Bill C-19

Budget Implementation Act, 2022, No. 1

An Act to implement certain provisions of the budget tabled in Parliament on April 7, 2022 and other measures

Part 1 implements certain income tax measures by
(a) providing a Labour Mobility Deduction for the temporary relocation of tradespeople to a work location;
(b) allowing for the immediate expensing of eligible property by certain Canadian businesses;
(c) allowing the Children’s Special Allowance to be paid in respect of a child who is maintained by an Indigenous governing body and providing consistent tax treatment of kinship care providers and foster parents receiving financial assistance from an Indigenous governing body and those receiving such assistance from a provincial government;
(d) doubling the allowable qualifying expense limit under the Home Accessibility Tax Credit;
(e) expanding the criteria for the mental functions impairment eligibility as well as the life-sustaining therapy category eligibility for the Disability Tax Credit;
(f) providing clarity in respect of the determination of the one-time additional payment under the GST/HST tax credit for the period 2019-2020;
(g) changing the delivery of Climate Action Incentive payments from a refundable credit claimed annually to a credit that is paid quarterly;
(h) temporarily extending the period for incurring eligible expenses and other deadlines under film or video production tax credits;
(i) providing a tax incentive for specified zero-emission technology manufacturing activities;
(j) providing the Canada Revenue Agency (CRA) the discretion to accept late applications for the Canada Emergency Wage Subsidy, the Canada Emergency Rent Subsidy and the Canada Recovery Hiring Program;
(k) including postdoctoral fellowship income in the definition of “earned income” for RRSP purposes;
(l) enabling registered charities to enter into charitable partnerships with organizations other than qualified donees under certain conditions;
(m) allowing automatic and immediate revocation of the registration of an organization as a charity where that organization is listed as a terrorist entity under the Criminal Code ;
(n) enabling the CRA to use taxpayer information to assist in the collection of Canada Emergency Business Account loans; and
(o) expanding capital cost allowance deductions to include new clean energy equipment.
It also makes related and consequential amendments to the Excise Tax Act , the Children’s Special Allowances Act , the Excise Act, 2001 , the Income Tax Regulations and the Children’s Special Allowance Regulations .
Part 2 implements certain Goods and Services Tax/Harmonized Sales Tax (GST/HST) measures by
(a) ensuring that all assignment sales in respect of newly constructed or substantially renovated residential housing are taxable supplies for GST/HST purposes; and
(b) extending eligibility for the expanded hospital rebate to health care services supplied by charities or non-profit organizations with the active involvement of, or on the recommendation of, either a physician or a nurse practitioner, irrespective of their geographic location.
Part 3 amends the Excise Act, 2001 , the Excise Act and other related texts in order to implement three measures.
Division 1 of Part 3 implements a new federal excise duty framework for vaping products by, among other things,
(a) requiring that manufacturers of vaping products obtain a vaping licence from the CRA;
(b) requiring that all vaping products that are removed from the premises of a vaping licensee to be entered into the Canadian market for retail sale be affixed with an excise stamp;
(c) imposing excise duties on vaping products to be paid by vaping product licensees;
(d) providing for administration and enforcement rules related to the excise duty framework on vaping products;
(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 vaping product taxation agreement with Canada; and
(f) making related amendments to other legislative texts, including to allow for a coordinated federal/provincial-territorial vaping product taxation system and to ensure that the excise duty framework applies properly to imported vaping products.
Division 2 of Part 3 amends the excise duty exemption under the Excise Act, 2001 for wine produced in Canada and composed wholly of agricultural or plant product grown in Canada.
Division 3 of Part 3 amends the Excise Act to eliminate excise duty for beer containing no more than 0.5% alcohol by volume.
Part 4 enacts the Select Luxury Items Tax Act . That Act creates a new taxation regime for domestic sales, and importations into Canada, of certain new motor vehicles and aircraft priced over $100,000 and certain new boats priced over $250,000. It provides that the tax applies if the total price or value of the subject select luxury item at the time of sale or importation exceeds the relevant price threshold. It provides that the tax is to be calculated at the lesser of 10% of the total price of the item and 20% of the total price of the item that exceeds the relevant price threshold. To promote compliance with the new taxation regime, that Act includes modern elements of administration and enforcement aligned with those found in other taxation statutes. Finally, this Part also makes related and consequential amendments to other texts to ensure proper implementation of the new tax and to ensure a cohesive and efficient administration by the CRA.
Division 1 of Part 5 retroactively renders a provision of the contract that is set out in the schedule to An Act respecting the Canadian Pacific Railway , chapter 1 of the Statutes of Canada, 1881, to be of no force or effect. It retroactively extinguishes any obligations and liabilities of Her Majesty in right of Canada and any rights and privileges of the Canadian Pacific Railway Company arising out of or acquired under that provision.
Division 2 of Part 5 amends the Nisga’a Final Agreement Act to give force of law to the entire Nisga’a Nation Taxation Agreement during the period that that Taxation Agreement is, by its terms, in force.
Division 3 of Part 5 repeals the Safe Drinking Water for First Nations Act .
It also amends the Income Tax Act to exempt from taxation under that Act any income earned by the Safe Drinking Water Trust in accordance with the Settlement Agreement entered into on September 15, 2021 relating to long-term drinking water quality for impacted First Nations.
Division 4 of Part 5 authorizes payments to be made out of the Consolidated Revenue Fund for the purpose of addressing transit shortfalls and needs and improving housing supply and affordability.
Division 5 of Part 5 amends the Canada Deposit Insurance Corporation Act by adding the President and Chief Executive Officer of the Canada Deposit Insurance Corporation and one other member to that Corporation’s Board of Directors.
Division 6 of Part 5 amends the Federal-Provincial Fiscal Arrangements Act to authorize additional payments to the provinces and territories.
Division 7 of Part 5 amends the Borrowing Authority Act to, among other things, count previously excluded borrowings made in the spring of 2021 in the calculation of the maximum amount that may be borrowed. It also amends the Financial Administration Act to change certain reporting requirements in relation to amounts borrowed under orders made under paragraph 46.1(c) of that Act.
Division 8 of Part 5 amends the Pension Benefits Standards Act, 1985 to, among other things, permit the establishment of a solvency reserve account in the pension fund of certain defined benefit plans and require the establishment of governance policies for all pension plans.
Division 9 of Part 5 amends the Special Import Measures Act to, among other things,
(a) provide that assessments of injury are to take into account impacts on workers;
(b) require the Canadian International Trade Tribunal to make inquiries with respect to massive importations when it is acting under section 42 of that Act;
(c) require that Tribunal to initiate expiry reviews of certain orders and findings;
(d) modify the deadline for notifying the government of the country of export of properly documented complaints;
(e) modify the criteria for imposing duties in cases of massive importations;
(f) modify the criteria for initiating anti-circumvention investigations; and
(g) remove the requirement that, in order to find circumvention, the principal cause of the change in a pattern of trade must be the imposition of anti-dumping or countervailing duties.
It also amends the Canadian International Trade Tribunal Act to provide that trade unions may, with the support of domestic producers, file global safeguard complaints.
Division 10 of Part 5 amends the Trust and Loan Companies Act and the Insurance Companies Act to, among other things, modernize corporate governance communications of financial institutions.
Division 11 of Part 5 amends the Insurance Companies Act to permit property and casualty companies and marine companies to not include the value of certain debt obligations when calculating their borrowing limit.
Division 12 of Part 5 enacts the Prohibition on the Purchase of Residential Property by Non-Canadians Act . The Act prohibits the purchase of residential property in Canada by non-Canadians unless they are exempted by the Act or its regulations or the purchase is made in certain circumstances specified in the regulations.
Division 13 of Part 5 amends the Parliament of Canada Act and makes consequential and related amendments to other Acts to, among other things,
(a) change the additional annual allowances that are paid to senators who occupy certain positions so that the government’s representatives and the Opposition in the Senate are eligible for the allowances for five positions each and the three other recognized parties or parliamentary groups in the Senate with the greatest number of members are eligible for the allowances for four positions each;
(b) provide that the Leader of the Government in the Senate or Government Representative in the Senate, the Leader of the Opposition in the Senate and the Leader or Facilitator of every other recognized party or parliamentary group in the Senate are to be consulted on the appointment of certain officers and agents of Parliament; and
(c) provide that the Leader of the Government in the Senate or Government Representative in the Senate, the Leader of the Opposition in the Senate and the Leader or Facilitator of every other recognized party or parliamentary group in the Senate may change the membership of the Standing Senate Committee on Internal Economy, Budgets and Administration.
Division 14 of Part 5 amends the Financial Administration Act in order to, among other things, allow the Treasury Board to provide certain services to certain entities.
Division 15 of Part 5 amends the Competition Act to enhance the Commissioner of Competition’s investigative powers, criminalize wage fixing and related agreements, increase maximum fines and administrative monetary penalties, clarify that incomplete price disclosure is a false or misleading representation, expand the definition of anti-competitive conduct, allow private access to the Competition Tribunal to remedy an abuse of dominance and improve the effectiveness of the merger notification requirements and other provisions.
Division 16 of Part 5 amends the Copyright Act to extend certain terms of copyright protection, including the general term, from 50 to 70 years after the life of the author and, in doing so, implements one of Canada’s obligations under the Canada–United States–Mexico Agreement.
Division 17 of Part 5 amends the College of Patent Agents and Trademark Agents Act to, among other things,
(a) ensure that the College has sufficient independence and flexibility to exercise its corporate functions;
(b) provide statutory immunity to certain persons involved in the regulatory activities of the College; and
(c) grant powers to the Registrar and Investigations Committee that will allow for improved efficiency in the complaints and discipline process.
Division 18 of Part 5 enacts the Civil Lunar Gateway Agreement Implementation Act to implement Canada’s obligations under the Memorandum of Understanding between the Government of Canada and the Government of the United States of America concerning Cooperation on the Civil Lunar Gateway. It provides for powers to protect confidential information provided under the Memorandum. It also makes related amendments to the Criminal Code to extend its application to activities related to the Lunar Gateway and to the Government Employees Compensation Act to address the cross-waiver of liability set out in the Memorandum.
Division 19 of Part 5 amends the Corrections and Conditional Release Act to restrict the use of detention in dry cells to cases where the institutional head has reasonable grounds to believe that an inmate has ingested contraband or that contraband is being carried in the inmate’s rectum.
Division 20 of Part 5 amends the Customs Act in order to authorize its administration and enforcement by electronic means and to provide that the importer of record of goods is jointly and severally, or solidarily, liable to pay duties on the goods under section 17 of that Act with the importer or person authorized to account for the goods, as the case may be, and the owner of the goods.
Division 21 of Part 5 amends the Criminal Code to create an offence of wilfully promoting antisemitism by condoning, denying or downplaying the Holocaust through statements communicated other than in private conversation.
Division 22 of Part 5 amends the Judges Act , the Federal Courts Act , the Tax Court of Canada Act and certain other acts to, among other things,
(a) implement the Government of Canada’s response to the report of the sixth Judicial Compensation and Benefits Commission regarding salaries and benefits and to create the office of supernumerary prothonotary of the Federal Court;
(b) increase the number of judges for certain superior courts and include the new offices of Associate Chief Justice of the Court of Queen’s Bench of New Brunswick and Associate Chief Justice of the Court of Queen’s Bench for Saskatchewan;
(c) create the offices of prothonotary and supernumerary prothonotary of the Tax Court of Canada; and
(d) replace the term “prothonotary” with “associate judge”.
Division 23 of Part 5 amends the Immigration and Refugee Protection Act to, among other things,
(a) authorize the Minister of Citizenship and Immigration to give instructions establishing categories of foreign nationals for the purposes of determining to whom an invitation to make an application for permanent residence is to be issued, as well as instructions setting out the economic goal that that Minister seeks to support in establishing the category;
(b) prevent an officer from issuing a visa or other document to a foreign national invited in respect of an established category if the foreign national is not in fact eligible to be a member of that category;
(c) require that the annual report to Parliament on the operation of that Act include a description of any instructions that establish a category of foreign nationals, the economic goal sought to be supported in establishing the category and the number of foreign nationals invited to make an application for permanent residence in respect of the category; and
(d) authorize that Minister to give instructions respecting the class of permanent residents in respect of which a foreign national must apply after being issued an invitation, if the foreign national is eligible to be a member of more than one class.
Division 24 of Part 5 amends the Old Age Security Act to correct a cross-reference in that Act to the Budget Implementation Act, 2021, No. 1 .
Division 25 of Part 5
(a) amends the Canada Emergency Response Benefit Act to set out the consequences that apply in respect of a worker who received, for a four-week period, an income support payment and who received, for any week during the four-week period, any benefit, allowance or money referred to in subparagraph 6(1)(b)(ii) or (iii) of that Act;
(b) amends the Canada Emergency Student Benefit Act to set out the consequences that apply in respect of a student who received, for a four-week period, a Canada emergency student benefit and who received, for any week during the four-week period, any benefit, allowance or money referred to in subparagraph 6(1)(b)(ii) or (iii) of that Act; and
(c) amends the Employment Insurance Act to set out the consequences that apply in respect of a claimant who received, for any week, an employment insurance emergency response benefit and who received, for that week, any payment or benefit referred to in paragraph 153.9(2)(c) or (d) of that Act.
Division 26 of Part 5 amends the Employment Insurance Act to, among other things,
(a) replace employment benefits and support measures set out in Part II of that Act with employment support measures that are intended to help insured participants and other workers — including workers in groups underrepresented in the labour market — to obtain and keep employment; and
(b) allow the Canada Employment Insurance Commission to enter into agreements to provide for the payment of contributions to organizations for the costs of measures that they implement and that are consistent with the purpose and guidelines set out in Part II of that Act.
It also makes a consequential amendment to the Income Tax Act .
Division 27 of Part 5 amends the Employment Insurance Act to specify the maximum number of weeks for which benefits may be paid in a benefit period to certain seasonal workers and to extend, until October 28, 2023, the increase in the maximum number of weeks for which those benefits may be paid. It also amends the Budget Implementation Act, 2021, No. 1 to add a transitional measure in relation to amendments to the Employment Insurance Regulations that are found in that Act.
Division 28 of Part 5 amends the Canada Pension Plan to make corrections respecting
(a) the calculation of the minimum qualifying period and the contributory period for the purposes of the post-retirement disability benefit;
(b) the determination of values for contributors who have periods excluded from their contributory periods by reason of disability; and
(c) the attribution of amounts for contributors who have periods excluded from their contributory periods because they were family allowance recipients.
Division 29 of Part 5 amends An Act to amend the Criminal Code and the Canada Labour Code to, among other things,
(a) shorten the period before which an employee begins to earn one day of medical leave of absence with pay per month;
(b) standardize the conditions related to the requirement to provide a medical certificate following a medical leave of absence, regardless of whether the leave is paid or unpaid;
(c) authorize the Governor in Council to make regulations in certain circumstances, including to modify certain provisions respecting medical leave of absence with pay;
(d) ensure that, for the purposes of medical leave of absence, an employee who changes employers due to the lease or transfer of a work, undertaking or business or due to a contract being awarded through a retendering process is deemed to be continuously employed with one employer; and
(e) provide that the provisions relating to medical leave of absence come into force no later than December 1, 2022.
Division 30 of Part 5 amends the Canada Business Corporations Act to, among other things,
(a) require certain corporations to send to the Director appointed under that Act information on individuals with significant control on an annual basis or when a change occurs;
(b) allow that Director to provide all or part of that information to an investigative body, the Financial Transactions and Reports Analysis Centre of Canada or any prescribed entity; and
(c) clarify that, for the purposes of subsection 21.1(7) of that Act, it is the securities of a corporation, not the corporation itself, that are listed and posted for trading on a designated stock exchange.
Division 31 of Part 5 amends the Special Economic Measures Act and the Justice for Victims of Corrupt Foreign Officials Act (Sergei Magnitsky Law) to, among other things,
(a) create regimes allowing for the forfeiture of property that has been seized or restrained under those Acts;
(b) specify that the proceeds resulting from the disposition of those properties are to be used for certain purposes; and
(c) allow for the sharing of information between certain persons in certain circumstances.
It also makes amendments to the Seized Property Management Act in relation to those forfeiture of property regimes.

[The Chair, Liberal, Peter Fonseca]

Welcome back, members.

This panel will be on the Select Luxury Items Tax Act and Bill C-19.

From the Department of Finance, we have Mr. Gervais Coulombe, senior director, excise taxation and legislation, sales tax division, tax policy branch; Mr. David Turner, senior adviser, sales tax division; and Mr. Darren D'Sa, tax policy officer, tax policy branch.

Welcome, and I understand the opening statement will be from Mr. Coulombe.

[The Chair, Liberal, Peter Fonseca]

I call this meeting to order. This is meeting number 77 of the House of Commons Standing Committee on Finance.

At our last meeting, I was unable to be here. I want to thank MP Hallan, our vice-chair, for chairing that meeting. I know it was an in camera meeting. From what I've heard, it was very collaborative, efficient and expedient, so I want to thank all members very much for all that hard work.

It's wonderful, at the start of 2023, to have Governor Macklem and Senior Deputy Governor Rogers joining us.

Pursuant to Standing Order 108(2) and the motion adopted on Monday, November 21, 2022, the committee is meeting, from 11:00 to 12:30, to discuss the Bank of Canada's report on monetary policy. Pursuant to Standing Order 108(2) and the motion adopted on Thursday, February 2, 2023, the committee is meeting with the Department of Finance, from 12:30 to 1:00, to discuss the Select Luxury Items Tax Act and Bill C-19.

Today's meeting is taking place in a hybrid format, pursuant to the House order of June 23, 2022. Members are attending in person in the room and remotely using the Zoom application.

I'd like to make a few comments for the benefit of witnesses and members.

Please wait until I recognize you by name before speaking. If you are participating by video conference, click on the microphone icon to activate your mike, and please mute yourself when you are not speaking.

For interpretation, those on Zoom have the choice, at the bottom of their screen, of “floor”, “English” or “French”. Those in the room can use the earpiece and select the desired channel.

I remind you that all comments should be addressed through the chair.

For members in the room, if you wish to speak, please raise your hand. For members on Zoom, please use the “raise hand” function. The clerk and I will manage the speaking order as best we can, and we appreciate your patience and understanding in this regard.

To commence, we have with us the Governor of the Bank of Canada, Tiff Macklem.

Welcome, Mr. Macklem.

Joining Mr. Macklem is the senior deputy governor, Carolyn Rogers.

Welcome, Ms. Rogers.

Please go ahead with your opening remarks. The members will then look forward to asking you questions.

Immigration and Refugee Protection Act

[Heather McPherson, NDP, Edmonton Strathcona, AB]

Mr. Speaker, it is always a great honour to stand in this place to speak on behalf of the residents and constituents of Edmonton Strathcona. I am particularly delighted to stand today to speak about our sanctions regime and the work that needs to be done to strengthen it and ensure it is as adequate and as strong as it can be.

We know that sanctions are one of the tools we have to hold governments and individuals around the world to the rule of law, to human rights, to democracy and to fairness and justice for their citizens. For a very long time, many members in this place have worked very hard and well together to try to increase the effectiveness of our sanctions regime and the ability of sanctions to do what we hope they will do, which is to change the course of governments and individuals, to change their behaviour and punish them for the harms they have caused without harming and punishing innocent people and citizens.

The act we are debating today is Bill S-8. This act would amend the Immigration and Refugee Protection Act, to make consequential amendments to other acts and to amend the Immigration and Refugee Protection Regulations.

The proposed legislation amends the Immigration and Refugee Protection Act, or the IRPA, and it provides Canada with much-needed abilities to better link government sanctions with authorities related to immigration enforcement. I think we can all agree that this means that not only will foreign nationals sanctioned due to the invasion of Ukraine be inadmissible to Canada, but it will also stop all previously sanctioned individuals from places like Iran, Myanmar or Burma, South Sudan, Syria, Venezuela and Zimbabwe among others.

I and the NDP are very supportive of the bill, but we need to consider, and most of my comments today will be on this, that this is a small piece of what needs to be done to strengthen Canada's sanctions regime.

The bill would not fix some of the things for which we have been calling for some time; for example, the absence of parliamentary oversight. We have very little parliamentary oversight of our sanctions regime, and I will speak to that a bit later.

This would also not fix the enforcement in areas that are not immigration related, for example, the seizure of assets. Again, I will speak to this in more depth later on, but I would raise again in the House that to date about $121 million has been seized from Russian oligarchs as part of our sanctions regime to force Russia to stop its illegal war in Ukraine. While that $121 million is an awful lot to me and probably an awful lot to most of us in this room and in the country, it is not an awful lot for Russian oligarchs.

The bill would also not fix the challenge that we as parliamentarians have with clarity. We still do not have a good system in this place that explains why the government chooses to add some people to the list to be sanctioned, how those decisions are made and how the timing of those decisions is determined. We know we work with our allies and other countries. That is very important for sanctions to be effective. However, as parliamentarians, we need to have more clarity on how those decisions are made.

As we go forward in looking at strengthening the sanctions regime, there are people in the House who have been doing very important work on this. I have to call out my colleague from the Conservative Party, the member for Selkirk—Interlake—Eastman, for his excellent work on the Magnitsky sanctions. The Deputy Prime Minister also did great work on ensuring the Magnitsky act was put in place. Of course, as some people have mentioned before, and my colleague from the Bloc mentioned just previously, the challenge is that putting a law in place does not actually matter if we do not enforce it or if we do not ensure it is adequately applied.

A perfect example of this is that with the Magnitsky sanctions, we are supposed to do a five-year review. Five years is 2022. There is some review being done in the Senate, but we have not done any review within the foreign affairs committee or within this Parliament. For me, that is the challenge we have.

I spoke briefly about the need to strengthen our sanctions regime. For years, the NDP has been pushing for a stronger sanctions regime. We are happy to see some of the important changes that this bill would bring forward, but there are things we have been asking for for years, including in the 2017 foreign affairs committee study on Canada's sanctions regime. Many of the recommendations from that study have not been implemented. We look forward to the government moving somewhat faster than it has to date to make sure those are implemented, especially considering that right now what we are seeing in Ukraine is a vital need for sanctions to be a key piece of our response to the Ukrainian war.

Another example of why our sanctions regime has not been as effective as it could be is the waiver. We saw the government in the summer, in the middle of July, put a waiver in place that would cancel some of the important sanctions we put in place against Russia. I am not going to stand here and pretend that would not have been a very difficult decision for the government to make. Our German allies and Ukrainian allies were asking for different things, and that is a very difficult situation to be in. While I did not agree with the decision that was made by the government, I do accept it was a difficult decision to make.

That said, first of all, the pipeline the waiver was supporting was a piece of equipment returned to Germany to be returned to Russia, and Russia did not pick it up. The second thing is that the pipeline it was meant to be used on has now been blown up. There is no reason whatsoever for us to still have this waiver in place and still have this lessening of our sanctions against Russia, yet we still do.

The Government of Canada has still not cancelled the waiver, which is appalling. It is something it should be doing immediately. I know the foreign affairs committee will be recommending that, if we can get out of the filibuster that has been put in place by some of our colleagues in the Conservative Party.

The other piece of our sanctions regime that I want to know about is how we can double-check it to see that what is happening is adequate and being done properly. I have talked a bit about sanctions oversight, and we know that after Russia invaded Ukraine in February, sanctions were put in place. However, we also know that those sanctions trickled out after months and months. We learned that many oligarchs had the opportunity to move their assets from Canada so they would not have those assets seized. That is a missed opportunity since those assets were supposed to help rebuild Ukraine and help with the rebuilding initiatives.

We also know that the government has failed to provide the clarity on sanctions that we have hoped for. For example, I have asked about this multiple times in the House and through Order Paper questions to get more information and details on who is being sanctioned, what is being sanctioned, what has been seized, how it is being seized and what processes are being used. However, I have never been able to get an adequate answer from the government.

In fact, one of the Order Paper questions was returned to me with a response that said the government was not 100% sure that it would be able to give me accurate information, so it provided me with no information at all. That is an interesting tactic. I would love to see somebody try to say in a high school or university course that since they are not sure they are giving all the information, they will give none at all. That is something we have problems with. We still do not have that level of clarity.

I have another concern. When the government introduced the last budget implementation act, there was a change to the way that sanctions were dealt with. In the past, there was parliamentary oversight because the government needed to record the use of the sanctions regime or the sanctions act and needed to report it to Parliament. It needed to be tabled with Parliament.

In the Budget Implementation Act, that requirement was removed. Therefore, it is now no longer the government's obligation to tell Parliament what those sanctions are or what has been seized. We could find out if we took the government to court and used a judicial remedy, but we cannot find out just through parliamentary processes.

This is taking away the right of all parliamentarians to have that transparency and to have that understanding of how our sanctions are being chosen, how they are being enforced and if they are working. A sanction is not that useful if it is not being enforced. A sanction is not that important if countries or individuals understand that it will not be enforced in Canada.

There is an interesting thing I found out as I was doing some digging around sanctions. If we want to find out what goods are coming into Canada from Russia, we can look at Russian shipping records. We cannot find that out by looking at Canadian shipping records.

It is very interesting to me that there is transparency that can be found in the U.S., the U.K., the EU and Russia, but we cannot find it here.

That is another challenge I have with our sanction regime. As I said at the beginning, this particular bill would help with some aspects of our sanction regime. I am very happy to support this legislation. I am very happy to see that it would be fixing some of those holes around our sanction regime. However, this seems very much, to me, like tinkering around the edges.

We have heard from the Senate. One of the key quotations from the Senate hearings on Bill S-8, from Canada's foremost expert on sanctions policy, Andrea Charron, was this:

While there is nothing wrong with highlighting in the Immigration and Refugee Act that inadmissibility due to sanctions is possible, this repeats a pattern whereby Canada tinkers on the margins of legislation without addressing core policy and process issues. If we are to continue to sanction autonomously with allies, we need to fix fundamental issues of policy and [fundamental issues of] process.

I believe that we have many things we still need to do. We need to have a comprehensive review of Canada's sanction regime. The NDP has proposed a study at the foreign affairs committee on Canada's sanction regime. That study was meant to have taken place during this fall's session. We are very hopeful that it will take place very quickly once the winter session begins. I urge my colleagues in the Conservative Party to stop filibustering our committee so that we can get on with the very important work of foreign affairs.

We can ensure that our sanctions are being more effectively applied. We can bring forward legislation that would align with the recommendations in the 2017 foreign affairs committee report that called for greater transparency. It called for a review of our sanctions regime and called for a parliamentary body of all parties that would assist in identifying which names and which individuals should be on the Magnitsky list and should be sanctioned by the Government of Canada.

One of our biggest problems, and I have said this many times, is that if we cannot fix our sanction regime, our sanction regime very quickly becomes not as effective and not as useful as we need it to be.

I think that members of the House have brought up circumstances where that is the case. We know that, for example, in Ukraine, sanctions are one of the key tools we have to hold Russia to account for its illegal invasion in Ukraine. It is one of the key levers that Canada can pull to force the Russian Federation to rethink this horrific and illegal attack on civilians.

It is also one of the things that we can use when other human rights abuses are raised around the world. We are seeing horrific attacks on protesters in Iran. Just this morning, I woke up to another horrific example of a protester being executed because he was fighting for his freedom. We know that there are many Iranians who are in grave danger right now. If this sanction regime can be fixed and can help the people in Iran even a little bit, it has to be done.

I am interested in looking at sanctioning a whole range of characters around the world who we know have been responsible for atrocious human rights abuses, such as what we see in Yemen and from members of Saudi Arabia. We need to be ensuring that, as a country, we are standing up for human rights, using the tools we have at our disposal for those efforts.

I also want to point out that the sanctions regime is a tool we also have to use for our feminist international assistance policy and for the feminist foreign policy that we certainly hope the government tables in Parliament very soon. We know that a huge percentage of the people who are identified by the Magnitsky sanctions and the other SEMA sanction measures are perpetrating human rights abuses that are disproportionately impacting women and girls around the world. We know that sexual violence and gender-based violence have been used as a tool to silence journalists and human rights defenders around the world. We know that rape has been used. This violence does not align with a country like Canada, which has a feminist foreign policy and a feminist international assistance policy, and we need to be looking at our foreign responses through that lens.

I would like to end my comments with this. As I was travelling here from Edmonton yesterday, I took some time to read some of the speeches from the Nobel Peace Prize winners, and I want to read a quote to the House. It is by Oleksandra Matviichuk from the Center for Civil Liberties, the 2022 Nobel Peace Prize winner. She spoke to me about the need for sanctions and why it was so important that we work with our allies to make our sanctions regime stronger.

She stated:

Peace, progress and human rights are inextricably linked. A state that kills journalists, imprisons activists, or disperses peaceful demonstrations poses a threat not only to its citizens. Such a state poses a threat to the entire region and peace in the world as a whole. Therefore, the world must adequately respond to systemic violations. In political decision-making, human rights must be as important as economic benefits or security. This approach {must} be applied in foreign policy...

Fall Economic Statement Implementation Act, 2022

[Andréanne Larouche, Bloc, Shefford, QC]

Mr. Speaker, I will begin by saying that I am sharing my time with my colleague from Jonquière.

I rise today to speak to Bill C‑32, on the 2022 fall economic statement. Unfortunately, this bill seems more impressive in form than in substance. Bill C‑32 contains maybe 25 various tax measures and a dozen or so non-tax measures. It may seem like a lot at first glance, but these are in fact two kinds of measures. Some are just minor amendments, like the ones this Parliament adopts on a regular basis, while others were already announced in the spring budget but had not been incorporated into the first budget implementation bill in June, Bill C‑19. In cooking we call that leftovers.

Simply put, like the economic statement of November 3, Bill C‑32 does not include any measures to address the new economic reality brought on by the high cost of living and a possible recession. This is a completely missed opportunity for the federal government. This bill will not exactly go down in history and its lack of vision does not deserve much praise either.

However, it does not contain anything “harmful” enough to warrant opposing it or trying to block it. The government often tends to bury harmful measures in its omnibus budget implementation bills, hoping they will go unnoticed, but that is not the case here. The bill contains no surprises, either good or bad.

As my colleagues can see, I am trying very hard to show some good faith. Bill C‑32 contains some worthwhile measures, but they were already announced in the last budget. I will go over them briefly.

An anti-flipping tax has been implemented to limit real estate speculation. That is a good thing. A multi-generational home renovation tax credit has also been created for those who are renovating their home to accommodate an aging or disabled parent. The Bloc has been calling for such a measure since 2015, as have many seniors' groups that have contacted me many times about this issue. I commend the government for introducing it.

There is also a first-time homebuyer tax credit to cover a portion of the closing costs involved in buying a home, such as notary fees and the transfer tax. It is hard to be against apple pie. There is also a temporary surtax and a permanent increase to the tax rate for banks and financial institutions, as well as the elimination of interest on student loans outside Quebec. Quebec has its own system, so it will receive an unconditional transfer equivalent to the amount Quebeckers would have received had they participated in the federal program.

In addition, a tax measure that supports oil extraction has been eliminated. It is just one drop in the bucket of subsidies, but it is a start. A tax measure is being implemented to promote mining development in the area of the critical minerals that are needed for the energy transition. In addition, assistance can be provided to a particular government. That is interesting. A total of $7 billion to $14 billion will be available for all foreign countries, when previously, it was $2.5 billion to $5 billion. While we are still far from the United Nations goal of 0.07% of gross GDP, the government is enhancing Canada's international aid, something the Bloc has been calling for for some time. As the status of women critic, I am regularly reminded that Canada can and must do more and better to safeguard the health of women and girls internationally.

Bill C‑32 sidesteps the big challenges facing our society, but there is nothing bad in it. It puts forward a few measures and does some legislative housekeeping that was necessary under the circumstances.

As such, I will reiterate, half-heartedly, what other Bloc members have said: We will vote in favour of Bill C‑32 even though the economic statement was disappointing. We take issue with an economic update that mentions the inflation problem 115 times but offers no additional support to vulnerable people and no new solutions despite the fact that a recession is expected to hit in 2023. The government seems to think everything will work out with an “abracadabra” and a wave of its magic wand.

Quebeckers concerned about the high cost of living will find little comfort in this economic update. They will have to make do with what is basically the next step in the implementation of last spring's budget, even though the Bloc Québécois did ask the government to focus on its fundamental responsibilities toward vulnerable people.

For the rest of my speech, I will therefore focus on the lack of increased health transfers, the lack of adequate support for people aged 65 and over, and the lack of much-needed genuine reform to EI, which, I should note, is the best stabilizer in times of economic difficulty. Sadly, the government dismissed our three requests, even though they made perfect sense. We can only denounce this as a missed opportunity to help Quebeckers deal with the tough times that they are already going through or may face in the months to come.

First, the Bloc Québécois asked the federal government to agree to the unanimous request of Quebec and the provinces to increase health transfers immediately, permanently and unconditionally. ER doctors are warning that our hospitals have reached breaking point, but the federal government is not acting. It clearly prefers its strategy of prolonging the health funding crisis in the hope of breaking the provinces' united front in order to convince them to water down their funding demand. It is the old tactic of divide and conquer.

I want to remind my colleagues that yesterday, at the Standing Committee on the Status of Women, on which I sit, during our study on the mental health of women and girls, the ministers of Women and Gender Equality and of Mental Health acknowledged that the national action plan concept, which seeks to impose national standards, was slowing down the process. Meanwhile, the women and girls who are suffering are being held hostage. The government's feminist posturing must end.

Second, people between the ages of 65 and 74 continue to be denied the increase to old age security, which they need more than ever before. Seniors live on fixed incomes, so they cannot deal with such a sharp rise in the cost of living in real time. They are the people most likely to have to make tough choices at the grocery store or the pharmacy, yet the government continues to penalize those who are less well-off and who would like to work more without losing their benefits. Unlike the federal government, inflation does not discriminate against seniors based on their age.

Currently, Canada's income replacement rate, meaning the percentage of income that a senior retains at retirement, is one of the lowest in the OECD. We cannot say that the government is treating seniors with dignity.

There is also the increase to old age security, which should prevent demographic changes from significantly slowing economic activity. Contrary to what the government says, starving seniors aged 65 to 75 will not encourage them to remain employed. That is done by no longer penalizing them when they work.

Not a day goes by that I do not receive a message from citizens about this. This morning, I again received comments from important seniors' groups such as AQDR and FADOQ, and they can be summarized in one word: disappointment. I do not even want to talk about the brilliant decision-makers who want to delay the pension process for 10% of seniors.

Third, let us remind the government that employment insurance is an excellent economic stabilizer in the event of a recession. While more and more analysts fear the possibility of a recession in 2023, the Canadian government seems to be backtracking on the comprehensive employment insurance reform that they promised last summer.

Essentially, the system has been dismantled over the years. Currently, six of 10 workers who lose their jobs do not qualify for EI. That is significant, it is a majority, it is 60%. Seven years after the government promised reform, time is running out. We must avoid being forced to improvise a new CERB to offset the shortcomings of the system if a recession hits.

During the pandemic, we saw that improvised programs cost a lot more and are much less effective. Above all, the government's financial forecasts show that it does not anticipate many more claims. In fact, the government is forecasting a surplus of $25 billion in the employment insurance fund by 2028, money that will go to the consolidated fund rather than improve the system's coverage. As for the 26 weeks of sick leave, the measure was in Bill C‑30 to update budget 2021, passed 18 months ago, even before the last elections. All that is missing is the government decree to implement it, but those who are sick are still waiting.

One last important thing: Last weekend, I attended the Musicophonie benefit concert for a foundation in our area, the fondation Louis-Philippe Janvier, which helps young adults suffering from cancer. I was told that the organization does indeed have to make up for the government's lack of financial support. That adds to the unimaginable stress on those who are sick, who should instead be focusing on healing with dignity. Even 26 weeks is inhumane. A person cannot recover properly in that time frame.

In closing, the government is acknowledging the rising cost of living without doing anything about it. It is warning of difficult times ahead this winter without providing a way to get through them. It makes some grim economic predictions without ever considering any of the opposition's proposals as to how to prepare ourselves.

As a final point, I want to talk about supply chains. We learned how fragile they are during the pandemic. Last spring's budget document mentioned the problem 71 times. The budget update mentioned it another 45 times. Neither one includes any measures to tackle the problem, leaving business owners in limbo. The new Liberal-Conservative finance minister missed the opportunity to send a clear message of leadership and instead raised fears about potential austerity. The government is rehashing past measures, implementing what it already announced in the April budget, but there is no indication that it has a clear sense of direction, leaving the people who really need it out in the cold.

For those who lose their jobs, we need EI reform. For those who are sick, we need to increase health transfers. For our seniors, we need to give them more money so they can age with dignity.

[Lindsay Gwyer]

I'll start with the point on double deductions. Both deductions would, as I mentioned earlier, apply in very similar circumstances. There are restrictions on both with respect to what can be deducted and with respect to what has been deducted under other provisions of the Income Tax Act, so the same expense would not be able to be deducted under both of the deductions.

In terms of being able to go and travel abroad, as I mentioned there's no restriction in Bill C-241 as to where the workplace needs to be located. Bill C-19, the existing law, does require that the work location be in Canada. That's there to address the issue of someone going to work in another country and claiming the deduction.

Then on the last point, the existing law sets out specifically what travel expenses would be acceptable: the travel expenses relating to one round trip, so costs of a flight or of gas or of whatever means by which the commuting is done; the cost of meals incurred on that round trip; and then, potentially, temporary lodging if the person maintains their existing lodging in their ordinary place of residence.

Those are the ways those concerns are addressed through the deduction that was passed in Bill C-19.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Thank you, Mr. Chair. I will begin by reiterating my full confidence in the way you are managing this committee.

In the first hour of debate, our esteemed colleague Sophie Chatel raised a number of concerns about this bill. As I said earlier, our goal here, all of us together, is to improve the bill and to make sure that it fulfils its objectives. I wanted to check with you to see if you had any comments on that.

Among the points raised, our colleague said that if Bill C‑241 were to be passed, there would be a double deduction, given that Bill C‑19 has already been passed. We know this and we need to find a solution to this problem.

She also said that a worker could claim expenses for travel to the United States if they go there to work. I would like to hear your comments on this. If we wanted to limit this type of expense in the event that a person went to work abroad, how could we proceed? Again, if you don't have an answer immediately, you can provide one in writing to the committee.

Also, the Income Tax Act states that if a supervisor gives an allowance for a worker's travel, they cannot claim those travel expenses. However, what if it is not an allowance, but some other form of expense payment? Do you think this could open the door to some abuse? If so, how could the bill be improved to avoid such abuses?

[Heath MacDonald, Liberal, Malpeque, PE]

Thank you.

As policy-makers we try to have every safeguard possible for the individuals we're talking about, and those are the construction workers. At the end of the day, we talk about our labour market, and we even talked a little bit about education, the lack thereof in K to 12 and the trades' being incorporated into the education system. Your answer obviously puts a flag up to ask how we can eliminate those possibilities, and there are many other cases with this bill. I think it's great that we brought this forth and we're moving in this direction, but no cap on the amount of expenses is a very interesting thing. If you travel on Prince Edward Island, the 120 kilometres pretty nearly takes you from one end of the island to the other.

Are there any additional safeguards with Bill C-19's labour mobility deduction that aren't included in Bill C-241, and could you elaborate on those? Could you give us a list of those items that you're aware of that could present challenges?

[Mark Maxson]

Maybe I can take this question.

As my colleague was indicating, there is a general rule in the tax system in Canada that limits deductions for employees to a greater extent than for self-employed workers. Part of the rationale behind that is that there is an expectation that employers are generally going to provide employees the tools necessary to do their jobs and are going to take on some of those costs on behalf of their employees in many cases. Certainly in this context, we've understood from stakeholders that these are often workers who are not employed by a specific employer, but who are rather perhaps moving from a region where they normally work with one or more employers and then taking on a job with a new employer in a different region. In that circumstance, that new employer may not necessarily be providing reimbursements of travel expenses. They may or may not, depending on what they feel they need to do in order to attract the workforce necessary.

The bill doesn't specifically place any constraints on whether employers do or do not provide that assistance, but both Bill C-241 and the deductions that are currently in law do prevent someone from receiving an allowance for travel and also claiming the deduction. The existing deduction passed through Bill C-19 also includes a restriction that there can't be any reimbursement that is, in law, different from an allowance. Bill C-241 doesn't include that language, but it would be a question of interpretation for Canada Revenue Agency to work through what would happen in that type of situation.

[Heath MacDonald, Liberal, Malpeque, PE]

Thank you, Chair.

This is a very interesting discussion and an interesting bill to hear about. Coming from a small island, I know that travel for work is really important. I think it's important for all parties, as it was put in the BIA, which is extremely important. I was very glad to see that.

I want to continue on somewhat with what Mr. Lawrence said with regard to the larger corporations or the employers. Maybe I'll go to Mr. Leblanc.

In your opening remarks, you spoke about the differences between Bill C-241 and the existing labour mobility deduction that was implemented through Bill C-19. One area that I'm particularly concerned about is the lack of protections that would prevent possible double-dipping by those corporations, by receiving compensation through an employer and via the tax credit. I guess my concern—in line with Mr. Lawrence's on the opposite side—in particular is that employers may choose to cut back on their compensation pre-emptively on the assumption that workers will access this benefit as well.

Am I understanding the legislation correctly? If so, could you elaborate?

[Lindsay Gwyer]

The tax system is set up in such a way that people are limited in what deductions they can make with respect to employment income in general. Most expenses related to employment income are not deductible unless they're specifically enumerated exceptions in the Income Tax Act, whereas business is more of a bigger picture of what expenses are relevant to computing the profit of a business, and that builds off accounting principles. It's really a difference in the way the system is set up. Deductions like this one, the deduction that was in Bill C-19, are really exceptions to the general rule that employees are not able to claim deductions against their employment income.

[Mark Maxson, Director, Employment and Education, Personal Income Tax Division, Tax Policy Branch, Department of Finance]

Thank you for the question.

Certainly there is not a substantive difference between the $4,000 and the next dollar. It is common in tax law for different provisions to contain maximum amounts. It's a typical practice when it comes to tax measures. It's not universal. As Pierre mentioned, this particular amount is something that was deemed reasonable not just by Parliament, I guess, in passing Bill C-19, but it was the amount that was put forward by the CBTU in terms of their financial projections as a typical amount. We think it's a reasonable amount to cover most circumstances.

[Lindsay Gwyer, Director General, Legislation, Tax Legislation Division, Tax Policy Branch, Department of Finance]

Both the existing labour mobility deduction that was implemented through the Budget Implementation Act and this deduction in Bill C-241 are deductions, so they're both amounts that an employee deducts from income and not tax credits.

[Pierre Leblanc]

—what was legislated in Bill C-19 is a credit.

On your question, let me turn to one of my colleagues.

[Pierre Leblanc]

Thank you, Mr. Chair.

Thank you to all members of the committee for inviting us to be with you today on this very important topic.

It was really interesting to hear the debate and the discussion over the last hour. I think it underscores the importance of this policy issue, certainly, in the current labour market context and the value of the member's contribution in bringing this bill forward.

Maybe I can just start by reiterating what the current law of the land is. The current tax system has a labour mobility deduction for tradespeople.

In Budget 2022, the government proposed a labour mobility deduction for tradespeople, similar in form and intent to the measure that Bill C‑241 seeks to introduce.

On June 23, 2022, Parliament passed Bill C‑19, which included amendments to the Income Tax Act to create tradespeople's mobility deductions, as proposed in Budget 2022.

Again, it's part of the current tax system. In fact, the Canada Revenue Agency is currently finalizing forms and administrative procedures, including guidance, to allow taxpayers to claim the labour mobility deduction for the 2022 tax year this coming spring. This is the time of year when the CRA is getting everything together so we can be ready for filing season.

Compared with the deduction that would be enacted by the bill you are considering today, Bill C-241, the labour mobility deduction that is already in law provides greater clarity on the definitions of some concepts and includes safeguards that contain its scope and cost. For example, Bill C-241 doesn't define travelling expenses or construction activity and uses the term “tax credit”, which is not a defined term in law. The bill also requires no minimum period of relocation, places no limit on the number of trips or the amount of expenses that could be deducted in the year and makes no allowance for trips that might span multiple tax years.

If Bill C‑241 were enacted, taxpayers would be using two substantially similar deductions that serve the same purpose. This would likely cause administrative difficulties for the Canada Revenue Agency and create confusion for tax filers, especially since the 2022 tax filing season will soon begin.

Once again, thank you. We will be happy to answer any questions that members may have on this or other elements of Bill C‑241.

[Daniel Blaikie, NDP, Elmwood—Transcona, MB]

Thank you very much, Mr. Chair.

Thank you, Mr. Lewis, for being here today and for taking on this work that has been advocated for by others. I'm going to give a shout-out to my former colleague Scott Duvall, who presented a similar bill a couple of Parliaments before this one, and of course to my colleague Matthew Green from the NDP, who also presented a very similar bill. I will note my own work around this table when Bill C-19 was here in order to ensure there was fair tax treatment, as Mr. Chambers was saying, equal to or certainly like the kind of treatment that businesses get for writing down certain kinds of expenses. There is a long track record of supporting this kind of work, and I thank you for your contribution to it.

On the question we've been discussing when it comes to collective bargaining rights, I do think it is disgraceful to see the notwithstanding clause abused in this way. I share Monsieur Ste-Marie's incredulity at seeing Liberals and Conservatives argue over this point, because I've watched Liberals legislate people back to work.

I think the use of the notwithstanding clause is a relevant federal issue, because this is a precedent. The notwithstanding clause can be used by the federal government as much as it can by provincial governments. If we care about workers' rights to bargain collectively in Canada, it matters when a provincial government does this. It sets a precedent that can be used by other provinces and by the federal government.

This is something a province is doing that will have consequences in not only its own jurisdiction. This is something that a province is doing that will have repercussions for workers across the country if either another provincial government or the federal government decides to pull this kind of stunt one day. Therefore, I do think we should be properly concerned with this issue around this table. I don't think we can just write it off as a provincial issue. The notwithstanding clause is not simply a provincial issue. It's an issue of our constitution, which applies right across the country and to all levels of government.

Now you know what I think about that.

As an IBEW member and construction electrician in Manitoba, I just want to circle back to Manitoba, which you mentioned in your opening remarks. I recall that before 2016 we had a lot of local employment. In fact, our hall was trying to get more and more people to travel to Manitoba because we had a provincial government that was investing in infrastructure. That meant not only that people were getting paid to be on publicly funded infrastructure projects in Manitoba but also that we had very high private sector confidence and very high levels of private sector investment.

The government changed in 2016. We saw the public financing of infrastructure projects go away. Then we started seeing a lot less private sector investment in places like downtown Winnipeg. Then we saw high levels of local unemployment, persistent unemployment, even as the government was quite happy to invite non-union contractors from outside the province to come do work in Manitoba.

We also have to think about the role governments play in funding good public works with good requirements around good pay and good benefits when we talk about whether people are going to have to travel for work and whether they have good work available to them.

Thank you, Mr. Chair. I'm sorry I ran out of time, and we don't have time for a response.