:
Mr. Speaker, I am pleased to have the opportunity to speak today at second reading of Bill , a bill that proposes to implement a fifth protocol to the tax treaty that we recently signed with the United States. That was an exceptionally exciting day for Canada to see our and his colleague from the United States come together and sign this treaty that we have been working on for a long time.
With the signing of this treaty last September, we have concluded nearly a decade of negotiations. At the same time we have strengthened the bonds of economic cooperation between our two countries. In doing so, we are modernizing a long-standing instrument for the betterment of individuals, families and businesses on both sides of the border, including manufacturers.
This fifth update or protocol of the Canada-U.S. tax treaty will stimulate further trade and investment between our two countries. As we all know, that is very critical because the U.S. is our largest trading partner on the other side of the 49th parallel and any way we can smooth that path is a tremendous benefit.
In today's highly competitive global economy we need to continually explore ways to grow, to expand and to compete. To that end, further improving and refining our relationship with our neighbours to the south is essential.
Canada is a trading nation. The United States is by far our largest trading partner. Through NAFTA we have come together to create a competitive, open and connected marketplace, the largest marketplace in the world.
This government recognizes the importance of our economic and trading relationship with the United States, so after almost 10 years of negotiations, we have signed an agreement that will provide tremendous value today and for future generations.
The bill we are looking at today represents the final step in this country in implementing that agreement. It also needs to be ratified by the United States before it comes into force.
This protocol will make our tax systems more efficient through initiatives such as eliminating withholding taxes on cross-border interest payments; extending treaty benefits to limited liability companies; allowing taxpayers to require that otherwise insoluble double tax issues be settled through arbitration; ensuring that there is no double taxation on immigrants' gains; giving mutual tax recognition of pension contributions; and clarifying how stock options are taxed.
I will speak in more detail shortly about these proposals, but first let me say a few words about the absolute necessity of tax treaties.
Tax treaties, like the one we are debating today, are key to Canada's competitiveness. One of the most important functions of a tax treaty is to prevent double taxation. Whenever a resident of one country earns income in another country, there is potential for double taxation. This is because both the person's country of residence as well as the country where the income is earned can legitimately assert rights to tax the same income.
Certainly no one wants to pay tax twice on the same income; that is hardly fair, nor is it logical. To prevent double taxation from happening, countries sign bilateral tax treaties, also known as tax conventions. These agreements set out which country gets to tax particular forms of income in a variety of specific situations. These agreements become legally binding once ratified, that is to say, once the proposals are passed into law by Parliament and by the government of the other country.
Tax treaties also help in the enforcement of tax law by providing for exchanges of information between tax authorities. One of the advantages of having tax treaties such as this one is that they include mechanisms for resolving differences of view between countries on such questions as characterizations of a particular item of income or where it was earned.
Within today's increasingly global economy and a more mobile population, tax treaties are increasingly important for Canada.
Those who benefit from tax treaties could be businesses that operate or invest abroad, or perhaps new ventures that are seeking foreign investment. They could even be individuals who may want to work temporarily in another country or own property there. A tax treaty gives all of these parties clear answers as to where they have to pay tax.
Canada's extensive tax treaty network consisting of over 85 countries includes our NAFTA partners, virtually all of the European Union and OECD countries, many members of the Commonwealth and the Francophonie, as well as other rapidly growing economies such as Brazil, Russia and China.
However, Canada's tax treaty with the United States is unique, given our close relationship. While it is similar to our other double taxation agreements in that it is based on an OECD model, the Canada-U.S. treaty has always included some special features that reflect the Canada-U.S. relationship.
As cross-border business and investment practices evolve, the tax treaty has to evolve at the same time to remain current. Canada and the U.S. have a long tradition of tax agreements dating back as far as 1928. However, the current Canada-U.S. income tax convention was first signed in 1980 and has been updated four times, in 1983, 1984, 1995 and again in 1997.
Those four changes to the treaty, or protocols as they are known, covered a wide spectrum of points, but they all have two things in common. First, they all helped to ensure the treaty adopted the latest developments in the two countries' tax policies. Second, they responded to the changing needs of Canadian and U.S. individuals and businesses. That is why it is so important for a government to be open to and aware of those changing needs. As a result, an agreement in principle was reached with the U.S. on a fifth protocol to update the tax treaty.
As I mentioned earlier, this agreement, signed last September by the and U.S. treasury secretary Paulson will enter into force once it has been given effect by both the Canadian and United States governments.
The proposed legislation contained in Bill will stimulate further trade and encourage investment between Canada and the United States. This bill delivers significant benefits to Canadian individuals and businesses in a number of ways.
Bill proposes to eliminate source country withholding tax on cross-border interest payments. With that goal in mind, I would like to mention that originally the government had planned to wait for this protocol to be ratified before this initiative would come into effect. However, that would have left Canadian borrowers in an uncertain position because of the uncertainty of the timing of the ratification.
To provide that certainty, rather than waiting for this treaty protocol to be ratified, the government has decided to specify in advance the date on which the measures will start to apply. Assuming that Parliament agrees, that date will be January 1, 2008. This means that after 2007 any person in Canada who pays interest to an arm's length non-resident will not have to withhold tax regardless of which country is involved.
For example, starting next year a resident of Canada who borrows money from a U.S. lender will no longer have to withhold and remit Canadian tax on the interest payments. This will reduce borrowing costs and will make cross-border investment more efficient.
Bill also proposes to provide protection against double taxation, for example, in cases where individuals cease to be resident in one country and become resident in the other.
Furthermore, the bill also allows residents of Canada or the United States who face the possibility of double taxation to require the two countries' revenue authorities to resolve the issue through arbitration if they cannot resolve it through negotiation. This proposal is important because it increases taxpayers' confidence that the tax treaty will resolve potential double taxation.
Bill contains other proposals that will improve the efficiency of the tax system in both countries. One such example is the proposal to extend treaty benefits to what are known as limited liability companies by removing a potential impediment to cross-border investment. Once passed, this legislation will give mutual tax recognition of pension contributions.
In other words, provided certain conditions are met, cross-border commuters, such as those in Windsor and Detroit who work in the automobile industry, may deduct for resident country tax purposes the contributions they make to a plan or arrangement in the country where they work.
As well, someone who moves temporarily from one country to the other for work reasons can get tax recognition in his or her temporary new home country for pension contributions he or she continues to make to the original employer's pension plan, again subject to some conditions. This proposal would facilitate the movement of workers between Canada and the United States by removing a possible disincentive for commuters and temporary work assignments.
Finally, Bill also clarifies how stock options are taxed and implements a number of technical improvements and updates.
To sum up, as we know, the United States is our closest neighbour and by far our largest trading partner. This tax treaty strengthens our very important economic relations. It promotes growth and investment. It enables Canada to move swiftly in the dynamic global economy. However, more than all of this, this protocol improves and refines our relationship with our friends and neighbours to the south.
For all of that to happen, this agreement must now be ratified by Parliament. I therefore encourage all hon. members to lend their support and pass this bill without delay.
I might add that this bill, as members can see, was tabled in the Senate. The senators, many of whom have business backgrounds, recognized the value of this bill. They understand the amount of trade back and forth and the amount of fluidity, so to speak, of our constituents who travel back and forth and who deal with pension contributions on both sides of the border and all sorts of financial matters.
We encourage our Canadian constituents to invest abroad. We encourage investment to come into this country. The senators looked at this very closely. In very short order, I might add, through one quick presentation, although I will not suggest it had anything to do with the presentation that I provided to them, they passed it entirely in one sitting. I think that is an indication of how important it is to expedite this.
As I said earlier in my speech, we want this done so that its effects can take place as of January 1, 2008. Once again, it is to help facilitate the movement of finance back and forth across this border without having double taxes, so to speak, paid on the two sides of the border.
I do not think any government would object to investments in or out of its country as long as it knows that taxes are being paid either in one jurisdiction or in the other. It is very important to get this legislation in place as quickly as we can. It is an encouragement to the movement and flow of money back and forth.
We see this in many places along this border. Windsor-Detroit is just one example. Another one is the lower mainland in British Columbia, just outside Roberts Bank. Many American citizens travel across that border every day to work in Canada. They work in the lower mainland.
This legislation is very important. There have been four protocols before this one. As the need for the flow of money and finance increases, we have a need for this fifth protocol to come into play.
I would certainly encourage all hon. members to look very seriously at this and to consult with their constituents, but very quickly. I think we have a lot of support in industry. In the financial sector, we have good support for this legislation. Its beginnings go back several years.
This is a very simple and straightforward piece of legislation and a very positive one. It would be a great Christmas present for Canadians if we could get the bill passed through the House as expeditiously as possible.
:
Mr. Speaker, I am pleased to rise this afternoon to speak on the second reading of Bill . Just in case there is any suspense in the House, I can say that given that perhaps 90% of the content of this bill was initiated under the previous government, the Liberal Party will be pleased to support this bill.
Canada has signed close to 90 such bilateral conventions with various countries. While each is important in its own right, there is no doubt that a convention with our largest trading partner by a long shot has a particularly important place.
This Canada-U.S. tax convention was last updated in 1997. Negotiations on this round began soon thereafter. They were officially announced in October of 1998.
As one can imagine, these are often extremely complicated and complex negotiations, requiring the utmost attention to detail. When Bill receives royal assent in the near future, I am sure there will be public servants on both sides of the border preparing to immediately begin negotiation of the next round of talks.
Before I get to the substance of this bill, I thought I might mention in passing a related area of international taxation and that is the Canada-South Korea free trade negotiations that are currently under way. As the leader of my party has pointed out, we are all in favour of free trade, but this deal is not really free trade at all because of the unacceptably high non-tariff barriers that remain in place.
A few days ago, the CEO of Ford Canada, Mr. Bill Osborne, took the unusual step of very publicly chastising the government for this failure. According to Mr. Osborne, the deal “contains no effective measures to ensure the immediate and sustained opening of the Korean market to significant numbers of imported vehicles”.
So while the government has some pieces of legislation, like Bill , which seek to improve the investment climate here in Canada and make us more competitive in the global marketplace, it also has the Korean free trade deal, which is doing just the opposite.
At a time when the high dollar and numerous other pressures are casting doubt on the future of the auto sector in this country, the Canadian government is pursuing policies that have the CEO of one our largest auto manufacturers taking strong offence and making the following comment. He stated:
The question is where's the most efficient jurisdiction for us to invest [our dollars], and where can we be most competitive? We would like to see policies and support from the Canadian government that allows Canada to be one of the most efficient places to invest.
On the one hand, Bill , which was largely inherited from the Liberal government, promotes competitiveness, and we support it. On the other hand, this Canada-South Korea free trade agreement goes in precisely the opposite direction, destroying the competitiveness of Canada, or diminishing it, and causing one of our biggest employers to question whether his company will even continue to invest in this country.
Let me turn now to the more technical elements of Bill . The biggest change in this bill is the elimination of source country withholding tax on cross-border interest payments from arm's-length lenders. That is to say, a borrower on one side of the border will no longer have to remit withholding tax on the interest payments for that loan.
In the last few years, both Australia and Japan have come to similar arrangements with the United States by reducing the withholding tax on interest payments from 10% to zero. When Bill receives royal assent, Canada will be on a par with these two countries.
What exactly does this mean for Canadian companies? It will mean better access to the United States debt market and an increased ability to finance expansion here and abroad.
Many of our small and medium sized businesses here in Canada struggle to find the capital to take their work from the very early stages of research and development to the point where they are ready to bring the product to market. Often they will find lenders in the United States who are interested in funding their products, but only if the remainder of the research and development takes place in the U.S.
By eliminating the withholding tax on cross-border interest payments, we would be eliminating one of the tax disincentives that prevent these companies from pursuing that work here in Canada. This measure also has implications for individual Canadians who would now have greater access to international lenders.
Another aspect of this bill, which will be of interest to many Canadians, is that it would allow for the mutual tax recognition of pension plan contributions for workers whose employers move to the United States for temporary postings. Currently, there is a problem with the double taxation of these pension plan contributions.
What Bill S-2 aims to do is ensure that if a Canadian is posted to a branch of his company located in the U.S. he would be able to contribute to the U.S. employer's pension plan and make those payments deductible for Canadian income tax purposes.
The bill would go a little way toward offsetting the disastrous impact of another really uncompetitive proposal brought in by the Conservative Party, which is the proposal that would have disallowed interest deductions for loans used to finance foreign acquisitions. This measure would have destroyed competitiveness even more than the South Korean deal would destroy competitiveness. It was described as one of the worst tax measures to come out of Ottawa in 35 years. It would have forced Canadian companies to compete with foreign companies with one hand tied behind their back. It would have weakened our companies relative to foreign companies. Happily, under pressure from the official opposition and from industry, the government withdrew that budget measure, replacing it with something less harmful, but even more foolish, something called double-dipping.
I do not think I will get into that more. It is another example, along with the South Korean free trade deal, of anti-competitive measures that the government has taken. At least here we have one bill that would a positive difference.
The bill would also deal with the stock option benefits that an employee might accrue when he is employed in both countries. Currently, when an employee's stock options are granted while working in one country and he exercises or disposes of the options while working in the other country, both Canada and the U.S. often tax the same benefit.
Under Bill S-2, both countries would continue to be able to tax the benefit of the stock option. The difference, however, would be that each country would be limited to taxing the benefit based on a time spent in country formula.
For instance, if a Canadian spends three months working from his company's office in the U.S. and nine months working on this side of the border, the U.S. would be able to tax one-quarter of the benefit realized between the date of the grant and the date of the realization of his stock option. Canada would be limited to taxing the other three-quarters of that benefit.
This bill could easily be viewed by some as a housecleaning bill that simply updates out tax treaty with the United States. It does, however, deal with our largest trading partner and, therefore, has a place of special significance. While I do not think it will be a matter of great controversy, I do think that the great majority of the members of this House, if not all members, will agree that this is a positive move for Canada.
:
Mr. Speaker, we are dealing here today with a very important bill. It implements certain corrections to the current tax convention between Canada and the United States. This is a very technical subject that requires a lot of detailed analysis.
As in the past, Canada and the United States held repeated negotiations to try to find the most operational tax convention possible. As I said earlier in my question for the parliamentary secretary, these revisions have previously had some rather negative consequences.
For example, a change was made to the way in which so-called American pensions were taxed, that is to say, the pensions that Canadians earned while going to work and paying contributions in the United States and then returning to Canada. It was not necessarily in bad faith, but the result the government produced a few years ago was that people whose incomes were 50% taxable in Canada suddenly found them 85% taxable. The amendment intended to correct the tax convention ultimately had the effect of increasing the tax rate. This result was not necessarily very positive. We fought it, though, and succeeded in winning a certain number of points.
This shows that even though a bill is very technical, we need to take the time to examine it. That is what we have started doing in the Bloc Québécois. In general, this is clearly a positive bill that the Bloc will support. However, we would like certain aspects to be studied more closely in committee.
The bill gives cross-border workers the same tax benefits as resident workers. In other words, it tries to standardize the tax treatment so that Canadians who work in the United States will be treated virtually the same as American workers, and the same for Americans who come and work in Canada. It tries to simplify things and treat people as equitably as possible.
The bill also institutes a bipartite tribunal to settle tax disputes. This is a sensible improvement. In the past we found that when a situation was inappropriate and needed to be corrected, the citizen paying the tax did not really have the tools needed to appeal the decision. Even when the citizen was right about something, he could not easily obtain satisfaction because there was no decision-making tribunal. This bill corrects that situation.
As well, the bill contains rules regarding certain kinds of companies, and will make it more difficult to use various tax loopholes. We have to work harder on this issue. We need only consider the Barbados situation. We know that there has been a tax treaty in force with Barbados for several years, which is very much to the advantage of businesses who use that loophole so effectively that some experts are now talking about billions of dollars being taken out of reach of Canada’s tax system. Ultimately, the people who pay their taxes are paying for the ones who are using that tax evasion mechanism.
In fact, at the Standing Committee on Finance in May, we realized that we had no idea of the real extent of this phenomenon, in terms of what it is costing. I put some questions to the representatives of the Canada Revenue Agency and the Department of Finance, and no one was able to tell us how much this tax evasion amounted to. At our request, some research was done, and the Canada Revenue Agency was able to confirm that unless there are changes to the tax return that would make it possible to distinguish between interest income from businesses in Canada and interest income from outside Canada, it is impossible to place a value on it.
In my opinion, this is a major flaw. This is a question of fairness. My colleagues and I, and all individuals and businesses in Canada, pay income tax. If there is a tax loophole that allows businesses or individuals not to pay their share of taxes, then ultimately we lose as a society, and this situation must be fixed. And so when we examine an issue like the tax convention between Canada and the United States, we have to be concerned about this.
We support the bill. However, we want to have a little more explanation of certain points, and in particular the proposals for eliminating the withholding tax on foreign interest and the tax treatment of cross-border corporations.
These are complex questions. Negotiations are conducted in good faith and we want to simplify how things are done, but we must be sure we are not creating something that would put Quebec and Canadian corporations at a disadvantage. In the past, with the Free Trade Agreement, for example, we have seen that Quebec and Canada have been winners overall, but that there are aspects that were not dealt with in sufficient detail in the negotiations and we did not come out in the final agreement in the position of strength we wanted. Given that we have a tax convention concerning these points, the elimination of withholding tax on foreign interest and the tax treatment of cross-border corporations, it will be important that we obtain additional information in committee to ensure that the agreement truly reflects what is wanted.
Let us come back briefly to the main aspects. One of them, in this draft tax convention, is advantageous for cross-border workers. It will make their lives easier. Prior to the new convention, Canadian residents who work in the United States could not deduct contributions to their American pension plans from their taxable income. We know that here in Canada, when we make contributions to our pension plan, we receive a corresponding deduction. People who work in the United States have not had the equivalent of that, and the new tax convention will fix that situation.
From now on, those workers would be able to deduct pension contributions from income, in the same way as an American worker living in the United States. Conversely, an American resident working in Canada could also deduct contributions to his or her pension plan for income tax purposes. Thus, we see a significant and desirable improvement that makes good sense and that moves us to support the bill. Numerous workers in border areas in the United States as well as in Canada would enjoy all the tax benefits related to their pension plan, just like resident workers.
It is a bit paradoxical. At the same time as we make progress by trying to simplify the situation related to border areas, we run into a tightening of border-crossing regulations that creates a great deal of complications. A lot of negotiation is necessary. We have seen the effort made by nearly every member of this House to put limits on the American requirement that anyone entering the United States have a passport so that we can find other solutions. Initiatives are underway to promote the use of a driver’s licence. There appears to be some interesting work in that regard. However, on the other hand, there is a joint effort at the level of the tax convention to really simplify the situation. In terms of attitude, logic and the economy, that is the direction we should be taking in our relations with the Americans. In fact, we could make real progress that way.
The agreement on the tax convention also provides for a binding arbitration procedure for tax disputes between the two countries. In case of double taxation, a taxpayer who was adversely affected could appeal to the arbitration board for relief. If someone recognizes that his or her income is being taxed by both governments and should not be, there will be an automatic right to recourse through arbitration. There will no longer be the very complicated tax procedure involving submissions to both governments. In future, there will be a tribunal, an arbitration board, made up of an American representative, a Canadian representative and a third representative jointly appointed, which will be able to make determinations on tax matters and which will facilitate the settlement of tax disputes between individuals and the two administrations.
We can see that as an improvement. In refining the manner in which decisions will be made in a dispute, we are improving the settlement of issues. We have seen how that can lead to complications for major issues or when the decision mechanism is not clear; for example, in the softwood lumber agreement. Let us hope that the mechanism introduced to enable taxpayers to obtain satisfaction will improve the situation in the future and simplify the steps involved.
This will also create a body of cases, which could result in future amendments to the tax convention to fix the problems as they are identified. If a citizen complains about double taxation and ends up winning his case, we could then make changes and actually do something about it.
Decisions by this board will be legally binding and will perhaps lead to quicker adjustments to the tax treaty. In any case, we hope that it will truly simplify matters.
Third, the bill clarifies some provisions of the tax treaty in order to eliminate flaws that could be used as tax loopholes. For example, since the income tax laws are different in Canada and the United States, some companies could benefit from both tax laws. There are probably tax experts who earn a living studying these questions to help companies get the maximum deductions. When this is done legally, it is fine. However, when we realize that there are some flaws in the act and they can be fixed, we must correct the situation. This is the aim of the bill to amend the Canada-U.S. Tax Convention, and it is for the best.
Some companies could benefit from both tax laws by being recognized in different forms in both administrations, without having to assume the costs. In real life, we can see that this part is not easy to administer. Earlier, I gave the example of the treaty with Barbados. When we look at the organization charts of companies, it is very clear that some fictitious corporations were developed with this in mind.
Canada was also even a bit complicit in some situations of this kind. For example, a group of 13 OECD countries, including Canada, asked in 2001 that the “no substantial activities” criterion be eliminated from the determination of tax evasion. This reduced the number of countries on the list of non-cooperative tax havens from 35 to seven. Canada turned a blind eye here to a something that costs us plenty. There is a loss of tax revenues for the Canadian government, which adds to the pressures on Canadian citizens, whether natural persons or corporations, that pay taxes on their activities in Canada. There is tax avoidance here as a result of something that the Government of Canada did deliberately.
I want to say again, therefore, that in treaties of this kind, everything is there for a purpose. We have to get to the bottom of everything to ensure that something that was thought to be positive does not end up having some perverse effect. Sometimes as well, the government may well try to put one over on us and we need to correct the situation.
In the current case, therefore, we will see an improvement because companies that were taking advantage of the two tax laws will find it much more difficult to do so. Some of the tax loopholes will be closed and companies will have to pay their fair share. We will have to watch whether it actually works. In addition to eliminating some of the obstacles to cross-border investment, the bill reduces the number of cases of double exemption through greater harmonization of the tax rules of the two countries.
It is going to be a huge job for both countries to ensure that they have finally corrected not only double taxation but also the actual company practice. We need to simplify the way things are done and the costs that this issue can engender.
Finally, in an attempt to stimulate cross-border investment, the bill clarifies the rules to avoid double taxation of cross-border capital gains. This issue needs to be explored in greater depth and the type of transactions checked. Will the Canadian and American governments not end up losing revenues to which they would otherwise be entitled? Will it favour one country or the other? The purpose is to make it as easy as possible to do business, but both countries need to be respected and need to benefit.
From now on, Canadian investors operating in American markets will be required to pay tax in just one jurisdiction. That is a major advantage. We just have to ensure that this positive new way of doing things, this advantage, does not lead to negative effects with respect to legal issues that might arise. We have to make sure that companies pay their taxes.
This bill raises a lot of interesting issues. The Bloc Québécois is in favour of referring this bill to the committee. We intend to study it there. Once things have been clarified and, if necessary, adjusted, we will see what can be done and how we can improve the Canada-U.S. Tax Convention. We hope that the federal government will put just as much energy into closing the Barbados tax loopholes. The Standing Committee on Finance held hearings on the subject, but the government has not yet done anything to fix the situation.
In the meantime, billions of dollars have been flowing unchecked and untaxed out of Canada, at great cost to our society.
I hope that we can count on the cooperation of all parties. Adopting this tax treaty would be a good thing, and the Bloc Québécois will work hard in committee so that we can bring the bill back here quickly and complete the process to amend the Canada-U.S. Tax Convention.
:
Mr. Speaker, I thank my colleague for his question, which is particularly relevant since he, like me, is the member for a border riding.
As I said at the beginning of my speech, border ridings have been having rather a hard time of it for about a decade now. The tax convention with the United States was amended, which led to negative consequences for a lot of workers in Quebec and the rest of Canada, specifically, that their incomes were subject to additional taxes.
Workers in the forestry sector—in my riding, these are people who worked in Maine—were often penalized by the situation, in terms of their pension incomes. We had to work very hard to fix that situation. At that time, we calculated how many people there were working in the United States. Thousands of people earn income in the United States every year. In some cases, it is a substantial income; in other cases, it is extra income that is earned at a particular time of year. That is why this tax convention has to be studied carefully.
As well, there is an impact on people as individuals, on the businesses where those people work and on the economic benefits that flow from improvements to a tax convention like this. There are major complexities in tax practice that can hinder regional economic development.
At the same time, we have to ensure that in fixing the problems we do not standardize things in a way that does not reflect the spirit of the legislation in Quebec and Canada, which is not the same as in the United States.
We will therefore look closely at how this amendment of the tax convention will impact people here. At first glance, and after preliminary study, it seems to us that this bill to amend the tax convention is beneficial. The vast majority of what we see in the bill will benefit the border regions, their people and businesses. There are a few matters that must be considered more closely to ensure that we will ultimately have a better tax convention.
In practice, we realize that once these aspects are corrected, once it is signed and becomes official, it is then very difficult to make corrections. The advantage of the decision-making board will certainly mean that any negative impact can be mitigated. In my opinion, everyone wins when the basic principle of “one tax for one income” can be applied. At the same time, we cannot proceed without ensuring that we have given sufficient consideration to the question of how to avoid tax loopholes, because we are familiar with federal practice.
In the past, the agreement with Barbados was made to the real detriment of Canadian taxpayers and to the benefit of a number of people whom that tax convention, that loophole, has served well. We absolutely must ensure that this model is not repeated in a tax convention with the Americans. Let us hope that the collaboration on the tax convention between Canada and the United States will send a message to the Americans: we have to pursue the same kind of collaboration even further to ensure fluidity at the border. Because in this respect there seems to have been some ground lost in recent years.
:
Mr. Speaker, I am pleased to have the opportunity to speak to the bill. I have a couple of preliminary points on Bill .
First, as I think most Canadians are aware, the New Democratic Party is opposed to the continued existence of the Senate. We are always concerned when a bill originates from that house when in fact it should originate in this House. The other place is simply not a democratically elected institution whatsoever. When we are dealing with a bill, and this bill is an important one, any bill of any import at all should originate in the House. We draw that to the attention of the government and insist that it consider any important bill always originating in this House.
The second point with regard to the bill is it has a scope that is generally acceptable to our party. We will be supporting it going through second reading and on to committee.
I am advised by our finance critic that some technical points give us some cause for concern but we expect those issues will be addressed, either amended if necessary or more likely explained to our satisfaction in committee. Then the bill can go ahead and come back to the House for third and final reading.
With regard to the bill itself, as we have already heard from some of the other members, it addresses a number of outstanding irritants between ourselves and the United States around tax matters.
I come from a community that has a very large population. For employment purposes, people move back and forth across from the Windsor-Essex County area into Michigan and even other parts of the United States on a daily basis. We also have a reasonable number of Americans who do the same in reverse and work on the Canadian side. Inevitably that produces some inequities in the taxation of the incomes derived by citizens living in one country but working and deriving all or most of their income from another country. The bill addresses a number of those issues.
Again, as I have indicated, with some slight concern on our part, we think it is a step forward. In particular, we are constantly being confronted, and I hear this from some of my constituents, with them being double taxed, being assessed a tax both in Canada and in the United States.
These individuals are Canadian citizens living in Canada, having a full time residence in Canada, but deriving their income from the U.S. side. They face the situation where there is double taxation on that revenue. It may be even a bit more complex, and I know the bill attempts to address this issue.
We have situations with a registered retirement savings plan on our side and the 401(k) on the U.S. side, which is the corresponding plan in the U.S., and not being able to get full credit for those types of deductions. These are pension savings for retirement purposes. The bill goes some distance to address that. Whether it goes far enough is a bit of a concern.
It is also good that the bill has an arbitration provision between the two countries so the two countries can rely on that rather than an individual having to challenge it or perhaps state to state having to challenge each other. If there are unforeseen problems with the arrangement we establish in the bill, it will give us a relatively efficient and hopefully quick mechanism to resolve those. Therefore, we would want to support that.
The largest concern we have with the legislation is what has happened historically with the protocols that have developed under these treaties with the United States. I believe this is either the fifth or sixth protocol starting back in the late eighties.
The one issue that has given us the greatest concern, and it has been a major issue in my riding, in Windsor-Essex county and, to a lesser degree, in a number of other communities across the country, involves the large number of people who have retired to Canada and are receiving social security benefits. Bill does not address this issue.
Protocol number four set out how these pension benefits would be treated for Canadians in our country and Americans in their country. They were to be taxed at a certain rate in Canada and the United States was to do the same with regard to the taxation of Canada pension benefits received by Americans who had obtained those benefits while working in Canada but who had retired to the United States. It was a sound approach to solving an irritant between the two countries. It made it clear how people who were receiving those respective pension benefits in those respective countries would be treated.
Although the United States has honoured its part of the treaty, both in spirit and in the letter of the law, Canada has not since 1997. This has been a gross injustice to a number of Canadians, a good number of whom live in my riding and in Windsor West and in the riding of Essex. A highly disproportionate number of people living in those three ridings suffer this injustice.
What first happened under the Liberals, but which has not been corrected under the current Conservative government, is that the level of tax has been substantially higher than what it was when these funds were being taxed on the U.S. side and substantially higher than they were supposed to be. The wording of the protocol was that the tax rates would continue as they had before the treaty came into effect but that the funds would be collected by the other country.
Canadian citizens residing in Windsor, who retired in the U.S. but were receiving social security benefits, were supposed to be taxed at the same rate had they retired in the United States and receiving those benefits. In fact, they are being taxed a full 35% higher than if they were residing in the U.S. and being taxed there. Despite comments made by an advocacy organization that has been before committees of both the House and the other chamber on a number of occasions, and in spite of the prior Liberal governments over several administrations, going back to 1996-97 when this became apparent, this continues to be the reality in spite of some very minor changes.
What I now find offensive is that we are now going into another protocol. What is to say that we will not run into the same situation, if the bill goes through, is ratified and the United States signs it, that we will not ignore or breach some of its provisions and our citizens will suffer? It always raises the question of whether the U.S. at some point will do the same thing. The U.S. may decide that since we did not honour one protocol it will not honour one of the new ones. This history is of great concern. I find it particularly offensive right now because there have been a number of private member's bills introduced on this point to correct this injustice.
I want to make this a little personal in terms of the injustice that has occurred here. I have met with a number of people in my riding and in the Windsor-Essex county area generally who have suffered significantly. I think of a couple who were members of our church. They both had worked on the U.S. side and came back to Canada to retire. They bought a house and had only finished the purchase about two months before they were notified that all of a sudden they would be taxed at a 35% increased rate on their pensions. It was a significant financial burden for them, compounded, quite horribly, by the fact that the husband came down with a terminal illness and passed away within about a year. His wife could no longer carry on the mortgage and had to sell the house.
Another instance is about an individual I heard about when I was canvassing in the 2000 election. The brother of this individual told me that his brother had been hit so hard with the increased tax that he had to give up his apartment and move in with him and his wife and never came out of his room. This man had become a total recluse. He usually only came out for meals and the rest of the time he basically stayed in his room. It totally destroyed his life.
This is not something that senior citizens who have contributed to both countries by their endeavours should ever have to face. I could give substantially more stories like that.
It is a situation where quite often people are living on relatively low fixed incomes and then they are hit with this severe tax penalty that they had no reason whatsoever to plan for. As those negotiations went on, as they are with this bill, it was clear that this was the way it would be handled, that it would not change the tax rate in Canada. Then they were hit with this increase after the fact. It significantly destroyed a number of lives and curtailed the ability of many people to enjoy their retirement years in many respects.
What happened later is that on two different occasions, one back in 1998 and again in 2001, the member from Calgary, the current , presented private members' bills to correct this. The wording in those bills was quite straightforward. It is one or two paragraphs in each case. All they simply said was “change this part of the Income Tax Act to say that the income received in the form of social security pensions will be taxed in this manner”.
We had those private members' bills but they never went to a vote. Two more were presented by the member for , who is a member of the government, one bill in 2004 and another one in this Parliament in May 2006. The final one is still before a committee but I think it may be close to being completed.
However, the reality is that the bill will probably not survive the final vote because it needs a royal proclamation and it will not get it because the government, in spite of those two members from the government who have advocated on it, have not been able to deliver. That is the situation as of today.
We have gone a full 10 years since this injustice has been perpetrated on our retirees. The Liberal government would not do anything about it and now, after two years with the Conservative government, it has not done anything about it. It is not in this bill nor is it in any government legislation. It was not in either of the two budgets that the government brought forward. I have not heard anything that says it will be in the next budget, assuming the government survives that long. When we see something like this it should be corrected. It begs the question, when we come back to Bill S-2, of whether we will see the same type of thing happen because this protocol will not be fully honoured by our government.
It is a shameful set of circumstances. It is a gross injustice that has been perpetrated now for over 10 years. There have been numerous opportunities to correct this.
I will perhaps finish with the fact that we are not talking billions of dollars here. We are not talking about the $10 billion or $12 billion that the government put back into various sources. It is a very small amount of money because so many of these individuals have passed away in the last 10 years, oftentimes simply because of the financial crisis they were facing. We are talking about $20 million to $25 million a year range, a very small tax credit, if one wants to think of it in those terms, to people who are greatly deserving of it because of what they were led to expect would happen and then had the tables turned on them, with no ability to alter how they were to be treated.
The government must fix this problem. It knows it is very simple to do. It would be a one paragraph amendment to the Income Tax Act. It must ensure that it does not repeat the same kind of injustice, assuming that Bill becomes law at some point.
:
Mr. Speaker, I am pleased to rise today to speak to Bill , which has to do with the tax convention between Canada and the United States. We could see a rather important conclusion reached here today, but this is hardly anything new. This is not the first time that the economy, culture or any other aspect of society has had to be managed between two countries. This is not a recent phenomenon. Significant demographic exchanges have been taking place between Canada and the United States for years.
Naturally, at the time, no one seemed to be too concerned about this overall dynamic. For example, when the United States of America achieved independence, many loyalists left that country and came to settle in Canada, including many in the Kingston area and in the Saint-Jean-sur-le-Richelieu area, where I am from. Many people from Lacolle are close to the American border and are descendants of loyalists. These people wanted to maintain their allegiance to the British crown and therefore came to Canada.
The reverse is also true. At one time, jobs in Canada were very rare and there was a great deal of immigration to the United States. My riding is right next to Burlington, in the state of Vermont. Many Quebeckers crossed the border in search of work on the American side. Furthermore, at present, nearly a third of the population of New England is of francophone descent. It was immigration following difficult working conditions here at home that led these people to cross the border to work and to start their family. Francophone generations have followed one after the other in an interesting manner. Family names often associated with Quebec have been changed slightly on the American side. However, everyone is perfectly aware of this and anyone you talk to who has these names will say that they are of francophone origin and that this carries some importance for them.
One thing leading to another, the economy and culture have developed on both sides of the border. I think that is forcing both governments to come to an agreement on economic practices. We cannot talk about integration, since the tax convention will be signed by two sovereign states, but this is forcing them to adjust to new realities, which are important. Just 60 kilometres or so from here, in Plattsburgh, in the State of New York, the Buy America Act, legislation enacted in the U.S. to encourage foreign investments to maintain a workforce in the U.S., ensures that 700 people work at the Bombardier plant located there.
This goes to show that the economy is stretching and shattering borders, and the situation is becoming increasingly complex. There was a time when the people working across the border fell into a kind of grey zone. They did not know to which side to pay their taxes or how they could claim deductions for a retirement plan. New situations and the new world are forcing countries like Canada and the United States to sign tax treaties to ensure fairness for all workers and industries as well.
I look at the issue of the new generation of workers. For instance, my daughter Geneviève started by working for Deloitte & Touche in Montreal, then was transferred to Toronto, and finally ended up in New York City. Many of our young people do not necessarily feel any particular ties to one country or another anymore. Theirs is almost an international mindset, and they go wherever their work takes them. This forces countries to think about the type of tax measures or tax treaties that should be put in place.
So this is nothing new. It has developed gradually over time. Today, the reality is that we have to adapt and that is the purpose of this piece of legislation.
As I was saying earlier, the pension plans for Canadians working in the United States were problematic, among other things. Those workers could be told they could not contribute to a Canadian pension plan. This had significant consequences. We have to understand that those who want to secure a decent future today have to invest in RRSPs, for example. If they do not, they will fall back on the public plan, which, in a few years, will no longer be able to pay the same level of benefit it does today.
Imagine someone who left Canada to work just across the border. That person could not secure a decent pension plan for himself. The purpose of the legislation before us is to correct that situation. The reverse situation of an American working in Canada was the same. The Americans probably told that person they could not invest in a pension plan because they were not working in the U.S. The bill before us resolves the issue of pension plan contributions for those workers. This allows a migration of workers from one side to the other and that is important.
I want to come back to the Buy American Act in effect in the United States. Earlier I gave the example of the Bombardier plant in Plattsburgh, New York. It employs Quebeckers since its headquarters are not in the United States, but in Quebec. Quebeckers will work there for significant lengths of time. This will allow them to save money in their pension plan as though they were working in Canada. That is important.
There is a second, equally important aspect of this bill that we support and that is the use of an arbitration board. This type of tax convention can leave room for anomalies or be open to interpretation. The bill provides workers with the opportunity to go before an administrative body to argue that they have been treated unfairly under part of this tax convention. This is a good addition because it is important for a worker to have legal recourse when he or she suffers an injustice. Furthermore, the composition of the board seems fair. Naturally, there is a representative from Canada, a representative from the United States and a third person selected by both countries. Understandably there might be alternation. For example, if the chair of the board has been filled by an American for some time, then it will likely be filled by a Canadian the next time around and so forth.
We believe that it is very important to have a board for a true hearing of the problems. We find that smart. We should not fall into the trap of international treaties where there is no recourse in the event of differences. Unfortunately, in our society, this still happens. Individuals suffer an injustice and face a void. Often there is not even an appeal mechanism. Having a board to hear difficult cases and to resolve issues is an important addition.
We are pleased to note efforts to plug certain tax loopholes. Tax law and various laws pertaining to tax treaties could allow companies to have it both ways. We must avoid that. We must avoid tax havens. From our perspective, it is an absolute disgrace. Take Barbados, for example. Canada had tax treaties with about a dozen countries that were tax havens. This allowed large companies to take part of their profits and invest them in these tax havens, where they could not be traced. What is truly ironic is that these big companies paid no taxes as such.
Canada loses hundreds of millions of dollars every year because of this type of tax haven. Thus, it is important that we not repeat the mistake even though tax havens continue to exist. I find fault with the former prime minister of Canada who one day announced that he was setting everything right and shutting down about 11 tax havens. Good for him. Except that in the meantime he did not tell us that his own company had transferred all its assets to Barbados, which was the only tax haven he was not shutting down.
Problems still exist. This part of the bill before us ensures that companies cannot play with two investment systems, two different tax systems and ensures that these companies will pay their due where their head office is located.
There are some amazing statistics on tax havens and offshore financial centres. Between 1990 and 2003, Canadian investment in tax havens and offshore financial centres rose from $11 billion to $88 billion. I would remind hon. members that companies avoid paying tax on this money, which means that Canadians lose. These companies are not doing their part and are poor corporate citizens, because they are not contributing to the public sector of Canada, Quebec or the provinces. These loopholes must be plugged.
The financial sector is another absurd example where investments in tax havens rose from $8 billion in 1990 to $72 billion in 2003. The financial sector is truly a poor corporate citizen, because it is not doing its part to support its country, its province or its municipality. This money is lost to the public coffers, which is totally unacceptable.
Consequently, with regard to the tax treaty covered by the bill that is before us, we are going to make sure companies cannot have it both ways. That will improve this bill.
The bill also clarifies the investment rules. This is more or less what I was just saying. Often, investors can deduct a portion of their fees. From now on, these investment rules will be harmonized, for greater tax fairness. There will be no loopholes, and both countries will come out ahead.
In conclusion, we are fairly satisfied with the bill. It could create a precedent. It would be good if this tax treaty served as a cornerstone for other types of tax treaties elsewhere, so that we get back to basics and big corporations pay their fair share and stop avoiding tax on their profits or setting up shop in tax havens to protect themselves. They need to do their fair share.
Finally, this is a good thing for workers. Regardless of which side of the border they work on, this shows that there is a great union between the United States and Canada and that these workers will be subject to the same rules and will be treated more equitably.
:
Mr. Speaker, I am pleased to take part in the debate concerning Bill , to implement the tax convention between Canada and the United States.
As my colleague from observed, the Bloc Québécois clearly supports Bill in principle, since it will allow cross-border workers to enjoy the same tax advantages as resident workers, it will institute a bipartite board for resolving tax disputes, it provides for rules governing certain types of companies that will make it more difficult to use various tax loopholes, and it will eliminate certain provisions regarding double taxation of capital gains.
As I noted, we support this bill. However, examination of the bill in committee will allow us to clarify certain of its provisions, in particular, the proposals for eliminating withholding tax on foreign interest payments and the tax treatment of cross-border corporations.
As we know, the Bloc Québécois has always supported tax conventions between countries that have taxation levels within the normal range. There are tax conventions between Canada and certain countries that do not tax according to the standards in countries where the government plays a proper role. Those are the tax havens. It is mainly this issue that comes to my mind when I look at this bill.
So we have before us a bill concerning tax conventions between Canada and the United States. As I said, this bill contains extremely positive elements. But at the same time, how is it that the government is not asking itself about some other tax conventions, the ones it in fact denounced when it was in opposition, with countries like Barbados, Bermuda and the Bahamas, where tax rates are ridiculously low? We must not look the other way; there are companies, including Canadian companies, that establish themselves in those three jurisdictions specifically to evade their responsibilities as corporate citizens of Canada and Quebec.
I would point out that tax havens attract everyone who refuses to carry their share of the tax burden. As I said earlier, that can mean both businesses and individuals. I have always said that when it comes to tax evasion or tax avoidance, we are talking about grey money, dirty money. What is extremely disturbing is that this grey money, when we are talking about tax avoidance, and dirty money, when we are talking about tax evasion, is used in large part for money laundering. That fact is recognized internationally.
I would point out that it has been estimated that this involved $6 trillion: $5 trillion in tax avoidance, and $1 trillion that is simply fraud. Still, it is extraordinary that the Conservative government, which has been presenting us with a constant stream of bills to increase sentences for young offenders, for example, or to introduce minimum sentences in a number of areas, has so far not expressed this kind of concern by revising the tax conventions with those countries. We must recall that the money we are talking about comes from crime, drugs, prostitution, arms trafficking, corruption and terrorism.
If this government were serious about wanting to fight crime, and particularly all the crimes that involve money laundering by terrorist networks, it should have announced—yes, this bill will be sent rapidly to the Standing Committee on Finance—that it was initiating a study to review a number of tax conventions with countries that, as I said, have ridiculously low taxation rates.
There are governments, including the Canadian government, that tolerate and even encourage these tax havens. In 1999, Canadians invested $17 billion in Barbados, which is recognized internationally as Canada’s tax haven. In 2001, that figure rose to $23.3 billion.
That was an increase of more than $5 billion in two years. Barbados is the third most popular destination for Canadian direct investment. This is rather troubling, however. Barbados ranks third, after the United States and Great Britain, as a destination for direct foreign investment by Canadian individuals and companies.
I seriously wonder what sort of real economic activity has, to date, required roughly $25 billion in Canadian direct investment—or even more, since the figure has no doubt risen. We are talking about an island that is known as a nice place to live, but that still has a rather small population and where industry centres mainly around recreation and tourism.
So why are Canadians finding ways to invest in Barbados to the tune of $25 billion or $26 billion, making it the third most popular destination, after industrialized nations the size of the United States and Great Britain, if it is not because investing in Barbados makes it easier to evade taxes?
Not only is investment growing, but it is being encouraged by the tax treaties signed between Canada and Barbados. As I mentioned, besides Barbados, only seven countries that have a tax treaty with Canada are or were considered tax havens by the OECD. It is interesting to know that the OECD classified the main tax havens a few years ago but has now completely given up making that list. Barbados was not included in the most recent OECD list. We learned that Barbados was removed in large part because of pressure from Canada—and I imagine from Barbados as well—on the OECD. Once again, in my opinion, this is proof that the Government of Canada, be it Liberal or Conservative, tolerates this sort of tax loophole, whether it serves legitimate purposes or is used to launder money.
When I refer to ridiculous taxation rates, I mean that the taxation rate in Barbados varies from 1% to 2.5%. This would be astonishing in our progressive tax system, although it is true that, at present, with the successive Liberal and Conservative governments, taxes and the Canadian tax system are less and less progressive. However, the concept is still part of Canada's tax philosophy.
In Barbados, the more profit one makes, the less tax one pays. For example, companies or individuals who have made US$15 million or more pay 1% tax. It is crazy to think that this tax rate is equivalent to those in countries where the tax system actually meets the needs of the people. The strangest thing of all is that, as I said, those who make $15 million or more pay 1% tax. As profits go down, the taxes go up, and those making less than $5 million in profits are taxed at 2.5%.
According to Canada's tax treaty with Barbados, Canadian companies and individuals who pay tax in Barbados do not have to pay tax in Canada because they have already discharged their tax obligations under Barbados' ridiculous and regressive tax system. That is totally absurd. Furthermore, year after year, the government is encouraging more and more money to leave Canada for Barbados, and that applies to Bermuda and the Bahamas as well.
In Barbados, not only is the tax rate between 1% and 2.5% for corporations, as I said, but there are no taxes on capital gains and there is no monitoring, which allows criminal organizations to launder money using a system the Canadian government itself put in place.
For example, in Canada, the five largest Canadian banks are operating in 26 tax havens, many of which were blacklisted by the Financial Action Task Force on Money Laundering (FATF) and the OECD when it kept such a list. We have to wonder about this. These banks claim to be doing everything legally, which is true. However, this also means that the Government of Canada—whether Liberal or Conservative—is sanctioning such opportunities to avoid responsibilities to society. In total, 61 branches of Canadian banks are located in tax havens.
I would like to mention that, a few years ago, a citizen wrote to the banks to ask them what they were doing in tax havens, and what they were thinking when investing or transferring their assets in these tax havens. This man received some rather interesting answers. For example, the Royal Bank of Canada, the RBC, provided the following reply to Mr. Gosselin, who had made the request. I am just quoting one paragraph in the reply given by the customer relations centre: RBC Financial Group would be very adversely affected, from a competitive point of view, and its actuarial asset value would be significantly reduced if it decided unilaterally to stop its operations in any of these territories. Unless expressly prohibited to do so by the legislation, RBC Financial Group must be allowed to take advantage of business opportunities in any region, so as to provide its clients with integrated financial services at the international level.
I am just wondering if having branches in some of these 26 tax havens really benefits the vast majority of RBC Financial Group customers, or whether it is only the small minority that has access to high level accounting services that actually can take advantage of that option.
RBC Financial Group also points out that if everyone were prohibited from doing this, it would not take advantage of that opportunity, but that it does for the time being, because if it did not, it would not be competitive. In my opinion, the bank and the government are both responsible for ensuring that these businesses do not benefit from this type of tax avoidance.
A similar reply was received from the CIBC, which essentially said the same thing. The Scotiabank also provided a similar reply. So did the Bank of Montreal. I found the Scotiabank reply particularly amusing, because the bank claimed that, if it were to leave these countries, local populations would suffer from such a move. Indeed, since these poor people would have less to do with Canada, they would not benefit from jobs, from direct and indirect economic benefits. Of course, we know full well that this is not the case. When I read the Scotiabank letter, I really thought we were dealing with a modern day Robin Hood.
It is a well-known fact: tax havens are most beneficial for people who have capital and there are no spinoffs for the tax haven countries themselves. Government action is needed here, on an international scale, to put an end to these loopholes.
Who benefits from these tax havens? First of all, one must recall that a tax haven is a country where there is a kind of free zone that promotes bank secrecy, where the officials are not very inquisitive and where the taxes are light, as I pointed out.
As we all know, the former prime minister, also a former finance minister, had a company operated by his sons called Canada Steamship Lines International and that company took advantage of the provisions set out in the legislation.
This exists among many business leaders and is going too far. The very fact of it is attacking the foundations of our society. The Auditor General reiterated this. Year after year, the use of tax havens by a growing number of people—they are still a minority, a tiny minority, which is why it is important to act quickly—erodes the tax base and threatens our social foundations.
Indeed, people here in Canada are benefiting from the fact that there are collective tools. We have social programs that have unfortunately been attacked quite a lot in recent years. These programs ensured more than one form of security, as the Conservatives are seeking. They provided social calm and social cohesion. These people therefore benefit from the efforts of the entire middle class and some less fortunate members of society. In that sense, there is definitely a problem. The former Auditor General mentioned it and the current Auditor General reiterated the problem. More and more, the upper middle class is entering into that kind of casino operation, thereby jeopardizing our social cohesion, the foundation of our society.
I was also saying that tax havens have greatly benefited Canadian companies and that our banks, in particular, have profited considerably from them. I would simply like to point out, since I found my document, that 61 branches of Canadian banks are in tax havens. There are 23 Bank of Nova Scotia branches in a whole series of tax havens. The Bank of Montreal is in 5 tax havens and the Toronto-Dominion Bank is in 3. The CIBC is in 12 tax havens and Royal Bank is in 17. All of this has allowed the banks to save $2 billion in taxes. These figures are from a few years ago.
When we look at the reports of each of these banks—I had the opportunity to look at them because I was rather incredulous— we see at the bottom of the page how much money the big banks did not have to pay in taxes like everyone else. I mentioned this earlier and, in my opinion, that is what our discussion should have been about.
Although the bill before us corrects a number of inequities and problems cross-border workers have to deal with, it does not really address the problem of tax avoidance and tax evasion that is going to cause major problems in the future.
We strongly believe that all income earned in Quebec, in Canada and by all Canadian companies abroad should be taxed in Canada, even though we entirely agree that countries with similar taxation can have tax conventions to avoid double taxation. Nonetheless, Barbados, Bermuda, and the Bahamas are very clearly not in that category.
I expect the Conservative government, if it is the least bit consistent, but I doubt it, in the coming days and weeks to bring us tax conventions to review and correct once and for all in order to put an end to these heavy losses in tax dollars that are putting our social programs and our way of life at risk.
It is true for Quebec and it is true for Canada. I am calling on my colleagues to help wake the and the out of their indifference.