Fall Economic Statement Implementation Act, 2022

An Act to implement certain provisions of the fall economic statement tabled in Parliament on November 3, 2022 and certain provisions of the budget tabled in Parliament on April 7, 2022

Sponsor

Status

This bill has received Royal Assent and is, or will soon become, law.

Summary

This is from the published bill. The Library of Parliament often publishes better independent summaries.

Part 1 implements certain measures in respect of the Income Tax Act by
(a) providing that any gain on the disposition of a Canadian housing unit within a one-year period of its acquisition is treated as business income;
(b) introducing a Tax-Free First Home Savings Account;
(c) phasing out flow-through shares for oil, gas and coal activities;
(d) introducing a new 30% Critical Mineral Exploration Tax Credit for specified mineral exploration expenses incurred in Canada and renounced to flow-through share investors;
(e) introducing the Canada Recovery Dividend under which banks and life insurers’ groups pay a temporary one-time 15% tax on taxable income above $1 billion over five years;
(f) increasing the corporate income tax rate of banks and life insurers’ groups by 1.5% on taxable income above $100 million;
(g) providing additional reporting requirements for trusts;
(h) providing rules applicable to mutual fund trusts listed on a designated stock exchange in Canada with respect to amounts that are allocated to redeeming unitholders;
(i) providing the Minister of National Revenue with the discretion to decline to issue a certificate under section 116 of the Income Tax Act in certain circumstances relating to the administration and enforcement of the Underused Housing Tax Act ;
(j) doubling the First-Time Homebuyers’ Tax Credit;
(k) expanding the eligibility criteria for the Medical Expense Tax Credit in respect of medical expenses incurred in Canada related to surrogate mothers and donors and fees paid in Canada to fertility clinics and donor banks;
(l) introducing the Multigenerational Home Renovation Tax Credit;
(m) allowing access to the small business tax rate on a phased-out basis up to taxable capital of $50 million;
(n) modifying the computation of income as a result of the adoption of a new international accounting standard for insurance contracts;
(o) introducing a new graduated disbursement quota rate for charities;
(p) providing that the general anti-avoidance rules can apply to transactions that affect tax attributes that have not yet been used to reduce taxes;
(q) strengthening the rules on avoidance of tax debts;
(r) modifying the calculation of the taxes applicable to registered investments that hold property that is not a qualified investment;
(s) modifying the tax treatment of certain interest coupon stripping arrangements that might otherwise be used to avoid tax on cross-border interest payments;
(t) clarifying the applicable rules with respect to audits by Canada Revenue Agency officials, including requiring taxpayers to give reasonable assistance and to answer all proper questions for tax purposes; and
(u) extending the capital cost allowance for clean energy and the tax rate reduction for zero-emission technology manufacturers to include air-source heat pumps.
It also makes related and consequential amendments to the Canada Deposit Insurance Corporation Act , the Excise Tax Act , the Air Travellers Security Charge Act , the Excise Act, 2001 , Part 1 of the Greenhouse Gas Pollution Pricing Act and the Income Tax Regulations .
Part 2 amends the Excise Act, 2001 and other related texts in order to implement changes to
(a) the federal excise duty frameworks for cannabis and other products by, among other things,
(i) permitting excise duty remittances for certain cannabis licensees to be made on a quarterly rather than a monthly basis, starting from the quarter that began on April 1, 2022, and
(ii) allowing the transfer of packaged, but unstamped, cannabis products between licensed cannabis producers; and
(b) the federal excise duty framework for vaping products in relation to the markings, customs storage and excise duty liability of these products.
Part 3 amends the Underused Housing Tax Act to make amendments of a technical or housekeeping nature. It also makes regulations under that Act in order to, among other things, implement an exemption for certain vacation properties.
Division 1 of Part 4 authorizes the Minister of Finance to acquire and hold on behalf of His Majesty in right of Canada non-voting shares of a wholly-owned subsidiary of the Canada Development Investment Corporation that is responsible for administering the Canada Growth Fund and to requisition the amounts for the acquisition of those shares out of the Consolidated Revenue Fund.
Division 2 of Part 4 amends the Bretton Woods and Related Agreements Act to increase the maximum financial assistance that may be provided in respect of foreign states.
Subdivision A of Division 3 of Part 4 enacts the Framework Agreement on First Nation Land Management Act .
Subdivision B of Division 3 of Part 4 contains transitional provisions in respect of the enactment of the Framework Agreement on First Nation Land Management Act and makes consequential amendments to other Acts. It also repeals the First Nations Land Management Act .
Division 4 of Part 4 amends the Government Employees Compensation Act in order to fulfil 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.
Division 5 of Part 4 amends the Canada Student Loans Act to eliminate the accrual of interest on guaranteed student loans beginning on April 1, 2023.
It also amends the Canada Student Financial Assistance Act to eliminate the accrual of interest on student loans beginning on April 1, 2023.
Finally, it amends the Apprentice Loans Act to eliminate the accrual of interest on apprentice loans beginning on April 1, 2023 and to clarify when the repayment of apprentice loans begins during the interest suspension period from April 1, 2021 to March 31, 2023.

Elsewhere

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.

Votes

Dec. 8, 2022 Passed 3rd reading and adoption of Bill C-32, An Act to implement certain provisions of the fall economic statement tabled in Parliament on November 3, 2022 and certain provisions of the budget tabled in Parliament on April 7, 2022
Dec. 7, 2022 Passed Concurrence at report stage of Bill C-32, An Act to implement certain provisions of the fall economic statement tabled in Parliament on November 3, 2022 and certain provisions of the budget tabled in Parliament on April 7, 2022
Dec. 7, 2022 Failed Bill C-32, An Act to implement certain provisions of the fall economic statement tabled in Parliament on November 3, 2022 and certain provisions of the budget tabled in Parliament on April 7, 2022 (report stage amendment)
Nov. 22, 2022 Passed 2nd reading of Bill C-32, An Act to implement certain provisions of the fall economic statement tabled in Parliament on November 3, 2022 and certain provisions of the budget tabled in Parliament on April 7, 2022
Nov. 22, 2022 Failed 2nd reading of Bill C-32, An Act to implement certain provisions of the fall economic statement tabled in Parliament on November 3, 2022 and certain provisions of the budget tabled in Parliament on April 7, 2022 (reasoned amendment)
Nov. 21, 2022 Passed Time allocation for Bill C-32, An Act to implement certain provisions of the fall economic statement tabled in Parliament on November 3, 2022 and certain provisions of the budget tabled in Parliament on April 7, 2022

Fall Economic Statement Implementation Act, 2022Government Orders

November 14th, 2022 / 3:25 p.m.
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Liberal

Randy Boissonnault Liberal Edmonton Centre, AB

moved that Bill C‑32, An Act to implement certain provisions of the fall economic statement tabled in Parliament on November 3, 2022 and certain provisions of the budget tabled in Parliament on April 7, 2022, be read the second time and referred to a committee.

Mr. Speaker, I am pleased to begin debate on Bill C‑32, which seeks to implement certain provisions of the fall economic statement and budget 2022.

As in countries around the world, the Canadian economy is facing a period of slow economic growth. The global challenge of high inflation with higher interest rates and cost of living increases have left many Canadians worried. Some are worried about whether they can continue to pay their bills, and some are wondering whether Canada's future will be as prosperous as our past. Our message to Canadians is simple. We hear them, and we stand with them. We will get through this difficult period together, and we will come out the other side stronger, together.

The good news is that no country is better placed than Canada to weather the coming global economic slowdown. We have an unemployment rate near its record low, with 500,000 more Canadians working today than before the pandemic. We have the strongest economic growth in the G7 this year and the lowest net debt and deficit-to-GDP ratios in the G7. Less than two weeks ago, we saw our AAA credit rating reaffirmed. We have a talented and resilient workforce, and we are a country to which skilled workers around the world want to move. On top of that, we have key natural resources and innovative ideas that the global economy needs. These are the foundations of strength on which we will get through this difficult time.

However, in this period of uncertainty, it is important to exercise restraint and remain cautious budget-wise. That is why our government continues to pursue a tight fiscal policy to keep reducing the federal debt-to-GDP ratio.

Even as we face global headwinds, the investments we are making today will make Canada more sustainable and more prosperous for generations to come. We are working hard to make life more affordable for Canadians. Building on our affordability plan, which was announced this summer, we are putting money back into the pockets of those who need it the most.

With Bill C-32, we are moving forward with an important measure to make life more affordable for a group of Canadians heavily affected by rising prices: post-secondary graduates with student loans. With the passing of this bill, the federal portion of all Canada student loans and Canada apprenticeship loans would become permanently interest free, including those being repaid. This measure would provide financial relief to young Canadians across the country, helping them to make ends meet and ensuring that their investment in themselves and their education was the right decision to make.

I am already looking forward to the effect this measure will have on young Canadians. There is no doubt that it will help many young people balance their budgets and invest in their future. It will also help give our businesses and business owners the skilled workers they need to continue to prosper.

Last week, I met with student apprentices, and they were delighted to hear about this move that we are making in their future.

Another area where I know Canadians are looking for support is the cost of housing. No one will be surprised if I say that our government believes that everyone should have a safe and affordable place to call home. Unfortunately, that goal is increasingly out of reach for far too many Canadians.

Housing prices have skyrocketed over the past few years and many people are concerned that rent will also go up because of the impact high interest rates will have on the mortgages of rental property owners.

We know that some Canadians need help. That is why, with Bill C‑32, the government is introducing an ambitious range of measures designed to build more houses and make housing more affordable across the country.

We are lowering taxes for new homebuyers so they can put their money in a place to call home. To help young Canadians afford a down payment faster, Bill C-32 would move forward with the new tax-free first-home savings account. This account would allow prospective first-time homebuyers to save up to $40,000 tax-free toward their first home. Bill C-32 would also double the first-time homebuyers tax credit to provide up to $1,500 in direct tax relief to homebuyers starting in 2022.

We would introduce a refundable, multi-generational home renovation tax credit. We are also moving forward in Bill C-32 with measures to crack down on house flipping. By doing so, we would ensure that investors who flip homes pay their fair share, which will play a role in lowering housing prices for Canadians. In short, we have a plan to make home ownership in this country more affordable, especially for young people.

As we continue to provide targeted support for Canadians, we are also hard at work to advance a robust industrial policy that will deliver stable, good-paying jobs. We have to seize opportunities in the net-zero economy, attract new private investment and provide the key resources the world needs.

Without a doubt, an investment in our country's future is also an investment in our workers. That is why the 2022 fall economic statement makes investments in workers to grow Canada's economy, create good-paying jobs and tackle Canada's investment and productivity challenges.

For example, we are proposing to expand the accelerated tax deductions for business investments in clean energy equipment. This will be important as our government moves forward with Canada's first critical mineral strategy. This strategy recognizes that critical minerals, including those found in my own home province of Alberta, are central to major global industries and clean technologies. To build on this, we would also introduce a new 30% critical mineral exploration tax credit for specified mineral exploration expenses incurred in Canada.

There is also a measure in Bill C-32 that I am particularly proud of, and that is the creation of the Canada growth fund. We first announced this fund in budget 2022, and we are now taking concrete actions to make it a reality with Bill C-32. With it, we could help attract billions of dollars in new private capital required to fight climate change and create good jobs at the same time. The $15 billion from us would attract in $45 billion, for a fund of $60 billion, and this growth fund would also help to attract scale-up companies that will create jobs, and drive productivity and clean growth. It would encourage the retention of intellectual property in Canada, while capitalizing on Canada's abundance of natural resources.

The fund will be launched by the end of this year, and the government will take steps to put in place a permanent, independent structure for the fund in the first half of 2023.

It is also important to continue supporting our small businesses, which create jobs across the country. That is why we are proposing through this bill to cut taxes for Canada's growing small businesses by phasing out access to the small business tax rate more gradually, with access to be fully phased out when taxable capital reaches $50 million rather than $15 million.

While we support our growing small businesses, we are also moving forward with the Canada recovery dividend to ensure large financial institutions that made significant profits during the pandemic help support Canada's broader recovery. With the passage of Bill C-32, we would impose a one-time 15% tax on taxable income above $1 billion for banks and life insurers' groups because it is important to ensure that large financial institutions pay their fair share.

In a time of great challenge and uncertainty in the global economy, it is important for Canada to have a clear plan for moving forward.

That is precisely what we have with the 2022 fall economic statement and Bill C-32. This bill includes great measures to build an economy that works for everyone, to create great jobs and make life more affordable for Canadians.

My call to all members of the House is to come together and support the positive, constructive and necessary measures in this bill, support tax relief for home owners, support financial relief for post-secondary graduates and support a strategy to grow our economy and maintain Canada's competitive advantage. Canadians are looking to us to put politics aside and ensure the quick passage of this important legislation.

Fall Economic Statement Implementation Act, 2022Government Orders

November 14th, 2022 / 3:35 p.m.
See context

Conservative

Eric Melillo Conservative Kenora, ON

Mr. Speaker, one of the things I want to pick up on is the fact that we are clearly in an economic crisis, with Canadians struggling across the country just to put food on the table and heat their homes. They are struggling to get by. The answer from the government, time and time again, is to spend more money, when this spending is the very thing that is causing the inflationary crisis to begin with.

On this side of the House, we believe we should be measuring our success based on the results of the dollars we are spending, not just on how many dollars we can spend. When will the minister and the government recognize that, take action, stop the spending and ensure we can get things back on track for Canadians who are struggling?

Fall Economic Statement Implementation Act, 2022Government Orders

November 14th, 2022 / 3:35 p.m.
See context

Liberal

Randy Boissonnault Liberal Edmonton Centre, AB

Mr. Speaker, I say to my hon. colleague that he can take a look at the numbers. We had an economy that was producing better than was even projected in budget 2022, and that is thanks to the hard work of Canadian businesses. Therefore, we took a prudent approach to paying down our deficit, which is much lower than predicted in the budget, and we invested money targeted to those Canadians who most need the supports at a time when they most need it.

We are investing in the economy so it will grow. We listened and responded to those Canadians who need it the most. We are making sure we have fiscal firepower for the future, and we are growing our economy so it works for everyone.

Fall Economic Statement Implementation Act, 2022Government Orders

November 14th, 2022 / 3:40 p.m.
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Bloc

Luc Desilets Bloc Rivière-des-Mille-Îles, QC

Mr. Speaker, I would like my colleague to explain something to me. The word “inflation” comes up 115 times in the document, but there is no mention of concrete measures. I am thinking about seniors, who keep taking hit after hit. There is nothing here for them. It never ends.

Why is that? What does that have to do with the inflation we are seeing now and the looming recession?

Fall Economic Statement Implementation Act, 2022Government Orders

November 14th, 2022 / 3:40 p.m.
See context

Liberal

Randy Boissonnault Liberal Edmonton Centre, AB

Mr. Speaker, we are clearly in an inflationary cycle. That is no secret. It is happening here in Canada, and it is happening in Germany, in France, in the United States and in the United Kingdom. It is important to note, however, that inflation here in Canada is among the lowest in the world, as are our interest rates.

What we have done for seniors is make sure all the benefits and supports they get, such as old age security, are indexed. They get their payments quarterly, not annually. That means there is a quarterly adjustment for inflation.

We will work with our counterparts the world over to slow inflation. In the meantime, we will invest in Canadians who need it most where they need it most.

Fall Economic Statement Implementation Act, 2022Government Orders

November 14th, 2022 / 3:40 p.m.
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NDP

Lori Idlout NDP Nunavut, NU

Uqaqtittiji, I would like to ask the minister if he could talk more about the Canada growth fund and how it will increase the under-represented groups of indigenous peoples and women in the trades.

Fall Economic Statement Implementation Act, 2022Government Orders

November 14th, 2022 / 3:40 p.m.
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Liberal

Randy Boissonnault Liberal Edmonton Centre, AB

Mr. Speaker, the whole point of the Canada growth fund is not only to crowd in private capital so we can actually green the economy, but also to make sure we are taking a smart approach to how we work with under-represented groups. It is not just the Canada growth fund. The investment tax credits that we are proposing on both clean hydrogen and green energy programs are focused and have a labour provision.

For example, in the clean hydrogen tax credit, 40% goes to those companies that are going to not only pay a good salary but also have apprenticeships. Across the board, we are focused on making sure indigenous peoples, people of colour and people who are under-represented in the workforce are part of these investments.

Fall Economic Statement Implementation Act, 2022Government Orders

November 14th, 2022 / 3:40 p.m.
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Liberal

Bardish Chagger Liberal Waterloo, ON

Mr. Speaker, the riding of Waterloo includes two universities and a college, so there are numerous students. I remember when I graduated from the University of Waterloo, I had Canada student loans and Canada student grants. After I graduated, I had six months to pay them back, but interest started to accumulate the day after I graduated. This took a really big toll.

Since then, many students have been asking for the removal of interest. Most recently, I met with the president of Conestoga Students Inc., who asked when the government would be able to deliver on this commitment. I would like to hear from the minister how quickly we can actually implement this commitment if we see swift passage of this legislation.

Fall Economic Statement Implementation Act, 2022Government Orders

November 14th, 2022 / 3:40 p.m.
See context

Liberal

Randy Boissonnault Liberal Edmonton Centre, AB

Mr. Speaker, I want to thank my hon. colleague for putting her finger on the number one question: How soon can we get this legislation passed through the House?

We can see that in the new year, probably April, and moving forward, we will no longer have student loan interest on the federal portion of student loans and apprenticeship interest. This would benefit not only students at Conestoga, but students at universities, colleges and technical institutes across the country. I met with Polytechnics Canada last week, and they were thrilled to hear that this was our plan and that it was going to be part of Bill C-32.

To all the businesses operating in my hon. colleague's riding and to all members of the House, we are going to work with the banks to make sure that credit card fees get reduced. If the banks do not come to the table before the end of December this year, we are going to pass legislation in the new year to get credit card fees reduced, because it is what small businesses are asking of us. We are responding to post-secondary students and to small business owners.

Fall Economic Statement Implementation Act, 2022Government Orders

November 14th, 2022 / 3:45 p.m.
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Green

Elizabeth May Green Saanich—Gulf Islands, BC

Mr. Speaker, I have to say to the hon. minister that it was very disappointing that during Veterans' Week, the fall economic statement ignored the need for veterans to have their spouses, if they married over age 60, recognized as actual surviving spouses so they can receive the benefits they would have received as a widow or widower after the death of their spouse who served this country. This was ignored in the budget. I noticed that survivors' benefits are dealt with, if we are looking at the multi-generational home renovation tax credit, as is what happens to that benefit for a surviving spouse, but there is nothing for our veterans if they married over age 60.

Would the government be open to amending this bill to end this injustice to our veterans and their families?

Fall Economic Statement Implementation Act, 2022Government Orders

November 14th, 2022 / 3:45 p.m.
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Liberal

Randy Boissonnault Liberal Edmonton Centre, AB

Mr. Speaker, I thank my hon. colleague for her insight. Of course, if this is a policy distortion, we will certainly take a look at it.

On the whole, we have to be mindful of the fact that the fall economic statement is in itself a very thin document. It is a prudent approach. We are paying down the deficit. We are focusing on growing the economy and helping Canadians who need it the most. Budget 2023 will be a whole other cycle. However, I take my hon. colleague's point and will definitely look into it.

Fall Economic Statement Implementation Act, 2022Government Orders

November 14th, 2022 / 3:45 p.m.
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Conservative

Brad Vis Conservative Mission—Matsqui—Fraser Canyon, BC

Mr. Speaker, in the fall economic statement, there is a specific line item solely related to my riding, and that is “Support to Rebuild the Village of Lytton”. It indicates that funds previously allocated in June to PacifiCan are being transferred to Industry Canada.

Why has the government decided to delay the funding to Lytton over a period of what seems to be five years? When the announcement was made in June, there was no indication that the village of Lytton would receive anything but a lump sum payment from the Government of Canada. If we could have some clarification on that, it would be very helpful.

Second, when can the village of Lytton expect to receive the first payment through Infrastructure Canada?

Fall Economic Statement Implementation Act, 2022Government Orders

November 14th, 2022 / 3:45 p.m.
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Liberal

Randy Boissonnault Liberal Edmonton Centre, AB

Mr. Speaker, I take the hon. member's point directly. My sense is the change from PacifiCan to Industry Canada, as I am a minister in the IC portfolio, is actually for speed and coordination on the ground.

I am happy to meet with my hon. colleague after this session to give him specific details and to work with him directly to ensure that the citizens of Lytton are able to get the money they need to rebuild their community. I will take up that matter personally.

Fall Economic Statement Implementation Act, 2022Government Orders

November 14th, 2022 / 3:45 p.m.
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Conservative

Adam Chambers Conservative Simcoe North, ON

Mr. Speaker, I am seeking unanimous consent to split my time.

Fall Economic Statement Implementation Act, 2022Government Orders

November 14th, 2022 / 3:45 p.m.
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Conservative

The Deputy Speaker Conservative Chris d'Entremont

Is it agreed?