August 17, 2006
Address by the Honourable Jim Flaherty, Minister of Finance, to the
Ontario Convenience Stores Association Annual General Meeting
Toronto, Ontario
Check against delivery
Convenience store owners make a big contribution and valuable
contribution to the Canadian economy and the Canadian way of life. I am
happy to be here, to share some time and ideas with a group of entrepreneurs
like you—people who work hard and contribute more than many of us know to
Canadians, to our communities and to the national economy as a whole.
My friends, you’re always there for Canadians, and I say that living in
Whitby with three 15-year-old boys who are constantly going out to the
store. You’re there 24 hours a day, 7 days a week. I’m sure
everyone in Canada has paid a visit to a convenience store at one time or
another. We’ve been there as children to buy—I guess I’m dating
myself—I was going to say penny candy but that shows how old I am, is
anything sold for a penny anymore? I don’t know. As teenagers certainly to
buy snacks and magazines, as adults to pick up milk and diapers for our
children—I can remember that well—and newspapers that connect us to our
communities.
Corner stores are the cornerstone of our economy in Canada. You are the
heart and soul of small business. You keep the entrepreneurial spirit alive
from generation to generation and many of you, I know, work long hours
alongside your families. Many of you provide young Canadians with their
first jobs and their opportunities to learn and to teach and to be taught
the value of hard work and responsibility and the value of a dollar. So your
contributions cannot and should not be underestimated and certainly are not
underestimated by the new Government of Canada.
In Ontario alone, convenience stores contribute $12 billion a year to the
Canadian economy and provide more than 70,000 jobs, which is an enormous
contribution to the province of Ontario, Canada. As your association itself
has noted, every 30 days Ontario’s convenience stores have as many
visitors as Canada has people—that’s about 32 million people. This
impact is profound and your determination is inspiring.
So on behalf of Canada’s new government, on behalf of Prime Minister
Stephen Harper, I thank you and your families for the constant sacrifice you
make in order to make our lives a little easier.
Now let me say a few words about the direction of the new Government of
Canada. It seems like a while ago now but it was only in January this year
that Canadians voted for change. They chose change to replace a culture of
entitlement with a new government that is open and accountable. They chose
change to replace years of excessive spending—and, my goodness, I’ve
seen that—with a government that is focused and deliberate and fiscally
responsible. They chose change. They chose a government that will move this
country forward and help Canadians reach their goals.
Like you, we keep our word. We respect the trust that Canadians have
placed in us and we will not take that for granted. We told Canadians we
would clean up government, and the first piece of legislation we introduced
in the House of Commons was the Federal Accountability Act. This act puts an
end to the culture of entitlement which was prevalent in government. It
ensures that Canadians receive a full accounting of how their tax dollars
are spent.
We also told Canadians that we would lower their taxes, and in our first
budget, which I was honoured to present in the House on May 2nd, we did just
that. We cut taxes of every kind. We cut taxes for working Canadians
beginning with a 1 per cent cut to the GST. Sales taxes are down. Income
taxes are down. Business taxes are down. Small business taxes are down.
Immigration taxes are down. Capital and capital gains taxes are down. And
we’re not finished yet.
We told Canadians we would make their streets safer. We’ve now
introduced legislation designed to protect Canadian families and communities
by strengthening the justice system, putting more police on the streets,
creating reality in sentencing in Canada and giving those police officers
better resources and training.
We also committed to Canadian parents that we would support their rights
to choose the best way to care for their children. After all, the best
parent is not the government; it’s mom and dad. Now Canadian parents are
receiving a $1,200 per year Universal Child Care Benefit designed to support
their child care choices through direct assistance. Our government is also
working to create more day care spaces.
And, finally, we told Canadians we would protect and strengthen our
health care system by working with the provinces to provide a patient wait
times guarantee. I can tell you that our government is hard at work on this
and making significant progress.
So those were the commitments that we made, and I’m going to talk a bit
about reducing the tax burden since that’s my job as Minister of Finance.
You know, a lot of you will say: why cut taxes? Well, simply put, it’s the
right thing to do. Simply put, we want Canada to grow. We want people to
make profits. We want people to reinvest in their businesses. We want them
to employ more people. We want people to view Canada as a great place to
invest and grow businesses and employ people and create wealth and watch
this economy grow.
Government has been overtaxing Canadians for too long. Under the previous
government, billions of dollars were taken from Canadians through
overtaxation to fund large and often hidden surpluses. Meanwhile, Canadians
are working longer, paying more taxes and saving less than they were 13
years ago when the last government came into office. We know that it’s in
the shop, on the farm, in the classroom, on the factory floor, in research
labs, small businesses, on construction sites, community centres and church
basements, all denominations, where this country moves forward every day.
And that is where we should remove the burden of overtaxation. Why? So
that we can encourage independence, initiative, family, hard work because
they are the very core of what drives and enriches Canadian lives. Canadians
don’t need to hand over more and more of their hard-earned money to
government in order to fund continued surpluses and wasteful spending, much
of which arises out of so-called windfalls at the end of fiscal years, where
the previous government would go ahead and spend money without parliamentary
authority on all kinds of programs, many of which had nothing to do with the
core responsibilities of the Government of Canada, and we’re not doing
that anymore.
Canadians need to keep more of their money to invest in their own
families and their own priorities and their futures, to invest in our
economy and help businesses thrive, and that helps all of us as Canadians.
So it’s time to take less from Canadians in terms of taxes. That’s
what we started doing in Budget 2006. We delivered over $20 billion in tax
relief over two years. That’s more tax relief in one budget than the
previous government’s last four budgets combined. In all, we introduced 29
tax cuts, with over 90 per cent of those tax reductions going to individual
Canadians and their families. As you know, we reduced the GST from 7 to 6 per cent effective July 1 of this year and there’s more to come. As you
know, we had a further commitment with respect to another point over the
course of the mandate.
Cutting the GST cuts taxes for everybody, including those who don’t
earn enough to pay income tax. And you may think that’s not very many
people in Canada, but it’s actually about a third of Canadians that
benefit from the GST that would not benefit from simply an income tax cut.
So we’re providing, by that GST reduction, we’re providing a benefit for
all Canadians every time they buy something in one of your stores or
elsewhere in the retail market. We reduced the lowest personal income tax
rate as well. And this is a substantial tax credit.
We brought in a credit for transit passes so that people who take public
transit now with a monthly pass will in effect have two months free per
year. And this is an encouragement. It’s an environmental measure. It’s
good for our cities. It’s good for our great urban areas like the Greater
Toronto Area and I think it’ll have a marked effect as it comes into play.
We delivered the Canada Employment Credit and that helps Canadians—you
know many Canadians have complained that if you have your own business or
you’re self-employed or whatever you get certain deductions but if
you’re employed you don’t. We brought in the Canada Employment Credit to
help Canadians offset the costs of working. Canadians can put this money
towards things like uniforms and computers and so on. And that’s available
on employment income of up to $500 and it will double to $1,000 starting
January 1, 2007.
Now looking forward, you know, every Canadian, I think, certainly in my
experience, dreams of a better future for themselves and for their children,
for the generations that will follow. It’s the Canadian dream and it’s
Canadian history—when you look at Canadian history. And all of us are
newcomers to this country, as you know, except for the Aboriginals in
Canada. And the dream always has been and the reality always has been in
this great country that each generation does better than the generation
before, that the standard of living and the quality of life of each
generation is higher than the generation before. And it is our goal to
ensure that that happens, in the new economy of the world, that this great
country, this great economy of Canada grows with that world economy.
We’re making it easier for new Canadians to pursue and realize their
dreams. We’re making it easier for those who make the difficult choice to
leave their country of birth and build a new life here in Canada, easier to
get settled and to get ahead. Our country is what it is today because of the
people who struggled before us.
Effective May 2nd this year, we reduced the Right of Permanent Residence
Fee, as we promised we would, by 50 per cent from $975 to $490. We increased
immigration settlement funding by $307 million and, very importantly, we
funded the establishment of the Canadian Agency for the Assessment and
Recognition of Foreign Credentials so that people who choose to make Canada
their home have the opportunity to put their professional training to good
use.
You know and I know that we have thousands of immigrants already in
Canada who have the skills and training necessary to make a much-needed
contribution to our economy and our labour market, and this is more and more
important in Canada today because in certain parts of the country,
certainly, we’re facing a shortage of qualified people for many jobs. Now
the problem has been that they often didn’t get their qualifications
evaluated and recognized by employers or by the appropriate licensing or
professional bodies. When they lose out, Canada loses out. It’s a waste of
potential and that’s why we’ve created the new agency so that we can
ensure that newcomers’ skills, training and credentials are recognized and
respected and rewarded promptly.
And we want Canadian business to grow. Canada is a country of
entrepreneurs. If you look at Canadian history we’re risk takers, we’re
innovators, we’re achievers. Some of the world’s most innovative
companies today and inventions today started right here in Canada. You know
this—I do have it with me—this device here, this RIM BlackBerry, which
every member of Congress in the United States carries, by the way, because
of 9/11. It was the only thing that kept working so they could communicate
with each other in Washington and elsewhere. That’s a piece of brilliant
Canadian innovation from, as you know, from Kitchener–Waterloo, from RIM.
It has revolutionized the way we communicate and do business. As I say,
created by Canadians.
Our government believes that it is important that entrepreneurs like you
have the opportunity to compete in a country with a supportive economic
environment which rewards hard work and helps entrepreneurs get ahead. The
reduction that we made this year in the small business eligibility threshold
moved from $400,000—sorry, to $400,000 from $300,000. That goes to the
point of wanting Canadians to reinvest in their small businesses and grow
their businesses.
We’re also reducing the 12 per cent rate to 11.5 per cent in 2008 and
11 per cent in 2009. That’s the small business rate. We’ve provided the
tax relief promised but not delivered, I might add, by the previous
government.
We reduced the general corporate income tax rate. We eliminated the
corporate surtax for all corporations. We eliminated the federal capital tax
as of January 1, 2006. We are delivering results for businesses, not just
good intentions. Just like you deliver results in your businesses.
So cutting taxes is one way to help Canadian businesses grow. Providing
the right environment for growth is another. There is a new momentum
building in Canada. I can tell you as I travel across Canada and including
here in the GTA, there’s a great feeling of optimism in this country.
It’s not just in Calgary we all know is boom times. There’s a tremendous
sense that we have an opportunity here, particularly with a new government,
with a new point of view, with a new optimism to grow the Canadian economy
and ensure that we fulfill that Canadian dream of a higher standard of
living and a higher quality of life.
So being Canadian today means being innovative, having initiative, being
confident, optimistic, ambitious. It means seeing ourselves and the world
through new eyes with a renewed will to achieve even more than we have
before in this great country. It means unleashing our country’s
entrepreneurial potential.
You know, Canada wasn’t built by programs. Even though I’ve been in
government for a while, it wasn’t built by governments either. It was
built by people, hard-working Canadians like you, like my parents, like my
grandparents, like your parents, striving for better lives for themselves,
their families and their communities. We as a government can never forget
that. The engine of the economy isn’t government. It’s people that get
up every morning, even those dark days in January and February, and go out
and work. I’d like to say you don’t work half the year for the
government but it still is almost half the year that you’re working for
the various levels of government in Canada. But we’re working on that and
we’ll continue to reduce that tax burden in order to encourage people to
work and grow the Canadian economy.
So that’s why we’re here. We’re here to create a better future for
Canada. We are fortunate—we all know that. We’re living in a country
where we are free to speak, and given the events of recent times, as you
look around the world, you know, just the ability to speak openly, to
worship freely, to vote, to raise a family, to educate our children, to have
the fabulous educational opportunities and skills training opportunities we
have for young people in Canada and to spend our lifetimes reaching higher,
striving to become better in whatever we define as success. That’s why
where previous governments pursued unsustainable spending, we are pursuing
and offering choices for Canadians, choices that will lead to greater
opportunity.
Now, as the Minister of Finance, I have had the opportunity recently to
discuss Canada’s potential with the finance ministers of the world’s
leading economies in the G7. I can tell you that they’re impressed and
excited by our country’s, by Canada’s growth and Canada’s potential.
We have the lowest unemployment rate in over 30 years, low inflation,
continuing budget surpluses and an economic expansion that is now in its
15th straight year, but we must have a vision. We must set clear and
practical goals, make the right choices and work together—private sector
and public sector—in a sustained and systematic way for an even better
economic future. We need a competitive tax system. We need a competitive
regulatory system. We need to make investments in our economy attractive and
easy. We need to educate our youth so that they can reach their full
potential and compete on the world stage. We need to invest in the
continuing development of those already in the workforce. We need to invest
in research and development. And we need to unleash and support the
entrepreneurial spirit of Canadians.
Now we’ve taken the first steps to do that with our first budget in May
but we are determined to do more, to do more to ensure Canadian businesses
can continue to grow, to do more to offer new incentives and create jobs.
That is why in the weeks and months ahead our government will set out a
clear, long-term economic plan to strengthen this country with objectives
aimed squarely at increasing opportunity for Canadians. We will talk with
Canadians across the country, listen to their challenges and their ideas and
develop a plan which will take Canada even further in the years ahead.
Now I’ve gone on here almost as long as it seems. I’m almost done.
These are good times for Canada. It’s great to represent Canada in the
finance meetings that we do with the G7 and G20 and the IMF and the World
Bank. We have a tremendous amount to be proud of in Canada. And what
opportunities we have in Canada to have what would be a dramatically
splendid economy going forward if we make the right decisions and have the
right vision.
As I say, our economy is solid. We have a new government and a new,
exciting direction. We have a great prime minister who knows where he wants
to go in terms of leading the Government of Canada and leading the growth in
the Canadian economy. Some people might think that this is not a bad start.
Well, it hasn’t been a bad start, I must say, for the government these
past six months or so. But we have much more to do. It can get much better.
We can do even better. Canada now has a government that embraces and
embodies the Canadian spirit to exceed our own expectations and reach for
our dreams. So let’s work together to create even more opportunity and an
even stronger and more prosperous Canada for today’s generation and for
those who will follow us.
Thank you for inviting me to be with you today, and I’ll be happy to
hear your questions. Thank you.
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