So whenever we're faced with that situation and as you know, we're at budget time now if we don't have competitive tax rates, well, we'll see further outflows of capital. Mr. Brian Pallister: One of the issues of concern here, and the Mintz report raised it, among other things, of course, is the issue of tax deductibility for interest charges, allowing our people in Canada to lever on their own assets here, reduce their taxable profits in Canada, and thereby remove capital from the country to low-tax jurisdictions elsewhere.

Where tax havens are concerned, cooperation between States, in particular within the OECD, must be supported in order to curb practices which may encourage tax evasion; this approach must be tempered by the right of States to define their methods and level of taxation autonomously, and to use tax incentives to attract investment and firms; in this context, the path of 'information coordination' suggested by the OECD might prove beneficial, and avoid the problems associated with the idea of 'regulatory coordination'.

Where an undertaking has significant market power on a specific market, it may also be deemed to have significant market power on a closely related market, where the links between the two markets are such as to allow the market power held in one market to be leveraged into the other market thereby strengthening the market power of the undertaking, but only where the imposition on the undertaking of the requirements resulting from its position on the market where it is already deemed to have significant market power cannot effectively compensate the effects of such leveraging.

This means, honourable senators, that our capital gains tax regime creates a powerful - and, I should like to believe, unintended - incentive to finance corporate expansion and reorganization through leveraging rather than through equity.

There are basic conditions and those conditions must be met''. Does the Prime Minister realize that this federalism, based on the imposition of national standards, is radically opposed to Quebec's wish to have control over the intervention tools, particularly in the manpower training sector?

At a time when other countries are using corporate tax reform and personal tax reform as vehicles and levers for economic growth, including Ireland and the Scandinavian countries, this country continues to cling to the past.