May 27, 1924

CON

Robert James Manion

Conservative (1867-1942)

Mr. MANION:

In listening to these

delinquent tax cases one's recollection is naturally thrown back to the old election cry with regard to the Riordon case. We were abused very severely for having allowed one company to forget to pay its taxes right on time. Now there are some thousands of such cases. There is an aspect of these delinquent taxes which, so far as I have noticed, has not been touched on, and I think it is worth impressing on the minister. When a company is in the position of owing $100,000 or $200,000 of taxes, as some of these companies are, that company is sometimes placed at a very material disadvantage in regard to its future business operations. I had an instance brought to my attention very recently. A very large corporation, through business ventures, is to-day in such a depressed condition that, instead of hiring in the neighbourhood of two thousand men, as it did in the very recent past, it is only able to hire three hundred.

Topic:   WAYS AND MEANS
Subtopic:   SALES TAX
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LIB

James Alexander Robb (Minister of Immigration and Colonization)

Liberal

Mr. ROBB:

That is not due to the sales tax.

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Subtopic:   SALES TAX
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CON

Robert James Manion

Conservative (1867-1942)

Mr. MANION:

No, but it is a case of delinquent taxes-I am not criticising the government in this case, I am simply illustrating the situation. The Minister of Finance recognized the case instantly.

Topic:   WAYS AND MEANS
Subtopic:   SALES TAX
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LIB

James Alexander Robb (Minister of Immigration and Colonization)

Liberal

Mr. ROBB:

Oh, yes.

Topic:   WAYS AND MEANS
Subtopic:   SALES TAX
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CON

Robert James Manion

Conservative (1867-1942)

Mr. MANION:

The fact is it is the business profits tax which the company is in arrears with, but at the same time it brings about exactly the same condition.

Topic:   WAYS AND MEANS
Subtopic:   SALES TAX
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LIB

Andrew Ross McMaster

Liberal

Mr. McMASTER:

Does the hon. gentleman feel that the government should use clemency and consideration in such a case? His leader does not seem to think so.

Topic:   WAYS AND MEANS
Subtopic:   SALES TAX
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CON

Robert James Manion

Conservative (1867-1942)

Mr. MANION:

I am not blaming the government. This company probably could have paid its taxes when it made its profits, but at the present time it cannot pay off those arrears, which are in the neighbourhood of $150,000. It is placed in a very difficult position..

Topic:   WAYS AND MEANS
Subtopic:   SALES TAX
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LIB

James Alexander Robb (Minister of Immigration and Colonization)

Liberal

Mr. ROBB:

Does my hon. friend blame

this government for not having collected that tax?

Topic:   WAYS AND MEANS
Subtopic:   SALES TAX
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CON

Robert James Manion

Conservative (1867-1942)

Mr. MANION:

No. I say I am not

criticising this government; I am offering this suggestion as a reason why we should- whether under this government or under some future government-avoid* as far as possible, allowing taxes to get in arrears.

Topic:   WAYS AND MEANS
Subtopic:   SALES TAX
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LIB

James Alexander Robb (Minister of Immigration and Colonization)

Liberal

Mr. ROBB:

I agree with my hon. friend.

Topic:   WAYS AND MEANS
Subtopic:   SALES TAX
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CON

Robert James Manion

Conservative (1867-1942)

Mr. MANION:

This company is in a

difficult position. To-day it is employing only about 300 men. It is in need of money from the bank to carry on its operations, but the bank refuses to give the company money on the ground that the government's claim comes first. They say, "If you go into bankruptcy the government will claim its money, having a first charge upon your goods, upon your debts, and so on; so we cannot lend you a cent unless you can come to some arrangement with the government." I repeat that I do not think in this case the government is subject to any criticism, but I have it from the officers of the corporation that unless some arrangement can be arrived at it will have to close down. Well, it is too bad that at any time, whether under this or any future government, a corporation should be permitted to get away from paying its taxes at a time when it probably can pay them and then at a later day have those taxes hanging over their heads

Ways and Means-Sales Tax

and preventing the financing of their operations. I mention this case to emphasize the necessity for collecting our taxes as they become due. I hold no brief for this company; it is not even in my own constituency; it is a company which cannot by any stretch of the imagination be regarded as able to pay its taxes, according to its own statement. It seems to me that in a case like that a thorough investigation should be made by some capable person, say a chartered accountant, with a view to arriving art some form of settlement that would permit the company in question to deal with the banks and to carry on operations to the best of its ability.

Topic:   WAYS AND MEANS
Subtopic:   SALES TAX
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LIB
CON

Robert James Manion

Conservative (1867-1942)

Mr. MANION:

Perhaps we should wetnurse them along. At any rate we should close the thing out in some way, get rid of it-take away from the corporation that debt which is hanging over its head.

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Subtopic:   SALES TAX
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CON

Arthur Meighen (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. MEIGHEN:

Will the minister give

us his explanation of the fact that some three thousand cases of companies that cannot pay their sales tax are being nursed, at a time when the country is as prosperous as described in the Speech from the Throne?

Topic:   WAYS AND MEANS
Subtopic:   SALES TAX
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LIB

James Alexander Robb (Minister of Immigration and Colonization)

Liberal

Mr. ROBB:

The act that my hon. friend

is complaining of, providing for the 6 per cent, came into force on the first of January. The total number of arrears, three months and under, according to' the return brought down, was 707. The others are further back.

Topic:   WAYS AND MEANS
Subtopic:   SALES TAX
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CON

Arthur Meighen (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. MEIGHEN:

More than three months. That will make the question I put still harder to answer.

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Subtopic:   SALES TAX
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LIB

James Alexander Robb (Minister of Immigration and Colonization)

Liberal

Mr. ROBB:

Oh, with regard to the observations of my right hon. friend that we should collect our taxes when due-*

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Subtopic:   SALES TAX
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CON

Arthur Meighen (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. MEIGHEN:

That is not the question.

Topic:   WAYS AND MEANS
Subtopic:   SALES TAX
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LIB

James Alexander Robb (Minister of Immigration and Colonization)

Liberal

Mr. ROBB:

I do not challenge that statement at all. I agree with my right hon. friend and with the hon. member for Fort William and Rainy River (Mr. Manion) that it is always good business to collect your taxes when they are due. I do not dispute that.

Topic:   WAYS AND MEANS
Subtopic:   SALES TAX
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CON

Arthur Meighen (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. MEIGHEN:

The minister seems to

have missed my point. How does he account for having to chrry along 3,170 cases of arrears of sales tax at a time when the country is as prosperous as described in the Speech from the Throne?

Topic:   WAYS AND MEANS
Subtopic:   SALES TAX
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May 27, 1924