Budget and Economic Statement Implementation Act, 2007

An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007 and to implement certain provisions of the economic statement tabled in Parliament on October 30, 2007

This bill was last introduced in the 39th Parliament, 2nd Session, which ended in September 2008.

Sponsor

Jim Flaherty  Conservative

Status

This bill has received Royal Assent and is now law.

Summary

This is from the published bill.

Part 1 implements goods and services tax and harmonized sales tax (GST/HST) measures proposed in the March 19, 2007 Budget but not included in the Budget Implementation Act, 2007, which received Royal Assent on June 22, 2007. Specifically, the Excise Tax Act is amended to
(a) increase the percentage of available input tax credits for GST/HST paid on meal expenses of truck drivers from 50% to 80% over five years beginning with expenses incurred on or after March 19, 2007;
(b) increase the GST/HST annual filing threshold from $500,000 in taxable supplies to $1,500,000 and the annual remittance threshold from $1,500 to $3,000, both effective for fiscal years that begin after 2007;
(c) increase the GST/HST 48-hour travellers’ exemption from $200 to $400 effective in respect of travellers returning to Canada on or after March 20, 2007; and
(d) implement changes to the rules governing self-assessment under Division IV of Part IX of the Excise Tax Act to ensure that GST/HST applies appropriately in respect of intangible personal property acquired on a zero-rated basis and consumed in furthering domestic activities, applicable to supplies made after March 19, 2007.
Part 2 amends the non-GST portion of the Excise Tax Act to implement measures announced in the March 19, 2007 Budget. Specifically, the excise tax exemptions for renewable fuels, including ethanol and bio-diesel, are repealed, effective April 1, 2008.
Part 3 implements income tax measures proposed in the March 19, 2007 Budget but not included in the Budget Implementation Act, 2007, which received Royal Assent on June 22, 2007. In particular, it
(a) introduces a new Working Income Tax Benefit;
(b) eliminates income tax on elementary and secondary school scholarships;
(c) eliminates capital gains tax on donations of publicly-listed securities to private foundations;
(d) enhances the child fitness tax credit;
(e) expands the scope of the public transit tax credit;
(f) increases the lifetime capital gains exemption to $750,000;
(g) increases the deductible percentage of meal expenses for long-haul truck drivers;
(h) provides tax relief in respect of the 2010 Winter Olympic and Paralympic Games;
(i) allows for phased-retirement options for pension plans;
(j) extends the mineral exploration tax credit;
(k) enhances tax benefits for donations of medicine to the developing world;
(l) streamlines the process for prescribed stock exchanges;
(m) introduces an investment tax credit for child care spaces;
(n) introduces a new withholding tax exemption with respect to certain cross-border interest payments;
(o) prevents double deductions of interest expense on borrowed money used to finance foreign affiliates (the Anti-Tax-Haven Initiative);
(p) eases tax remittance and filing requirements for small business;
(q) introduces a mechanism to accommodate functional currency reporting;
(r) provides certain tobacco processors that do not manufacture tobacco products with relief from the Tobacco Manufacturers’ Surtax; and
(s) provides authority for regulations requiring the disclosure by publicly traded trusts and partnerships of information enabling investment managers to prepare the tax information slips that they are required to issue to investors on a timely basis.
Part 4 implements the disability savings measures proposed in the March 19, 2007 Budget. The measures are intended to support long-term savings through registered disability savings plans to provide for the financial security of persons with severe and prolonged impairments in physical or mental functions. Part 4 contains amendments to the Income Tax Act to allow for the creation of registered disability savings plans. It also enacts the Canada Disability Savings Act. That Act provides for the payment of Canada Disability Savings Grants in relation to contributions made to those plans. The amount of grant is increased for persons of lower and middle income. It also provides for the payment of Canada Disability Savings Bonds in respect of persons of low income.
Part 5 implements measures that provide for payments to be made to provinces as a financial incentive for them to eliminate taxes on capital under certain circumstances.
Part 6 enacts the Bank for International Settlements (Immunity) Act.
Part 7 amends the Pension Benefits Standards Act, 1985 to permit phased retirement arrangements in federally regulated pension plans by allowing an employer to simultaneously pay a partial pension to an employee and provide further pension benefit accruals to the employee. These amendments are consistent with amendments to the Income Tax Regulations to permit phased retirement.
Part 8 authorizes payments to be made out of the Consolidated Revenue Fund for the purpose of Canada’s contribution to the Advance Market Commitment.
Part 9 amends the Canada Oil and Gas Operations Act to authorize the National Energy Board to regulate traffic, tolls and tariffs in relation to oil and gas pipelines regulated under that Act.
Part 10 amends the Farm Income Protection Act to allow financial institutions to hold contributions under a net income stabilization account program.
Part 11 amends the Federal-Provincial Fiscal Arrangements Act to provide for an additional fiscal equalization payment that may be paid to Nova Scotia and Newfoundland and Labrador. This Part also specifies the time and manner in which the calculation of fiscal equalization payments will be made and it amends that Act’s regulation-making authority. In addition, this Part makes consequential amendments to other Acts.
Part 12 amends the Canada Education Savings Act to clarify the authority of the Minister of Human Resources and Social Development to collect, on behalf of the Canada Revenue Agency, any information that the Canada Revenue Agency requires for purposes of administering the registered education savings plan tax provisions.
Part 13 authorizes payments to be made out of the Consolidated Revenue Fund to an entity, designated by the Minister of Finance, to facilitate public-private partnership projects.
Part 14 implements tax measures proposed in the October 30, 2007 Economic Statement. With respect to income tax measures, it
(a) reduces the general corporate income tax rate;
(b) accelerates the tax reduction for small businesses;
(c) reduces the lowest personal income tax rate, which automatically reduces the rate used to calculate non-refundable tax credits and the alternative minimum tax; and
(d) increases the basic personal amount and the amount upon which the spouse or common-law partner and wholly dependent relative credits are calculated.
Part 14 also amends the Excise Tax Act to implement, effective January 1, 2008, the reduction in the goods and services tax (GST) and the federal component of the harmonized sales tax (HST) from 6% to 5%. That Act is amended to provide transitional rules for determining the GST/HST rate applicable to transactions that straddle the January 1, 2008, implementation date, including transitional rebates in respect of the sale of residential complexes where transfer of ownership and possession both take place on or after January 1, 2008, pursuant to a written agreement entered into on or before October 30, 2007. The Excise Act, 2001 is also amended to increase excise duties on tobacco products to offset the impact of the GST/HST rate reduction. The Air Travellers Security Charge Act is also amended to ensure that rates for domestic and transborder air travel reflect the impact of the GST/HST rate reduction. Those amendments generally apply as of January 1, 2008.

Elsewhere

All sorts of information on this bill is available at LEGISinfo, an excellent resource from the Library of Parliament. You can also read the full text of the bill.

Votes

Dec. 13, 2007 Passed That the Bill be now read a third time and do pass.
Dec. 10, 2007 Passed That Bill C-28, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007 and to implement certain provisions of the economic statement tabled in Parliament on October 30, 2007, be concurred in at report stage.
Dec. 10, 2007 Failed That Bill C-28 be amended by deleting Clause 181.
Dec. 4, 2007 Passed That the Bill be now read a second time and referred to the Standing Committee on Finance.

Budget and Economic Statement Implementation Act, 2007Government Orders

December 12th, 2007 / 8 p.m.


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Independent

Louise Thibault Independent Rimouski-Neigette—Témiscouata—Les Basques, QC

Mr. Speaker, I would like to take this opportunity to make a few comments about Bill C-28. As usual, my comments will focus on how this affects the people of my riding.

Practical items that concern me the most for the people in my region have to do with the lack of serious speeches and measures from the Conservative government on Bill C-28.

I am thinking about an economic sector that is vital in my region, in particular, but also in a number of regions in Quebec and Canada, and that is the forestry sector. This sector is going through a crisis and its workers are affected by it more so than workers in other sectors. Unfortunately, there is a crisis in many other manufacturing sectors as well.

We all know that circumstantial factors contributed to making an already difficult situation even worse. In light of these circumstances and this crisis, we expected the government, which has the means to provide informed and dynamic governance, to help the people. After all, the role of government is to redistribute wealth and to be fair to all its citizens, whom it is meant to serve.

While we expected measures to help these sectors, both businesses and workers, we have seen in official documents just a small sentence, as though this were not as important—the Leader of the New Democratic Party was just talking about this a few minutes ago—as the oil sectors, the banks and high finance. Nonetheless, when it comes to sectors that are vital to the people in our regions, there are just a few words that leave a whole lot to be desired in the economic statement.

I am not speaking only about workers and what could be very legitimate expectations regarding employment insurance. I am speaking of course for workers who have been laid off, in particular. I am thinking of employability measures that will keep our forestry workers on the job, as well as our businesses.

We all know that in our various communities, our towns, municipalities and regions, thousands of jobs are being lost. We now know that, in many cases, there have been temporary closures in the forestry sector, but we also know that, quite often, they will unfortunately not be temporary. Some closures could be permanent. Given the lack of timely support and vision, municipalities and towns are being put at risk of devitalization, for which the people will pay the price.

While firm action was needed to allow these businesses in the forestry sector, among others, to reposition themselves, modernize, diversify and become more competitive, absolutely nothing has been done. This is unacceptable for everyone involved, since the possibilities were and are significant.

What is the government doing? As I said earlier, with one short sentence, it thinks it will console someone or that perhaps no one will even see it. The Conservative government—and this has already been clearly and eloquently stated—is nevertheless offering considerable tax cuts for businesses that are already thriving.

Clearly, in the provinces and sectors affected by this measure—let us be honest, there are more of them in the west than in the east—businesses and employees will benefit from it.

This is an easy solution. It is certainly not a sign of a government possessed of the vision and the will to use the means available to it to provide enlightened governance by demonstrating that it is concerned about all sectors of the economy, does not play favourites, is not in league with anyone and is fair to everyone. What I find striking, as I just said, is the degree to which these tax cuts will benefit companies that are doing well and making a profit, including, above all, oil companies.

To switch gears, I would like to talk about something I care deeply about, as do many of my colleagues, I am sure. The government failed to take the opportunity to help thousands of people who make up an entire demographic: our seniors. Unfortunately, I am talking about poor seniors. I am talking about seniors who are on fixed incomes because for various reasons, they were unable to put any money aside for retirement even though they worked hard. These people live on their old age pension and their guaranteed income supplement. They receive about $1,100 a month, which places them well below the poverty line.

Here is one example from my riding. Given the cost of living and the poverty line in the Rimouski region, our seniors' annual income is about $4,000 or $5,000 below the poverty line. To add insult to injury, they found out too late, because they were not informed, that they were entitled to receive the guaranteed income supplement. To top it off, the previous government, the party that is now the official opposition, granted them just 11 months of retroactivity.

The new government—the adjective “new” has been used for some time by the other side of the House—had the chance to do something, to make an important decision for our seniors everywhere in Canada. There is nothing partisan or sovereignist about it—I am bringing this forward on behalf of everyone. This government had the opportunity to do something. However, once again, absolutely nothing was done.

In February, I will have the opportunity to table a motion in this House. I hope that this will spur a large number of my colleagues to reflect on the appalling situation of our mothers, grandmothers, fathers, grandfathers, in short, our seniors. They are the ones who built this society and who are largely responsible for who we are and what we have today. At the very least, out of respect for them, we could provide an income that is above the poverty line.

I see that some colleagues have such an interest in this matter that they have been overcome by laughter.

Before I conclude, I would like to suggest to my colleagues in this House that they read a few pages from a very revealing book. It may prove to be a way of learning French but it is also a way to broaden almost everyone's horizons. This book was written by the well known author, Riccardo Petrella. He has just written a new book, Pour une nouvelle narration du monde. Just before these holidays, I believe that the members of the Conservative Party, the Liberal Party and the other parties, as well as the three independents, would benefit from broadening their horizons and realizing that we can look at our world from a different perspective. We can believe in solidarity and sharing, and not just in globalization, competition and in market forces that are completely out of control.

Budget and Economic Statement Implementation Act, 2007Government Orders

December 12th, 2007 / 8:10 p.m.


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NDP

Yvon Godin NDP Acadie—Bathurst, NB

Mr. Speaker, I thank my colleague for her important speech. The federal government has billions of dollars in surpluses and is giving a tax reduction to large companies that are turning a profit. Ordinarily, a company that does not make a profit does not pay any tax. But when we look at what is happening, we see that the big oil companies in Alberta are getting tax breaks and reductions.

But some large companies were losing money and some large companies have closed. For example, UPM in Miramichi, the Smurfit-Stone paper mill in Bathurst and plants in New Richmond and Dalhousie have just closed. Fils Fins d'Atlantique and textile companies in Quebec have also closed their doors. These companies have not received any help, and the workers have lost their jobs.

Does the member agree with me that instead of giving money to companies that are making a profit, the big banks and all those people, the government could have used it to help create employment for people who have lost their jobs? Once again, the Liberals have helped the Conservatives by voting with them or not voting at all, as they tend to do. They are not here to represent ordinary Canadians who have lost their jobs and are in terrible straits, families living in poverty and need and children who are hungry.

There are currently 1.4 million children in Canada who are hungry. This was the case under a Liberal government in the past, and it is now the case under a Conservative government.

Is it not shameful to see a government that stands up for big companies? I hope that the Canadian workers who are watching us this evening and seeing what is happening will realize that these are not the sorts of political parties they should vote for, because these parties do not stand up for them.

I would like to hear what my colleague from Rimouski-Neigette—Témiscouata—Les Basques has to say about this.

Budget and Economic Statement Implementation Act, 2007Government Orders

December 12th, 2007 / 8:15 p.m.


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Independent

Louise Thibault Independent Rimouski-Neigette—Témiscouata—Les Basques, QC

Mr. Speaker, I would like to thank my colleague from Acadie—Bathurst who, like many members of his party, cares deeply about the well-being of his communities. That has been clear to me since I came here, and I knew it even before I was elected.

I agree with him that the government's inaction is nothing short of scandalous in light of what is going on. I agree with what he said and I would add that I, like many others, no doubt, was dumbfounded when I discovered that the government planned to help those who were already able to help themselves. Those who are in a position to benefit from a tax cut or from a 1% GST cut are those who have money to spend.

Consumer spending is all well and good, but we should also be talking about productivity. We have to put people to work and keep them working as long as possible. However, when people are unable to work, there should be measures in place not only to improve their employability but to support them during hard times.

It is clear that given the current surpluses, especially those that were announced before we came back to the House—the $10 billion, $11 billion or $12 billion being used to pay down the debt, which is not actually a problem for Canada—we could put some of that money to work to help people who need help. That is called redistribution of wealth. That is what the government should be doing, but the Conservative government seems to have forgotten all about that particular responsibility.

Budget and Economic Statement Implementation Act, 2007Government Orders

December 12th, 2007 / 8:15 p.m.


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The Acting Speaker Royal Galipeau

Is the House ready for the question?

Budget and Economic Statement Implementation Act, 2007Government Orders

December 12th, 2007 / 8:15 p.m.


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Some hon. members

Question.

Budget and Economic Statement Implementation Act, 2007Government Orders

December 12th, 2007 / 8:15 p.m.


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The Acting Speaker Royal Galipeau

The question is on the motion. Is it the pleasure of the House to adopt the motion?

Budget and Economic Statement Implementation Act, 2007Government Orders

December 12th, 2007 / 8:15 p.m.


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Some hon. members

Agreed.

No.

Budget and Economic Statement Implementation Act, 2007Government Orders

December 12th, 2007 / 8:15 p.m.


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The Acting Speaker Royal Galipeau

All those in favour of the motion will please say yea.

Budget and Economic Statement Implementation Act, 2007Government Orders

December 12th, 2007 / 8:15 p.m.


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Some hon. members

Yea.

Budget and Economic Statement Implementation Act, 2007Government Orders

December 12th, 2007 / 8:15 p.m.


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The Acting Speaker Royal Galipeau

All those opposed will please say nay.

Budget and Economic Statement Implementation Act, 2007Government Orders

December 12th, 2007 / 8:15 p.m.


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Some hon. members

Nay.

Budget and Economic Statement Implementation Act, 2007Government Orders

December 12th, 2007 / 8:15 p.m.


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The Acting Speaker Royal Galipeau

In my opinion the yeas have it.

And five or more members having risen:

On the advice of both whips, the vote is postponed until tomorrow at 1 p.m.

Budget and Economic Statement Implementation Act, 2007Government Orders

December 13th, 2007 / 1 p.m.


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The Acting Speaker Andrew Scheer

It being 1 p.m. the House will now proceed to the taking of the deferred recorded division on the motion at the third reading stage of Bill C-28.

Call in the members.

And the Clerk having announced the results of the vote: