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

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 has also written a full legislative summary of the bill.

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 Parliament. You can also read the full text of the bill.

Bill numbers are reused for different bills each new session. Perhaps you were looking for one of these other C-32s:

C-32 (2021) An Act for the Substantive Equality of French and English and the Strengthening of the Official Languages Act

C-32 (2016) An Act related to the repeal of section 159 of the Criminal Code

C-32 (2014) Law Victims Bill of Rights Act

C-32 (2012) Law Civil Marriage of Non-residents Act

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

Debate Summary

This is a computer-generated summary of the speeches below. Usually it’s accurate, but every now and then it’ll contain inaccuracies or total fabrications.

Bill C-32 is legislation designed to implement measures from the recent fall economic statement and previous budget proposals. It includes a one-time tax on large financial institutions, a permanent increase to the corporate tax rate for banks and insurance companies, and the elimination of interest on federal student loans. The bill also contains provisions related to the housing market, such as a tax on home flipping, and aims to provide targeted relief to Canadians facing inflationary pressures through programs like the GST tax credit and rental support.

Liberal

Supporting Canadians: The Liberals emphasize their commitment to supporting Canadians during challenging times, contrasting their approach with the Conservative's 'trickle down' economics, which they believe involves unspecified cuts.
Addressing inflation: Liberals acknowledge the impact of inflation on Canadians but highlight that Canada's inflation rate is relatively controlled compared to other countries. The government has introduced measures like doubling the GST credit, providing rental support, and forgiving interest on federal student loans to provide relief.
Investing for the future: Liberals emphasize the importance of investing in a low-carbon economy, including supporting electric vehicle production and critical minerals exploration. They also want to streamline regulatory processes to expedite major projects.
Criticizing Conservatives: Liberals criticize the Conservative party for inconsistency on issues like the carbon tax and for voting against measures aimed at supporting Canadians, such as dental care benefits for children and rental support.

Conservative

Government overspending: Conservative members repeatedly criticized the government for overspending and increasing the national debt. They argued the government's fiscal policies are unsustainable and lead to increased taxes for Canadians. They also cited reports from the Auditor General and Parliamentary Budget Officer to support claims of government waste and mismanagement.
Carbon tax concerns: The carbon tax was a major point of contention, with members arguing it increases the cost of living for Canadians, especially in rural areas, and punishes small businesses and farmers. They highlighted the impact of the carbon tax on the price of gas, groceries, and home heating, and questioned its effectiveness as an environmental plan.
Lack of support for armed forces: Several members noted the economic statement's silence on support for the armed forces, highlighting the need to address recruitment and retention issues. They emphasized the need for updated living allowances and expressed concern that the military is operating below effective levels due to shortages.
Broken immigration system: One member stated that the Canadian immigration system is broken, resulting in application backlogs and causing problems for businesses needing temporary foreign workers. This has impacted sectors such as healthcare where doctors are waiting for work permits.

NDP

Supports targeted tax increases: The NDP supports the Canada recovery dividend, a one-time tax on large financial institutions, and the increase in the corporate tax rate for banks and life insurance companies. While they would like to see these measures expanded to other sectors, they view them as important steps towards tax fairness.
Housing measures insufficient: While the NDP supports measures aimed at helping first-time homebuyers, they believe the government's approach to housing is inadequate. They advocate for a return to significant government investment in social housing and regulatory changes to address the role of large corporate players in driving up housing prices.
Missed opportunities: The NDP notes the bill's shortcomings, particularly the lack of employment insurance reform and the attribution of CERB/CRB debt to the EI account. They also call for eliminating the GST on home heating and addressing the challenges faced by first responders.
Fights corporate greed: The NDP emphasizes that greed is a major factor and wants the government to take stronger action to ensure corporations pay their fair share and that wealth is distributed to Canadians.
Remove student loan interest: The NDP supports removing the federal portion of interest on student loans as a step to support young people. It would remove a burden and allow them to contribute more to their communities. More needs to be done to support youth.

Bloc

Bill is disappointing: The Bloc finds Bill C-32 disappointing, containing minor legislative amendments, lacking vision, and failing to address the economic reality of high living costs and a potential recession.
Missed opportunity: The Bloc Québécois believes the bill is a missed opportunity to provide additional support to vulnerable populations facing rising living costs and economic uncertainty. They argue the government has failed to take meaningful action to address these challenges.
Support for seniors: The Bloc criticizes the bill for not including support for seniors aged 65 to 74, who are particularly vulnerable to rising costs due to fixed incomes. They advocate for ending penalties for seniors who want to work without losing benefits.
EI reform needed: The Bloc calls for comprehensive employment insurance (EI) reform, including increasing the replacement rate and better reflecting the reality of seasonal workers. They express concern that the government is backtracking on its promise to modernize the EI system.
Health transfer increase: The Bloc demands an increase in federal health transfers to the provinces and Quebec, arguing that the current level is insufficient to meet the needs of the health care system. They want the federal government to increase its share of health-care funding.

Green

Supports eliminating student loan interest: The bill would permanently eliminate interest on Canada student loans. The member supports this measure, saying it would save students an average of $410 per year and is a step in the right direction given the financial challenges facing young people.
Supports the Canada recovery dividend: The bill would implement the Canada recovery dividend, a one-time 15% tax on profits above $1 billion for banks and life insurance companies. The member supports this measure, noting that the PBO estimates it would raise $3 billion, enough to pay for eliminating interest on student loans.
Opposes carbon capture and storage credit: The member opposes the tax credit for carbon capture and storage, calling it a false climate solution and a fossil fuel subsidy. He notes that studies have shown that carbon capture has often increased emissions.
Wants more climate action: The member argues that the government should take further action on climate change, including applying the Canada recovery dividend to the oil and gas sector and eliminating fossil fuel subsidies. He suggests investing in renovations and ground transportation.
Wants more investment in mental health: The member calls on the government to follow through on its promise to invest in mental health. He notes that the Liberal Party platform included a $4.5 billion commitment to mental health, but that this has not been realized in budgets or economic statements.