Bill C-15 (Historical)

Budget Implementation Act, 2016, No. 1.

An Act to implement certain provisions of the budget tabled in Parliament on March 22, 2016 and other measures

Part 1 implements certain income tax measures proposed in the March 22, 2016 budget by
(a) eliminating the education tax credit;
(b) eliminating the textbook tax credit;
(c) exempting from taxable income amounts received as rate assistance under the Ontario Electricity Support Program;
(d) maintaining the small business tax rate at 10.‍5% for the 2016 and subsequent taxation years and making consequential adjustments to the dividend gross-up factor and dividend tax credit;
(e) increasing the maximum deduction available under the northern residents deduction;
(f) eliminating the children’s arts tax credit;
(g) eliminating the family tax cut credit;
(h) replacing the Canada child tax benefit and universal child care benefit with the new Canada child benefit;
(i) eliminating the child fitness tax credit;
(j) introducing the school supplies tax credit;
(k) extending, for one year, the mineral exploration tax credit for flow-through share investors;
(l) restoring the labour-sponsored venture capital corporations tax credit for purchases of shares of provincially registered labour-sponsored venture capital corporations for the 2016 and subsequent taxation years; and
(m) introducing changes consequential to the introduction of the new 33% individual tax rate.
Part 1 implements other income tax measures confirmed in the March 22, 2016 budget by
(a) amending the anti-avoidance rules in the Income Tax Act that prevent the conversion of capital gains into tax-deductible intercorporate dividends;
(b) qualifying certain costs associated with undertaking environmental studies and community consultations as Canadian exploration expenses;
(c) ensuring that profits from the insurance of Canadian risks remain taxable in Canada;
(d) ensuring that the dividend rental arrangement rules under the Income Tax Act apply where there is a synthetic equity arrangement;
(e) providing specific tax rules in respect of the commercialization of the Canadian Wheat Board, including a tax deferral for eligible farmers;
(f) permitting registered charities and registered Canadian amateur athletic associations to hold limited partnership interests;
(g) providing an exemption to the withholding tax requirements for payments by qualifying non-resident employers to qualifying non-resident employees;
(h) limiting the circumstances in which the repeated failure to report income penalty will apply;
(i) permitting the sharing of taxpayer information within the Canada Revenue Agency to facilitate the collection of certain non-tax debts; and
(j) permitting the sharing of taxpayer information with the Office of the Chief Actuary.
Part 2 implements certain goods and services tax/harmonized sales tax (GST/HST) measures proposed in the March 22, 2016 budget by
(a) adding insulin pens, insulin pen needles and intermittent urinary catheters to the list of GST/HST zero-rated medical and assistive devices;
(b) clarifying that GST/HST generally applies to supplies of purely cosmetic procedures provided by all suppliers, including registered charities;
(c) relieving tax to ensure that when a charity makes a taxable supply of property or services in exchange for a donation and an income tax receipt may be issued for a portion of the donation, only the value of the property or services supplied is subject to GST/HST;
(d) ensuring that interest earned in respect of certain deposits is not included in determining whether a person is considered to be a financial institution for GST/HST purposes; and
(e) clarifying the treatment of imported reinsurance services under the GST/HST imported supply rules for financial institutions.
Part 2 also implements other GST/HST measures confirmed in the March 22, 2016 budget by
(a) adding feminine hygiene products to the list of GST/HST zero-rated products; and
(b) permitting the sharing of taxpayer information in respect of non-tax debts within the Canada Revenue Agency under certain federal and provincial government programs and in respect of certain programs where information sharing is currently permitted under the Income Tax Act.
Part 3 implements certain excise measures proposed in the March 22, 2016 budget by
(a) ensuring that excise tax relief for diesel fuel used as heating oil or to generate electricity is targeted to specific instances; and
(b) enhancing certain security and collection provisions in the Excise Act, 2001.
Part 3 also implements other excise measures confirmed in the March 22, 2016 budget by permitting the sharing of taxpayer information in respect of non-tax debts within the Canada Revenue Agency under certain federal and provincial government programs and in respect of certain programs where information sharing is currently permitted under the Income Tax Act.
Division 1 of Part 4 repeals the Federal Balanced Budget Act.
Division 2 of Part 4 amends the Canadian Forces Members and Veterans Re-establishment and Compensation Act to, among other things,
(a) replace “permanent impairment allowance” with “career impact allowance”;
(b) replace “totally and permanently incapacitated” with “diminished earning capacity”;
(c) increase the percentage in the formula used to calculate the earnings loss benefit;
(d) specify when a disability award becomes payable and clarify the formula used to calculate the amount of a disability award;
(e) increase the amounts of a disability award; and
(f) increase the amount of a death benefit.
In addition, it contains transitional provisions that provide, among other things, that the Minister of Veterans Affairs must pay, to a person who received a disability award or a death benefit under that Act before April 1, 2017, an amount that represents the increase in the amount of the disability award or the death benefit, as the case may be. It also makes consequential amendments to the Children of Deceased Veterans Education Assistance Act, the Pension Act and the Income Tax Act.
Division 3 of Part 4 amends the sunset provisions of certain Acts governing federal financial institutions to extend by two years, namely, from March 29, 2017 to March 29, 2019, the period during which those institutions may carry on business.
Division 4 of Part 4 amends the Bank Act to facilitate the continuance of local cooperative credit societies as federal credit unions by granting the Minister of Finance the authority to provide transitional procedural exemptions, as well as a loan guarantee.
Division 5 of Part 4 amends the Canada Deposit Insurance Corporation Act to, among other things, broaden the Corporation’s powers to temporarily control or own a domestic systemically important bank and to convert certain shares and liabilities of such a bank into common shares.
It also amends the Bank Act to allow the designation of domestic systemically important banks by the Superintendent of Financial Institutions and to require such banks to maintain a minimum capacity to absorb losses.
Lastly, it makes consequential amendments to the Financial Administration Act, the Winding-up and Restructuring Act and the Payment Clearing and Settlement Act.
Division 6 of Part 4 amends the Office of the Superintendent of Financial Institutions Act to change the membership of the committee established under that Act so that the Chairperson of the Canada Deposit Insurance Corporation is replaced by that Corporation’s Chief Executive Officer. It also amends several Acts to replace references to that Chairperson with references to that Chief Executive Officer.
Division 7 of Part 4 amends the Federal-Provincial Fiscal Arrangements Act to authorize an additional payment to be made to a territory, in order to take into account the amount of the territorial formula financing payment that would have been paid to that territory for the fiscal year beginning on April 1, 2016, if that amount had been determined using the recalculated amount determined to be the gross expenditure base for that fiscal year.
Division 8 of Part 4 amends the Financial Administration Act to restrict the circumstances in which the Governor in Council may authorize the borrowing of money without legislative approval.
Division 9 of Part 4 amends the Old Age Security Act to increase the single rate of the guaranteed income supplement for the lowest-income pensioners by up to $947 annually and to repeal section 2.‍2 of that Act, which increases the age of eligibility to receive a benefit.
Division 10 of Part 4 amends the Special Import Measures Act to provide that a finding by the President of the Canada Border Services Agency of an insignificant margin of dumping or an insignificant amount of subsidy in respect of goods imported into Canada will no longer result in the termination of a trade remedy investigation prior to the President’s preliminary determination. It also provides that expiry reviews may be initiated from a date that is closer to the expiry date of an anti-dumping or countervailing measure and makes amendments related to that new time period.
Division 11 of Part 4 amends the Pension Benefits Standards Act, 1985 to combine the authorities for bilateral agreements and multilateral agreements into one authority for federal-provincial agreements, and to clarify that federal-provincial agreements may permit the application of provincial legislation with respect to a pension plan.
Division 12 of Part 4 amends the Employment Insurance Act to, among other things,
(a) increase, until July 8, 2017, the maximum number of weeks for which benefits may be paid to certain claimants in certain regions;
(b) eliminate the category of claimants who are new entrants and re-entrants; and
(c) reduce to one week the length of the waiting period during which claimants are not entitled to benefits.
Division 13 of Part 4 amends the Canada Marine Act to allow the Minister of Canadian Heritage to make payments to Canada Place Corporation for certain celebrations.
Division 14 of Part 4 amends the Jobs, Growth and Long-term Prosperity Act to authorize the Minister of Infrastructure, Communities and Intergovernmental Affairs to acquire the shares of PPP Canada Inc. on behalf of Her Majesty in right of Canada. It also sets out that the appropriate Minister, as defined in the Financial Administration Act, holds those shares and authorizes that appropriate Minister to conduct, with the Governor in Council’s approval, certain transactions relating to PPP Canada Inc. Finally, it authorizes PPP Canada Inc. and its wholly-owned subsidiaries to sell, with the Governor in Council’s approval, their assets in certain circumstances.
Division 15 of Part 4 amends the Canada Foundation for Sustainable Development Technology Act to modify the process that leads to the Governor in Council’s appointment of persons to the board of directors of the Canada Foundation for Sustainable Development Technology by eliminating the role of the Minister of Natural Resources and the Minister of the Environment as well as the consultative role of the Minister of Industry from that process. It also amends the Budget Implementation Act, 2007 to provide that a sum may be paid out of the Consolidated Revenue Fund to the Foundation on the requisition of the Minister of Industry and to clarify the maximum amount of that sum.

Bill C-15—Time Allocation Motion

[Brian Masse, NDP, Windsor West, ON]

Mr. Speaker, I have to admit, I have been tested and I am a little red-green colour blind, but I can say that for the years I have been here, I am clearly becoming red-blue colour blind in all measures of the sense, because we are seeing exactly here what the Conservatives have done in the past.

It is interesting; if the Liberals want to measure themselves to the previous government, when it comes to the Senate, lobbying, ministers and fundraising, and all the issues that are so important for Canadians, they can set that bar all they want. However, my comment to the minister is that to suggest members of Parliament from any side of the House do not support our veterans is absolutely outrageous, shameful, and disrespectful. My grandfather died in the fall of Burma; my other grandfather served in the Royal Navy. We all support our veterans. For him to wrap himself around that element is nothing short of a disgrace to the House.

[Bill Morneau, Liberal, Toronto Centre, ON]

Mr. Speaker, as we think about what we are putting forward, we do need to reflect on the fact that our budget puts forth measures that would make a real difference for Canadians. We are going to make a difference for Canadians in many different ways.

We have identified for this House important measures that would make a huge difference for Canadian families. We need to move forward on them quickly, because we know we can make a difference for families with our Canada child benefit.

We know there are measures in our budget that could make a real difference for students by increasing student grants for them for the next school year.

We know that, yes, we are putting forward changes in benefits for veterans in our country, which would make a real difference for veterans. They would provide them with the service they require in order to actually get an understanding of what they are eligible for. Most importantly, they would change their situation so they could be better off in the future.

We are proud of this budget. We want to move forward rapidly to ensure that Canadians have the benefits they deserve and need. We look forward to the support of this House in order to do that in an expeditious fashion.

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Mr. Speaker, it is important to make a couple of, I believe, valid points. First, what we are really talking about with respect to the budget implementation bill is an election promise that was made in our platform and now is being delivered.

The Minister of Finance talked about the Canada child benefit and how it would be greatly enhanced. One of my personal favourites is the proposed increase to the guaranteed income supplement.

While I was in opposition I said that time allocation is necessary at times when the opposition is unable to work with the government or the government is not able to get agreement to get things passed in a timely fashion. That is what we are looking at today. We are trying to get the bill passed in a timely fashion, and that is why we sometimes have to use time allocation.

Would the Minister of Finance not agree that this is an important piece of legislation that was part of our election platform, and Canadians want to see it put in place and that is why we had to use time allocation to ensure it gets done in a timely fashion?

[Bill Morneau, Liberal, Toronto Centre, ON]

Mr. Speaker, I would like to confirm that we have put measures in our budget that are related to the election campaign that we put forward for Canadians. We have made sure that the measures in our budget implementation act are financial measures that would make a real difference for our country.

The member specifically mentioned the measures that we want to put in place for seniors. The top-ups for seniors in our country are focused on single seniors, seniors who are three times more likely to be living in poverty than other seniors. That top-up alone, which would be up to $947 for a single senior, would help 900,000 seniors in this country and put them in a better situation.

It is important to note that these measures would come into effect in July. Based on the current schedules, that would be on July 27, 2016.

We are looking forward to making a difference in the near term for so many seniors in this country. This is what people voted for, and we are proud to be able to bring this forward on a timely basis.

[Alex Nuttall, Conservative, Barrie—Springwater—Oro-Medonte, ON]

Mr. Speaker, I quote the throne speech:

Canada succeeds in large part because here, diverse perspectives and different opinions are celebrated, not silenced.

Parliament shall be no exception.

In this Parliament, all members will be honoured, respected and heard, wherever they sit. For here, in these chambers, the voices of all Canadians matter....

Through careful consideration and respectful conduct, the Government can meet these challenges, and all others brought before it.

Could the finance minister tell me if he is looking to end debate just so the government can get access to the Canadian chequebook, to Canadian taxpayers' money? Is that the reason, that you just cannot wait to spend their money?

[The Assistant Deputy Speaker, Liberal, Anthony Rota]

Before going on, I just want to remind hon. members that they do go through the Chair, and I have no intention of touching any chequebook at all.

The hon. Minister of Finance.

[Bill Morneau, Liberal, Toronto Centre, ON]

Mr. Speaker, we take respect for Parliament seriously. The way we start is by putting forth a budget that is really focused on how we can help Canadians. I would like to remind the member opposite of a few numbers that might be helpful for him to put that in context.

In 2010, the previous government put forward Bill C-9, which was a budget bill with 904 pages. I do not know how Parliament can go through 904 pages, but I do know that Canadians expect us to go through what we want to go through, which is the budget that we have put forward and which is a much more reasonable budget for people to understand.

I would remind him of Bill C-13, put forward in 2011 with 658 pages, again vastly more than triple the number of pages in our budget 2016. Maybe I can move to Bill C-43 from 2014, with 478 pages.

We will take no lessons from members on the opposite side about respecting Parliament. We have debated the budget for almost twice as many hours as they put forward in Bill C-43 and Bill C-59. We have had the time we need to reflect on this legislation, and we would like to move forward so we can make a difference for Canadians, which is what they elected us to do.

[Don Davies, NDP, Vancouver Kingsway, BC]

Mr. Speaker, I want to echo the comments of my colleague in saying how disappointing and unacceptable it is to hear the new Liberal government hold up the previous Conservative government as a barometer of respect for democracy. I do not think that is what Canadians voted for when they went to the polls last October.

This is the third time this session that the Liberal government has implemented closure on the House. To hear the finance minister suggest that those who are standing up for democracy in the House are somehow disrespecting veterans is absolutely shameful. If veterans fought and stand for anything in this country, it is that they stand up for the democratic rights of all Canadians and the people in this chamber to have the democratic ability to hold governments to account. That is what our veterans are there for. To somehow perversely suggest that we are not supporting veterans by standing up for democracy is the height of chicanery.

The government says that 19 hours is sufficient time for parliamentarians in the House to debate a budget that would spend somewhere close to $200 billion. I would like the finance minister to tell Canadians if he thinks that 19 hours are sufficient for all parliamentarians in the House to hold the government to account and whether he thinks that parliamentarians in the House have the right to stand and represent their constituents by having their say and their perspectives voiced on this budget, or if he thinks that just does not matter.

[Bill Morneau, Liberal, Toronto Centre, ON]

Mr. Speaker, in my estimation, the height of chicanery might well be the fact that the NDP finance critic, one hour into the debate, moved forward for closure of the debate, knowing full well that would not allow us in any way to have a proper debate.

We want to move forward. We have had 19 hours of debate on this bill. It is a bill that brings forward measures that we know the members opposite recognize would make a real difference for Canadians. We are going to find a way for Canadian families to be significantly better off. Nine out of 10 families with children would have an average $2,300 more per year. Those cheques would start to go out in July.

Students would have 50% larger grants. If they are in low-income families, it would go from $2,000 to $3,000 a year, a 50% increase, making it much more possible for 250,000 students from low-income families to be better off.

This is an important set of measures that would make a real difference for families struggling to get into the middle class and those already in the middle class who are anxious and struggling to figure out how to support their families. We are looking forward to making a real difference for Canadian families. That is what this budget would do.

[Mike Bossio, Liberal, Hastings—Lennox and Addington, ON]

Mr. Speaker, I would like to thank the finance minister for the hundreds of thousands of Canadians he consulted on this budget.

To emphasize the benefits that this budget would have to my rural community and rural communities across Canada, the $500-million investment in digital infrastructure would go a long way to help small businesses grow and compete on the world stage. The infrastructure investments that were announced in this budget would greatly transform a number of rural municipalities in my riding that are looking for upgrades in their sewage treatment plants, which are about to break down, or expand the water filtration plant that is serving both a local municipality and the Mohawk territory. The filtration plant that exists today is already past its maximum use.

As for the guaranteed income supplement, when I knocked on seniors' doors, they said to me, “Mike, I'm trying to figure out, do I heat or do I eat”.

The Canada child benefit would lift hundreds of thousands of children out of poverty, including in my own riding.

I would like the minister to, once again, point out how much this budget would impact rural Canada and why we need to get to work to bring about growth in rural Canada.

[Bill Morneau, Liberal, Toronto Centre, ON]

Mr. Speaker, I appreciate the member's observations. We worked hard in budget 2016 to make sure we would create benefits for Canadians across the country from coast to coast to coast. That means helping Canadians who live in urban centres. It also means helping Canadians who live in rural or centres that are hard to get to. We have a number of measures in our budget that are going to make a real difference for rural communities.

The member correctly pointed out the measures that we are putting in place around high-speed Internet across this country. We recognize that for Canadians to stay linked to an increasingly global world, they need to have access to that global world. We know that applies not only in cities where it is often better to get that access, but also in rural communities where the last mile of fibre can often be very expensive.

We put in our budget a $500-million investment over the next five years in order to improve access for rural communities to link to the global community through high-speed Internet access. This is a real measure that can allow families, and the children of families who are living in rural communities, to see a future in the place where they have actually grown up and where people have brought up their families.

We also recognize that infrastructure, while critically important in big cities, can also make a real difference in rural communities. It is not only about mass transit systems; it is about roads and bridges. It is not only about waste-water systems in cities, but it is about recognizing that with climate change, what is happening to those waste-water systems across the country is that they often need to be renovated and upgraded.

That is why we put infrastructure money into transit, and into roads and bridges. That is why we put infrastructure money into upgrading our waste-water systems across the country. It is going to make a real difference for Canadians who live in hard-to-access places. It will make their lives better, and it will make our country better.

[Michelle Rempel, Conservative, Calgary Nose Hill, AB]

Mr. Speaker, there is something that we have not talked about today. In April, the job numbers for Alberta showed another 20,000 losses. There have been reports that due to the Fort McMurray fire, Alberta's unemployment rate will rise to 15%. What I am concerned about is that this bill does nothing to give the energy sector regulatory certainty. It does nothing to help retain labour in Alberta. If we want to see the economy grow again in western Canada, we have to figure out a way to keep people in Alberta through this economic downturn.

The bill alludes to a carbon tax, which is so detrimental to my province at this point in time. It does nothing for small businesses. In fact, it stalls a decrease in the tax rate that many people were depending upon. It increases debt to this country. Certainly, the minister's budget projections will be affected by the natural disaster that occurred this week in the northern part of the province.

I am asking a very serious question, one which I hope the minister will give more than his pat response to. I am asking with a deep level of sincerity. Why is the minister curtailing debate on this bill when the people in my province need something better than what is in there?

[Bill Morneau, Liberal, Toronto Centre, ON]

Mr. Speaker, we recognize there are enormous challenges today, this week, in Fort McMurray. The people of Alberta are going through some enormous stress that is, frankly, unimaginable for most of us. We stand shoulder to shoulder with the people in Alberta who are going through these challenges. We are committed to working together to ensure the restoration and renewal of Fort McMurray. We have started by ensuring that we will match donations to the Red Cross. As of today, those donations that we matched are in the order of magnitude of $60 million, which is an enormous tribute to the efforts of Canadians across the country to stand together with their fellow Canadians in a time of real need. We know that is increased challenge for people in Alberta at a time when they are already facing real challenges due to the change in oil prices.

In our budget, we have presented a number of initiatives that we know will make a difference, and there are other initiatives that are yet to come that can make a real difference.

Our initiative around employment insurance will make a difference for people who are struggling due to job loss. They can get into the system one week quicker. It provides people more certainty that they can get into the system faster for training dollars, for the opportunity to think about what their future would look like. That shortening of two weeks to one week in the employment insurance system has real and measurable impact on people in Alberta and people in other parts of the country, like Newfoundland and Labrador, Saskatchewan, and northern Ontario, where they are facing real challenges.

By looking at places where we have had a sharp and sustained increase in unemployment and increasing the number of weeks that they have available for employment insurance, we know that we are creating a buffer against a challenge that is facing people in Alberta in particular and in some other regions of the country.

We are also looking forward to what we can do in the future. We put in our budget some measures around infrastructure that are long term in nature. We started with the first couple of years. We will be coming forward within this calendar year to talk about our long-term infrastructure plans which will have a material impact upon Alberta and other parts of the country that are looking to ensure that people get back to work and that their long-term productivity is higher.

We also, very importantly, put forward an agenda around innovation that we know can make a long-term difference in a place like Alberta. We put $800 million over the next four years into an innovation fund. We will be coming back to Parliament, to Canadians, to talk about how we want to set up an innovation agenda.

I am looking forward to this coming Monday when I will meet with my economic advisory council to talk about how that innovation agenda can specifically impact places like Alberta; how we can ensure that we take the enormous reservoir of talent in Alberta and ensure that we use that talent, not only in the resource sector, but in other ways that can be successful.

We will be focused on the resource sector. We will be focused on how we can be effective in Alberta. We will be focused on how we can make real improvements for the long term for people who are going through real challenges.

[Niki Ashton, NDP, Churchill—Keewatinook Aski, MB]

Mr. Speaker, I want to build on the finance minister's comments.

We heard about the heart-wrenching situation taking place in Alberta. The reality is that the budget bill before us, the omnibus budget bill, does make changes to EI. While some of those changes are welcome, they certainly do not go far enough. In fact, workers in Edmonton, southern Saskatchewan, Winnipeg, and other parts of the country who desperately need changes to be made to EI so that they can access EI are not able to. We are talking about workers who have been deeply affected by the downturn in the extractive sector.

While we hear comforting rhetoric from the minister, the NDP proposed splitting the bill so that we could get at fixing EI for Canadians who need it most, but the government disagreed.

We have to be clear that this omnibus budget bill, and that is what it is, does not go nearly far enough when it comes to making the changes to EI that are necessary for Canadians.

Furthermore, as my colleagues have reiterated, when Canadians voted on October 19, they were told by the Liberals that they were voting for real change. The cutting off of debate today is the opposite of that. It is certainly in line with the anti-democratic approach that we saw from the previous Conservative government. Not only are the measures inadequate in this budget, but certainly, the failure to give us the opportunity to scrutinize the budget properly certainly flies in the face of that commitment to Canadians of real change.

[Bill Morneau, Liberal, Toronto Centre, ON]

Mr. Speaker, this budget implementation act is absolutely not an omnibus bill. The measures in the budget implementation act are directly related to budget 2016. Over 100 pages of the budget are related to tax measures, important tax measures that we know will make a real difference for Canadians. Tax measures are complicated. In order to be open and transparent, we have to help Canadians to understand them clearly, evaluate what we are doing clearly, and show that in our budget itself.

I would like to focus specifically on employment insurance. We took measured approaches in employment insurance in our budget bill in order to ensure that we make a real difference for Canadians as they face some challenges. I would like to focus first on some things that will impact Canadians across the country.

As I mentioned, we have changed employment insurance so that rather than waiting for two weeks to get into the EI system we will allow people to get into the EI system within one week. This is important. We have an increasingly volatile situation with the kind of technological change that goes on with globalization. We know that allowing people to get into the EI system more rapidly is critically important. It is important because the largest single bucket of training dollars in our country is actually through the employment insurance system. For people to get access to that training, they need to get into the system. We do not want to have people wait. We want to get them into the system as quickly as possible. In budget 2016, we increased the amount of training dollars in the employment insurance system, which will help Canadians to actually retrain once they get into the system. Those are measures that will be applicable for Canadians across the country.

In addition, as I have mentioned, in 12 regions we expanded the amount of time available for EI. We believe that will have a real impact in those regions by helping Canadians.