Escalator Tax and the Independant Senate

     In last week’s report I referenced the emerging new dynamic in Ottawa.  The increasingly more independent Senate is interfering with the Liberal Government's Parliamentary agenda. While most of the response I've heard locally is supportive of the Senate reviewing and amending legislation they believe to be flawed,  there are certainly some who oppose any intervention from an un-elected Senate over bills passed in a democratically elected house.
 
The primary issue I raised last week was the Liberal Government's proposed use of an “escalator tax” that would be levied on most wine, beer and spirits sold in Canada. Under an escalator tax essentially the tax rate is increased every year and is set by civil servants linked to inflation as opposed to having to come before the House for debate in the annual budget.
 
As I also speculated last week, despite considerable effort by the Liberal Government to the contrary, the Senate did indeed vote to amend the Liberal budget bill and removed the “escalator tax”. What happens next? Once the Senate amends legislation it must then be sent back to the House of Commons where the Liberals have already stated they will reject the amendment made by the Senate and insist on the inclusion of the escalator tax in the budget bill. This in turn has the potential to send the re-amended bill back to the Senate where it could potentially be amended again, thus creating a legislative standoff. At this point it is unclear what the outcome will be however many eyes in the Ottawa bubble are focused on this topic.
 
From a Parliamentary aspect it should not be overlooked that the idea of removing Senators from caucus to sit as independent Senators was championed and done by Prime Minister Trudeau.  In that respect some observers point out that this problem is one of the Liberal's own creation. However a closer inspection reveals that the ‘Independent’ Senators appointed by the PM have actually voted in support of Liberal government bills close to 95% of the time. In reality it is former Liberal Senators now sitting as Independent Liberals and Conservative Senators who more frequently vote against Liberal legislation.
 
One point that all Ottawa pundits do agree on is that the greater independence of the Senate has ultimately created a more powerful Senate. This is a point that has not been lost on Ottawa lobbyists either. Recent lobbyist registry data shows that Senate lobbying has increased dramatically. In fact Senators were lobbied more in 2016 than any other year in history with close to 700 interactions recorded. In 2015, the last year the former Government was in power, this number was 217.
 
Although the vast majority of citizens I have heard from support the Senate’s current efforts to stop the escalator tax there, may well come a time when the Senate stages an intervention on a democratically passed Bill that the public may be more supportive of.

I welcome your comments on this or any subject before the House and can be reached at Dan.Albas@parl.gc.ca or call toll free at 1-800-665-8711.