Ah, I see.
Evidence of meeting #140 for Finance in the 44th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was amendment.
A recording is available from Parliament.
Evidence of meeting #140 for Finance in the 44th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was amendment.
A recording is available from Parliament.
1 p.m.
Bloc
Gabriel Ste-Marie Bloc Joliette, QC
Yes, I've got it. While I listen to the other explanations, I'll read the French version. Based on my colleague Mr. Baker's explanations, I'll support the amendment.
1 p.m.
Liberal
The Chair Liberal Peter Fonseca
Thank you, Mr. Ste‑Marie and Mr. Baker.
I have Mr. Chambers and then Mr. Lawrence.
1 p.m.
Conservative
Adam Chambers Conservative Simcoe North, ON
I guess I'll wait for it to show up in my inbox. I was curious about the change between what was circulated before and your amended version. It hasn't landed yet. Is it a comma, or is it...?
1 p.m.
Liberal
The Chair Liberal Peter Fonseca
Do you want to respond to that, or do you want me to go to MP Lawrence and then...?
1 p.m.
Liberal
Yvan Baker Liberal Etobicoke Centre, ON
I'm conscious of being efficient and moving through this. I would say there was a version issue in the previous draft. The intent of what we want to achieve is what I described, and it's reflected in the new version of the text.
1 p.m.
Conservative
Adam Chambers Conservative Simcoe North, ON
How many policyholders would be affected if this amendment did not pass? Do we have an idea?
1:05 p.m.
Director General, Legislation, Tax Legislation Division, Tax Policy Branch, Department of Finance
I don't have the information in front of me. It would relate to any insurance companies, so it would exempt the insurance companies broadly.
1:05 p.m.
Conservative
Adam Chambers Conservative Simcoe North, ON
Does it exempt all insurance companies in total, or does it exempt those parts of the insurance company business where there's flow-through to specific insurance policies, like insurance products?
1:05 p.m.
Director General, Legislation, Tax Legislation Division, Tax Policy Branch, Department of Finance
It would exempt any dividends received by an insurance company in respect of a share that's held by the corporation in the ordinary course of its insurance company business, as well as if the share is received through a mutual fund trust.
1:05 p.m.
Conservative
Adam Chambers Conservative Simcoe North, ON
It's for any dividends that all insurance companies receive.
1:05 p.m.
Director General, Legislation, Tax Legislation Division, Tax Policy Branch, Department of Finance
If they're holding the share in connection with their insurance business, yes.
1:05 p.m.
Conservative
Adam Chambers Conservative Simcoe North, ON
Okay. That's satisfactory to me.
We still don't have the amended version. I don't think we do.
1:05 p.m.
Liberal
The Chair Liberal Peter Fonseca
No. You should have the amended version. It's been sent.
I have MP Lawrence and then MP Davies.
1:05 p.m.
Conservative
Philip Lawrence Conservative Northumberland—Peterborough South, ON
I want to say that my Bloc Québécois colleague raised a good point earlier and I thank him. We're in a bilingual country and that's very important to Canadians.
1:05 p.m.
NDP
Don Davies NDP Vancouver Kingsway, BC
Thank you, Mr. Chair.
To follow up on the last question, I want to make sure that the effect of this amendment.... Would it confer a benefit, broadly speaking, on the insurance companies, or is it a benefit that's conferred upon the policyholders of certain kinds of policies that may be affected?
April 30th, 2024 / 1:05 p.m.
Director General, Legislation, Tax Legislation Division, Tax Policy Branch, Department of Finance
It's a benefit that would, generally speaking, be conferred on the insurance company, but what we have heard from some insurance companies is that that cost would be passed on to policyholders if the amendment was not made.
Directly speaking, under the existing rules for financial institutions, a dividend received deduction would be denied, including for insurance companies, and this would provide an exemption so that insurance companies, if they meet the conditions of this exemption, would be able to continue to claim the dividend received deduction. It would impact their tax at the corporate level.
1:05 p.m.
NDP
Don Davies NDP Vancouver Kingsway, BC
How is that different from a financial institution, which could also pass on the extra cost from the change to dividends to their customer base in the form of bank fees or whatever?
I'm trying to figure out why a life insurance policyholder is worthy of protection from additional costs in the form of their premium, as opposed to a bank customer in the form of extra fees.
1:05 p.m.
Director General, Legislation, Tax Legislation Division, Tax Policy Branch, Department of Finance
I think it's a policy decision and a political decision whether to provide an exemption for financial institutions more broadly or just for insurance companies. I think one of the concerns is that the insurance companies, in particular, have pointed to a number of products for which they have suggested that fees will be passed on to customers.
1:05 p.m.
Liberal
1:05 p.m.
Conservative
Philip Lawrence Conservative Northumberland—Peterborough South, ON
Could we have a recorded division?