CANADA

High noon in Calgary

Mulroney faces Alberta’s fury over a tax

LISA VAN DUSEN April 16 1990
CANADA

High noon in Calgary

Mulroney faces Alberta’s fury over a tax

LISA VAN DUSEN April 16 1990

High noon in Calgary

Mulroney faces Alberta’s fury over a tax

With a light snow falling, the setting was idyllic. In jeans and new cowboy boots and accompanied by his wife, Mila, Prime Minister Brian Mulroney inspected a herd of Red Angus cattle at the 2,500-acre Mesa Creek Ranch in Millarville, Alta., 45 km south of Calgary. But the Prime Minister had larger objectives than simply showcasing his knowledge of livestock. Facing continuing criticism of his government’s proposed Goods and Services Tax, as legislation to enact the new seven-percent levy approached third and final reading in the Commons, the Prime Minister visited the heartland of antiGST sentiment in an attempt to influence public opinion. And he left little doubt of his determination to implement the unpopular tax, which is scheduled to take effect on Jan. 1. “We are going to sell it in Alberta and across the country,” he vowed. “Just you hang around and watch.”

In Ottawa, Finance Minister Michael Wilson also demonstrated the government’s resolve. With Commons consideration of the GST dragging on, Wilson imposed a two-day limit on further debate. The measure was intended to secure House approval of the bill and send it to the Senate this week. In response, the Liberal opposition threatened to use its majority in the upper house to delay the GST—or prevent it from becoming law entirely. Meanwhile, the strains of introducing an unpopular tax began to show within Mulroney’s own party.

The Prime Minister publicly warned two maverick Alberta backbenchers that he would not tolerate dissension on the GST from his own MPs.

Still, he and Wilson clearly face a difficult task in trying to sell the tax to the country. Late in January, Gallup Canada reported that fully 74 per cent of Canadians expressed distaste for the tax—which would replace an existing 13.5-per-cent federal manufacturers sales levy, but would apply to a wider range of transactions. The GST is particularly unpopular in Alberta, the only province without its own retail sales tax, where the prospect of Ottawa imposing the first direct consumer tax has galvanized intense opposition. Alberta’s 24 Conservative MPs are under particularly acute pressure from lobby groups and fellow Tories to vote against the levy.

In one case in February, Edmonton-area opponents of the tax won a majority of positions

on the executive of the Elk Island riding Conservative association. The group promptly demanded that the riding’s MP, Brian O’Kurley, vote against the tax. O’Kurley rejected that demand. But anti-GST spokesmen now say that they will work to replace him with another candidate before the next election. In Ottawa, meanwhile, Liberal finance critic

Douglas Young said that he will ask Liberal senators to block the legislation. Indeed, constitutional authority exists for the upper house to veto certain bills by voting against them. The last time the Senate employed that tactic, however, was in 1939. More commonly, the Senate has simply withheld its assent from bills

that it has opposed. In the past, that course of action has resulted in the government withdrawing the legislation—or allowing it to die on the order paper. Said Young: “We think the whole notion of the GST is unacceptable—so we will ask the Senate to block it.”

For their part, Liberal senators have not yet indicated how they might respond to Young’s request. But Senate banking committee chairman Sidney Buckwold, a Liberal, said that his panel, which will study the bill before the Senate decides on any course of action, planned to hold cross-Canada hearings on the bill. The committee is under no obligation to impose any deadline on its deliberations. But senior Tories warned that, in the event of a long delay by the Senate, they would keep both the House and

the Senate from recessing for the summer—a tactic designed to pressure the upper house to pass the bill. The government could also argue that the GST legislation qualifies as a money bill—which, the Commons claims, the Senate has no constitutional authority to tamper with. But Buckwold said that the government’s own claim that the GST is revenue neutral—and hence would not change the government’s money supplies—would undermine any attempt to designate the legislation as a money bill.

Criticism from within his own caucus also attracted Mulroney’s attention last week. For months, Tory MPs David Kilgour of Edmonton and Calgarian Alex Kindy had made their dislike of the tax apparent. Indeed, both men have said that they will vote against the GST. But, on March 23,the Alberta wing of the Tory caucus notified the two dissidents that they had been suspended. Last week, Mulroney said that their outspoken criticism of the tax had led to the expulsions.

Meanwhile, the Pro-Canada Network, a coalition of about 40 organizations opposed to the proposed tax, launched a new anti-GST campaign in association with the Canadian Labour Congress last week. It is asking Canadians critical of the GST to sign cards distributed by union members in workplaces, shopping centres and other locations, and mail them to Ottawa. “It will be another symbol of our total disgust with this tax,” said Adolph Cetinski, an Edmonton accountant and spokesman for the group. “People will vote down the GST.” And anti-GST § politicians clearly welcome those ^ grassroots campaigns. Said Young: “The one thing politicians will do is listen to the voice of the people if that

voice is loud enough.” Ultimately, it may take many more trips by Mulroney, like the one to Alberta, to convince a skeptical public to accept the divisive GST.

LISA VAN DUSEN

JOHN HOWSE