Bill C-32

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.

Fall Economic Statement Implementation Act, 2022

[The Assistant Deputy Speaker, Carol Hughes]

The hon. member's time is up, but I am sure he will be able to add during questions and comments.

Questions and comments, the hon. Parliamentary Secretary to the Minister of Canadian Heritage.

[Chris Bittle, Liberal, Parliamentary Secretary to the Minister of Canadian Heritage]

Madam Speaker, I was listening to the hon. member's speech and he spoke about speaking to his constituents. I know when he was speaking to his constituents he did not talk about the rebate on the price of pollution and I am guessing he did not mention to his constituents that he ran on a carbon tax. When he was speaking to his constituents about affordability, did he mention the CCB and the fact that his party voted against it? Did he mention to his seniors about voting against rental and dental supports? Did he mention voting against the OAS and GIC increases, or is that just inflationary spending that people should not receive?

[Dan Muys, Conservative, Flamborough—Glanbrook, ON]

Madam Speaker, absolutely, we are opposed to inflationary spending, because what that is doing is increasing the interest rates. We are going to see that again tomorrow. People in my community who have housing prices now approaching $1.2 million on average are going to pay for that in interest rates. We know that the average homeowners in Canada are going to see, when it is time to renew their five-year mortgage, a $7,000 increase in mortgage payments. In my community, we are above the average, so people are going to see about $1,000 a month more in expense.

I think Canadians would rather pay less on their mortgage and less on interest than for the inflationary spending and policies of the government.

[Mike Morrice, Green, Kitchener Centre, ON]

Madam Speaker, the member for Flamborough—Glanbrook spoke about making energy more affordable. On this point it is important that we talk about the extent to which oil and gas companies across the country are gouging folks at the pump, including in his riding. In the last year alone, the wholesale margins, in other words, the profits, are up 18¢ a litre.

Is the member concerned about this gouging that is happening? Would he not agree that more needs to be done to recover these funds and use them to invest in making life more affordable for people across the country?

[Dan Muys, Conservative, Flamborough—Glanbrook, ON]

Madam Speaker, I respectfully disagree. Energy companies in Canada create thousands of jobs and pay millions of dollars in taxes. All of that contributes to the Canadian economy. It contributes to what we are able to pay for health care, education and the services that we value in this country. In fact, we have one of the most abundant supplies of energy in the world. It is clean. It is environmentally sourced. We are consulting with indigenous communities on extracting it. If we were to get more of our natural gas to the B.C. coast to liquefy it and get it to China, it would help that country get off coal, as it is planning to build a thousand coal plants over the course of the next years.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

Madam Speaker, it is estimated that the interest alone on the debt will be greater than the combined health transfers to the provinces. How will this burgeoning, continually snowballing debt impact Canada's ability to care for our citizens?

[Dan Muys, Conservative, Flamborough—Glanbrook, ON]

Madam Speaker, the hon. member for Renfrew—Nipissing—Pembroke has asked this very good question many times throughout her long tenure as a member of Parliament.

It is a very important one because when we are spending $27 billion and more, growing to $30 billion, $40 billion over the course of a number of years, on interest on the debt, we are not spending that money on health care, education and the things that matter.

My mom is a retired nurse. She worked in the health care system in Hamilton, Ontario, and saw that first-hand. My dad just went through chemotherapy. I know all Canadians who have gone through health issues understand this. We value our health care system, so rather than spending $27 billion on interest, let us spend more on health care. Absolutely, that makes a lot of sense.

[Caroline Desbiens, Bloc, Beauport—Côte-de-Beaupré—Île d’Orléans—Charlevoix, QC]

Madam Speaker, we will not oppose Bill C‑32, which implements the government's economic statement. Seasons may change, but this government's economic statements remain the same. We are not very excited, because this one is virtually the same as the spring economic statement, which contained nothing in the way of a constructive or reassuring vision for the people of Quebec and Canada.

The Bloc Québécois decries the economic update, which mentions inflation 108 times but does not offer a dime in extra support for recognized initiatives, such as transportation electrification, or for seniors, the unemployed, or families trying to put a roof over their heads. The cornerstone of this government's everything-old-is-new-again approach to solving problems is interference. When it comes to interfering in areas under Quebec's and the provinces' jurisdiction, none can equal this government.

Let us think about that for a minute. Retirees who contributed their entire working lives to the economic and social development of their communities, who humbly and honestly paid their taxes, as my colleague from Drummond was saying earlier, and who suddenly are 65, or 70 or 74, are being completely ignored by the government. However, the contributions they made while working were used to run the public service, including the seats in this place. Now, we thank them by telling them to go back to work, to do something else, to find a way to earn some income, to go to food banks, because there is no money for them.

All of a sudden, at 75 years of age, they receive a cheque. It is extraordinary. Sometimes magic happens, but we do not know why. We do not know what justifies it and the reason behind it.

In fact, I think that the government does not know its citizens. In any case, it does not know the citizens of Quebec. Does it have any idea what their reality looks like? That is the question. Does the government know Mr. Lucien, who no longer has affordable housing, who has to use the food bank and make tough choices to be able to afford his medication? Does the government know Ms. Mariette, who has to pay for essential home care services to be able to continue living at home because that is what she wants more than anything? She has to turn the heat off at night and eat only one meal a day so that she can continue to live at home. Does the government know Ms. Agathe and Mr. Georges, who did not make much money when they were working? Even so, they worked for 45 years and were honest about paying their taxes. Ms. Agathe is in a wheelchair because she worked as a waitress all her life and no longer has any circulation in her legs. She lives on the outskirts of the city and so she has to take public transportation to get health care. Her husband, who is a little younger than her, retired unexpectedly early because he saw that his wife was unable to get around. Today, they live at home. They have not had any additional income for more than 15 years. They are aged 72 and 65 respectively.

With inflation taking a heavy toll on seniors' meagre incomes, old age security offers little in the way of actual security because fixed costs, rising food prices and gas taxes are not going away.

What really worries me is that seniors have been getting poorer for a very long time. The government has not taken them into account when making decisions for a very long time. I think society agrees on that. We can blame a lot on the pandemic, but the health care issues we are dealing with now have everything to do with the fact that the pandemic amplified indifference, complacency and callousness on the part of both governments—for these decisions were not made by just one government—toward the people who built the Canada and Quebec we know today. By the time people reach old age, they have built their lives and contributed in the hope of benefiting from a decent social safety net. What we are seeing now is people who, if they had more money, would manage to live at home instead of crowding long-term care facilities and hospitals.

There is a whole network of interconnected issues that are the result of the government not paying attention to the seniors who built this society. I find that particularly painful, because I know many of them in my riding. They are upright, reliable and honest people who have really given everything in the hope of receiving a little something. Now the government is telling them that it is not going to happen.

It seems that there is no accountability at the federal level these days. No one is accountable for anything. Things go wrong, but it is nobody's fault. Neither the Conservatives nor the Liberals are accountable for their past actions. To hear them tell it, each party has done much better than the other and nothing is their fault. It must be that thing called fate, or the evil pandemic, or the global inflationary crisis.

Then there are the excessive oil investments and environmental failures—both of which make people sicker and sicker—but they are nobody's fault. Elderly people and the unemployed find themselves on the street, but it is nobody's fault. Small and medium-sized businesses are closing down because there are no accommodating tax provisions for them, while foreign and oil mega-corporations conveniently squirrel their profits away in tax havens, but that is nobody's fault.

On top of that, people need to be asked more and more to have confidence in politics, so we go on plastering faces on placards during every election campaign, when we have the nerve to tell people we will be forming government and doing great things for them. Yes, the government will do things like interfere and impose its position and its assessment of the reality facing seniors, as if there could suddenly and magically be two categories of seniors. It will also interfere by determining how much money will be paid into the health care system and, more importantly, how the provinces will spend it, when the federal government has no idea what choices the provinces must make in managing health care.

Let me give an example. In Quebec, we want to encourage seniors to remain in their homes. If the government offers money on the condition that we invest only in hospitals and long-term care facilities, is that a good condition for Quebec? The answer is no. That is one reason why we do not want conditions. We want the money that, in principle, is owed to us.

The government likes to interfere in provincial jurisdictions, and so it is interfering in the protection of the French language with a bill that I would describe as odious and that will paralyze all of Quebec's efforts to impose the use of French in federally regulated businesses and to teach French to new Quebeckers. The government is also interfering in the housing sector and property taxes. It watches everything and tries to make its way into every sector.

It is also perpetuating the status quo on employment insurance. We have been waiting for EI reform for years. There are new realities in the labour market such as seasonal work and self-employed workers. With respect to employment, there are support measures for people who suffer from serious illnesses, illnesses that are becoming more prevalent than they were 15 or 20 years ago. I am also thinking of Émilie Sansfaçon, who left behind two children. She came to this place, despite being under treatment and not feeling well, to raise awareness and ask the government to change its position and support seriously ill people looking to heal with dignity.

I will conclude my speech by saying that the independence movement did not come out of nowhere. It is not a delusion. It is not a bubble in the brain of someone who appeared just like that. The independence movement is a movement that advocates free management of its own public funds, a movement that wants to take its own direction.

I think that the Government of Canada is a Titanic right now. It has not noticed, but the hull has been breached. I hope it will realize this fact before meeting the iceberg of opulence, because opulence is fatal in the eyes of our constituents.

In Quebec, our hull is solid and our engines are remarkable. We are successful. Resources are invaluable and almost unlimited. We have unique economic development levers—

[The Assistant Deputy Speaker (Mrs. Alexandra Mendès), Alexandra Mendes]

I must interrupt the member because she has far exceeded her speaking time.

The hon. member for Saint John—Rothesay.

[Wayne Long, Liberal, Saint John—Rothesay, NB]

Madam Speaker, as a government, we often hear about everything we are doing wrong. It seems to be one thing after another. Certainly, the official opposition is quick to remind us that we cannot manage the economy, yet it ran nine straight deficits. The economy was in a mess when we took over.

In the fall economic statement, we came forth with a lot of good programs. To be sure, we hear from the party opposite about eliminating the tax on home heating, which would be about $40 or $50 per tank, but what about the doubling of the GST credit? What about the elimination of interest on student loans? What about the rent support? What about all of the programs we have offered that will help Canadians through the situation we are in now?

Can the member opposite tell us which of those programs she would cut?

[Caroline Desbiens, Bloc, Beauport—Côte-de-Beaupré—Île d’Orléans—Charlevoix, QC]

Madam Speaker, there are a number of programs that we helped the current government develop. We are satisfied with some of those programs, but what bothers me and what I would tell my colleague is that there are not enough programs.

The government needs to improve its overall economic management to be able to offer more services to the public through new programs, those that we have long been calling for.

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

Madam Speaker, this afternoon, during oral question period, we heard the member for Gaspésie—Les Îles-de-la-Madeleine make preposterous comments that cast aspersions on the Auditor General.

The Auditor General's report was tabled today and, in it, we learned that the government overspent approximately $23 billion, if I am not mistaken.

In keeping with the really great speech my colleague gave, I would like her to draw a parallel between the money wasted and the economic statement, which contains nothing new and no additional measures.

[Caroline Desbiens, Bloc, Beauport—Côte-de-Beaupré—Île d’Orléans—Charlevoix, QC]

Madam Speaker, I thank my wonderful colleague for his question, which allows me to elaborate on my comments.

The $23 billion that the Auditor General mentioned is likely money that could be allocated to the various programs we were talking about earlier.

What worries me even more is that, at the moment, the government is checking whether CERB was paid out to the right people. People are being asked to pay the government back, then the government realizes that it was correct after all and gives the money back to them. Meanwhile, the Titanic is headed for the iceberg.

During the pandemic, we suggested that the government should be careful about handing out the CERB. It has access to the annual income of anyone who pays taxes, so it could have easily directed supports to where they were needed most, and we would not have the problems we are facing today. We would be much further ahead.

[Jenica Atwin, Liberal, Fredericton, NB]

Madam Speaker, the member mentioned in her speech that not a lot is different from the spring economic statement. I would highlight that we experienced hurricane Fiona on the east coast, and spending was dedicated to that for rebuilding Atlantic Canada and eastern Quebec.

I wonder if the member could comment on how important it is to help rebuild resilient communities moving forward in the future.

[Caroline Desbiens, Bloc, Beauport—Côte-de-Beaupré—Île d’Orléans—Charlevoix, QC]

Madam Speaker, of course there should be a climate change resiliency piece and a fund. We are no longer talking about what is going to happen 15 years from now. It is happening now. It is important to acknowledge that because water levels are rising, and fast. The government absolutely has to make this situation a priority.

What we want to see is that $23 billion, which people are searching high and low for, being available the minute the storm hits. That would mean money to support small boat harbours, fishers and anyone affected. We absolutely need a fund to help communities face clear and present climate change.