Leadership to Lower Canadian Taxes: Uniting to Fight for Tax Relief
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The Empire Club of Canada Addresses (Toronto, Canada), 29 Apr 1999, p. 499-512


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Manning, Preston, Speaker
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Text
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Speeches
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A brief status report on taxes in Canada. Results of a Compas poll commissioned by the National Post with regard to tax rage. Some facts and figures with regard to taxes paid by Canadians. Provincial tax cuts in Ontario. The issue of federal taxation. Looking at the political realities of fighting for tax relief in Canada. Three political realities, with discussion: the federal Liberals and Finance Minister Paul Martin won't deliver real tax relief; the Official Opposition cannot deliver tax relief by itself without increased support; to pass a budget containing broad-based, substantive tax relief in the federal Parliament requires 150+ members of Parliament committed to such a plan. The bottom line. The need for leadership to lower taxes. What concerned political people have been doing to unit together to fight for tax relief and other essential reforms. The United Alternative Convention. Conclusion of the Convention summarised in a report which the speaker has been distributing to Reformers and others. Personal recommendations included in the report. Why political leaders like the speaker are involved in this United Alternative effort. What Toronto business and community leaders can do to help lower federal taxes.
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29 Apr 1999
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English
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Full Text
Preston Manning, MP Calgary Southwest and Leader of the Official Opposition
LEADERSHIP TO LOWER CANADIAN TAXES: UNITING TO FIGHT FOR TAX RELIEF
Chairman: George L. Cooke, President, The Empire Club of Canada

Head Table Guests

William D. Laidlaw, Director, Government Relations, Glaxo Wellcome Inc. and Second Vice-President, The Empire Club of Canada; Reverend Kim Beard, Rector, Christ Church, Brampton; Abdullah Hamdard, Student, Danforth Collegiate and Technical Institute; Peter G. White, Executive Vice-President, Argus Corporation; Sandra Manning, Partner, Lifestyle Realty; Robert J. Dechert, Partner, Gowling, Strathy & Henderson and First Vice-President, The Empire Club of Canada; The Hon. Henry N.R. Jackman, Chairman and President, E-L Financial Corporation Ltd. and Honorary Officer, The Empire Club of Canada; Gareth S. Seltzer, Vice-President, Private Wealth Management, Guardian Capital Advisors and Immediate Past President, The Empire Club of Canada; Fredrik D. Eaton, Chairman, The Eaton Foundation and a Director, The Empire Club of Canada; and Ann Curran, Partner, Lewis Companies Inc. and Third Vice-President, The Empire Club of Canada.

Introduction by George L. Cooke

It is my privilege to introduce to you our guest speaker, Mr. Preston Manning, Leader of the Official Opposition, Leader of the Reform Party of Canada, and Member of Parliament for Calgary Southwest.

I first met Mr. Manning several years ago at a dinner where he was the guest of honour. Not only did he deliver a high-quality, lucid speech without text, but he engaged the crowd in a question-and-answer session where he actually answered the questions.

The Reform Party of Canada was formed in 1987 with Preston Manning elected as leader and has evolved from a western-based party into a national political movement. In 1997 Reform ran 227 candidates with 60 MPs elected and they became Canada's Official Opposition.

Through these years, Mr. Manning has advanced the principles of:

• Fiscal responsibility;

• Social responsibility;

• Democratic accountability;

• Equality of citizens and provinces; and

• Re-balanced federal and provincial powers.

In 1998, Preston Manning extended an invitation to like-minded Canadians from other political backgrounds to work together with Reform to create a new cross-partisan political party. Many Canadians responded, and in February of 1999, they gathered in Ottawa at the United Alternative Convention.

Prior to entering politics, Preston Manning's Alberta-based career focused on long-range planning for the energy sector, native and community economic development, and federal/provincial relations research.

Mr. Manning is a graduate of the University of Alberta with a degree in economics.

He was born in Edmonton on June 10, 1942 where he spent his early childhood until his family moved to a rural community east of the city. Throughout his adolescence and teen years, he lived and worked on his family's dairy farm. There must have been something in the milk nurturing his political ambition, as his father, the late Ernest C. Manning, served as premier of Alberta for 25 years.

Preston Manning and his wife Sandra have been married for 30 years. They have five children and reside in Calgary.

Mr. Manning, welcome to The Empire Club of Canada.

Mr. Chairman, honoured guests, ladies and gentlemen: Before I begin, I'd like to join with you in expressing our profound sorrow and sympathies to the parents and students of W R. Myers High School in Taber, Alberta, concerning the tragic shootings that occurred there yesterday.

If Parliament could legislate a ban on such tragedies we would do so tomorrow. But the roots and causes of this random violence demand a deeper and broader response than that.

I am convinced (not just as a politician, but as the father of five children) that detecting and preventing these tragedies require a deeper commitment from all of us to strengthening homes and families, to strengthening counselling and social services for young people, and to paying both personal and public attention to these troubled teenagers before they resort to violent acts.

If it is possible at all for any good to follow from the evil of this tragedy, it will be if it causes all of us to more fully open our eyes and ears and minds and hearts to the emotional needs of the students and young people in our lives over the months ahead.

I'd like to pay a special tribute to Bob Dechert, the new President of the Empire Club. He is an active federal and provincial Progressive Conservative and a tremendous contributor to the United Alternative Convention. Thank you, Bob, for inviting me to speak.

I'd like to also pay a special tribute to Toronto business and community leaders. I would like to pay tribute to your economic, social, and cultural contributions to the city of Toronto.

Finally, I would like to pay tribute to the 14 million Canadian taxpayers who sent more than $150 billion in federal taxes to Ottawa last year. You are the most longsuffering taxpayers in the civilised world.

Which brings me to the subject of my remarks to you today: Leadership to lower Canadian taxes: Uniting to fight for tax relief.

Here is a brief status report on taxes in Canada.

A Compas poll commissioned by the National Post this month shows that 85 per cent of Canadians are suffering from tax rage. You can imagine what it must take to enrage a Canadian! Canadians are outraged because high taxes risk our livelihoods, dreams, well-being, and future. Tax outrage is expressed at the kitchen table, in coffee shops, on talk shows, and in boardrooms; outrage that needs to be converted into action. "We need to do something."

Canadians are now paying the highest personal income taxes in the G-7. A Windsor auto-plant worker had a tax bill for overtime work that was equal to his net pay. Something needs to be done about that.

The federal government not only taxes the well-to-do and over-taxes the middle class, it is in a league by itself when it comes to taxing the poor. It has collected $3.7 billion in income taxes from those earning less than $20,000 a year; $2.3 billion in payroll taxes from workers earning less than $20,000 a year. We need to unite to do something about that.

Canada's corporations on average are the third-highest taxed in the world, next to Japan and Germany. Canadian high-tech companies, the engine of the new economy are the highest-taxed in the high-tech world. We need to unite to do something about that.

The government of Ontario under Mike Harris has done a great job in bringing provincial tax relief to the people of Ontario. I hope Ontario people give Mike Harris a renewed mandate to finish the job. But what is the benefit of sweating blood to get provincial taxes down in Ontario if a tax-and-spend Liberal government in Ottawa simply moves into the tax room vacated by the province?

Ontario taxpayers need to unite to do something to bring fiscal common sense to Ottawa as well as Queen's Park.

In summary, high federal taxes drive companies, capital, jobs, opportunity, and Canadian youth out of the country. Enough is enough. We need to unite to do something.

What are we going to do, and who is going to do it? The answers to these questions require us to take a hard look at the political realities of fighting for tax relief in Canada. There are three political realities.

The first reality: the federal Liberals and Finance Minister Paul Martin won't deliver real tax relief.

The current Finance Minister has presented six budgets containing 40 tax increases and increasing government tax revenues by $42 billion more per year ($3,000 per taxpayer) than when the Liberals took office in 1993.

Federal Liberals balanced the budget, not through federal spending controls but 77 per cent through revenue increases and most of the rest through off-loading to the provinces. The only department they slashed was Defence.

The government cooks the books by front-end loading expenses to make the surpluses look smaller, thus allowing it to argue there is no room for substantive tax relief. This despite the fact that the Auditor General has twice condemned the process and has refused to sign off on government financial statements.

The government currently has surpluses of $7-15 billion in the general revenue account; $26 billion in the employment insurance account; and still refuses to grant substantive, broad-based reductions in either income tax or payroll taxes.

The current Finance Minister has assisted the Prime Minister in making several hundred excuses as to why taxes can't be lowered, principally because the majority of the Liberal caucus would prefer to spend any government surplus rather than return it to the taxpayers.

First political reality: the Liberals will offer token tax relief, but not the broad-based, sustained, substantial tax relief that Canadians need and want.

The second reality: the Official Opposition cannot deliver tax relief by itself without increased support. When Reformers arrived in Ottawa in 1993, we had a financial to-do list with four things on it: Control the spending, balance the budget, pay down debt, and reduce taxes.

As the Official Opposition, Reform has presented a tax relief programme which would deliver $26 billion in tax relief over three years ($2,000-3,000 per family), including a $7-billion reduction in payroll taxes over three years.

But the Official Opposition has only 59 seats and votes in the 301-seat Parliament. Even if the 19 federal Tories join with us, we together have 78 votes.

The third political reality: to pass a budget containing broad-based, substantive tax relief in the federal Parliament requires 150+ members of Parliament committed to such a plan.

What is the principal political obstacle to electing 150+ members of Parliament committed to broad-based tax relief and other essential reforms? It is vote splitting among the opposition parties.

In the last federal election, the Liberals formed a majority government with only 38 per cent of the vote. Sixty-two per cent of Canadians did not want Jean Chretien as Prime Minister, Paul Martin as Finance Minister; did not want a Liberal government; did not want tax-and-spend financial policies. But that's precisely what we got. Why? Principally because the opposition support was split among a number of opposition parties--especially between Reformers and Progressive Conservatives in Ontario. That is what resulted in the election of the 101 Dalmatians in Ontario who do what they're told and support tax-and-spend policies, not broad-based tax relief. The bottom line? The political imperative that flows from these realities? Bold, innovative, vigorous leadership is required from business and political leaders to unite to resolve this vote-splitting problem and elect 150+ members of Parliament committed to tax relief.

We need leadership to lower taxes and leadership to unite Canadians in new ways to fight for tax relief.

What have concerned political people been doing to unite together to fight for tax relief and other essential reforms?

At the May 1998 Assembly of the Reform Party of Canada, I proposed to our members that we help initiate a United Alternative Convention to bring together people from different political backgrounds who might share such principles as a commitment to fiscal responsibility and tax relief. A Steering Committee was set up to plan the United Alternative Convention in Ottawa for February of 1999.

That Steering Committee has 21 people on it. Six federal Reformers, who were soon joined by others willing to work together to define common ground and a plan of political action to create a responsible alternative to the Liberals, particularly on such issues as tax relief. These included respected and responsible members of the Toronto business and political community known to you all:

• Your new president, Bob Dechert;

• Hal Jackman, prominent businessman, prominent Conservative, former Lieutenant-Governor of your province;

• Tony Clement, Minister of Transportation in the Harris government and one of the original authors of the Common Sense Revolution;

• Peter White, Executive Vice-President, Argus Corporation and the former Chairman of PC Canada Fund.

They, together with federal Reformers, were also able to use their influence to attract other prominent Canadians willing to add their voices to this effort to unite to fight for lower taxes and other common objectives--people like Premier Klein of Alberta; Alberta provincial Treasurer Stockwell Day; Clayton Manness, former Finance Minister of Manitoba; Michael Fortier, Montreal lawyer and candidate for the federal PC leadership; independent Member of Parliament John Nunziata; and many others.

The United Alternative Convention was held on February 19-21. It spent 50 per cent of its time defining common ground among members of different federal and provincial parties upon which it might be possible to unite to stop the vote splitting at the federal level and to get a single candidate in 301 federal ridings committed to the same set of principles.

They found themselves in agreement on such goals/principles as social responsibility, democratic reforms, reform of the federation. But the principles on which there was the broadest agreement were those of fiscal responsibility; in particular, the mandating of balanced budgets, priority pay-down of the national debt, and the lowering of personal and business taxes.

These positions are supported today by far more than business people and fiscal Conservatives. There is also potential for broad-based support for tax relief from a large portion of over-taxed rank-and-file union members, and from social and anti-poverty groups who recognise that excessive federal taxation of the poor is one of the principal causes of poverty in Canada.

The United Alternative Convention then spent the other 50 per cent of its time considering four political action plans for stopping the vote splitting and uniting under one federal banner those people who believe in common principles like federal tax reduction.

When a vote was taken, a majority of those at the United Alternative Convention favoured the creation of a bigger and broader federal political entity to which the supporters of the respective groups represented at the Convention could bring their common principles and traditions as well as their capacities to organise and fund election campaigns.

There was also strong second-place support for a proposal by Mr. Jackman to encourage joint consultations and nominating meetings between federal Progressive Conservative and Reform associations, particularly in Ontario, to nominate a single candidate in each riding.

The conclusions of the United Alternative Convention are all summarised in a report which I have been distributing to Reformers and others. It includes my Personal Recommendation to Reformers that we vote yes in a party-wide referendum on the question, "Do you want the Reform Party of Canada to continue with the United Alternative process?"

We are currently in the midst of a nation-wide, party-wide consultation on this question. Similar discussions are going on in federal and provincial conservative circles, and although Joe Clark has been un-receptive to date, the door has been kept open for his involvement and the UA effort will proceed with or without him.

Why are political leaders like myself involved in this United Alternative effort?

I can't speak for the others, but I can speak for myself.

I am involved because I believe it is the right thing to do.

I am involved because I didn't get into federal politics 12 years ago simply to criticise or just talk about tax relief and fiscal responsibility at the federal level. I got involved to actually achieve results. And if that involves taking some risks and doing some new things, then that's what I'm prepared to do.

I am involved because I believe that if Opposition politicians want Canadians themselves to unite in new ways to reduce taxes, to strengthen health care, to democratise the federal institutions, or to re-balance the powers between the federal and provincial governments, then we are going to have to lead by example. That means endeavouring to unite ourselves in new ways across old boundaries to provide a principled alternative to the Liberals.

Most of all, I am involved because of what I see high taxes doing to people I care about.

Sandra and I have five children. I remember when my oldest son got his first pay cheque. Getting your first pay cheque from your first full-time job ought to be a day for celebration of achievement. But for him, as for thousands and thousands of other young people like him, what struck him most forcibly was how much the government took from that cheque.

I have a 24-year-old daughter who is a financial analyst for a big American financial house and who's worked in New York, Seoul, Moscow, and London. She is one of the thousands of bright young men and women who love Canada, who received a good education here, but who saw her opportunities in Canada limited by her own government; who saw what her tax and financial position would be if she stayed in Canada versus the U.S. and when the head-hunter called went to greener pastures.

I get phone calls and e-mails from her from time to time with postscripts, "Let me know, Dad, when Canada gets its act together," and one of her measures of whether a country has its act together is competitive, responsible levels of taxation.

I now come to the most important question: What can Toronto business and community leaders do to help lower federal taxes?

1. Send the federal Liberals a message on taxes in the only language they'll understand.

The business community, particularly Bay Street, votes with the cheque book. So why are so many companies contributing as much as $25,000, $50,000, $75,000 a year to high-tax federal parties like the Liberals?

When Toronto business leaders present briefs to the federal government and the Finance Minister deploring excessive taxation, but still give the Liberal Party of Canada millions of dollars to finance candidates and members of Parliament who have never voted for a genuine, broad-based tax reduction programme in their lives, you know what happens in the Liberal back rooms? There is laughter, not respect, and no action on tax relief.

Political contributors who are really serious about winning the battle for tax relief will follow the advice of Wayne Gretzky: "Skate to where the puck is going to be, not where it's been."

By failing to act on tax relief, the Liberal caucus has lost that puck; it's going somewhere else and that's where you should be.

2. Send the federal Tory leadership a message.

Tell those who refuse to acknowledge that vote splitting only elects Liberals to wake up and smell the coffee, and that there will be no more cheques to the PC Canada Fund untii there is a more open and positive response to the proposals put forward by the UA Convention.

You can send the federal Conservative hierarchy a message: It's time to work together with others for the sake of the country; so why not send that message?

3. Support the Reform Party and the Official Opposition in our efforts to be the voice of tax relief in Parliament and to work together with others to elect the 150+ members of Parliament required to make tax reform and tax relief a reality.

In the last federal election, Reform ran an $8-million national campaign which elected 60 MPs, compared to the federal Tories' $22-million campaign which elected 20 MPs. In other words, a dollar invested in the Reform campaign yielded an 825-per-cent-higher return than a dollar invested in the federal Conservative campaign.

Reform is the one federal party that has put its own money, manpower, and energy where its mouth is on this matter of seeking to stop the vote splitting that elects Liberals by default.

To sustain our involvement in the United Alternative process, as well as carry out our responsibilities to our constituents and fulfil our role as Official Opposition, we need your moral, intellectual, political, and financial support.

4. Become involved personally in the United Alternative process.

Examine for yourselves the principled ground defined by the United Alternative Convention and make a decision: Can I or can I not support these principles?

Examine our political action plan for creating a newer and bigger political entity to bring tax relief and other needed reforms to the Canada of the 21st century. And ask yourself: Should I stand on the sidelines? Or should I participate in this process?

Participation means doing something. Write a letter to a Reform association or MP encouraging them to continue their involvement in the UA process and offering your support.

Identify federal and provincial Conservatives with whom you have influence. Telephone or write to them encouraging their involvement in the UA process and offering your help.

Tie your interest and support for the United Alternative to the issues Canadians care about: "We need to unite together in new ways to get taxes down." This is bigger than politics and parties.

People who choose not to involve themselves in the politics of their country are destined to be governed by those who do.

Be one of those who actively participate in the governance of your country. Make your own headlines: "Toronto business and community leaders unite to fight for tax relief."

As we enter the new millennium, I am calling upon Canadians--particularly leaders in business and politics--to emulate the example of the Fathers of Confederation who created both a new politics and a new country.

There's a picture in the Railway Committee Room in the Parliament building of the 36 delegates to the Charlottetown and Quebec Conferences in 1864--people from six different colonies, 12 different political groups; people who were willing to take risks, embrace new ideas, and put aside intense personal and political differences, in order to create a new politics and a new federation.

I see many of those qualities in the business and labour and community leaders of today. They need to be harnessed to a bold new political objective: We need to take those qualities of courage and initiative, and unite together to lead Canadians into a new era of tax relief and responsible government for the benefit of generations to follow.

Some day, someone will take a picture of the group that helped to put together the federal alternative to the Liberals--the one that delivered genuine, broad-based tax relief to millions of Canadians and reformed the federation for the 21st century. My question for you is: "Who from Toronto's business and community leadership will be in that picture? Will it be you?"

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Leadership to Lower Canadian Taxes: Uniting to Fight for Tax Relief


A brief status report on taxes in Canada. Results of a Compas poll commissioned by the National Post with regard to tax rage. Some facts and figures with regard to taxes paid by Canadians. Provincial tax cuts in Ontario. The issue of federal taxation. Looking at the political realities of fighting for tax relief in Canada. Three political realities, with discussion: the federal Liberals and Finance Minister Paul Martin won't deliver real tax relief; the Official Opposition cannot deliver tax relief by itself without increased support; to pass a budget containing broad-based, substantive tax relief in the federal Parliament requires 150+ members of Parliament committed to such a plan. The bottom line. The need for leadership to lower taxes. What concerned political people have been doing to unit together to fight for tax relief and other essential reforms. The United Alternative Convention. Conclusion of the Convention summarised in a report which the speaker has been distributing to Reformers and others. Personal recommendations included in the report. Why political leaders like the speaker are involved in this United Alternative effort. What Toronto business and community leaders can do to help lower federal taxes.