This bill was last introduced in the 41st Parliament, 1st Session, which ended in September 2013.
Jim Flaherty Conservative
This bill has received Royal Assent and is now law.
This is from the published bill. The Library of Parliament often publishes better independent summaries.
Part 1 implements certain income tax measures and related measures proposed in the March 29, 2012 budget. Most notably, it
(a) amends the rules relating to Registered Disability Savings Plans (RDSPs) by
(i) replacing the 10-year repayment rule applying to withdrawals with a proportional repayment rule,
(ii) allowing investment income earned in a Registered Education Savings Plan (RESP) to be transferred on a tax-free basis to the RESP beneficiary’s RDSP,
(iii) extending the period that RDSPs of beneficiaries who cease to qualify for the Disability Tax Credit may remain open in certain circumstances,
(iv) amending the rules relating to maximum and minimum withdrawals, and
(v) amending certain RDSP administrative rules;
(b) includes an employer’s contributions to a group sickness or accident insurance plan in an employee’s income in certain circumstances;
(c) amends the rules applicable to retirement compensation arrangements;
(d) amends the rules applicable to Employees Profit Sharing Plans;
(e) expands the eligibility for the accelerated capital cost allowance for clean energy generation equipment to include a broader range of bioenergy equipment;
(f) phases out the Corporate Mineral Exploration and Development Tax Credit;
(g) phases out the Atlantic Investment Tax Credit for activities related to the oil and gas and mining sectors;
(h) provides that qualified property for the purposes of the Atlantic Investment Tax Credit will include certain electricity generation equipment and clean energy generation equipment used primarily in an eligible activity;
(i) amends the Scientific Research and Experimental Development (SR&ED) investment tax credit by
(i) reducing the general SR&ED investment tax credit rate from 20% to 15%,
(ii) reducing the prescribed proxy amount, which taxpayers use to claim SR&ED overhead expenditures, from 65% to 55% of the salaries and wages of employees who are engaged in SR&ED activities,
(iii) removing the profit element from arm’s length third-party contracts for the purpose of the calculation of SR&ED tax credits, and
(iv) removing capital from the base of eligible expenditures for the purpose of the calculation of SR&ED tax incentives;
(j) introduces rules to prevent the avoidance of corporate income tax through the use of partnerships to convert income gains into capital gains;
(k) clarifies that transfer pricing secondary adjustments are treated as dividends for the purposes of withholding tax imposed under Part XIII of the Income Tax Act;
(l) amends the thin capitalization rules by
(i) reducing the debt-to-equity ratio from 2:1 to 1.5:1,
(ii) extending the scope of the thin capitalization rules to debts of partnerships of which a Canadian-resident corporation is a member,
(iii) treating disallowed interest expense under the thin capitalization rules as dividends for the purposes of withholding tax imposed under Part XIII of the Income Tax Act, and
(iv) preventing double taxation in certain circumstances when a Canadian resident corporation borrows money from its controlled foreign affiliate;
(m) imposes, in certain circumstances, withholding tax under Part XIII of the Income Tax Act when a foreign-based multinational corporation transfers a foreign affiliate to its Canadian subsidiary, while preserving the ability of the Canadian subsidiary to undertake expansion of its Canadian business; and
(n) phases out the Overseas Employment Tax Credit.
Part 1 also implements other selected income tax measures. Most notably, it introduces tax rules to accommodate Pooled Registered Pension Plans and provides that income received from a retirement compensation arrangement is eligible for pension income splitting in certain circumstances.
Part 2 amends the Excise Tax Act and the Jobs and Economic Growth Act to implement rules applicable to the financial services sector in respect of the goods and services tax and harmonized sales tax (GST/HST). They include rules that allow certain financial institutions to obtain pre-approval from the Minister of National Revenue of methods used to determine their liability in respect of the provincial component of the HST, that require certain financial institutions to have fiscal years that are calendar years, that require group registration of financial institutions in certain cases and that provide for changes to a rebate of the provincial component of the HST to certain financial institutions that render services to clients that are outside the HST provinces. This Part also confirms the authority under which certain GST/HST regulations relating to financial institutions are made.
Part 3 amends the Federal-Provincial Fiscal Arrangements Act to provide the legislative authority to share with provinces and territories taxes in respect of specified investment flow-through (SIFT) entities — trusts or partnerships — under section 122.1 and Part IX.1 of the Income Tax Act, consistent with the federal government’s proposal on the introduction of those taxes. It also provides the legislative authority to share with provinces and territories the tax on excess EPSP amounts imposed under Part XI.4 of the Income Tax Act, consistent with the measures proposed in the March 29, 2012 budget. It also allows the Minister of Finance to request from the Minister of National Revenue information that is necessary for the administration of the sharing of taxes with the provinces and territories.
Part 4 enacts and amends several Acts in order to implement various measures.
Division 1 of Part 4 amends the Trust and Loan Companies Act, the Bank Act, the Insurance Companies Act and the Jobs and Economic Growth Act as a result of amendments introduced in the Jobs, Growth and Long-term Prosperity Act to allow certain public sector investment pools to directly invest in a federally regulated financial institution.
Division 2 of Part 4 amends the Canada Shipping Act, 2001 to permit the incorporation by reference into regulations of all Canadian modifications to an international convention or industry standard that are also incorporated by reference into the regulations, by means of a mechanism similar to that used by many other maritime nations. It also provides for third parties acting on the Minister of Transport’s behalf to set fees for certain services that they provide in accordance with an agreement with that Minister.
Division 3 of Part 4 amends the Canada Deposit Insurance Corporation Act to, among other things, provide for a limited, automatic stay in respect of certain eligible financial contracts when a bridge institution is established. It also amends the Payment Clearing and Settlement Act to facilitate central clearing of standardized over-the-counter derivatives.
Division 4 of Part 4 amends the Fisheries Act to amend the prohibition against obstructing the passage of fish and to provide that certain amounts are to be paid into the Environmental Damages Fund. It also amends the Jobs, Growth and Long-term Prosperity Act to amend the definition of Aboriginal fishery and another prohibition relating to the passage of fish. Finally, it provides transitional provisions relating to authorizations issued under the Fisheries Act before certain amendments to that Act come into force.
Division 5 of Part 4 enacts the Bridge To Strengthen Trade Act, which excludes the application of certain Acts to the construction of a bridge that spans the Detroit River and other works and to their initial operator. That Act also establishes ancillary measures. It also amends the International Bridges and Tunnels Act.
Division 6 of Part 4 amends Schedule I to the Bretton Woods and Related Agreements Act to reflect changes made to the Articles of Agreement of the International Monetary Fund as a result of the 2010 Quota and Governance Reforms. The amendments pertain to the rules and regulations of the Fund’s Executive Board and complete the updating of that Act to reflect those reforms.
Division 7 of Part 4 amends the Canada Pension Plan to implement the results of the 2010-12 triennial review, most notably, to clarify that contributions for certain benefits must be made during the contributory period, to clarify how certain deductions are to be determined for the purpose of calculating average monthly pensionable earnings, to determine the minimum qualifying period for certain late applicants for a disability pension and to enhance the authority of the Review Tribunal and the Pension Appeals Board. It also amends the Department of Human Resources and Skills Development Act to enhance the authority of the Social Security Tribunal.
Division 8 of Part 4 amends the Indian Act to modify the voting and approval procedures in relation to proposed land designations.
Division 9 of Part 4 amends the Judges Act to implement the Government of Canada’s response to the report of the fourth Judicial Compensation and Benefits Commission regarding salary and benefits for federally appointed judges. It also amends that Act to shorten the period in which the Government of Canada must respond to a report of the Commission.
Division 10 of Part 4 amends the Canada Labour Code to
(a) simplify the calculation of holiday pay;
(b) set out the timelines for making certain complaints under Part III of that Act and the circumstances in which an inspector may suspend or reject such complaints;
(c) set limits on the period that may be covered by payment orders; and
(d) provide for a review mechanism for payment orders and notices of unfounded complaint.
Division 11 of Part 4 amends the Merchant Seamen Compensation Act to transfer the powers and duties of the Merchant Seamen Compensation Board to the Minister of Labour and to repeal provisions that are related to the Board. It also makes consequential amendments to other Acts.
Division 12 of Part 4 amends the Customs Act to strengthen and streamline procedures related to arrivals in Canada, to clarify the obligations of owners or operators of international transport installations to maintain port of entry facilities and to allow the Minister of Public Safety and Emergency Preparedness to require prescribed information about any person who is or is expected to be on board a conveyance.
Division 13 of Part 4 amends the Hazardous Materials Information Review Act to transfer the powers and functions of the Hazardous Materials Information Review Commission to the Minister of Health and to repeal provisions of that Act that are related to the Commission. It also makes consequential amendments to other Acts.
Division 14 of Part 4 amends the Agreement on Internal Trade Implementation Act to reflect changes made to Chapter 17 of the Agreement on Internal Trade. It provides primarily for the enforceability of orders to pay tariff costs and monetary penalties made under Chapter 17. It also repeals subsection 28(3) of the Crown Liability and Proceedings Act.
Division 15 of Part 4 amends the Employment Insurance Act to provide a temporary measure to refund a portion of employer premiums for small businesses. An employer whose premiums were $10,000 or less in 2011 will be refunded the increase in 2012 premiums over those paid in 2011, to a maximum of $1,000.
Division 16 of Part 4 amends the Immigration and Refugee Protection Act to provide for an electronic travel authorization and to provide that the User Fees Act does not apply to a fee for the provision of services in relation to an application for an electronic travel authorization.
Division 17 of Part 4 amends the Canada Mortgage and Housing Corporation Act to remove the age limit for persons from outside the federal public administration being appointed or continuing as President or as a director of the Corporation.
Division 18 of Part 4 amends the Navigable Waters Protection Act to limit that Act’s application to works in certain navigable waters that are set out in its schedule. It also amends that Act so that it can be deemed to apply to certain works in other navigable waters, with the approval of the Minister of Transport. In particular, it amends that Act to provide for an assessment process for certain works and to provide that works that are assessed as likely to substantially interfere with navigation require the Minister’s approval. It also amends that Act to provide for administrative monetary penalties and additional offences. Finally, it makes consequential and related amendments to other Acts.
Division 19 of Part 4 amends the Canada Grain Act to
(a) combine terminal elevators and transfer elevators into a single class of elevators called terminal elevators;
(b) replace the requirement that the operator of a licensed terminal elevator receiving grain cause that grain to be officially weighed and officially inspected by a requirement that the operator either weigh and inspect that grain or cause that grain to be weighed and inspected by a third party;
(c) provide for recourse if an operator does not weigh or inspect the grain, or cause it to be weighed or inspected;
(d) repeal the grain appeal tribunals;
(e) repeal the requirement for weigh-overs; and
(f) provide the Canadian Grain Commission with the power to make regulations or orders with respect to weighing and inspecting grain and the security that is to be obtained and maintained by licensees.
It also amends An Act to amend the Canada Grain Act and the Agriculture and Agri-Food Administrative Monetary Penalties Act and to Repeal the Grain Futures Act as well as other Acts, and includes transitional provisions.
Division 20 of Part 4 amends the International Interests in Mobile Equipment (aircraft equipment) Act and other Acts to modify the manner in which certain international obligations are implemented.
Division 21 of Part 4 makes technical amendments to the Canadian Environmental Assessment Act, 2012 and amends one of its transitional provisions to make that Act applicable to designated projects, as defined in that Act, for which an environmental assessment would have been required under the former Act.
Division 22 of Part 4 provides for the temporary suspension of the Canada Employment Insurance Financing Board Act and the dissolution of the Canada Employment Insurance Financing Board. Consequently, it enacts an interim Employment Insurance premium rate-setting regime under the Employment Insurance Act and makes amendments to the Canada Employment Insurance Financing Board Act, the Department of Human Resources and Skills Development Act, the Jobs, Growth and Long-term Prosperity Act and Schedule III to the Financial Administration Act.
Division 23 of Part 4 amends the Canadian Forces Superannuation Act, the Public Service Superannuation Act and the Royal Canadian Mounted Police Superannuation Act and makes consequential amendments to other Acts.
The Canadian Forces Superannuation Act is amended to change the limitations that apply in respect of the contribution rates at which contributors are required to pay as a result of amendments to the Public Service Superannuation Act.
The Public Service Superannuation Act is amended to provide that contributors pay no more than 50% of the current service cost of the pension plan. In addition, the pensionable age is raised from 60 to 65 in relation to persons who become contributors on or after January 1, 2013.
The Royal Canadian Mounted Police Superannuation Act is amended to change the limitations that apply in respect of the contribution rates at which contributors are required to pay as a result of amendments to the Public Service Superannuation Act.
Division 24 of Part 4 amends the Canada Revenue Agency Act to make section 112 of the Public Service Labour Relations Act applicable to the Canada Revenue Agency. That section makes entering into a collective agreement subject to the Governor in Council’s approval. The Division also amends the Canada Revenue Agency Act to require that the Agency have its negotiating mandate approved by the President of the Treasury Board and to require that it consult the President of the Treasury Board before determining certain other terms and conditions of employment for its employees.
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.
Charlie Angus NDP Timmins—James Bay, ON
Mr. Speaker, I listened with great interest to my hon. colleague and I was rather let down by the continual use of mistruths.
I would like to quote from the Ottawa Citizen because I think Dan Gardner hit it on the head about the use of the political lie. The whole point of Dan Gardner's article is the use of lying. He said, “the worst part” is that the people in the Prime Minister's Office won't care if he calls them “cynical liars who would wince when they look in the mirror—
The Speaker Conservative Andrew Scheer
The hon. member for Ancaster—Dundas—Flamborough—Westdale is rising on a point of order.
David Sweet Conservative Ancaster—Dundas—Flamborough—Westdale, ON
Mr. Speaker, it is very clear that we cannot do indirectly what we should not do directly. Clearly, unparliamentary language is being used by the member.
The Speaker Conservative Andrew Scheer
I will remind the hon. member.
The hon. member for Timmins—James Bay.
Charlie Angus NDP Timmins—James Bay, ON
Mr. Speaker, I am leading a point, and I understand the rules of Parliament. That is why I think it is very important that he listen to this. He said that--
The Speaker Conservative Andrew Scheer
Order, please. Order, please.
I will just remind the member for Timmins—James Bay that we cannot do indirectly what we are not allowed to do directly. Even when quoting from media reports or articles, and we have had cases of this in the House before, we cannot use unparliamentary language or use it to accuse members of unparliamentary actions.
Charlie Angus NDP Timmins—James Bay, ON
Mr. Speaker, in this Parliament there is a notion that we cannot call someone a liar, but the notion that someone can lie is seen as parliamentary. I would continue with Dan Gardner's phrase:
It’s the gobsmacking cynicism and the contempt that is its foundation. Contempt for Parliament, the judiciary, the media, and anyone who gets in their way. But most of all, contempt for Canadians.
Chris Alexander Conservative Ajax—Pickering, ON
Mr. Speaker, there was no question there. There was no truth there. There was no integrity there in the remarks of the member opposite. However, that is no surprise to those of us on this side of the House.
That will not, however, let the members opposite off the hook. A $21.5 billion carbon tax on page 4 of their own party platform remains with them--
The Speaker Conservative Andrew Scheer
The hon. member for Timmins—James Bay is rising on a point of order.
Charlie Angus NDP Timmins—James Bay, ON
He may refrain from calling people liars, but he cannot stand in this House and make a mistruth. He does not have that evidence and he has used this again and again in this House to divert attention.
I refer him to page 680 of O'Brien--
The Speaker Conservative Andrew Scheer
Order, please. The hon. member has asked a question. The parliamentary secretary is answering it. It sounds like what the member for Timmins—James Bay is raising is a further point of debate. If there is time, I can recognize him for another question and comment and he could make his point then.
The hon. parliamentary secretary has the floor to respond to the comment made by the member for Timmins—James Bay.
Chris Alexander Conservative Ajax—Pickering, ON
Mr. Speaker, the bill before this House is absolutely about fiscal policy, and it is absolutely legitimate for members on this side of the House to draw the contrast between a low tax plan for jobs, growth and long-term prosperity and the electoral platform of the other side, on the basis of which some of them entered the House.
That $21.5 billion carbon tax proposed by his leader, embraced by all of them, expresses that contrast as well as anything else, as does the performance of his leader in debate in the House last week, when he spoke for the better part of an hour without even mentioning the question of public debt.
Fin Donnelly NDP New Westminster—Coquitlam, BC
Mr. Speaker, speaking of what is in platforms, in their 2008 platform, the Conservatives promised to:
develop and implement a North American-wide cap-and-trade system for greenhouse gases and air pollution, with implementation to occur between 2012 and 2015.
If he is interested in reading further, there is an article by a Jeffrey Simpson in The Globe and Mail that talks about the “Conservative carbon amnesia”. It reads:
The Conservative Party's attack machine, with its television ads, canned speeches and pre-written scripts, has always been constructed on exaggeration tinged with mendacity. To this, since Parliament resumed, can now be added flagrant hypocrisy, since the machine and its mouthpieces, Conservative MPs, are attacking with customary vehemence the very policy on which they once campaigned.
I am wondering if my hon. colleague could respond to that.
Chris Alexander Conservative Ajax—Pickering, ON
Mr. Speaker, the hon. member knows perfectly well that there is no such North American regime and there never was a policy proposal on this side to create a $21.5 billion carbon tax.
That proposal did not come from this party. That proposal came from his party, and both members who have asked these questions and reminded this House many times over should know that it is not so much the policy move, the policy mistake, that matters, but the cover up that Canadians find particularly off-putting.
Marie-Claude Morin NDP Saint-Hyacinthe—Bagot, QC
Mr. Speaker, it has become clear that omnibus bills will now be the norm in the House of Commons. It gives me no pleasure to rise today at second reading of Bill C-45, the second omnibus budget bill.
In addition to implementing the 2012 budget, the Trojan Horse bill included a number of other changes that had not been announced beforehand. This is yet another budget implementation bill that goes well beyond implementing the budget.
We said it when the Trojan Horse bill was forced through the House in May, and we are saying it now: this is not an acceptable way of doing things in a so-called democratic country like Canada. The monster Bill C-45 is over 440 pages long and contains a huge number of disparate measures. It would amend over 60 laws, giving the minister more power and weakening environmental protection legislation.
It also sets out a vast number of complicated measures, including a reworking of the Canada Grain Act and changes to subsidies for scientific research and experimental development, elements that are essential to the nation's development. In addition, it sets out major changes to the public service pension plan and the Canada Labour Code.
Here are the facts. The Conservatives have introduced a bill encompassing dozens of disparate measures, and they want to have it passed as quickly as possible so that we do not have time to talk about it. That is because they do not want Canadians to know what really goes on here in the House of Commons. MPs do not have enough time to study the bill closely and analyze its repercussions. Who will pay the price for that? Canadians—the very people whose interests the government is supposed to protect. As elected representatives, Conservative MPs are also supposed to work for Canadians.
On the one hand, MPs are being prevented from doing the work they were elected to do, and on the other, Canadians are being kept in the dark. Fortunately, Canadians can count on the NDP, which strongly opposes the undemocratic nature of Bill C-45.
We have defended and will always proudly defend the concepts of transparency and accountability. We will always stand up for environmental protection. We will always stand up for old age security and health care. If we do not, who will? Certainly not the government, which is showing us once again that democracy is not its priority.
Canadians are not blind. They know that the government is not doing so and that it is preventing the official opposition from doing its job by imposing a gag order once again. Actually, how many gag orders have we had so far? I think it is a record number. I am not sure what the exact figure is, but I know there have been more than 20. In short, that is preventing us from doing our job.
As a result of the strong offensive launched by our party, the government is finally going to allow various committees to study this bill. What a privilege. However, we do not know whether we will be able to propose amendments during those consultations. Needless to say, that will greatly hinder the process.
The Parliamentary Budget Officer, or PBO, has once again said that members of Parliament are not receiving the information they need to be able to reasonably exercise their power of oversight. Well, yes, power of oversight, but also responsibility of oversight.
The PBO recently even had to threaten to take the Conservative government to court if it did not forward the information about the budget cuts that were announced. The government has to stop trying to obstruct the work of Parliament and must allow a real study of this bill.
Canadians will agree that the amendments and their impact on Canadian families need to be studied in particular. It is appalling to see that, once again, Canadian families are being completely ignored. The government is continuing to ignore the real needs of Canadians.
According to the Co-operative Housing Federation of Canada, 4 million Canadians, including 750,000 children, have core housing needs at this time. However, once again, the 2012 budget implementation bill does not contain any measures related to housing or any measures to fight poverty or homelessness. Yet major institutions like the Wellesley Institute and the Federation of Canadian Municipalities have sounded the alarm several times. These national organizations asked the federal government to invest in housing in the most recent budget. Clearly, nothing has been done.
Housing is an important issue not only for families, but also for seniors, a very high-risk group. The current government reduced old age security benefits, which means that some seniors will have even more difficulty paying their rent. Approximately one-third of social housing is occupied by seniors, and one-third of that group is at risk of losing their housing because long-term operating agreements between the federal government and housing co-operatives are not being renewed.
A survey conducted by the Ontario Non-Profit Housing Association found that the number of seniors waiting for housing has been increasing steadily since 2004. That number is increasing, yet this government does nothing. Seniors represented one-quarter of all households waiting for housing in 2011.
Since we are talking about poverty, let us also talk about the changes to employment insurance. These measures will also have an impact on a claimants' ability to find housing, particularly since the federal operating agreements are about to expire. As a result of the loss of employment insurance benefits, more households may have core housing needs. Core housing needs are no joke. I am talking about substandard, overpriced homes that are difficult to heat and that are too small for families. These are not trivial matters.
Since the federal government did not introduce any housing measures in its budget, it could at least help all Canadians by supporting my national housing strategy. It will not do so under the pretext that housing falls under provincial jurisdiction.
And yet, the purpose of Bill C-400 is to provide secure, adequate, accessible and affordable housing for Canadians, while respecting provincial jurisdictions. The government's inaction is a mystery.
Once again, the government is not demonstrating leadership. The omnibus bill contains another attack on agriculture, which provides even more evidence that the government is not demonstrating leadership.
Bill C-38 already hit my riding hard—really hard—by interfering with the CFIA's ability to conduct proper inspections to ensure the food security of all Canadians.
Saint-Hyacinthe—Bagot is one of the biggest agricultural regions in Quebec. The CFIA's services are thus very important to this region, which largely depends on agriculture-related economic activity.
Unfortunately, we still do not know what impact the cuts will have on the CFIA's regional centre, which is located in my riding. Many people are concerned about their jobs, and for good reason.
However, that is not my riding's only concern. Saint-Hyacinthe—Bagot is made up of 25 municipalities and more or less all of the farmers there grow grains. Thus, many of these farmers will be affected by the elimination of the grain appeal tribunals, which are independent committees set up by the region that provide a great deal of support to farmers. Who will farmers deal with if they do not have anyone to represent their region?
If Bill C-45 is passed, any recourse will automatically have to go through the chief grain inspector. Will the chief grain inspector be able to consider the unique characteristics of my riding as well as the local committees can? I seriously doubt it and so do my constituents.
In fact, all Canadians doubt the Conservatives' approach. The 443-page omnibus bill proves that they have reason to doubt.