Bill C-63 (Historical)

Budget Implementation Act, 2017, No. 2

A second Act to implement certain provisions of the budget tabled in Parliament on March 22, 2017 and other measures

Part 1 implements certain income tax measures proposed in the March 22, 2017 budget by
(a) removing the classification of the costs of drilling a discovery well as “Canadian exploration expenses”;
(b) eliminating the ability for small oil and gas companies to reclassify up to $1 million of “Canadian development expenses” as “Canadian exploration expenses”;
(c) revising the anti-avoidance rules for registered education savings plans and registered disability savings plans;
(d) eliminating the use of billed-basis accounting by designated professionals;
(e) providing enhanced tax treatment for eligible geothermal energy equipment;
(f) extending the base erosion rules to foreign branches of Canadian insurers;
(g) clarifying who has factual control of a corporation for income tax purposes;
(h) introducing an election that would allow taxpayers to mark to market their eligible derivatives;
(i) introducing a specific anti-avoidance rule that targets straddle transactions;
(j) allowing tax-deferred mergers of switch corporations into multiple mutual fund trusts and allowing tax-deferred mergers of segregated funds; and
(k) enhancing the protection of ecologically sensitive land donated to conservation charities and broadening the types of donations permitted.
It also implements other income tax measures by
(a) closing loopholes surrounding the capital gains exemption on the sale of a principal residence;
(b) providing additional authority for certain tax purposes to nurse practitioners;
(c) ensuring that qualifying farmers and fishers selling to agricultural and fisheries cooperatives are eligible for the small business deduction;
(d) extending the types of reverse takeover transactions to which the corporate acquisition of control rules apply;
(e) improving the consistency of rules applicable for expenditures in respect of scientific research and experimental development;
(f) ensuring that the taxable income of federal credit unions is allocated among provinces and territories using the same allocation formula as applicable to the taxable income of banks;
(g) ensuring the appropriate application of Canada’s international tax rules; and
(h) improving the accuracy and consistency of the income tax legislation and regulations.
Part 2 implements certain goods and services tax/harmonized sales tax (GST/HST) measures confirmed in the March 22, 2017 budget by
(a) introducing clarifications and technical improvements to the GST/HST rules applicable to certain pension plans and financial institutions;
(b) revising the GST/HST rules applicable to pension plans so that they apply to pension plans that use master trusts or master corporations;
(c) revising and modernizing the GST/HST drop shipment rules to enhance the effectiveness of these rules and introduce technical improvements;
(d) clarifying the application of the GST/HST to supplies of municipal transit services to accommodate the modern ways in which those services are provided and paid for; and
(e) introducing housekeeping amendments to improve the accuracy and consistency of the GST/HST legislation.
It also implements a GST/HST measure announced on September 8, 2017 by revising the timing requirements for GST/HST rebate applications by public service bodies.
Part 3 amends the Excise Act to ensure that beer made from concentrate on the premises where it is consumed is taxed in a manner that is consistent with other beer products.
Part 4 amends the Federal-Provincial Fiscal Arrangements Act to allow the Minister of Finance on behalf of the Government of Canada, with the approval of the Governor in Council, to enter into coordinated cannabis taxation agreements with provincial governments. It also amends that Act to make related amendments.
Part 5 enacts and amends several Acts in order to implement various measures.
Division 1 of Part 5 amends the Bretton Woods and Related Agreements Act to update and clarify certain powers of the Minister of Finance in relation to the Bretton Woods institutions.
Division 2 of Part 5 enacts the Asian Infrastructure Investment Bank Agreement Act which provides the required authority for Canada to become a member of the Asian Infrastructure Investment Bank.
Division 3 of Part 5 provides for the transfer from the Minister of Finance to the Minister of Foreign Affairs of the responsibility for three international development financing agreements entered into between Her Majesty in Right of Canada and the International Finance Corporation.
Division 4 of Part 5 amends the Canada Deposit Insurance Corporation Act to clarify the treatment of, and protections for, eligible financial contracts in a bank resolution process. It also makes consequential amendments to the Payment Clearing and Settlement Act.
Division 5 of Part 5 amends the Bank of Canada Act to specify that the Bank of Canada may make loans or advances to members of the Canadian Payments Association that are secured by real property or immovables situated in Canada and to allow such loans and advances to be secured by way of an assignment or transfer of a right, title or interest in real property or immovables situated in Canada. It also amends the Canada Deposit Insurance Corporation Act to specify that the Bank of Canada and the Canada Deposit Insurance Corporation are exempt from stays even where obligations are secured by real property or immovables.
Division 6 of Part 5 amends the Payment Clearing and Settlement Act in order to expand and enhance the oversight powers of the Bank of Canada by further strengthening the Bank’s ability to identify and respond to risks to financial market infrastructures in a proactive and timely manner.
Division 7 of Part 5 amends the Northern Pipeline Act to permit the Northern Pipeline Agency to annually recover from any company with a certificate of public convenience and necessity issued under that Act an amount equal to the costs incurred by that Agency with respect to that company.
Division 8 of Part 5 amends the Canada Labour Code in order to, among other things,
(a) provide employees with a right to request flexible work arrangements from their employers;
(b) provide employees with a family responsibility leave for a maximum of three days, a leave for victims of family violence for a maximum of ten days and a leave for traditional Aboriginal practices for a maximum of five days; and
(c) modify certain provisions related to work schedules, overtime, annual vacation, general holidays and bereavement leave, in order to provide greater flexibility in work arrangements.
Division 9 of Part 5 amends the Economic Action Plan 2015 Act, No. 1 to repeal the paragraph 167(1.‍2)‍(b) of the Canada Labour Code that it enacts, and to amend the related regulation-making provisions accordingly.
Division 10 of Part 5 approves and implements the Canadian Free Trade Agreement entered into by the Government of Canada and the governments of each province and territory to reduce or eliminate barriers to the free movement of persons, goods, services and investments. It also makes related amendments to the Energy Efficiency Act in order to facilitate, with respect to energy-using products or classes of energy-using products, the harmonization of requirements set out in regulations with those of a jurisdiction. Finally, it makes consequential amendments to the Financial Administration Act, the Department of Public Works and Government Services Act and the Procurement Ombudsman Regulations and it repeals the Timber Marking Act and the Agreement on Internal Trade Implementation Act.
Division 11 of Part 5 amends the Judges Act
(a) to allow for the payment of annuities, in certain circumstances, to judges and their survivors and children, other than by way of grant of the Governor in Council;
(b) to authorize the payment of salaries to the new Associate Chief Justice of the Court of Queen’s Bench of Alberta; and
(c) to change the title of “senior judge” to “chief justice” for the superior trial courts of the territories.
It also makes consequential amendments to other Acts.
Division 12 of Part 5 amends the Business Development Bank of Canada Act to increase the maximum amount of the paid-in capital of the Business Development Bank of Canada.
Division 13 of Part 5 amends the Financial Administration Act to authorize, in an increased number of cases, the entering into of contracts or other arrangements that provide for a payment if there is a sufficient balance to discharge any debt that will be due under them during the fiscal year in which they are entered into.

Budget Implementation Act, 2017, No. 2

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

Madam Speaker, I think it must be opposite day, because that is exactly the opposite of what I was saying. We actually need money being spent in Ontario and, yes, for broadband, because government is expecting us to do everything over the Internet, but it is not quite available.

Instead of investing in roads and broadband, the Liberals are putting money, according to this omnibus piece of legislation, into the Business Development Bank. However, instead of developing businesses that are going to help Canadians, it is taking that money overseas or using it to have more so-called green social infrastructure manufactured, which only increases poverty and drives up the need to have more tax credits for the poor who cannot afford it.

[John Brassard, Conservative, Barrie—Innisfil, ON]

Madam Speaker, during the member's speech, I Googled “hypocrites”, and it led me to the “Real Change” website of the Liberal Party platform. There was a specific section with respect to omnibus bills, which said:

We will not resort to legislative tricks to avoid scrutiny....

[The previous government]...used omnibus bills to prevent Parliament from properly reviewing and debating his proposals. We will change the House of Commons Standing Orders to bring an end to this undemocratic practice.

Well, we are dealing with an omnibus bill. I am wondering what the member thinks of that.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

Madam Speaker, we can just look at the Liberals' platform, and essentially everything they said they were going to do is exactly the opposite of what seems to have transpired. Welcome to opposite day in Canada. I do not think the Liberals understand the difference between being transparent and being invisible.

[Steven MacKinnon, Liberal, Parliamentary Secretary to the Minister of Public Services and Procurement]

Madam Speaker, I would like to inform you that I will be sharing my time with my friend, the member for Scarborough—Rouge Park.

I will be speaking about the second budget implementation act.

First of all, I would like to say how proud I am to represent the people of Gatineau in the House. It is an honour to have been chosen as their spokesperson in this chamber of Canadian democracy. Every day, as the Parliamentary Secretary to the Minister of Public Services and Procurement and as MP for Gatineau, I try to promote the interests of my constituents within the Government of Canada.

The first thing I would like to say is that this bill is part of a larger movement or trend, part of our government's wider plan to promote greater work-life balance. It will also help ease the burden of young families and our families in general. This is a well represented group in my riding of Gatineau. A recent study found that the population of Gatineau is younger, and that its income and rate of growth is higher than the Quebec average. The riding's people work hard and have helped build Canada through their participation in the federal public service. The people of Gatineau have worked hard in the forestry and resource sectors. They have created wealth. My constituents work, and most importantly, live and raise their families in the riding of Gatineau.

Our government's efforts and policies are appropriate for the people of my riding and have a positive impact on the citizens of Gatineau. It is very difficult to achieve work-life balance today. There are problems with transportation, and there is stress. Even with two incomes, our families' debt levels are higher than the national average. The government must take action.

Our election platform and the bill before us today are meant to ease this burden. I would remind the House that we cut taxes for the middle class. When we talk about the middle class, this includes the people of Gatineau. One of the first things we did was to cut taxes for the middle class. We dropped the retirement age. Mr. Harper wanted to raise the eligibility age for retirement to 67, but we brought it back down to 65.

As the Prime Minister said yesterday, the Canada child benefit and the enhancement we just announced in the fall economic update will help all Canadian families. It will give them room to make some choices, whether regarding child care, registration in cultural activities, leisure activities, and so on. The Canada child benefit is the most important social program of my generation for future generations, for the families and children in Gatineau and across Canada.

We enhanced the Canada pension plan. I applaud the Quebec finance minister' initiative, which will adapt the Canadian reform to Quebec society. The Canada pension plan will get a boost from coast to coast thanks to the federal government's efforts. This means that young workers and young families can rest assured that they will have a better and more secure retirement. What they save now will be returned to them at the end of their working lives.

Of course, there is also the working income tax benefit. Just like everywhere else, some people have trouble getting off social assistance. They find it difficult to choose between getting back into the job market and continuing to receive social assistance. Thanks to measures we just announced, this tax credit will be enhanced, which will make it easier for people to choose to go back to work and contribute more to society because they know they will get a tax credit, they know the government supports them, and they know that, financially, going back to work makes sense.

The bill we are talking about today will make life easier for people working in federally regulated industries. There will be more flexibility around vacation and annual leave. People will have up to 10 days of bereavement leave if they lose a loved one, and they will have an additional three days of unpaid leave to attend to family responsibilities. That is one way we are showing compassion for our workers and for people who are having a hard time balancing work and family responsibilities. Those responsibilities can be toward our parents, our children, or even ourselves. We have introduced important measures.

Our government will continue to make life easier for Canadian families. It will also continue to make it easier to raise a family and to deal with the stress associated with two incomes, the stress caused by personal debt, and the stress caused by job insecurity in our country.

We are well aware of these realities in Gatineau and elsewhere. As the member for Gatineau, I will continue to urge my government to take action and do what is necessary to help families in Gatineau and Quebec find work-life balance.

I will close on a more personal note. Tax measures alone will not allow people in the riding of Gatineau and the Outaouais region achieve work-life balance. We need to invest more in our roads and infrastructure, including those we share with other levels of government.

We have taken a big step forward with the Rapibus extension that I recently announced with my friends and provincial and municipal counterparts. This will make life easier for many people in Gatineau. We must continue to find solutions for the western part of Gatineau and extend this transit system to the eastern end of the city.

Another initiative that must be undertaken by our government, in co-operation with our friends in Ottawa, Ontario, Quebec, and Gatineau is the construction of a sixth interprovincial bridge, this one in the Gatineau sector. That would allow a young single mother who works in Tunney's Pasture to get to the Cheval-Blanc sector of Gatineau more easily to watch her daughter's soccer game, for example. We need to reduce traffic by improving transportation, something that the programs we will put in place will accomplish. With the help of the federal government, life will be greatly improved for the people of Gatineau.

I am very pleased to be part of this government, this movement, and this trend. I once again thank the people of Gatineau who gave me the honour of representing them.

[Dan Albas, Conservative, Central Okanagan—Similkameen—Nicola, BC]

Madam Speaker, the member opposite talked about wanting to lessen the stress on middle-income families. One thing this bill will absolutely do, and the Parliamentary Secretary to the Minister of Finance said this earlier, is create serious challenges with respect to the work-in-progress provisions. Often times, people will seek to have a lawyer represent them in court but do not have the money to pay for it and a lawyer will often take the case based on contingency fees. This bill will force taxes to be paid on work that has not yet been done, has not been billed, and may never be paid. Does the member not agree that this is the exact opposite of reducing stress? This is increasing stress on a very vulnerable population. What does he have to say about that?

[Steven MacKinnon, Liberal, Gatineau, QC]

Madam Speaker, I thank my friend from British Columbia for the question. Obviously, if he thinks that the federal government is advocating anything other than tax fairness, well he is wrong. The government is advocating tax fairness, equal treatment of income in our corporations. That is indeed what is being done in the provision here. If the firms we consult did not bill for the work, that would have a positive impact on their tax situation. I believe the question does not really apply, here.

[Scott Duvall, NDP, Hamilton Mountain, ON]

Madam Speaker, the member across the floor mentioned something that was interesting to me when he talked about pensions and what the government has done, namely lowering the eligible age back to 65 from 67, which we welcome. Also, I do not think what was done with the CPP is enough, but it is for our children and our grandchildren going forward.

One thing he did not state is that there is something in the bill that a lot of workers have, a defined pension benefit plan, which will give them a stable income when they retire. However, the government wants to change that to what it calls a “defined target plan”, which would give them instability. Why is the government attacking these middle-class people, and those who are striving to join them, who have defined benefit plans?

[Steven MacKinnon, Liberal, Gatineau, QC]

Madam Speaker, let me be very clear: as I stand here let me say that our federal public service pensions, those that are subject to the plan in question, will remain in place forever. They will be there for current and future employees. It is not by lowering our standards for pensions that we are going to ensure a better retirement for Canadian society. I think that my colleague is talking about a bill that will be debated here in Parliament and I look forward to having that discussion. To me, federal public service pensions are sacrosanct.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

Madam Speaker, we in the official opposition have said that the government's policies tend to hurt those who they precisely were intended to help. That could not be more clear, given the example that my colleague ended his speech with. He spoke about a single mother who wants to be able to use public transit to take her daughter to soccer. I have a great idea for how we can help her. We could make transit passes tax-deductible. Wait. That was a measure the current government cancelled. It is increasing taxes precisely on the groups it talks about helping.

When we talk about children and families, I want to very quickly ask the member this. Does he think it is fair to the next generation to run deficits in perpetuity? If not, when will the government balance the budget?

[Steven MacKinnon, Liberal, Gatineau, QC]

Madam Speaker, what is fair to the next generation is ensuring that they have a retirement and that is what we just did by improving the Canada pension plan. As far as public transit is concerned, there needs to be a public transit system, like in my case that goes to the Cheval-Blanc neighbourhood, to help this young single mother.

[Gary Anandasangaree, Liberal, Scarborough—Rouge Park, ON]

Madam Speaker, I thank my friend from Gatineau for his speech.

I am very proud to rise this afternoon to speak on Bill C-63 , a second act to implement certain provisions of the budget tabled in Parliament on March 22, 2017 and other measures.

I want to start by acknowledging that we are gathered here on the traditional unceded lands of the Algonquin people.

This is the first time I am actually making a full speech since my good friend and mentor Arnold Chan passed on September 14. I do want to take this opportunity to remember him and to reflect on his enormous contribution to Canada, and express my continued support and love to the Chan-Yip family.

I want to congratulate the Minister of Finance on directing such a great job on our economy. I know there is limited time for me to speak before question period, so I want to just have the first part of my speech contextualize the position of our economy today, two years since our government took office.

It is very clear that our policies are indeed working. In the past four quarters alone, the Canadian economy grew at the fastest rate since 2006. The average growth was 3.7% for the past four quarters. The economy created 450,000 jobs since late 2015. That is a remarkable number to reflect on.

The unemployment rate is the lowest it has been since 2008. This economy is projected to continue growing with a forecasted growth of 3.1% annually, the fastest growth rate in any of the G7 countries.

We have the lowest debt-to-GDP ratio of any G7 nation. The economy is directly benefiting from our progressive economic policies. Our aim is to reduce the gap between the rich and the poor, and build a middle class that will be the engine of this country. We want to ensure that no one is left behind, and, yes, that will mean that those with the ability to pay more ought to pay more.

Members may recall the measures that our government has put in with respect to where the economy has now landed. First, with respect to the middle class, we have lowered taxes on the middle class. We have put more money into the pockets of people who drive the economy. We have cut taxes for nine million Canadians.

The Canada child benefit has been an enormous source of strength to our economy. I look forward to picking up on that and elaborating more on its benefits to my riding.

[The Speaker, Liberal, Geoff Regan]

The hon. member for Scarborough—Rouge Park will have seven minutes remaining in his speech when the House next comes back to this topic.

The House resumed consideration of the motion that Bill C-63, A second Act to implement certain provisions of the budget tabled in Parliament on March 22, 2017 and other measures, be read the second time and referred to a committee.

[Gary Anandasangaree, Liberal, Scarborough—Rouge Park, ON]

Mr. Speaker, as the member of Parliament for Scarborough—Rouge Park, I once again rise to continue the discussion on Bill C-63, a second act to implement certain provisions of the budget tabled in Parliament on March 22, 2017 and other measures.

I was talking about the economy, and I highlighted some of the work of our government had done with respect to tax fairness.

I now want to touch on something that is very close to my heart and certainly something that affects each and every member, which is the Canada child benefit.

In July of this year, according to statistics that were recently provided to me, 9,170 payments, benefiting 16,160 children, were made through the Canada child benefit in Scarborough—Rouge Park. An average payment in Scarborough—Rouge Park is $630 per month, or $5.754 million just for this year. If we look at it over four years, it works out to a significant amount of money. I am quite proud to say that this has had a game-changing effect in my community and I am sure in other communities across the country.

Many people in my community are unable to afford to send their children to extracurricular activities. There are housing issues in Toronto. In the eastern part of Toronto, especially, housing is quite expensive, with a high cost for basic services such as the Internet and telephone. The Canada child benefit will assist many families to support their children better than they were able to before.

This is a very important aspect of our platform. Enhancements to this were proposed recently in the fall economic statement by the Minister of Finance, such as the acceleration of indexing of the Canada child benefit to inflation in two years, starting in July of 2018, with an additional $5.6 billion in support of Canadian families over 2017-19. For a single parent, with two children, making $35,000 a year, this will mean an additional $560 more next year.

In addition to the Canada child benefit, there are also enhancements to the working income tax benefit. It is a refundable tax credit that cuts tax for eligible people in the workforce and encourages others to get a job. It will be an additional $500 million per year, starting in 2019.

I want to dive into the substantive parts of the legislation and talk about several aspects of it.

First are the amendments to the Canadian Labour Code to improve the rights of workers. We have introduced these measures to ensure people can have flexible work arrangements. All employees working for more than six months have the right to ask for changes to the number of hours they work, the location, and schedule, among other things if they work in a sector that is regulated by the federal government.

Employers must respond to requests within 30 days and employers are prevented from disciplining employees. If the employer does not accept their request, it is required to give a written rational for its decision and refute the request on legislated grounds.

We have expanded family leave to three days to aid family members suffering from health issues, or for educational purposes, as well as leave for victims of family violence who can receive 10 days of leave to seek medical or psychological help, family services, relocation services, and to seek law enforcement assistance.

Also important is the introduction of five days leave to engage in traditional indigenous practices. I sit on the indigenous affairs committee. It has been a great opportunity to learn important aspects of indigenous culture. Over the last two years, it has been clear to me that the current workplace environment and systems in Canada do not reflect, respect, nor give space for the traditional practices of our indigenous brothers and sisters. It is important to ensure those in the workforce are able to take time off to engage in traditional indigenous practices.

These are very important measures.

To quickly summarize, this is a very important aspect of our platform. It is the second phase implementing the budget introduced by our finance minister, which has been great for the economy, as it has allowed for a more equal playing field and reduced the gap between the poor and other Canadians. It is aimed at enabling Canadians to live in harmony without having the large income disparities that we see in other countries, which often trigger social unrest.

[Sheri Benson, NDP, Saskatoon West, SK]

Mr. Speaker, I want to call to the hon. member's attention a big concern of mine about unpaid domestic leave.

I want to hear the member's response to the fact there will be a barrier to people actually accessing unpaid domestic leave. Nine percent of women in a domestic violence situation are controlled by their partner economically. The member can imagine the impact of someone coming home with less pay than their a partner who is abusing them. Although I understand the intention, I am concerned that in reality it will not be accessible to the people it is intended to help.