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

[Peter Fonseca, Liberal, Mississauga East—Cooksville, ON]

Madam Speaker, the member knows full well just how hard families work in his riding, in my riding, and in ridings right across the country. For our part, we have to ensure we support those families and those children. That is why the first budget brought forward the Canada child benefit. Now, with our economy doing so well, it is providing those investments back into our communities so our communities can continue to grow.

Does the member not believe that his community, and all communities, deserve this funding, this plan that is working, that is driving our economy, creating jobs, and taking 300,000 kids out of poverty?

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Madam Speaker, speaking of investments, I would like to refer the hon. member to the national housing strategy. Most of that money will not come into effect until after 2019. The last time I checked, some communities are in crisis right now. We have known about the housing crisis for decades, and still Canadians have to wait until they elect another Liberal government in 2019. The NDP will ensure the job gets done immediately.

[The Assistant Deputy Speaker, Carol Hughes]

Order. It is my duty, pursuant to Standing Order 38, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Bruce—Grey—Owen Sound, Taxation; the hon. member for Drummond, Official Languages.

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

Madam Speaker, just listening to the previous speaker reminds me of the degree to which the NDP love to put a spin on things. Let me just comment on a couple of the things the member across the way makes reference to.

He talked about the importance of a national pharmacare program. I believe there are many members of this chamber who are striving to achieve that. I know my colleagues, at least on the government benches, are very much committed to strive toward that. We have a Standing Committee on Health that is working on that and inviting stakeholders to its meetings. It was in the midst of a report when the NDP had a flash of an idea and took the idea from the standing committee and presented it inside the chamber, not allowing the standing committee to do its fine work. True to form, the NDP likes to think that if it is a good idea it has to be an NDP idea.

The member just made reference to the housing strategy, that it might be a big plan but that we are not spending money on it today. I inform the member across the way that we are spending money today. Every year, the national government spends hundreds of millions of dollars in subsidizing national housing. However, this is historic because this is the first time we are getting the type of money we are seeing invested not only for today but into the future for a national housing strategy. Instead of at times trying to recognize the fine work the government is doing, the NDP tends to navel gaze and wants to look at where it can criticize and how it can say it is better than the government.

The member talked about tax fairness. One of my favourite lines is that the NDP likes to come across as if it thinks the rich and corporations should be taxed and the money given to the poor. That is the standard line that it likes to say. When I was in the provincial Manitoba legislature, where the NDP was in government for far too many years, it actually reduced corporate taxes from 16.5% to 12%. That was the NDP in government in the province of Manitoba—

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

We are in Ottawa.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Madam Speaker, that is right, we are in Ottawa. That is very observant of the member opposite.

What did the members in Ottawa have to say? When it came to putting a tax on Canada's wealthiest, what did they do? They voted against it. What did they do when it came time to support Canada's middle class? The member opposite says that it was brought in because of the salaries of MPs. No, that is not true.

The difference between us and the New Democrats is that the Government of Canada supports its middle class and those striving to be a part of it to the degree that it brought in a middle-class tax cut that put hundreds of millions of dollars into the pockets of its middle class. I am talking about teachers, health care workers, and factory floor workers. Millions of Canadians had their disposable income increase, had that tax break, and what did the NDP do? It voted against that too.

Then we take a look at New Democrats wanting tax fairness. Once again, we have a government that wants to—

[The Assistant Deputy Speaker, Carol Hughes]

The hon. member for Longueuil—Saint-Hubert is rising on a point of order.

[Pierre Nantel, NDP, Longueuil—Saint-Hubert, QC]

Madam Speaker, I will not lie: it is good to switch off this member's loudspeaker. The truth is that that this man’s speech has nothing to do with the business that is before us today. He spends his life blaming us for our positions. He should talk about the topic at hand, Bill C-63.

[The Assistant Deputy Speaker, Carol Hughes]

The hon. member knows that there is some latitude when members are speaking. However, I also know that the parliamentary secretary raised several points of order today regarding the relevance of speeches. I would ask him to make sure that his own speech be relevant to the bill that is before the House.

The hon. parliamentary secretary.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Madam Speaker, I will do just that. I may actually do a bit more than that. However, before I do that, I can appreciate the sensitivity because when New Democrats hear the truth it makes them feel a bit uncomfortable in their seats.

[Pierre Nantel, NDP, Longueuil—Saint-Hubert, QC]

It has filled my veins.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

The truth hurts at times but the truth needs to be said.

Madam Speaker, I have done quite well in terms of not standing up, because I hear many members of the opposition stand in their place and talk about the exact same things that I am talking about, but maybe not being as harsh on my friends in the NDP. I will try to stay away from being so harsh and look at ways in which we are supposed to be adding further thoughts on today. That is the issue of the infrastructure investment and the Asian Infrastructure Investment Bank. That is what the NDP moved an amendment on to the budget. I realize very few members have actually talked about that, but I want to at the very least make reference to it because what we hear from across the way is again a false impression.

The members tried to give the impression that Canada is actually spending money on infrastructure in China in a very significant way. I thought it was interesting that one of the most significant investments that it made was actually in the Philippines. In the Philippines, where there were issues related to flooding, there was a commitment of just under half a billion dollars providing flood protection. Flood protection is important, I know. Manitoba is a province that has often had floods, and we have invested in flood protection and it works. It has saved the City of Winnipeg billions of dollars over the years.

We have the Asian infrastructure bank, which does some fine work that might not have taken place. Not that long ago, some serious floods took place in the Philippines and at the time members on all sides of this House stood up and called on the Canadian government to do something. We had individuals in every region in our country; it went far beyond the Filipino heritage community, which continues to grow and be prosperous and add to our very rich heritage. People responded to the flooding in the Philippines, not only by providing comments but by providing hundreds of thousands of dollars and the Canadian government responded to that.

This is some of the work that is being done with the Asian infrastructure bank. However, if people listen to the opposition that is not the impression they would receive. One of the things we do exceptionally well in Canada is the high level of expertise of individuals who have infrastructure experience. Investing in the Asian infrastructure bank allows Canada to better compete, with the expertise that we have to offer the world. If people listen to the opposition, they would think that we are throwing the money away. That is not the case because that money ultimately will come back and there is a very good chance there will be a healthy dividend on it. Therefore, we are contributing to the development in many areas of the world, particularly in that Asian area, in a very humanitarian way as in the example I just cited, and allowing Canadian expertise and possibly even Canadian companies to participate in the process.

It is a bit ironic. We hear Conservatives talk about how bad this thing is because of infrastructure dollars going out of Canada, and yet here we have a Minister of Finance who has invested more in infrastructure with historic record highs, hundreds of millions going toward billions of dollars invested into our infrastructure.

The government has excelled at investing in Canada's infrastructure. By building infrastructure, we support the middle class, and the healthier the middle class, the healthier our infrastructure, the better we all will be.

[Peter Kent, Conservative, Thornhill, ON]

Madam Speaker, I always appreciate my colleague's enthusiasm, but I will pick up from the end of his remarks when he talked about the government's promises for infrastructure spending, many billions of dollars worth of those promises postdated until after the next election. How does he excuse the $2 billion committed already, which has had to be reprofiled because the government could not get those $2 billion out the door?

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Madam Speaker, I am sure my friend across the way recognizes that as much as the government would like every dollar of that spent in a fiscal year, there is an obligation to work with provinces and other stakeholders. In many situations, they could not get the shovels in the ground fast enough. More and more projects are being approved and there are more and more shovels in the ground, but let there be no doubt that this government is truly committed to Canada's infrastructure and the dollars tied to it, because we want the Canadian economy to continue to develop and grow.

[Greg Fergus, Liberal, Hull—Aylmer, QC]

Madam Speaker, I would like to thank my colleague from Winnipeg North for his speech and for emphasizing the Asian Infrastructure Investment Bank.

After the Second World War, Canada learned its lesson well regarding the importance of being part of multilateral organizations to ensure development.

As we all know, when everyone works to create prosperity and wealth by investing in basic infrastructure, everyone benefits, as it ensures progress and development in Asian countries.

Canada is not the only investor in the Asian Infrastructure Investment Bank. Indeed, it is not 10 or 20 countries that expressed interest, but 80 countries.

According to my colleague, is it a good idea for Canada to do its part to invest in development in developing countries?