Bill C-32 (Historical)

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

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.

Report Stage

[Warren Steinley, Conservative, Regina—Lewvan, SK]

Mr. Speaker, I am shocked the member was in my riding and did not give me a call. I would have given him a tour of some of the food banks and union halls I get to visit. He would have been able to meet some of the hard-working members of Regina—Lewvan who are strong Conservative supporters.

However, I wish this member would stop trying to play class warfare. I wish this member would realize employees work for some of these big companies, and they are good-paying jobs. I wish this member would stop trying to pit Canadian against Canadian and being as divisive as his Liberal counterparts.

I would ask the member to go back home, talk about how he can get good-paying jobs and get hard-working union people back to work, support the oil and gas industry and make sure that all the guys at USW 5890 can continue to work at the steel plant and the guys at Unifor can keep working at the refinery. They are good-paying jobs in Regina, and I wish he would support them.

[Ryan Turnbull, Liberal, Whitby, ON]

Mr. Speaker, it gives me great pleasure to rise today in the House to speak to the fall economic statement. I appreciated the accolades from my colleague across the way, the member of Parliament for Regina—Lewvan. He gave me a shout-out for being authentic and real with Canadians, and I appreciate that. Although I disagree with most of the sentiments he shared, I appreciate the accolades from him. It is great when we can stand and be honest and authentic in this place.

In terms of the vision the member opposite claimed our government does not have, I would say the Conservative Party today seems to bring nothing to the table but angst and austerity, fear and division, and empty rhetoric and catchphrases. There are no solutions and no plan. I will argue in my speech today that we do have a vision, there is a plan and it is represented in the fall economic statement.

We know the challenges all too well that this country is facing and we have to understand those challenges in context. Coming out of the global pandemic, we have averted a sort of second coming of the Great Depression. It has been the worst public health crisis in 100 years. That is the context in which we need to understand our recovery and the fall economic statement. Canada has fared much better than almost any other country in the world. There have been fewer deaths per capita, higher vaccination rates and a stronger economic recovery than pretty much every peer country we could compare ourselves to.

Our real GDP recovery from the pandemic is strong and Canada is leading G7 countries. Our labour market is strong and has come back stronger than ever. Just yesterday there was a report saying that Canada has improved and has one of the highest participation rates among women in the economy at this point, due to some of the measures our government put in place. We have also seen what we call a V-shaped recovery, documented in the fall economic statement, which shows that our economy dipped drastically during the pandemic and then recovered quite quickly, which is exactly what the government had said multiple times would be the optimum scenario.

As another member pointed out recently in his question, we have the lowest net debt-to-GDP ratio in the G7, we are forecasted to have the lowest deficit as a percentage of GDP and we have also maintained a AAA credit rating. That sounds pretty good to me. I do not know if other members in the House really pay attention to those fact-based details, but it certainly seems to me like that is a strong recovery.

Now we have global inflation that is the top issue Canadians care about today, although I will note that health care is trending and really overtaking inflation as the top issue. We know inflation is the direct result of pandemic-related supply chain disruptions, extreme weather due to climate change and geopolitical instability due to Russia's illegal invasion of Ukraine. We all know these, as we have heard them many times in the House.

Coming out of the pandemic, demand for many goods and services has exceeded supply, and that has led to global inflation of course. There are inflationary pressures, and we know that. Even when we look at inflation in comparable countries, Canada has lower consumer price inflation compared to other economies. If we compare Canada to Italy, Sweden, Germany, the U.K., Europe, the G20 average, the U.S., Australia, New Zealand, Norway, the list goes on, we have lower consumer price inflation in Canada.

Global supply chain pressures have started to subside after their pandemic peak, and commodity price fluctuations are still quite volatile, which we have seen, so tackling inflation is obviously one of the key challenges. A key measure that the Bank of Canada and all central banks around the world are taking is raising interest rates, with Canada doing so quite aggressively, to cool down and slow down the economy until supply starts to catch up to demand.

The postpandemic economic growth will slow as a result and Canadians are feeling the pinch. We all know this. It is tricky to get this right. Of course we have to have debates and be really thoughtful about how we approach this because there are lots of unknowns.

Global financial markets are not something within the federal government's control. We have to remain agile. We have to be careful not to add fuel to the fire. I think we have all heard these things. They are quite clearly outlined in the fall economic statement.

We must do what we can to alleviate the inflationary pressures, while we work toward preparing the conditions for growth. In my view, and in our government's view, it is to build an economy that works for all Canadians. What does that mean? It is an economy that is more equitable, fair, just and sustainable; that is more resilient; that addresses long-standing inequities that we experienced during the pandemic; that continues to fight climate change; and that we do not let up from the fight against climate change just because some of the members opposite do not agree that climate change is real.

We on this side of the House understand that climate change is real. There is ample evidence to suggest that we all need to be concerned about global warming and that Canada experiences even more than many other places in the world.

We have also provided immediate targeted supports for those who need it the most. We can think of the doubling of the GST tax credit, the rental top-up support of $500 and dental care as well for lower-income families and kids.

If I were to summarize all of this, we have a pretty good track record. We have had a strong recovery and we have dealt with the pandemic quite well. Now we are moving into a period of global inflation. The fall economic statement outlines three main areas we are addressing.

We have supply chains. We are strengthening the resiliency of our supply chains. That is very clearly laid out. That means those supply chains can withstand shocks in the future. There is the national trade corridors fund, which launched in 2017. There are $4.6 billion, $2.8 million allocated to over 130 projects, including the Oshawa port authority, right next door to my riding, which will be making major updates to the port so its infrastructure can accommodate more shipments coming in and out. The national supply chain task force is another initiative, which has already achieved some great recommendations that are being implemented.

People and their talents, skills and labour is another major theme in the fall economic statement. We are investing in the skills for a net-zero economy. There is the sustainable jobs training centre, a new sustainable jobs stream under the union training and innovation program, and a sustainable jobs secretariat. All of these are designed to help retrain people to take on the jobs in a net-zero economy.

The immigration levels plan has also been increased, which is great news for our labour market constraints.

My favourite portion has to do with sustainable finance. We are launching the innovation and investment agency, $1 billion over five years, modelled after the Business Finland and Israel innovation authority. The objective is to work to help new and established Canadian firms innovate, commercialize, research and create new economic opportunities for workers and businesses in Canada.

We are also launching the Canada growth fund, which is designed to attract substantial private investment in Canadian businesses and projects to help seize the opportunities provided by a net-zero economy. The policy goals are very clearly outlined in the fall economic statement. We will be able to capitalize on an abundance of natural resources and strengthen critical supply chains to secure Canada's economic environmental well-being.

Fifteen billion dollars of public capital will have a three time multiplier effect with respect to leveraging private capital. Think about how much that $60 billion will help build the economy of tomorrow. We saw an example of that just yesterday at the GM Ingersoll plant, which is producing Canada's first-ever electric cargo vans. This is great news for our country.

There have been substantive investments through the net-zero accelerator and some of the other government initiatives. We want to build that even stronger, so that in clean hydrogen and clean technology, Canada can be a world leader. Using the new financial tools, while using the government's leverage to basically de-risk some of those investments, is a key strategy in how we can move forward.

[Warren Steinley, Conservative, Regina—Lewvan, SK]

Mr. Speaker, I listened intently to the speech of the member for Whitby. He is a member of the Standing Committee on Agriculture and Agri-Food, and we have worked together on some things. He talked about the innovation fund. He said that it would add $60 billion and create investments. I hope it does a lot better than the Infrastructure Bank, which did nothing for Canadians but build pipelines in China.

In the 2019 campaign, the Liberals promised not to raise the carbon tax over $50 a tonne. They broke that promise and blew by that cap. By 2030, the carbon tax is supposed to be $170 a tonne, which increases the cost of everything from food to fertilizer to fuel. Everything people buy will be more expensive because of the carbon tax.

Therefore, how high is high enough? With the tax currently at $170 a tonne, the Liberals will break that promise as well. How high is the carbon tax going to go before they realize it is going to bankrupt Canadians?

[Ryan Turnbull, Liberal, Whitby, ON]

Mr. Speaker, I will start with the first part of the question of the member for Regina—Lewvan, in which he asserts that the Canada Infrastructure Bank has done nothing. My riding of Whitby, and across Durham region, has come up with a memorandum of understanding with the Regional Municipality of Durham to finance over 100 electric buses across the region over the next seven to eight years. To me, that is not insignificant. It is a huge investment, a $68 million investment. There will be loans that will be repaid. The Canada Infrastructure Bank is doing a lot of really good work, so I will take issue with that first off.

On the price on pollution, in every jurisdiction in the world that has implemented a price on pollution, the evidence shows that it is by far the most effective market-based mechanism for fighting climate change. We disincentivize the wrong type of behaviour, the behaviour in our industries that pollute, and incentivize innovation and the uptake of technology that will help us get to net zero.

[Denis Trudel, Bloc, Longueuil—Saint-Hubert, QC]

Mr. Speaker, my colleague seems very pleased with his government's record on fighting climate change.

I do not know what world he is living in exactly, but it was pretty pathetic to see the Minister of Environment and Climate Change walk into COP27 with a retinue of oil company executives. It would have been entertaining, if not for his government's feeble track record.

Canada is the only G7 country to have increased its emissions since 2007, since the Liberals took office. It is the second-worst G20 country on average in terms of public investment in fossil fuels. I cannot believe the government is still patting itself on the back. I want to know what the plan is now.

We were talking about the carbon tax. At $50, the current price, it is not effective. It would have to be tripled immediately to achieve concrete results. What is the government's plan for dealing with the problems of climate change?

[Ryan Turnbull, Liberal, Whitby, ON]

Mr. Speaker, I take issue with the member opposite's assertion that somehow our government has a poor track record when it comes to fighting climate change. In fact, we inherited over a decade of inaction from the Stephen Harper era, which was a dark shadow on our country—

[Some hon. members]

Oh, oh!

[The Deputy Speaker, Chris d'Entremont]

Order, please. The hon. member for Whitby has the floor.

[Ryan Turnbull, Liberal, Whitby, ON]

Mr. Speaker, I take issue with the assertion from my hon. colleague that somehow our government's track record on fighting climate change is not superb.

[Some hon members]

Oh, oh!

[Ryan Turnbull, Liberal, Whitby, ON]

Mr. Speaker, I am glad this elicits the same response from my colleagues, because it shows just how little they know about climate change and how they do not really take it seriously, which we have seen time and time again. Even at their national convention, they voted to say that climate change was not real. Who, in their right mind, these days could deny climate change is real?

I will go back to my point, which is our government entrenched our climate commitments in the Canadian Net-Zero Emissions Accountability Act to hold our government and every future government accountable. We have the strongest emissions reduction plan. We have implemented all kinds of initiatives that are making changes right across our economy. Every industry is fighting climate change at the same time. It is a big task to transform our economy to net zero and move people's behaviours over to a sustainable lifestyle. It is going to take time, but I am very proud of our record.

[Anna Roberts, Conservative, King—Vaughan, ON]

Mr. Speaker, the Liberals' fall economic statement outlines an agenda on how to support Canadians struggling with the cost of living, where, theoretically, no one is left behind. Guess what. Canadian seniors were left behind.

In a document with almost 40,000 words, seniors were only mentioned 16 times. Statistics Canada indicates that the population of seniors is expanding six times faster than that of children ages zero to 14. The number of Canadians age 85 and older has increased by 100% since 2001, reaching 861,000 in 2021. The number could triple by 2046 according to the current population.

Accordingly to Bill VanGorder, chief policy officer of CARP, Canada's largest advocacy association for seniors, the needs of older Canadians are increasingly relevant and significant as the population ages. Based on the numbers from Statistics Canada I just shared, I whole heartedly agree.

Despite this urgent need for greater attention to seniors, the 2022 fall economic statement does not adequately address the current struggles of seniors. Nor does it implement any of the recommendations put forward by CARP.

The fall economic statement promises that the government will boost old age security by 10%. A 10% increase will amount to $69, which will do little to help the soaring expenses due to tax hikes, inflation, heating and housing costs. With the tripling of the tax on home heating, gas and groceries, how does this help many seniors living on a fixed income? The 10% increase will not cover the cost of heating their homes. In Canada, we love our seasons, but this could be deadly for seniors.

In Atlantic Canada, seniors are worried about having to heat their homes this winter. I would like to share a quote from the Liberal Minister of Labour. He said, “I am sick and tired of people talking about the cold winter.” The Liberal Minister of Labour has shown a lack of compassion for our seniors and this quote underscores his denial of the significant debt we owe our seniors. They raised us, provided for us, worked hard for us and now they cannot even enjoy the fruits of their labour.

Sharon Callahan, executive director of Newfoundland and Labrador Public Sector Pensioners' Association and chairperson of the seniors' coalition said recently that seniors were experiencing extreme difficulty with the cost of living. If the price of fuel keeps going up over the winter and continues onto next winter, how will they survive? Ms. Callahan is concerned that many seniors will be forced to make choices between food, medication and heat. Seniors will be forced out of their homes.

In Canada, natural gas is also a form of energy used to heat our homes. Over six million homeowners use natural gas to heat their homes and their water. Using the Ontario Energy Board calculator, for a single detached home, approximately $22.03 would be added to the monthly heating bill due to the federal carbon tax. This is something for which even saving $13.99 on a monthly Disney subscription does not account.

What about gas for their cars so they can buy groceries? Food bank usage is at an all-time high. Food banks reported 1.5 million visits to the food bank in just one month. That is a 35% increase. While food banks are increasing their supplies to accommodate, the Prime Minister spends $6,000 a night in a hotel room. That money could have helped the homeless. That money could have helped our seniors. That money could have gone a long way.

The ArriveCAN app cost Canadians $54 million. What did it accomplish? Nothing. The money could have helped support seniors and all vulnerable adults and children. There are numerous examples of the waste.

The cost of housing is another pressing issue affecting Canadians and seniors that is not properly addressed in the fall economic statement is Canada has the second-most inflated housing bubble in the world. Interest rates are increasing at the fastest rates in a decade. A family that bought a home five years ago will now see, after renewal, their mortgage payments going up $7,000 a year. Canada cannot afford this, and Canadians have had enough.

What about the homeless? The recent report from the Auditor General highlights that, even though five years have gone by since the federal government first launched the national housing strategy to reduce homelessness, no organization in the federal government is taking the lead. Even though about half of the $9 billion has been spent, it is unknown whether this has benefited anyone. Where is the accountability? What happened? Where is the money? Who did it help? We have no answers.

According to CMHC, in 2016, of the 3.4 million senior households, close to 480,000 were in need of affordable housing. The national housing co-investment fund aims to create 7,000 new homes by 2027-28. That is 1.5%. How is this going to solve our housing crisis?

A CBC report on October 8, 2022, told the story of Lynn from Toronto, who never imagined herself being homeless when she retired. About four years ago she found herself living out of her car. She started working at the age of 15 and no longer has a home. She had a condo and had to sell it. At first she tried living with her sister, but that did not help. She slept in her car. She finally got into a shelter. The struggles are still there.

According to Homes First, an organization that helps people get off the streets and into supportive housing, Lynn's story is becoming increasingly common, and Toronto's seniors are struggling. It said, “That's due to the city's aging population, rising inflation and an increasingly expensive housing market”.

The other thing I want to talk about is the Canada pension survivor benefit for seniors. In the fall economic statement, nothing was mentioned. Why are we punishing spouses who decided to stay home and raise their children while their spouse continued to work? These seniors came here from other countries, like my grandparents and those of many of us here in this room. Most of the time the responsibility of raising the children fell to the mothers. Once the spouse has passed, his pension is gone. The wife has to endure the fact and make some choices, either go back to work or lose her home.

There is a shortage of long-term care facilities right across this country. Due to the lack of staffing, we are going to hit a crisis. We are going to find ourselves with seniors having no choice but to live on the streets. Recently a senior wrote to me about her financial struggles while she was caring for her disabled son. She is working three jobs to support him. This fall economic statement would not help her at all.

We have a major issue in this country, and the Liberal government needs to respect our seniors and understand the cost of inflation. The tripling of the carbon tax will see more and more families struggle to survive. Is this the Canada we want to reside in? Many individuals immigrated to this country in search of opportunities for themselves and their families, but this inflation is out of control. The spending by the government has proven deadly for all of us.

Therefore, when we look at hard-working Canadians, our seniors and the vulnerable in our communities, what is the government going to do to help them? The fall economic statement shows no respect for the people who raised us and nurtured us, and who paid their taxes.

[Kody Blois, Liberal, Kings—Hants, NS]

Mr. Speaker, I took particular issue with the member opposite's remarks as they relate to Atlantic Canada and her mischaracterization of the Minister of Labour's comments

The Minister of Labour was very clear that he is sick and tired of hearing Conservative politicians misinform the public about carbon pricing as it relates to home heating in Atlantic Canada. There will be no carbon price on home heating in Atlantic Canada, and that member did not even acknowledge that today.

We have put money on the table to help homes transition, $250 million, including money for seniors in my riding and in parts of Newfoundland and Labrador. There was no recognition of that, but when we talk about seniors, will that member recognize that it was her party, under the last prime minister, who actually brought old age security back up to 67 and was going to try to take that away from seniors?

It was our government that brought that back, increased the guaranteed income supplement and brought 250,000 seniors out of poverty over the last term of our government. There was no recognition of that. The Conservatives have a terrible record on seniors, and it is despicable to hear the member opposite say that somehow Conservatives are the heroes for seniors in this country.

[Anna Roberts, Conservative, King—Vaughan, ON]

Mr. Speaker, what is despicable is the fact that the Liberals decided that being a senior starts at the age of 75. How would he explain to seniors between the ages of 65 and 74 why they are not getting the benefits—

[Kody Blois, Liberal, Kings—Hants, NS]

We did not take anything away like you did.