have that $44-billion bill, $20 billion higher than this year, two years from now. It is something we need to start focusing on, and she did use some words in her speech. I read those words, and I heard those words as well.
She talked about prudent fiscal management, but this is anything but prudent, and she talked about keeping powder dry. I do not know how running a $39-billion deficit in a supposedly inflationary economy is keeping powder dry. It is burning their powder so they will not have any powder going forward.
Just to say thanks to the main source of the windfall gains, the resource sector, the minister acquiesced to some shrill voices of public opinion from her bench and the benches of some of the other parties in the House. She said she is going to have a 2% tax on the share buybacks that these industries are incurring in Canada. I do not know where she has been for the last seven years, but I can say that the companies that are doing share buybacks now are the companies that issued shares at far lower prices over the last seven years. Therefore, they are reconfiguring their balance sheets back to where they were when they had a normal business environment and they did not have to incur hundreds of billions of dollars in losses, as an industry, over seven years.
At that point in time, of course, there were some on the benches who were saying that this was a sunset industry and of course it was going to lose millions of dollars. All of a sudden, one year it makes some money for its investors, and the government comes back to say it needs to tax that back now because it does not want them buying back their shares from investors. Instead, it wants them to reinvest that money in the Canadian economy.
How do they do both? How do they say that there is an impetus to actually reinvest in the Canadian economy and not buy back shares after they have invested so much and taken so much money into their balance sheet, which they had to do in tough times in order to survive?
Let us think about a 2% tax on share buybacks as far as it affects everything in the world. It is the flavour of the day in so many respects. We think about the 1% share buyback mechanism in the States, and we are not to be outdone here. We doubled it in Canada because the resource industry is much less important in Canada than it is in the United States. I say that sarcastically, and I hope that is reflected.
However, profits increased for a reason. Profits increased because an industry is actually cyclical. All our resource industries in the world are cyclical. These things go up, and these things go down. They cannot take with one hand and not give back with the other if they are going to have a sustained industry here going forward.
Here is the issue on investment in Canadian oil and gas. Oil and gas investment in Canada follows international oil and gas pricing, but not anymore. Oil prices and gas prices are going up, but the investment is not happening in the Canadian economy anymore. That is because there is no longer an environment to invest in and there is no longer transparency for Canadian companies to invest in their own industry, which is an industry that we prosper at and that we perform in a more environmentally friendly manner than any other industry in the world. This is something we should be proud of, and this is something we need to make sure we do more of. The result, of course, is fewer tax-paying jobs for Canadians. The minister could get out of the way and actually get more money into her coffers if she just allowed this to happen.
There are fewer jobs, less investment in Canada, less green technology development in Canada, fewer future taxes to be paid and a lower Canadian dollar because of the government's actions. A lower Canadian dollar affects all Canadians because we get so many of our goods from other markets. That means we are paying more Canadian dollars to get the same goods that cost the same in U.S. dollars, British pounds, euros, yuan, or yen, or whatever the currency of where we are importing from at that point in time. We have devalued ourselves because of that.
There is a lack of transparency in what the government wants to accomplish. Any industry that wants to build something in Canada is now subject to an Impact Assessment Act, which has complete lack of transparency. That means that the stakeholders in the critical minerals industry the government wants are wondering how they can do this, and they cannot do this. Looking at the examples shown in our natural resources industry of the building of a pipeline for liquid natural gas exports, we are slow in Canada.
With respect to who has prospered over the last decade, the U.S. has prospered mightily. Australia and Qatar have prospered, as has Mozambique, that beacon of investment in the world, while Canada has not. They all have opportunities that are inferior to Canada's, except for one thing, which is that Canada has an inferior regulatory regime. These investments are not coming back, and the minister's numbers show that. To do better, we need a better fall economic statement.
1667 words
All Topics
- Hear!
- Rabble!
- add
- star_border
- share
