This bill was last introduced in the 43rd Parliament, 2nd Session, which ended in August 2021.
Chrystia Freeland Liberal
This bill has received Royal Assent and is now law.
This is from the published bill. The Library of Parliament often publishes better independent summaries.
This enactment amends the Income Tax Act to revise the eligibility criteria, as well as the level of subsidization, under the Canada Emergency Wage Subsidy (CEWS) as part of the response to the coronavirus disease 2019. It also extends the CEWS to June 30, 2021. The enactment further amends the Income Tax Act to introduce the Canada Emergency Rent Subsidy (CERS) in order to support those hardest hit by the coronavirus disease 2019. This subsidy provides relief in respect of rent and interest on debt obligations incurred to acquire real property used by businesses, charities and not-for-profit organizations in the course of their businesses or other activities. The rent subsidy is effective as of September 27, 2020.
All sorts of information on this bill is available at LEGISinfo, an excellent resource from the Library of Parliament. You can also read the full text of the bill.
The Assistant Deputy Speaker NDP Carol Hughes
A brief question, the hon. member for Courtenay—Alberni.
Gord Johns NDP Courtenay—Alberni, BC
Madam Speaker, we just heard the minister say that she has been listening to small business. For six months we and small businesses have been letting her know that they cannot access the commercial rent assistance program.
The New Democrats support the changes. However, the Liberals have admitted that they have a design flaw in the commercial rent assistance program. The finance minister just said that they could and would do anything to help support small business with an equitable recovery. There is no equity here regarding the fairness of the roll out of the legislation. They need to backdate the program to April 1—
The Assistant Deputy Speaker NDP Carol Hughes
I am sorry. I asked the member for a brief question. We have to allow for the answer.
The hon. minister, a brief answer please because we are going to be running short on time.
Mona Fortier Liberal Ottawa—Vanier, ON
Madam Speaker, as the Minister of Finance mentioned, we will retroactively bring this new program to September 27. As we know, the CECRA program provided support until September. We knew we needed to have an approach where tenants had direct access. That is why we are proposing an approach today that will support businesses and their fixed costs.
The Assistant Deputy Speaker NDP 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 Fredericton, Seniors; the hon. member for Nanaimo—Ladysmith, Health; the hon. member for Saanich—Gulf Islands, Foreign Affairs.
The hon. member for Carleton.
Pierre Poilievre Conservative Carleton, ON
Madam Speaker, what is the solution for the mess we are in? The answer is that there are 20 million solutions. They are called workers. That is the size of Canada's workforce. We have 20 million men and women who get out of bed every day and go to work to produce the wealth of the nation. That wealth puts food on their tables, finances the roads upon which they and others drive, pays for our schools, hospitals and everything else we do that makes this country as splendid and as wonderful as it is.
Unfortunately, those workers have been deprived of work, many of them sent home because of health ordinances by local officials during the COVID-19 period. As many as eight million had to take assistance from the government in order to replace their lost jobs or, in the case of furlough, their lost income. Because governments deprived them of their income, those workers had every right to expect governments to replace that income. That, however, is not an excuse for the deliberate policy decisions of the government that have penalized workers who attempted to get back into their jobs as the shutdown began to be lifted.
For example, the early CERB program was pulled out of the hands of any worker who regained more than $1,000 of their monthly income. Rather than being graduated slowly to ensure that each dollar earned was beneficial to the worker, the government penalized people for the crime of trying to rebuild their lives.
Then we had the wage subsidy, for which small businesses were punished if they committed the crime of recuperating more than 30% of their lost revenues. They had to be down by that 30% in order to qualify. If they earned $1 more, they would get nothing at all, forcing many businesses to suppress their revenues, legally and necessarily, in order to continue receiving the support necessary to keep them alive. The same went for the rent program for which businesses had to be down 70% in revenue to qualify. It was another penalty imposed on businesses attempting to recover.
On May 2, I wrote an op-ed in the Ottawa Sun in which I proposed practical solutions that would allow workers or businesses to graduate, slowly and one step at a time, from these assistance programs in a way that ensured that they were always better off earning that extra dollar, taking that extra shift or serving that extra customer.
Finally, today we are debating legislation from the government that does those things. Finally, there is legislation that rewards, rather than punishes, workers for working and businesses for earning. That is what we have asked for all along. This was a painful lesson with great cost, and is one of the reasons why Canada has the highest unemployment rate of all G7 countries, save for Italy. Italy is of course the most socialist country in the G7, and the country from which the Liberal government tries its best to take examples. It is funny that the most socialist country has the highest unemployment, and our government is doing its best to compete for the prize of highest jobless rate in the G7 by replicating those same disastrous policies. However, we have the second highest unemployment rate: higher than the U.S., the U.K., France, Germany and Japan. There we are, barely under Italy in the rate of unemployment, as we enter now the seventh or eighth month of the pandemic crisis.
The government has had to learn, slowly and painfully, the cost to the economy of punishing workers and businesses, but this cost is not unique to COVID times. In fact, we in this country suffer from something I call the war on work. The war on work happens when governments punish wage earners by taking away, through clawbacks and taxes, a large share of each extra dollar a person earns.
Take, for example, someone who might be on disability assistance and who gets a job. They not only pay taxes on their earnings but start to lose their disability benefit at a combined rate that can at times exceed 100%. This war on work effectively makes it unaffordable for many workers to take an extra shift.
Even for people who are not on social assistance, this war on work exists. For example, just last week the reporter Jordan Press obtained a finance committee study showing that a single mother earning $55,000 a year could lose as much as 70¢ on every extra dollar she earns. People in the lower income categories suffer a higher level of marginal effective tax rates.
These are penalties people pay for the crime of getting out of bed in the morning and working hard. This is why our party is proposing there be a full review and reform of our tax and benefit systems to ensure people are always better off working, earning another dollar, taking another shift or serving another customer.
The war on work goes beyond the transfer and tax system. It goes to the regulatory system, which has thus far outright killed two pipeline projects because of the Prime Minister's opposition to them. The pipeline projects would have taken western crude to eastern refineries and to Asian markets, and would have created jobs for steel workers in central Canada, trades workers across the country, refinery workers on the east coast and of course energy workers in Alberta, Saskatchewan and British Columbia. Those jobs are now lost because the government prevented the construction of those very same projects.
It is not just pipelines that were affected. The Prime Minister successfully killed a massive $20-billion mining project in northern Alberta: the Teck Frontier mine, which was supported by all the surrounding indigenous communities. These communities are often the greatest victims of the federal government's war on work. People want to go out and work hard, build their dreams, earn a great living and live a great life, but are prevented from doing so because the government penalizes and blocks projects that create opportunities.
Think of those opportunities and how we could unleash them. I remember being with the member for Kamloops—Thompson—Cariboo about five weeks ago and meeting with local pipeline workers who are part of the Trans Mountain pipeline project, and how proud they were. The local indigenous communities are putting forward remarkable, great Canadian workers, who brought their skills to the front lines and were earning great wages, and rightly so. That is just one example of what we could multiply in this country if the government got out of the way and allowed more of these projects to go forward.
It is not just energy. It is not just resources. It is the construction of anything in this country. It takes three times as long for a warehouse to get governmental approval in Canada as it does in the United States of America. If a group of investors is in the business of building warehouses to produce a particular product and calculates that the wait time to get approval here is three times as long and far more uncertain, then the investors' money leaves our country to go and build somewhere else.
That is exactly the phenomenon we have witnessed in Canada over the last five years. Hundreds of billions of dollars have left the country. Canadian investment in the U.S. doubled while American investment in Canada fell by half. That is because money goes where it can build and earn a return. If governments prevent construction and returns from occurring, the money will go somewhere else. What it means is the jobs and wealth production happen outside of our country. What do we do to make up the difference? We have to import goods from abroad and borrow from foreigners to pay the difference, thus we witness our economy becoming more and more indebted.
It is not just the government that is now on a massive borrowing binge, but also businesses and households. The combined total of this, if we take households, corporations and governments, is a 380% debt-to-GDP ratio, which is the highest anywhere in the G7, with the exception of Japan.
These debts have, thus far, only been sustainable because of low interest rates, but low interest rates are not a sure thing forever. When those rates rise, our people will be shouldering an unmitigated disaster.
The only thing we can do to avert that disaster is to unleash the power of the free enterprise system to create jobs so that our 20 million workers, whom I identified at the outset of my remarks as the solution to this problem, can earn the salaries necessary to pay their bills and contribute to the governmental coffers so that we can continue to afford the programs and services upon which our people rely.
Today's bill is past due. It would finally remove the penalties on workers that I warned about in early May. Hopefully, it would allow us to reverse the damage that the government did throughout the summer. Hopefully, it would allow our businesses to get back on their feet to hire the necessary workers, to rebuild our workforce and unleash the mighty power of our 20 million great Canadian workers. Let us get to work.
Income Tax ActGovernment Orders
November 4th, 2020 / 4:50 p.m.
Winnipeg North Manitoba
Liberal
Kevin Lamoureux LiberalParliamentary Secretary to the President of the Queen’s Privy Council for Canada and to the Leader of the Government in the House of Commons
Madam Speaker, what the member forgets to mention when he talks about unemployment is that 75% of those who had to leave their jobs because of the pandemic have been returned to the workforce, compared with the U.S., which is just over 50%. That is a very important aspect that the member chose not to comment on.
The programs that have been provided to date by this government have been demonstrated to be very effective. All one needs to do is look at those individuals who are back in the workforce that had to leave the workforce because of the pandemic.
Pierre Poilievre Conservative Carleton, ON
Madam Speaker, we still have higher unemployment in Canada than in the United States of America. It is higher than in the U.S., the U.K., France, Germany and Japan. Frankly, only Italy, whose economy has been paralyzed by its debt-ridden socialist policies for more than a decade, is slightly higher than us in unemployment. As I said at the outset, the government is trying to replicate the Italian approach of a permanently larger government funded by deficits. That is exactly how the Italian economy got into such permanent hardship, even well before the crisis.
The member can celebrate that we no longer have the highest unemployment in the G7 because the Italians are slightly ahead of us due to their socialist policies but, for God's sake, are Liberals really going to start pumping their fists in the air and saying, “We're number six, we're number six”?
Julie Vignola Bloc Beauport—Limoilou, QC
Madam Speaker, I really enjoyed my colleague's speech.
We share the same opinion on the government's tremendous and unprecedented capacity to wait too long before making decisions. I would like my colleague to tell me how many businesses have had to close their doors for good because the government does not make decisions quickly enough and does not immediately consider the proposals submitted by the other parties.
Pierre Poilievre Conservative Carleton, ON
Madam Speaker, I thank the hon. member for her question.
It is clear that some businesses were unable to survive because of unexpected and unjustifiable delays by a government that could well have taken our suggestions as early as May.
If a small restaurant has to close for three months or sees a drop in revenue during that same period, it will be unable to survive if it cannot access a commercial rent assistance program or if it is penalized by the emergency wage subsidy. Families are losing their life savings and it is precisely family businesses that have disappeared. This is an economic tragedy caused by this government's delays.
Gord Johns NDP Courtenay—Alberni, BC
Madam Speaker, I want to thank my colleague for talking about the flawed design of the commercial rent assistance program, and how unfair it was for those who could not apply for the program because their landlords would not support them through the crisis. We have the government members right now patting themselves on the back saying they will backdate it to September 27.
Does my colleague support New Democrats in calling on the government to bring that back, and backdate the support to April 1 for those business owners who could not apply because their landlord would not support them, who are steeped in debt, and many of them facing bankruptcy?
I am sure the member is used to the Liberals not answering a yes-or-no question. Do the Conservatives support New Democrats in asking the government to backdate the program to April 1, yes or no?
Pierre Poilievre Conservative Carleton, ON
Madam Speaker, we do support backdating the rental assistance to September, and that is why we will be allowing this to pass. That said, this entire mess related to the rent subsidy program is highly suspicious.
The Liberals said that CRA could not administer the rent assistance program and that, therefore, they had to go over to CMHC which does not do commercial real estate and is responsible for mortgage insurance. CMHC officials said they could do it either, and that they had to contract this out to a company whose vice-president is married to the Prime Minister's chief of staff. Now, the Liberals admit that they could have just given this to CRA all along and that there was nothing stopping them from having CRA do it.
The only reason we can assume that the Liberals ever punted this over to an outside company is that their Liberal friends and family members were intimately involved in its original delivery. It is quite a sad thing that so many businesses suffered for so long because the government put as its priority the helping of insider Liberals rather than small business owners and workers.
Marty Morantz Conservative Charleswood—St. James—Assiniboia—Headingley, MB
Madam Speaker, the Minister of Finance, in her comments earlier, seemed to take comfort in the fact that interest rates were so low. My colleague commented on interest rates as well. Could he further expand on the catastrophic effect a rise in interest rates will have, at some point in the future, on the fiscal position of the Government of Canada?
Pierre Poilievre Conservative Carleton, ON
Madam Speaker, it is really quite simple. When the debt-to-GDP ratio is somewhere around 400%, where we have $4 of debt, public and private combined, for every dollar of GDP, they could assume that a 1% increase in the effective interest rate on our economy would be equal to 4% of our economy. Given that the economy only grows by 1.5% a year, that is like two and a half years of growth. It is an enormous impact. The Liberals say that is okay because the interest rates are low, but they never tell us what is going to happen when interest rates finally go up.
They also never tell us that the only reason interest rates are low is because the Bank of Canada is printing hundreds of billions of dollars in order to buy up government debt and suppress interest rates. It is not because the market has deemed that rates should be low; it is because the Bank of Canada has cranked up its printing presses. This is not a new idea. This has been tried by emperors and kings and governments for thousands of years and results always in the same consequence.
We know what happens when we debase a currency. It ends up costing the working people, by reducing the value of their wages, while enriching the insiders whose assets are appreciated in value. There is a massive wealth transfer from working poor to the super rich, and here we have a government in collaboration with the Bank of Canada, doing it all over again.
Kevin Lamoureux LiberalParliamentary Secretary to the President of the Queen’s Privy Council for Canada and to the Leader of the Government in the House of Commons
Madam Speaker, I want to go back to the issue of unemployment. Maybe I was right, which I was, when I made the statement that we have a much higher return rate than the United States: 75% versus 50%. The member then went back and said we have such a high unemployment rate.
Prior to the pandemic, we had the lowest unemployment rate, historically in Canada, since unemployment stats were being taken. If we compare it to Stephen Harper's government, the rate now is considerably less, where we generated over a million jobs in less than four years.
I wonder if the member wants to provide a further comment in terms of how successful we were in working with Canadians and generating those jobs, and not only with the support of Canadians going into the pandemic, but we were able to return more Canadians back to work because of the programming that was put into place.