Public finances: An urgent recovery
Elements of political statements
Political statements of the Conservative Party of Quebec in terms of public finance and taxation respect the values of the Conservative Party of Quebec, the respect for freedom and individual rights, individual responsibility, a market economy, a state that s' sticking to the basics, a confidence for Quebecers and a place for Quebec within Canada and around the world.
A Conservative government will implement the following policies on public finances.
The fiscal balance and debt reduction
Quebec is the province where the various levels of government combined take in taxes of all kinds most of the gross domestic product. In addition, the Quebec government net debt is among the highest in North America in terms of percentage of gross domestic product.
From a first term, a Conservative government will introduce budgets that are at least balanced (no deficit) that will allow a reduction in the overall tax burden of Quebec taxpayers. Furthermore, these budgets will not include increases in total spending and even aim at reductions in these expenses as net debt (accumulated debt) of the Government of Quebec has not been reduced as a percentage of gross domestic product at a level classifying the lowest among the 25% in North America.
Spending cuts of the Québec State
We must balance the Quebec budget but also ultimately pave the way to begin to repay this huge debt that weighs on the shoulders of future generations.
A Conservative government will exercise to reduce state spending by deploying the three axes: first, the State will give up some activities that are not essential to its mandate and restrict capital expenditures in its core missions . He then delegate more and more activities to private enterprise to the extent that it can accomplish the same task more cheaply. Finally, departments will review their approaches and use their resources to do the same with less.
The financial assistance to businesses and subsidies
Quebec pays billions of dollars a year in direct subsidies to enterprises and loans and deferrals of all kinds that are accessible only to certain businesses and encourage dependence among women and pampered. The level of business support in Quebec would reach according to some calculations, measured per capita, more than four times the Ontario level. These grants and aid to companies create unfair competitive advantages for businesses favorites government in place, in addition to causing distortions in the efficient operation of a market economy.
A Conservative government will not pick winning companies from those who want to offer goods and services in a market of healthy competition.
State intervention in the economy and Crown corporations
The size of the Quebec state and its public and semi-public functions is among the most impressive in North America. The state intervention in most sectors of the Quebec economy has had the effect of creating an artificial economy often not viable in the long term, offering fewer real opportunities to its more younger generations. In addition, the state's economic involvement generally had as a corollary the granting of monopolies to the State in various facets of the economy.
A Conservative government will revise its first year in power, the role and purpose of each Crown corporation and public and parapublic organization that acts in an economic sector including the corollary existence of a monopoly in the provision and sale of services and goods by them. This review will aim to establish a list of those who should have priority:
- either be in their field of activities of free competition by private interests;
- either be privatized while subject to free competition in the provision and sale of their services and their property;
- or simply be abolished to allow the recipients of their goods and services available to meet their needs through the normal functioning of the market.
Before increasing electricity rates as proposed by the Commission Godbout, it would be appropriate to take the necessary measures to increase the productivity of Hydro-Québec. It is also imperative that the government stop using this Crown corporation to distribute grants.
Hydro-Québec could reduce operating costs of $ 700 million per year by reaching the same level of productivity comparable to private sector companies, which would increase all earnings.
A Conservative government is committed to taking the necessary measures to reduce operating expenses to $ 700 million over six years.
An increase of 25% of Hydro-Québec efficiency rate in managing its investments to reduce its term depreciation expenses and interest payments of one billion dollars a year, which would mean a equivalent increase in annual profit. As is done already in Ontario, a Conservative government will compete with the private sector to achieve its major infrastructure projects. This will result in a gradual increase in annual profit of one billion dollars.
A Conservative government is committed to Hydro-Québec in competition with the private sector to achieve its infrastructure projects to increase gradually, following a quick and realistic timetable, the annual profit of one billion dollars.
The government uses, for a dozen years, Hydro-Québec to subsidize handsomely private electricity producers (water, wind and biomass). It could eventually generate savings of $ 900 million per year if the government allowed Hydro-Québec to manage its electricity supply at the lowest possible cost.
A Conservative government agrees to leave Hydro-Québec to manage its supply of electricity at the lowest possible cost and to stop using our Crown corporation to subsidize private power producers.
Société des alcools du Québec (SAQ)
Although the Société des alcools du Québec (SAQ) pays an annual dividend of about $ 1 billion to the government, financial performance is poor. The government would increase its annual dividend of $ 300 million if the SAQ reached the level of efficiency of the best food distributors. We will improve the financial performance of the company by abolishing monopoly and allowing private enterprise to compete. This reform will not reduce the revenue that the government receives from the sale of alcohol.
A Conservative government is committed to abolish the monopoly of the SAQ and allow private enterprise to compete.
Taxes on payroll
It is in Quebec that taxes on payroll are the highest in Canada. For many, it is the main factor affecting the growth of small and medium enterprises in Quebec because they are a tax on human capital and thus hamper job creation for all Quebecers who want to work.
A Conservative government will begin a gradual reduction in the level of taxes on payroll in Quebec in a first term, with the goal of reducing it in a reasonable time among the most competitive in Canada.
The concept of the user pay
When the company decided to allow the State to provide certain goods and services that are well-qualified public, it is good practice to do reasonably bear the costs of these benefits by individuals who are the primary beneficiaries. This approach reduces the wasteful consumption of goods and services provided free or at a fraction of the real cost and is maintain equity between individuals and generations.
A Conservative government will, from a first term, to deploy the most realistic possible application of this concept in most goods and services that the Quebec government provides but, not increasing the overall tax burden of Quebec taxpayers.
The aggregate compensation of the public service
When a company chooses to provide goods and services to the population through the same employees of the State, it is essential that these employees are paid properly to achieve quality of service to which the public expects. Additionally, this compensation when considered globally (eg, salary, bonus, vacation, sick leave, job security, retirement defined benefit plans) does not have to be greater than it would be in the area private for similar circumstances.
A Conservative government will ensure that the total compensation of government employees will now comparable to that offered to private sector employees in similar circumstances or who liken it.
Labour funds (Solidarity Fund and actionfund) and Desjardins regional capital cost $ 221 million Quebec taxpayers in 2012. Only 21% of the funds raised have been invested in Quebec SMEs. The return on the portfolio is so low that they would be hard pressed to raise funds without the considerable tax advantage that they have agreed the federal and provincial governments. The costs of managing these funds are very high. Thus, the cost of managing the Solidarity Fund amounted to $ 130 million in 2013.
Governance of labor funds is poor and suffers from a democratic deficit. First, it is generally the unions, not investors, who appoint administrators funds even if the unions do not invest a penny in fund units. Then, shareholders can not withdraw their funds prior to retirement if they are unhappy with the return on their investment.
A Conservative Government will review in depth the rules on workers' funds. This revision will include:
- a cap on the subscribed share capital;
- redeployment of labor fund of capital and a redefinition of their mandate to truly help Quebec SMEs; and
- reviewing government strategies to encourage investment in venture capital by promoting a model where business angels and private investors would provide the majority of the development capital.
Godbout Commission, a major reform of Quebec's tax system
Here is how the members of the Godbout Commission evaluate Quebec's tax system:
"... The ratio between the volume of tax revenues to GDP observed in Quebec is higher than the average of the G7 and OECD countries. Taxation of Quebec is heavier than that used by major North American partners of Quebec to tax personal income, tax on corporate income, the consumption tax, the mass on taxes wage and taxes on property. The electricity tariff is the only major area where samples taken in Quebec are lower than in neighboring jurisdictions. "
The Conservative Party of Quebec fully endorses this diagnosis and welcomes the Commission recommendation to reduce the tax burden on individuals and to $ 5.9 billion business.
To promote economic growth and rising living standards, the Commission proposes revising the current tax scale on individual income that would allow them to benefit from a reduction of $ 4.4 billion of their tax burden through the abolition of the health contribution, to the increase in the basic personal amount to $ 18,000 and the addition of tax brackets that would increase the progressivity of the system. It is not, however, change the maximum marginal tax rate is 50% at present and would apply from taxable income 150 000 $ (102 $ 400 currently).
With regard to companies, their tax burden would be reduced by $ 1.5 billion as a result of a reduction of 11.9% to 10% tax rate on their income, the establishment of a "premium growth" for SMEs and a decrease in the rate of tax on the payroll for SMEs.
A Conservative government would apply, in a first term, net tax cuts of 5.9 billion proposed by the Commission Godbout.
Funding for this tax reduction
As Godbout Commission chose to define a tax reform bill that is neutral in terms of tax revenues collected, reducing taxes would be funded by a significant increase in the consumption tax, by reducing tax expenditures and by a substantial increase in electricity rates.
According to the Commission, the proposed reform would increase to $ 2 billion in GDP and nearly $ 600 million in personal disposable income. It would also create 20 500 jobs, which would give hope to the 300,000 unemployed people in Quebec.
But we can and must do better is to further increase the number of jobs and disposable income of Quebecers
The Conservative Party of Quebec applauds the reduction of tax expenditures recommended by the Commission. However, we strongly object to the proposed increase in consumption taxes and rising electricity rates.
A Conservative government would put in a first term, all the recommendations of the Commission Godbout for the abolition of tax expenditures.
The Conservative Party of Quebec is strongly opposed to the proposed increase in consumption and rising electricity rates taxes, as long as lower taxes on individuals and corporations is less than any increase of so there is a net decrease of $ 5.9 billion.
Compensate for income losses otherwise
Otherwise it is possible to offset the revenue losses that the government would suffer by implementing tax cuts proposed by the Godbout Commission. The Conservative Party of Quebec is convinced that this can be achieved by the abolition of a multitude of grants and tax expenditures that have stood the analysis of the Commission, as well as an increase in productivity of public administration and public sector enterprises.
The measures that we have identified would further reduce the income tax for taxpayers and tax payroll companies. Why stop to make the collection of taxes less harmful to the economy, when we can reduce the tax burden of Quebecers, create more jobs and make our economy more productive?
A Conservative government is committed to reducing the tax burden of Quebecers and to foster job creation more than the proposed Godbout Commission and to make our economy more competitive.
The Commission is funding a portion of the tax cuts it proposes the abolition of a number of tax credits that benefit businesses and individuals at the present time. The Commission expressed support for his reform on the following analysis of the OECD:
"According to the OECD, tax regimes favor ... increase costs and create rent-seeking opportunities and tax evasion. ... They erode the tax base, affect the quality of the investment and often against-productive .... "
After subscribing to the OECD analysis, the Commission surprised us by proposing the improvement or maintenance of five costly tax provisions:
The Conservative Party of Quebec is absolutely agree with the OECD and believes that we should abolish all tax credits which, like the others, distort investment incentives do not contribute to the collective and undermine the transparency of the tax system enrichment.
the total financial assistance from the Quebec government to economic development reached in 2013-2014, $ 3.4 billion. This assistance was divided between tax assistance (73.5% of total aid), direct budget support (14.7% of total aid) and indirect budgetary aid - that is, said supporting organizations mandated to support economic development (11.8% of total aid).
Business support is scattered, with the risk of overlap and duplication. In 2013-2014, direct budgetary aid was distributed by twelve departments and agencies, as part of 84 different programs. Also in 2013-2014, the indirect budgetary aid was distributed to 503 organizations mandated to support businesses in certain areas of intervention. Approximately 60% of these organizations were involved in the fields of entrepreneurship and consultation.
A Conservative government is committed to abolish:
- - The tax credit for the production of multimedia titles;
- - The tax credit for scientific research and experimental development;
- - The tax credit for the development of electronic business;
- - The tax credit for the integration of information technology and telecommunications in manufacturing SMEs;
- - The tax holiday for large investment projects (C2i)
- - The tax credit for investment.
The retail funds
We also propose the abolition of tax credits that benefit the Fondaction and the QFL Solidarity Fund. Both funds have provided investors with their low yields. They do not contribute to increase the financial literacy of Quebeckers as their advertising campaigns primarily based on tax benefits they provide or the fact that they invest in the Quebec economy. It is generally speaking not yield, a key reason for investing.
A Conservative government is committed to progressively abolish, over a period of three years, the tax credits enjoyed by retail funds.
Support to scattered companies
According to a study for the Commission Robillard, the total financial assistance from the Quebec government to economic development reached in 2013-2014, $ 3.4 billion, and was divided into three categories according to the nature of the aid.
- Tax assistance reached $ 2.5 billion, or 73.5% of total aid to economic development;
- Direct budget support represented $ 0.5 billion or 14.7% of total aid to economic development;
- Part of this aid, or $ 134 million corresponded to loans and loan guarantees, which the leverage is much more important than just budgetary impact;
- Indirect budget support - that is to say, supporting organizations mandated to support economic development - reached $ 0.4 billion, or 11.8% of total aid to economic development.
- Twelve departments and agencies were managing 110 different programs (direct aid and indirect aid) and fifty fiscal measures, and provided support to more than 500 organizations mandated to support businesses in certain areas of intervention.
Also in 2013-2014, with GDP twice as high, Quebec provided direct budget support almost as high as in Ontario and higher tax assistance to Ontario's tax assistance.
Taxation Quebec requires companies a significantly higher tax burden than all other Canadian provinces. This gap represents a higher tax burden of $ 3.0 billion compared to the application in Quebec of Ontario's tax system. The tax burden of Quebec companies is twice higher than that of businesses in British Columbia or Alberta
The Couillard government has already reduced by about $ 600 million in tax assistance for businesses between 2013-2014 and 2015-2016 without touching budget aid that has remained virtually constant at $ 552 million in 2015-2016.
A Conservative government is committed to phase out tax incentives and direct and indirect support of business support and use the money saved to reduce their tax burden.
Abolition of the QST on the resale of used goods
The more one extends the useful life of a consumer, the more we decrease its ecological footprint. In other words, the more a property is used for a long time, the more damage that the production of this well has caused to the environment are amortized over a longer period of time. Or, apply to used goods QST returns to discourage the purchase, which harms the environment because the production of new consumer goods is a polluting process.
Moreover, apart from some thrift trendy upscale areas, most used goods, such as clothing, are purchased by the less fortunate in society. Therefore, applying the QST on the sale of used goods is the practice disproportionately affects the poor.
A Conservative government completely cease taxing the resale of all used consumer goods, including automobiles.
Abolition of the deposit on bottles and cans
Instructions 5 ¢ and 10 ¢ on the bottles were created at the time the selective collection of garbage or blue box when depositing recyclables, did not exist. Now that the selective garbage collection covers almost the entire territory of Quebec, it would be greener to file containers that are currently recorded in our recycling bins. So the transportation of recyclable materials to the sorting centers in Consolidated find, which would reduce its emissions of greenhouse gases.
Finally, as the set would have no raison d'être, it would be abolished, which makes it easy for merchants who sell products in containers that are currently recorded.
A Conservative government would abolish the deposit on all bottles and cans and encourage Quebecers to put them in their recycling bin.
Abolish Revenu Québec
According to the Federation of Quebec's Chambers of Commerce, the Quebec coexistence of the two agencies responsible for tax administration, Revenue Québec and the Canada Revenue Agency, represents a duplication would cost between four and five hundred million dollars per year .
The weight of the tax splitting for public administration must be added that for taxpayers. Individuals and companies must complete two tax returns, dealing with both agencies for audit or dispute. This time spent to comply with two sets of tax obligations could be better spent, especially by small businesses.
A Conservative government is committed to abolish Revenu Québec to reduce state spending four hundred million dollars and to make life easier for taxpayers.
SODEC Financing Reform
SODEC is currently 100% financed by taxpayers' money. For example, its federal counterpart in the recording industry, Musicaction, receives part of its funding in the form of federal grants, and must pick up the rest with private enterprise. Impose the same model of funding from SODEC would be an excellent way of ensuring that public funds are not used exclusively to finance the author that few Quebecers cinema productions will look or albums songwriting little-translators will buy and listen to Quebecers.
A Conservative government will transform SODEC non-profit organization (NPO) Private and reduce public subsidies to this organization to allow the private sector to contribute more. In addition, the Government of Quebec contribution to SODEC become proportional to the amount of money it has collected in the private sector.
Abolition of the Law on the development of Québec firms in the book industry.
The "book chain", a structure established in 1981 under Law 51 (or Development Act of Québec firms in the book industry), defines the responsibilities of each link in the chain and the share of profits which amounts everyone who should supply where, who can sell what, when, to whom. This legislative framework is a real straitjacket for the book industry in Quebec, and it is time to modernize it in the liberalizing.
A Conservative government will abolish the Act respecting the development of Québec firms in the book industry to liberalize the marketing of books and promote the growth of the Quebec economy.
Public-Private Partnerships (PPPs) in Infrastructure
A Conservative government is committed to achieving, in PPPs, infrastructure works needed to improve the flow of traffic on road networks.