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An Act to amend the Income Tax Act (transfer of small business or family farm or fishing corporation)

This bill is from the 43rd Parliament, 2nd session, which ended in August 2021.

Sponsor

Larry Maguire  Conservative

Introduced as a private member’s bill.

Status

This bill has received Royal Assent and is now law.

Summary

This is from the published bill. The Library of Parliament has also written a full legislative summary of the bill.

This enactment amends the Income Tax Act in order to provide that, in the case of qualified small business corporation shares and shares of the capital stock of a family farm or fishing corporation, siblings are deemed not to be dealing at arm’s length and to be related, and that, under certain conditions, the transfer of those shares by a taxpayer to the taxpayer’s child or grandchild who is 18 years of age or older is to be excluded from the anti-avoidance rule of section 84.‍1.

Similar bills

C-208 (43rd Parliament, 1st session) An Act to amend the Income Tax Act (transfer of small business or family farm or fishing corporation)
C-274 (42nd Parliament, 1st session) An Act to amend the Income Tax Act (transfer of small business or family farm or fishing corporation)

Elsewhere

All sorts of information on this bill is available at LEGISinfo, an excellent resource from Parliament. You can also read the full text of the bill.

Bill numbers are reused for different bills each new session. Perhaps you were looking for one of these other C-208s:

C-208 (2025) National Livestock Brand of Canada Act
C-208 (2021) Early Learning and Child Care Act
C-208 (2015) An Act to amend the Canada Evidence Act (interpretation of numerical dates)

Votes

May 12, 2021 Passed 3rd reading and adoption of Bill C-208, An Act to amend the Income Tax Act (transfer of small business or family farm or fishing corporation)
Feb. 3, 2021 Passed 2nd reading of Bill C-208, An Act to amend the Income Tax Act (transfer of small business or family farm or fishing corporation)

Opposition Motion—Special Committee on Canada-United States Economic RelationshipBusiness of SupplyGovernment Orders

February 4th, 2021 / 3:55 p.m.


See context

Conservative

Larry Maguire Conservative Brandon—Souris, MB

Madam Speaker, it is an honour to be able to speak to the opposition day motion put forward today. I want to thank my colleague, the member for Calgary Centre, for his excellent presentation and for sharing his time with me today.

When we look at the nations Canada trades with, we see there is nothing more important than our relationship with the United States. As with all relationships, though, we cannot take this one for granted. As a farm leader, an MLA and now a member of Parliament, I have had a front row seat to some of the ups and downs of the politics of that trade relationship.

Throughout the years, I have attended many Midwestern legislative conferences in the U.S., as well as some in Manitoba when I was there, which provide an opportunity for elected Canadian representatives across the Prairies to meet with their American counterparts from the Great Plains and Midwest industrial states.

At those conferences, there was an opportunity to meet countless people, and I quickly learned that they are facing many of the same challenges we are. I mentioned the Midwestern legislative forums. I attended them in Michigan; Kansas; Des Moines, Iowa; and one in the Pacific Northwest, out in Whitefish, Montana, as well.

At these conferences, we learned a lot about the interchange of the relationship that we have with our American counterparts. As I said earlier, many of the issues are very common, particularly on the trade side. When the U.S. put its first farm bill in place in 1986, I was in Kansas.

Whether it is logistical or regulatory barriers, or just plain old politics, we get a better understanding of what is at the root of some of the trade disputes that still linger to this day. We do not have to look far for those examples, such as with softwood lumber or the country-of-origin labelling that we had for beef.

Trade disruptions over the years have negatively impacted numerous Canadian exports. More recently, NAFTA was renegotiated, and we witnessed the former U.S. administration impose a 25% tariff on imports of Canadian steel, and a 10% tariff on imports of Canadian aluminum.

Regardless of who occupies the White House or controls Congress, we must always be cognizant that with the stroke of a pen many of our industries and people's jobs could be severely impacted. I applaud our Leader of the Opposition for taking the proactive step of putting forward this motion to create this new special committee.

When I was first elected to the House of Commons in 2013, the now Leader of the Opposition was the parliamentary secretary to the Minister of International Trade. At that time, the Canada-Europe trade agreement was still being negotiated. The member for Durham visited my constituency to meet with agricultural and business leaders about this new opportunity, and what an opportunity it was.

Trade is at the heart of our region's economy. Western Manitoba's exports are based primarily on agriculture, livestock and natural resources, alongside manufacturers, such as Behlen Industries, which are major employers in our region. To put a number on it, the latest data from the Government of Manitoba on agricultural exports stated that the American domestic market is worth over $2.6 billion per year for the province of Manitoba.

Let us never forget, there are almost as many people living in the National Capital Region as in the entire province of Manitoba. By far, Americans are Manitoba's largest foreign customer, with the second-largest being Japan. Trade with Japan amounts to roughly $896 million a year.

Manitoba's canola exports alone to the United States are worth over half a billion dollars, followed by processed potatoes, oilseed cakes, hogs and cattle. The economic prosperity of almost every community in my region is directly tied to the success of exporting many of these agricultural products.

Due to the importance of this trade relationship, coupled with the new U.S. administration, it is imperative we have an ability to work on this issue, in conjunction with whatever our committees decide to study.

As with many issues, there is a lot of crossover between the various parliamentary committees and stakeholders. The agriculture, industry, natural resources and transport sectors want to be heard and will want to know the government's strategy moving forward.

Just this week in Congress, Tom Vilsack, who was nominated by President Biden to be his agricultural secretary, received a unanimous vote from the Senate agriculture committee and is expected to be confirmed by the overall Senate in the days ahead. Secretary Vilsack even joked that it felt like Groundhog Day during his Senate confirmation hearing, as he was President Obama's agriculture secretary during his entire eight years in office.

The United States and Canada enjoy the world's largest bilateral agricultural trade relationship, with almost 120 million dollars' worth of food and farm products crossing the border every day. In the last couple of years, the United States Department of Agriculture has created an undersecretary of trade position within the Department of Agriculture itself to work solely on trade policies directly related to agriculture. I say this just to emphasize the importance of that trade arrangement.

As is to be expected, the U.S. is on the offence. It is looking to expand its market opportunities not only here in Canada but also around the world. Americans might be our friends and allies, but I have always stated they are also our competition.

In the spirit of collaboration, I truly hope we can pass this motion and immediately get this new committee up and running, because I think the Liberal government could benefit from the insights and experience of many of our Conservative caucus members. While I am not lamenting this, there is not a Liberal MP from Winnipeg to the greater Vancouver area, and between those two points there are thousands of farmers and agri-food industries. As a member who represents a lot of farmers, I have grave concerns about the government's track record on agriculture.

As an example, we saw how long it took the government to respond to the Chinese government blocking Canadian canola shipments. In fact, we had to call emergency committee meetings to even discuss the issue. I remember the procedural manoeuvres the government took to ensure we could not even request an emergency debate in the House. My point is not to rehash these issues, but to learn from them. We must be proactive on potential trade disruptions. I believe this new special committee will provide an appropriate avenue to do so.

We know there are going to be issues in the coming months relating to pipelines, as has been mentioned by many of my colleagues today, and the buy America procurement rules. Our Canadian economy cannot afford any more trade disruptions. We need to get all our sectors back up and running, and we cannot afford to be caught asleep at the wheel. Our constituents are counting on us to get this right.

As a believer in free trade and free markets, I want to create the right conditions for entrepreneurs, business people and farmers to flourish. It is part of the reason I brought forward Bill C-208 yesterday in the House. I thank my colleagues for their support on that. Canada must be a place where no ambition is too big and no federal government will stand in the way of people working hard to get ahead.

A dynamic economy where businesses are forming and hiring is what is needed. A free market economy is a social institution that harnesses human creativity and ingenuity for the benefit of everyone. There is not enough money in all the government coffers in Ottawa to replicate what entrepreneurs and risk-takers do every single day. Let us work together to make sure our farmers, businesses and manufacturers have a stable and predictable American market they can sell into.

Income Tax ActRoutine Proceedings

February 19th, 2020 / 3:25 p.m.


See context

Conservative

Larry Maguire Conservative Brandon—Souris, MB

moved for leave to introduce Bill C-208, An Act to amend the Income Tax Act (transfer of small business or family farm or fishing corporation).

Mr. Speaker, I am pleased to rise today to introduce my private member's bill, an act to amend the Income Tax Act regarding the transfer of small businesses or family farms or fishing corporations. This legislation would level the playing field for small businesses, family farms or fishing corporation owners when transferring their operation to a family member.

Currently, when a person sells his or her business to a family member, the difference between the sale price and the original purchase price is deemed to be a dividend. However, if this business is sold to a non-family member, it is considered a capital gain, which is taxed at a lower rate and allows the seller to use his or her lifetime capital gains exemption.

The bill would allow small businesses, family farms and fishing corporations the same tax rate when selling their operations to their family member as they would selling it to a third party.

I encourage all members to support this bill to promote sustainable small business succession, enhance opportunities for entrepreneurship and end the inequitable taxation of those transferring a small business, farm or fishing corporation to a family member.

(Motions deemed adopted, bill read the first time and printed)