Bill C-74 (Historical)

Budget Implementation Act, 2018, No. 1

An Act to implement certain provisions of the budget tabled in Parliament on February 27, 2018 and other measures

Part 1 implements certain income tax measures proposed or referenced in the February 27,2018 budget by
(a) ensuring appropriate tax treatment of amounts received under the Veterans Well-being Act;
(b) exempting from income amounts received under the Memorial Grant for First Responders;
(c) lowering the small business tax rate and making consequential adjustments to the dividend gross-up factor and dividend tax credit;
(d) reducing the business limit for the small business deduction based on passive income and restricting access to dividend refunds on the payment of eligible dividends;
(e) preventing the avoidance of tax through income sprinkling arrangements;
(f) removing the risk score requirement and increasing the level of income that can be deducted for Canadian armed forces personnel and police officers serving on designated international missions;
(g) introducing the Canada Workers Benefit;
(h) expanding the medical expense tax credit to recognize expenses incurred in respect of an animal specially trained to perform tasks for a patient with a severe mental impairment;
(i) indexing the Canada Child Benefit as of July 2018;
(j) extending, for one year, the mineral exploration tax credit for flow-through share investors;
(k) extending, by five years, the ability of a qualifying family member to be the plan holder of an individual’s Registered Disability Savings Plan;
(l) allowing transfers of property from charities to municipalities to be considered as qualifying expenditures for the purposes of reducing revocation tax;
(m) ensuring that appropriate taxpayers are eligible for the Canada Child Benefit and that information related to the Canada Child Benefit can be shared with provinces and territories for certain purposes; and
(n) extending, by five years, eligibility for Class 43.‍2.
Part 2 implements certain excise measures proposed in the February 27,2018 budget by
(a) advancing the existing inflationary adjustments for excise duty rates on tobacco products to occur on an annual basis rather than every five years; and
(b) increasing excise duty rates on tobacco products to account for inflation since the last inflationary adjustment in 2014 and by an additional $1 per carton of 200 cigarettes, along with corresponding increases to the excise duty rates on other tobacco products.
Part 3 implements a new federal excise duty framework for cannabis products proposed in the February 27,2018 budget by
(a) requiring that cannabis cultivators and manufacturers obtain a cannabis licence from the Canada Revenue Agency;
(b) requiring that all cannabis products that are removed from the premises of a cannabis licensee to be entered into the Canadian market for retail sale be affixed with an excise stamp;
(c) imposing excise duties on cannabis products to be paid by cannabis licensees;
(d) providing for administration and enforcement rules related to the excise duty framework;
(e) providing the Governor in Council with authority to provide for an additional excise duty in respect of provinces and territories that enter into a coordinated cannabis taxation agreement with Canada; and
(f) making related amendments to other legislative texts, including ensuring that any sales of cannabis products that would otherwise be considered as basic groceries are subject to the GST/HST in the same way as sales of other types of cannabis products.
Part 4 amends the Pension Act to authorize the Minister of Veterans Affairs to waive, in certain cases, the requirement for an application for an award under that Act.
It also amends the Veterans Well-being Act to, among other things,
(a) replace the earnings loss benefit, career impact allowance, supplementary retirement benefit and retirement income security benefit with the income replacement benefit;
(b) replace the disability award with pain and suffering compensation; and
(c) create additional pain and suffering compensation.
Finally, it makes consequential amendments to other Acts.
Part 5 enacts the Greenhouse Gas Pollution Pricing Act and makes the Fuel Charge Regulations.
Part 1 of that Act sets out the regime for a charge on fossil fuels. The fuel charge regime provides that a charge applies, at rates set out in Schedule 2 to that Act, to fuels that are produced, delivered or used in a listed province, brought into a listed province from another place in Canada, or imported into Canada at a location in a listed province. The fuel charge regime also provides relief from the fuel charge, through rebate and exemption certificate mechanisms, in certain circumstances. The fuel charge regime also sets out the registration requirements for persons that carry out certain activities relating to fuels subject to the charge. Part 1 of that Act also contains administrative provisions and enforcement provisions, including penalties, offences and collection provisions. Part 1 of that Act also sets out a mechanism for distributing revenues from the fuel charge. Part 1 of that Act also provides the Governor in Council with authority to make regulations for purposes of that Part, including the authority to determine which province, territory or area is a listed province for purpose of that Part.
Part 2 of that Act sets out the regime for pricing industrial greenhouse gas emissions. The industrial emissions pricing regime requires the registration of any facility that is located in a province or area that is set out in Part 2 of Schedule 1 to that Act and that either meets criteria specified by regulation or voluntarily joins the regime. The industrial emissions pricing regime requires compliance reporting with respect to any facility that is covered by the regime and the provision of compensation for any amount of a greenhouse gas that the facility emits above the applicable emissions limit during a compliance period. Part 2 of that Act also sets out an information gathering regime, administrative powers, duties and functions, enforcement tools, offences and related penalties, and a mechanism for distributing revenues from the industrial emissions pricing regime. Part 2 of that Act also provides the Governor in Council with the authority to make regulations for the purposes of that Part and the authority to make orders that amend Part 2 of Schedule 1 by adding, deleting or amending the name of a province or the description of an area.
Part 3 of that Act authorizes the Governor in Council to make regulations that provide for the application of provincial laws concerning greenhouse gas emissions to works, undertakings, lands and waters under federal jurisdiction.
Part 4 of that Act requires the Minister of the Environment to prepare an annual report on the administration of the Act and to cause it to be tabled in each House of Parliament.
Part 6 amends several Acts in order to implement various measures.
Division 1 of Part 6 amends the Financial Administration Act to establish the office of the Chief Information Officer of Canada and to provide that the President of the Treasury Board is responsible for the coordination of that Officer’s activities with those of the other deputy heads of the Treasury Board Secretariat. It also amends the Act to ensure Crown corporations with no borrowing authority are able to continue to enter into leases and to specify that leases are not considered to be transactions to borrow money for the purposes of Crown corporations’ statutory borrowing limits.
Division 2 of Part 6 amends the Canada Deposit Insurance Corporation Act in order to modernize and enhance the Canadian deposit insurance framework to ensure it continues to meet its objectives, including financial stability.
Division 3 of Part 6 amends the Federal-Provincial Fiscal Arrangements Act to renew Fiscal Equalization Payments to the provinces and Territorial Formula Financing Payments to the territories for a five-year period beginning on April 1,2019 and ending on March 31,2024, and to authorize annual transition payments of $1,270,000 to Yukon and $1,744,000 to the Northwest Territories for that period. It also amends the Act to allow Canada Health Transfer deductions to be reimbursed when provinces and territories have taken the steps necessary to eliminate extra-billing and user fees in the delivery of public health care.
Division 4 of Part 6 amends the Bank of Canada Act to ensure that the Bank of Canada may continue to buy and sell securities issued or guaranteed by the government of the United Kingdom if that country ceases to be a member state of the European Union.
Division 5 of Part 6 amends the Currency Act to expand the objectives of the Exchange Fund Account to include providing a source of liquidity for the government of Canada. It also amends that Act to authorize the payment of funds from the Exchange Fund Account into the Consolidated Revenue Fund.
Division 6 of Part 6 amends the Bank of Canada Act to require the Bank of Canada to make adequate arrangements for the removal from circulation in Canada of its bank notes that are worn or mutilated or that are the subject of an order made under paragraph 9(1)‍(b) of the Currency Act. It also amends the Currency Act to provide, among other things, that
(a) bank notes are current if they are issued under the authority of the Bank of Canada Act;
(b) the Governor in Council may, by order, call in certain bank notes; and
(c) bank notes that are called in by order are not current.
Division 7 of Part 6 amends the Payment Clearing and Settlement Act in order to implement a framework for resolution of clearing and settlement systems and clearing houses, and to protect information related to oversight, by the Bank of Canada, of clearing and settlement systems.
Division 8 of Part 6 amends the Canadian International Trade Tribunal Act to, among other things,
(a) create the position of Vice-chairperson of the Canadian International Trade Tribunal;
(b) provide that former permanent members of the Tribunal may be re-appointed to one further term as a permanent member; and
(c) clarify the rules concerning the interim replacement of the Chairperson of the Tribunal and provide for the interim replacement of the Vice-chairperson of the Tribunal.
Division 9 of Part 6 amends the Canadian High Arctic Research Station Act to, among other things, provide that the Canadian High Arctic Research Station is to be considered an agent corporation for the purpose of the transfer of the administration of federal real property and federal immovables under the Federal Real Property and Federal Immovables Act. It also provides that the Order entitled Game Declared in Danger of Becoming Extinct is deemed to have continued in force and to have continued to apply in Nunavut, as of April 1,2014.
Division 10 of Part 6 amends the Canadian Institutes of Health Research Act in order to separate the roles of President of the Canadian Institutes of Health Research and Chairperson of the Governing Council, to merge the responsibility to establish policies and to limit delegation of certain Governing Council powers, duties and functions to its members or committees or to the President.
Division 11 of Part 6 amends the Red Tape Reduction Act to permit an administrative burden imposed by regulations to be offset by the reduction of another administrative burden imposed by another jurisdiction if the reduction is the result of regulatory cooperation agreements.
Division 12 of Part 6 provides for the transfer of certain employees and disclosure of information to the Communications Security Establishment to improve cyber security.
Division 13 of Part 6 amends the Department of Employment and Social Development Act to provide the Minister of Employment and Social Development with legislative authority respecting service delivery to the public and to make related amendments to Parts 4 and 6 of that Act.
Division 14 of Part 6 amends the Employment Insurance Act to modify the treatment of earnings received by claimants while they are in receipt of benefits.
Division 15 of Part 6 amends the Judges Act to authorize the salaries for the following new judges, namely, six judges for the Ontario Superior Court of Justice, one judge for the Saskatchewan Court of Appeal, 39 judges for the unified family courts (as of April 1,2019), one judge for the Federal Court and a new Associate Chief Justice for the Federal Court. This division also makes consequential amendments to the Federal Courts Act.
Division 16 of Part 6 amends certain Acts governing federal financial institutions and related Acts to, among other things,
(a) extend the scope of activities related to financial services in which federal financial institutions may engage, including activities related to financial technology, as well as modernize certain provisions applicable to information processing and information technology activities;
(b) permit life companies, fraternal benefit societies and insurance holding companies to make long-term investments in permitted infrastructure entities to obtain predictable returns under the Insurance Companies Act;
(c) provide prudentially regulated deposit-taking institutions, such as credit unions, with the ability to use generic bank terms under the Bank Act, subject to disclosure requirements, as well as provide the Superintendent of Financial Institutions with additional enforcement tools under the Bank Act and the Office of the Superintendent of Financial Institutions Act, and clarify existing provisions of the Bank Act; and
(d) modify sunset provisions in certain Acts governing federal financial institutions to extend by five years, after the day on which this Act receives royal assent, the period during which those institutions may carry on business.
Division 17 of Part 6 amends the Western Economic Diversification Act to remove the requirement of the Governor in Council’s approval for the Minister of Western Economic Diversification to enter into an agreement with the government of a province, or with a provincial agency, respecting the exercise of the Minister’s powers and the carrying out of the Minister’s duties and functions.
Division 18 of Part 6 amends the Parliament of Canada Act to give each House of Parliament the power to make regulations related to maternity and parental arrangements for its own members.
Division 19 of Part 6 amends the Canada Pension Plan to, among other things,
(a) eliminate age-based restrictions on the survivor’s pension;
(b) fix the amount of the death benefit at $2,500;
(c) provide a benefit to disabled retirement pension beneficiaries under the age of 65;
(d) protect retirement and survivor’s pension amounts under the additional Canada Pension Plan for individuals who are disabled;
(e) protect benefit amounts under the additional Canada Pension Plan for parents with lower earnings during child-rearing years;
(f) maintain portability between the Canada Pension Plan and the Act respecting the Québec Pension Plan; and
(g) authorize the making of regulations to support the sustainability of the additional Canada Pension Plan.
Division 20 of Part 6 amends the Criminal Code to establish a remediation agreement regime. Under this regime, the prosecutor may negotiate a remediation agreement with an organization that is alleged to have committed an offence of an economic character referred to in the schedule to Part XXII.‍1 of that Act and the proceedings related to that offence are stayed if the organization complies with the terms of the agreement.

Budget Implementation Act, 2018, No. 1

[Filomena Tassi, Liberal, Hamilton West—Ancaster—Dundas, ON]

Mr. Speaker, with respect to the consultation that has taken place, the hon. member respects and values consultation. I would like her to share with the House the consultation she engaged in with respect to the pre-budget and the implementation of previous budgets, as well as this BIA, and the response she has received from her constituents with respect to what our government has delivered.

[Pam Goldsmith-Jones, Liberal, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Mr. Speaker, I would like to particularly comment on the six budget meetings I held last week in the riding. Each was sold out and ranged from our trade agenda, because there is a lot of support for our progressive trade agenda and particularly full benefits of CETA and the TPP. We held a wonderful Squamish round table for the things our budget would do for women in entrepreneurship, women in technology, and women in trade. We held another public meeting in West Vancouver with the chamber of commerce, which very much focused on the tax reforms proposed by the Minister of Finance. They were very appreciative of the ability of our government to listen to the concerns expressed last summer and to realize the real movement in this budget, because of listening to people. Generally speaking, people are very happy.

[Pat Kelly, Conservative, Calgary Rocky Ridge, AB]

Mr. Speaker, it is always an honour to rise in this place, even during difficult times such as today when it is with somewhat of a heavy heart one rises after the tributes we heard on the terrible tragedy in Saskatchewan.

It is also sometimes difficult to rise in trying times such as these when so much is at stake for the future of our country, even as we grapple with the ongoing crisis over the Trans Mountain expansion and the implications that a failure of that project would have for all future projects in Canada.

This budget implementation act necessarily brings us back to the budget that it implements. The bottom line of any budget, and really the first thing that anyone wants to know about a budget, is whether it is going to be a surplus budget or a deficit budget. Any analysis, criticism, or commentary has to take place in the context of the size and scope of any surplus or deficit. All the choices of inclusion or omission from a budget have to be viewed through that lens.

In the case of a deficit, it is customary to address the question of when the budget will return to surplus. I say this is customary because indeed it is. In fact, all 13 provincial and territorial governments either have a balanced budget or have a specific timeline or projection for when their budget will be balanced, and it is contained in their budget.

The finance minister is currently running a significant deficit, and neither the budget nor this implementation act make any mention of the means or timing of a return to balance. I raised this with the minister when he appeared before the finance committee last month. I asked him why he is the only finance minister in Canada who has no plan for a balanced budget, and why he did not even address the issue in a 400-page budget document. He said, “No matter how many times the Conservative members ask us to follow the playbook of the previous Conservative government, we won't do it.” I may disagree with the minister on the point of whether or not he should follow the Conservative playbook, but at this point I think most Canadians would settle for this government merely following its own playbook.

On page 12 of the 2015 Liberal platform, its playbook, it reads:

We will run modest short-term deficits of less than $10 billion in each of the next two fiscal years to fund historic investments in infrastructure....

After the next two fiscal years, the deficit will decline and our investment plan will return Canada to a balanced budget in 2019.

On page 72 under the fiscal plan and costing chapter it reiterates, “We will run modest deficits for three years so that we can invest in growth for the middle class and credibly offer a plan to balance the budget in 2019.” Later on in the same chapter it says, “After the next two fiscal years, the deficit will decline and our investment plan will return Canada to a balanced budget....” The Liberal playbook refers to balanced budgets, and in fact, the Liberals promised balanced budgets. They promised small deficits and a return to a balanced budget.

Given that the Liberals promised a balanced budget by 2019 in the 2015 election, given that they promised only short-term deficits of less than $10 billion, and given that they promised these short-term deficits only to fund historic investments in infrastructure, the question is why they are now implementing a structural deficit in a budget with over a $20-billion deficit. Why does the finance minister repeatedly refuse to give any timeline for a balanced budget at all? Why does he bizarrely criticize the Conservatives for even asking about a balanced budget when he ran on an election platform that contained that very promise?

In fact, the finance minister got lucky this past year. The Canadian economy benefited from a whole host of factors, for none of which the finance minister can take any credit. Commodity prices were better than forecast. The world economy has had perhaps its best year since the great recession. The American economy was positively booming with a record-setting stock market run. Real estate price inflation has continued in Canada. Interest rates have remained low. Even with all of these factors in his favour, the finance minister still ran a promise-breaking deficit in this budget following what will surely be one of the strongest economic years in this Parliament.

If the minister promised to return to balanced budgets, he has completely failed to deliver, and it is more than reasonable for opposition members to ask if not now, then when. Given that a return to balance was a huge part of the Liberals' election promise, we would not be doing our jobs as an opposition holding the government to account without asking that question and no answer has been given so far. Still, there really is nothing in the bill to address that question either.

There is, however, in the original budget a troubling item contained on page 290, and that is a recognition of the fact that Canadian oil sells at a significant discount to world prices due to a lack of pipeline capacity in general and the routing of existing pipeline capacity mostly to the oversupplied Cushing, Oklahoma hub rather than to tidewater or to other refinery areas with spare capacity. This discount from world prices, which the government commented on in the budget itself, has grown significantly worse in the past few months.

This difference between the price that our producers get and world prices has a significant impact on business profits and jobs in the industry. The discount has an enormous impact on tax revenues to both the oil-producing provinces and to the federal government itself and it dictates the viability or non-viability of future projects. Simply put, this discount means that we are actually exporting tax revenue and public services to the United States.

Using round numbers, Canadian exports are about three million barrels a day. If Canadian producers take a $20 discount, that means the industry loses $60 million a day, or roughly $22 billion per year. A significant portion of that $22 billion will be taxable income at both the federal and provincial levels. The federal government loses billions in tax revenue because of this price differential, so it cannot be ignored as a factor in the budget.

What is truly alarming today, given the debacle over the Kinder Morgan Trans Mountain expansion, is that the finance minister, in his budget, assumes that both Trans Mountain and Keystone XL will be built at a reduced price discount. We obviously know that these assumptions are being challenged right now. Both projects at best will delay projected revenue from profitable oil production, but in typical fashion, the finance minister has just assumed that the pipelines will be built even though a host of opponents are doing everything they can, including breaking the law, to prevent these pipelines from getting built.

The finance minister surely knows that he has cabinet colleagues who oppose the energy industry, that he has caucus colleagues who campaigned in the last election against the Trans Mountain expansion, and that the most senior unelected adviser to the Prime Minister is notoriously anti-pipeline. Therefore, it was a fairly bold assertion for him to simply assume the Trans Mountain and Keystone XL pipelines would be built. Both projects are behind schedule. Both continue to be opposed by extremists committed to everything from vexatious litigation to violent clashes with police while defying court orders, trespassing, and destroying private property.

Given the government's track record, what credibility does it really think it deserves on pipelines? The finance minister's budget assumes the pipelines are going to be built, and yet one of the first things the government did after it was elected was to kill the northern gateway project, which was a pipeline to tidewater approved previously. The proponent was working through the conditions and the concerns that had been raised about the project when the Liberal government used an arbitrary tanker ban to ensure that it could never be built.

Then the Prime Minister completely failed to get Barack Obama to approve Keystone XL, which added another couple of years to the delay of that project. The finance minister is counting on this project to reduce the differential that has to be taken into account in his tax revenue projections.

We know energy east was killed by the government's decision to move the goalposts on its proponent by absurdly deciding to make both upstream and downstream emissions part of the criteria. I say absurd because the emissions from fossil fuels moved through a pipe are mostly determined by the type of vehicle the fossil fuel is put into by the end consumer.

Now the government is even pushing through Bill C-69. At the environment committee, the president of the Canadian Energy Pipeline Association said, “It is hard to imagine that any pipeline project proponent would be prepared to test this new process or have a reasonable expectation of a positive outcome at the end of it.” He went on to say, “If the goal is to curtail oil and gas production and to have no more pipelines built, this legislation may have hit the mark.”

What is the finance minister going to do if the capital flight that has been under way for months cannot be reversed? What is he going to do if nobody will invest and create jobs in the resource sector? What is he going to do if interest rates exceed his expectations? What is he going to do if there is a real estate price correction? What is he going to do if the NAFTA renegotiations end in trade restrictions that damage Canadian access to the American market? Even with everything going his way he cannot balance the budget. Was he going to do it if any of these eventualities happen or any of the hundred other unforeseen events should happen? Now is the time to establish a fiscal cushion to prepare for the inevitability of difficult times ahead.

The budget is not balanced. There is no plan to balance it. There is no date for the budget to be balanced. There is no plan that will get pipelines built, which has a significant impact on the finance minister's ability to balance future budgets. There is no apology by the Liberals to Canadian voters for breaking their promise on the deficit in the first place. There is nothing in the budget implementation act to address any of these issues.

What does this bill do? It makes certain changes to the Income Tax Act to implement changes announced by the Minister of Finance last summer on the taxation of Canadian-controlled private corporations, and other tax changes that we are now getting to the point where the CRA has to actually implement them.

We know that on July 17, the Minister of Finance dropped his bombshell announcing that too many wealthy Canadians were using complex corporate structures to avoid taxes. He went on to announce, following a brief summertime sham consultation, that the Liberals would ram through private corporate tax changes to severely restrict dividend payments between related shareholders, the so-called sprinkling, eliminate the dividend tax credit, which would create the double taxation of passive income with rates at about 73%, and make it virtually impossible to sell a business to a relative, among other things.

I am sure that every member of this House heard from small business owners who do not have a pension, do not have a minimum wage, do not have the protections of employment law, and cannot collect employment insurance. They have to be 100% liable for the conduct of their own employees, who they also cannot sue for gross negligence. What all of these people, these hard-working business owners, heard in the summer was the wealthy finance minister called them tax cheaters.

What happened after that announcement was remarkable. Business owners and tax experts all across Canada spontaneously rose up and with diverse voices unanimously spoke in opposition to every aspect of the minister's proposals. This grassroots opposition did cause the government to partially backpedal on some of its plans contained in this bill. The part of last summer's announcement that many found the most egregious was the double taxation of passive income. Therefore, in December, the finance minister backpedalled and said there would be a limit under which the double tax would not apply. What he did instead in the budget, was he said there would now be a tie-in between passive income and access to the small business rate, which will now be reduced or eliminated for small business owners who have passive incomes of greater than $50,000.

My suggestion to addressing the problem that he created back in the summer was simply a complete retraction of what the Liberals had announced then, and an apology to all of the hard-working small business owners across Canada who were deeply wounded by the bold assertions the finance minister made. Let us face it. The reason the finance minister and the Prime Minister believe that small businesses are really just tax dodges for the wealthy is that they themselves use private corporations to dodge taxes. All the while he was pointing his finger at shopkeepers, farmers, plumbers, realtors, accountants, doctors, lawyers, engineers, taxi drivers, and restaurant owners, the finance minister, that wealthy-born one percenter, was found to have failed to disclose the private corporation he used for tax planning purposes to shelter income and future gains on his French villa. Contrary to his past statements and all expectations of a minister of the crown, much less a finance minister, the finance minister still owned millions of dollars of Morneau Shepell shares.

How was that fact concealed from the public for almost two years? The shares were held in a private numbered company the finance minister registered in Alberta, presumably for tax-planning purposes. It was owned by him, his wife, and another Ontario numbered company. For the first time in the span of a few months, the finance minister was found not only to be personally using complex corporate structures to avoid paying tax but was using them to avoid requirements of the Conflict of Interest Act.

It is high time for this finance minister to end his war on small-business owners and to apologize for his own hypocrisy instead of proceeding with changes to the Income Tax Act contained in this bill.

If passed, this bill would also hand over to the CRA responsibility for dealing with the changes to the tax on split income and the reduction of the limit on the small-business tax rate for small businesses with over $50,000 in passive income.

As shadow minister for national revenue, I could not help but notice that 2017 was a particularly tough year for the Minister of National Revenue and her agency. Every time we turned around, it seemed the agency had a half-baked plan to raise additional tax revenue at the expense of some vulnerable group or another, such as when the minister spent the entire months of October and November insisting that the CRA had done nothing to deny the disability tax credit to type 1 diabetics, despite the fact that it was obvious to everyone except her, and perhaps her parliamentary secretary, that of course the CRA had changed its forms in May 2017 to make it harder to qualify.

The agency also changed its folio to state that after 2017, it would tax employee discounts and meals, but the minister again seemed to be the last person at the agency to be aware that this was being done, before she ordered a reversal. The agency also appeared to be targeting single parents, restaurant-server tips, and disabled Canadians, who suddenly had problems qualifying for the disability tax credit.

On top of that, tax preparers complained about an ever-increasing backlog of corrections and appeals caused by sloppy or incompetent assessments, and a scathing Auditor General's report confirmed that the agency's call centre hangs up on people 64% of the time and gives incorrect information to 30% of the rest who get through.

To an agency already struggling, and a minister who is clearly not in control of her department, this bill would now add a complex reasonableness test for dividends paid to related shareholders of private corporations. Let us think about that. An agency that hangs up on people and is wrong almost a third of the time when it speaks to taxpayers would now have to answer questions about things like the reasonableness of the payment of dividends, questions about share classes, questions about labour contributions, questions about property contributions, questions about the financial risks assumed, and a great catch-all, questions about such other factors as may be relevant.

How on earth can Canadians expect that they will get reliable answers to these questions, given the track record of both the current government and the CRA's call centre? These questions have been asked here in this House and at committee meetings and even at public meetings attended by the minister, and nobody from the government has been able to give anything but the most vague and hypothetical answers to these questions. Canadians might be forgiven if they are a bit worried that nobody knows the answers to these questions and that the legality of thousands of Canadians' tax planning is going to be at the mercy of future court decisions.

It would be very easy to go on for a lot longer about different aspects of this act, such as the implementation of the higher taxes on beer, wine, and spirits and the escalator clause; and certainly about the carbon tax, which is also part of the government's horrific mismanagement of its natural resources policy and an outrageously regressive tax on the poorest and most vulnerable members of society. However, time marches on, so I will wrap up.

I would like to conclude by urging members to vote against this bill, given that it would increase taxes; would fail to even address the very concept of a balanced budget; would do absolutely nothing to get pipelines built, the very same pipelines the budget needs for its own tax revenue; would help facilitate this minister's war on small business through the changes to the taxation of private corporations, and of course, would enable the job-destroying, poverty-inducing carbon tax. Therefore, I will be voting against this act, and I urge all other members to do so as well.

[Filomena Tassi, Liberal, Hamilton West—Ancaster—Dundas, ON]

Mr. Speaker, I would like to thank my hon. colleague for his speech. I have a great deal of respect for him. However, I have a difference of opinion with respect to the response of business and small business to the budget. I consulted with business owners and small business owners, and they were very pleased that we were actually reducing the taxes to be paid. We reduced the taxes in 2015 from 11%, ultimately to bring them down to 9% in 2019. The other thing they were pleased with was the amount of consultation we had with them to get this right so it would help them.

I am curious about the view the member has stated, because my experience has been the opposite. In fact, I sent out a householder, and I had a number of small businesses that commended and thanked our government for the changes we would be making.

In the budget we did something that I think is very important, which is set a guide for a new gender results framework. I would like to know whether the hon. member supports that.

[Pat Kelly, Conservative, Calgary Rocky Ridge, AB]

Mr. Speaker, there was a whole lot in that question. I will start with the last point and state that in my riding, what men and women want most is economic security through a job. They feel that their livelihoods are threatened by the government's agenda, in particular in the resource sector. Having the word “gender” hundreds of times in a budget does not give women, men, or anybody else a job or the economic security they are looking for through employment.

I respect the hon. member. As she mentioned, in this House there are differences of opinion. We are here today to exchange some of these differences.

With respect to consultation and the impact on small business people, I find it strange that the Liberals want extraordinary credit for going back and reversing a decision to break a campaign promise on the small business tax rate. It was a promise to merely do what the previous government had already promised to do in its final budget. I do not think there should be too much credit given to the government for that.

[Wayne Stetski, NDP, Kootenay—Columbia, BC]

Mr. Speaker, I met with a number of small businesses in my riding during the furor, I guess would be the best way to describe it, on the original Liberal government proposals. Absolutely we need to do better for small businesses. For example, I would like to see a limit to the credit card charges our businesses pay.

I am going to read the title of the budget to make sure I get it right. The Liberals claim that it is a gender and growth budget. I want to be a little more specific than my colleague across the floor. Would the Conservatives agree that we need pay equity now?

[Pat Kelly, Conservative, Calgary Rocky Ridge, AB]

Mr. Speaker, I did not get a chance in the limited time we had earlier to answer some of the previous questions. The question about pay equity or the issue of gender equality in the workplace and in pay is surely going to be best addressed through a strong economy. The way this budget simply repeats phrases and adds the word “gender” on every page is going to do nothing to actually make any change that will be meaningful in any way to women in the workplace or achieve anything that will bring economic security to women or men.

The member mentioned credit card rates. It reminded me of a meeting I had with some small business owners recently in Prince Edward Island. They were restaurateurs. They talked about the impact it has on their businesses. They pointed out that in a typical transaction, the government and the credit card company are paid the most, because restaurant margins are less than what either of those two bodies make in a transaction.

I want to go back to the earlier comments about consultation and what small business owners had to say. In my riding, it was universal. I had very large round table meetings both in my riding and in other parts of the country, and I had a very different experience than the member for Hamilton West—Ancaster—Dundas. The finance minister's changes were universally panned. People recognized in them the attack they are on their livelihoods.

[Colin Carrie, Conservative, Oshawa, ON]

Mr. Speaker, I wonder if my colleague would comment on some of the comments Liberals have made about the economy in Canada. Former ambassador Frank McKenna, who was also the premier of New Brunswick, talking about the cancelled energy east pipeline, said, “We're buying 700,000 barrels a day for eastern refiners from other places in the world at world prices. There's no other country in the world that would do anything as dumb as this.” McKenna also said that we have given up our leverage in NAFTA talks.

Former finance minister Manley has said that there is nothing to address competitiveness in this budget.

I stand here in an Oshawa Generals jersey today, because in Oshawa, we have to trade. We are a city that builds cars. The competitiveness issue is really starting to hit us.

How much time does Canada have if the Liberal government does not wake up and smell the roses on the importance of these issues the Liberals brought up?

[Pat Kelly, Conservative, Calgary Rocky Ridge, AB]

Mr. Speaker, the member for Oshawa makes some excellent points. Importing 700,000 barrels a day at world prices while we are sending oil into the United States at $20 a barrel less than the same oil they are then transferring north is crazy.

I hope it might be helpful to some of the members on the other side to hear some of the luminaries from their past, who are Liberals, tell them that they are wrong on energy issues. They are wrong everywhere they go on pipelines. Only the Liberal Party could have contradictory messages on pipelines, with candidates in one part of the country being pro-pipeline and candidates in other parts of the country being anti-pipeline, and manage to alienate both sides of the pipeline issue over energy east and Keystone. None of this is going to make--

[The Deputy Speaker, Conservative, Bruce Stanton]

Questions and comments, the hon. member for Saanich—Gulf Islands.

[Elizabeth May, Green, Saanich—Gulf Islands, BC]

Mr. Speaker, although the debate this afternoon is taking us a little far afield from the budget, I want to pick up on the point the member for Calgary Rocky Ridge made. I could not agree more with former premier Frank McKenna that it does not make sense to be importing crude at high-value prices and exporting low-value bitumen, which always gets a low price, because it is solid, unlike the crude that comes into eastern Canada. Would he agree that it would be a good plan to stop importing foreign oil to eastern Canada and to process bitumen within Alberta and use it in the domestic market in Canada?

[Pat Kelly, Conservative, Calgary Rocky Ridge, AB]

Mr. Speaker, this is an argument usually used by opponents of the industry who say that they are not really totally opposed to the whole industry and shutting it down, but could we not defy the market and build infrastructure to process our product rather than export it raw? If we upgraded bitumen in Alberta, would the member propose the most aggressive expansion of the oil and gas industry in Alberta and the most aggressive possible expansion of the distribution of these fuels? I think likely not, but who knows?

[Alaina Lockhart, Liberal, Parliamentary Secretary for Small Business and Tourism]

Mr. Speaker, before I begin, I wish to inform the House that I will be splitting my time today with the member for Gatineau. I would also like to extend condolences to Humboldt, to the team, the families, the billets, and to the entire community, on behalf of the people of Fundy Royal. Our hearts are with them.

Today I rise to speak on Bill C-74, the budget implementation act. This is a budget that builds on the investments made by the previous budgets. It takes it to the next level to ensure that all Canadians have an opportunity to benefit from the growth we are seeing in the economy.

Today I would like to focus on a few items that are having, and will have, a profound impact in my riding of Fundy Royal. The riding of Fundy Royal is predominantly rural, nestled between three southern cities in New Brunswick, and bordered to the north by the beautiful Bay of Fundy. Although the area is peppered with communities that are unique, each in their own way, there is a common thread that runs through them: a tenacity to grow, prosper, and to build a better life for our next generation.

I came to Ottawa with a mission to address the concerns of my constituents, concerns I hear daily, about the sustainability and growth of our communities and the local economy. This became a bigger challenge shortly after I was elected when the Potash Corporation of Saskatchewan announced it was indefinitely suspending operations at the Picadilly mine. I am proud of how local leaders responded, how we quickly found a path forward, and how the federal government was there as a partner. At that time, our government did not waver in its commitment to Fundy Royal, and this budget is a continuation of the commitment to everyday Canadians who are facing challenges and are committed to progress.

I have always subscribed to the theory that a high tide raises all boats. Many of the commitments in budget 2018 will make sure that the most vulnerable in our communities are provided with the resources they require to find stability in their lives and participate more fully in society. These are measures that build on our monumental investments in the Canada child benefit, which supports over 16,000 children each month in Fundy Royal; skills training investments; flexibility in El, which allows Canadians to return to school to upgrade their education; and a new national housing strategy, which will provide updated and additional rental units in our communities.

We are also building on investments for seniors, who are an important part of our families and communities. In addition to the special provisions for seniors in the housing strategy and the increase to the guaranteed income supplement for single seniors introduced previously, budget 2018 goes further for seniors in New Brunswick. A commitment to a healthy seniors pilot project will see $75 million to combat challenges produced by an aging demographic and determine best practices to keep seniors healthy and in their homes.

Budget 2018 also recognizes the struggles of those who are working hard to join the middle class. The Canada workers benefit was introduced to encourage more people to join the workforce. This will offer real help to over two million Canadians while raising 70,000 out of poverty.

Budget 2018 also recognizes the reality of seasonal work and the integral part it plays in rural economies like Fundy Royal. To support seasonal workers who have exhausted their El benefits, my colleague from Acadie—Bathurst announced an agreement with the Province of New Brunswick just last week. This will provide the province with $2.5 million immediately to directly help workers who have been impacted. The seasonal worker program offers income support as well as training and work experience for seasonal workers in the Restigouche-Albert region of New Brunswick, for those in the fisheries, agriculture, forestry, and tourism industries.

Our government continues to focus on growth in Atlantic Canada, and investing in the great people, communities, and ideas in the Atlantic region. That is what this budget does. It empowers women, parents, employees, small businesses, industry, and our regional economies.

For instance, spruce budworm is a native insect that periodically kills large numbers of balsam fir and spruce trees across eastern Canada. We saw this happen about 30 years ago. We know it is cyclical, and the threat is present again today. The economic impact of these disturbances has the potential to wipe out up to three million hectares of crown land in New Brunswick alone, and negatively impact up to 1,900 jobs every year if left unchecked.

I would like to thank my colleague from South Shore—St. Margarets for reflecting on this already during the debate on budgetary policy. I can very well attest to the threat that the outbreak poses in Fundy Royal. Forestry workers in Fundy Royal have a sense of relief knowing that our government is committing nearly $75 million over five years to combatting spruce budworm. This will support the work of the healthy forests network to continue with its early intervention strategy, which has been showing very promising results over the past several years.

We have thriving fisheries in Fundy Royal, and the continued growth of these fisheries requires ongoing investments in small craft harbours. This budget commits $250 million on a cash basis over two years, starting in 2018-19, for projects like extending the breakwater in Alma.

Fundy Royal is one of the most beautiful places in Canada. Not only is it home to the Fundy Biosphere, but also to the Hammond River, the Kennebecasis Valley, and the Fundy Trail. I am proud of the work that our local environmental organizations are doing, and I am glad that this budget will provide the resources needed to preserve and safeguard our environment. This budget makes one of the largest investments in nature conservation in Canadian history, $1.3 billion, to protect more land, waters, species at risk, and preserve biodiversity. It is up to all of us to protect the environment so that future generations of Canadians can continue to hike the Fundy Footpath, mountain bike on the bluff, or kayak in St. Martins.

The Conservation Council of New Brunswick says that this groundbreaking investment by our government shows it is listening and acting to an unprecedented degree on Canadians' deep connection to nature and our desire to see the forests, parks, lands, and waters we love, and the wildlife that calls these places home, protected. Lois Corbett, the executive director of the council, said “This is a huge breakthrough and a day to celebrate for New Brunswickers and folks clear across the country who love nature, wildlife, and the outdoors."

Canada's new tourism vision places high importance on our rich natural surroundings, especially Parks Canada sites. More than 22 million people each year visit the national parks, historic sites, and marine conservation areas administered by Parks Canada. I am delighted to note that admission to Parks Canada sites, including Fundy National Park, will now be permanently free for those aged 17 and under.

One of the most exciting parts of my job as the member of Parliament for Fundy Royal is talking to future generations of political leaders. In December, I received a letter from a student at Three Oaks Senior High School in Summerside, P.E.I., in the riding of my friend, the member for Egmont. Kate was asked to write a member of Parliament about an issue of concern to her. She spoke about mental health with conviction, saying there are growing number of cases of anxiety, depression, and even suicide, and that it is becoming normal in our daily lives which should not be occurring in our society. She said that we need to stop the issue before it becomes worse. We agree with Kate. In our efforts to support veterans, we have further extended support by ensuring that the medical expense tax credit will now recognize the costs of psychiatric service dogs, provide assistance to the amazing organizations that support veterans, and invest in research for first responders who suffer from these invisible disabilities.

Our government is also supporting research for autism, as well as diseases such as Alzheimer's and dementia.

This budget is revolutionary, in that it focuses on Canada's future. It puts people first, and focuses on what matters most to the people of Fundy Royal. It invests in the protection of our environment, and promotes equality and prosperity for those from Hillsborough to Nauwigewauk and around the world. I am proud to stand and speak to this budget, one that recognizes the potential growth of our country and focuses on equality.

As part of this year's budget, the finance minister announced our government's women entrepreneurship strategy that will help women grow their businesses by accessing financing, talent, networks, and expertise. The women entrepreneurship strategy is part of a broader effort to address gender-related barriers that have impaired the progress of women in business. As a former small business owner, this is near and dear to my heart. I know the potential is there if we provide a path forward for more women to succeed and grow as entrepreneurs.

Like many others in Fundy Royal and in the House, I am driven when I think about our youth and the future they should have in Canada. It is why I became involved in politics, to ensure I am part of a movement to make sure they will have a prosperous future in our home province of New Brunswick. By becoming the first woman elected in Fundy Royal, I, like all of the men elected before me, am confident that I can make a difference, not only in the lives of these youth, but also in the lives of all Canadians.

Each progressive budget that has been presented by our government is a step in the right direction, and this budget is no different. I am confident that it will provide lasting challenges for generations to come.

[Colin Carrie, Conservative, Oshawa, ON]

Mr. Speaker, I would like the member to comment on a couple of things that she left out about the budget. In Canada now, we are basically seeing business investment at about 11% of GDP, which is 16th out of 17 OECD countries. Business investment in Canada, per worker, is 40% to 50% less than in the high-productivity countries like the United States and Switzerland, especially the United States, with our competing against them. Taxes in the United States are going down. We are basically at 19% now, from 34.6%. At the same time, her government is increasing taxes that were 17.5% in 2012. Now they are 21%, also with increases in CPP, EI, carbon taxes, and high electrical costs. Even the former Liberal finance minister, John Manley, who is the president and CEO of the Business Council of Canada has said, “Budget 2018 overlooks Canada's competitiveness challenges.”

I come from a community in Oshawa. We depend on being competitive, and the government and its provincial partners are making us less competitive. Could the member please tell us what in the budget, if anything, is going to help address the competitiveness issue that Mr. Manley and many businesses in my community are worried about?

[Alaina Lockhart, Liberal, Fundy Royal, NB]

Mr. Speaker, part of our path forward as a country and for our economy is to make sure we have an innovative economy that includes all people in Canada. That is what the budget focuses on, ensuring that Canadians have an opportunity to participate in the economy, making sure they have the skills training they require, and making sure women are in a position where they can overcome the barriers that have been there for them, not only in small business but also in trade and other areas.

It is important that we invest in Canadians at this time, and it is our Canadian people who will drive this economy forward in the future.