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

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

Madam Speaker, I have respect for the member opposite as well, but I can understand why Canadians would be confused about what Conservatives stand for.

I just listened to the member opposite talk about the housing benefit not having a wide enough scope, immediately after he said the government was spending too much money. He talked about carbon pricing, yet he ran on a platform just over 12 months ago to do exactly that, to put a price on carbon. He also ran on a platform that would propose to outspend what we were planning to spend as a government.

What would the member have to say to his constituents? He comes in the House and talks about carbon pricing being bad, yet he ran on it just months ago. He talks about the government spending too much money, yet he stands in the House and says the government is not providing enough support. Where is the principle in what he is saying here today? What does he actually stand for?

[John Barlow, Conservative, Foothills, AB]

Madam Speaker, that seems to be the answer for every Liberal problem that they create themselves. They just want to throw more money at it to solve the problem. They have not solved any problems. In fact, despite record levels of spending, the problems have gotten worse. The Liberals have broken Canada. This is a government, as any Canadian can tell you, that cannot offer the most basic services, despite adding tens of thousands of public sector workers and despite adding $200 billion of additional debt. What has it accomplished?

Canadians cannot get a passport. Our airports are not functioning. We have a 2.4-million backlog in immigration applications. That is what this additional money has accomplished. Nothing.

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

Madam Speaker, I thank my colleague for his speech. In the government's fall economic statement, the word “inflation” appears 108 times.

However, when we look at the measures announced in the economic statement, we see that it is essentially implementing the measures that were in the last budget. Apart from rhetoric, the government is not contributing to the response to current inflation and the risk of recession.

We at the Bloc Québécois had asked the government to refocus on its core missions to better support the most vulnerable, namely by increasing old age security from age 65 on, increasing health care funding and reforming EI.

This government seems to identify the current economic crises, but does not appear to propose any new measures. What does my colleague think of that?

[John Barlow, Conservative, Foothills, AB]

Madam Speaker, I would agree. I do not believe the fall economic statement added any new measures to try to curb inflation and end higher interest rates. In fact, I think the fall economic statement is doing everything it possibly can to accelerate inflation and raise interest rates by continuing inflationary spending, by continuing to go further and further in debt, and by tripling the carbon tax.

It is unfortunate that the Liberal government did not listen to the opposition parties, which put forward very concrete and realistic potential solutions to try to curb inflation with no new taxes and no new spending. As I said, the solution for any Canadian business or any Canadian family, when faced with a financial crisis, would not be to rack up the credit card. Their solution would be to get their budget in order.

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

Madam Speaker, as the member would know, health care in Alberta is at a crisis level. Children are going without it. Some hospitals, particularly in Calgary, have wait times of almost 20 hours for children. These are real people. I know the member cares deeply about our province and about the people in it.

It has been the position of New Democrats for a long time that when health care, something so critical to Canada, is at risk, we must defend it and we must protect it. Publicly administered, publicly accessible health care was the promise that began in Alberta and went into Saskatchewan and is now across Canada.

Will the member defend publicly accessible health care that is publicly administered, which the founders of our province were able to secure?

[John Barlow, Conservative, Foothills, AB]

Madam Speaker, my colleague is right. I do care about my constituents, and all Albertans, passionately.

It is frustrating to see what is happening, not only in Alberta but across the country, in terms of the condition of our health care system.

Over the last few weeks, we saw the inability to purchase children's Tylenol, acetaminophen products, for example, and how it took the Liberal government weeks to try to address that. I am proud of the fact that then prime minister Stephen Harper increased health care spending and made it accountable every single year, by making sure that—

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

Resuming debate, the hon. member for Halifax West.

[Lena Metlege Diab, Liberal, Halifax West, NS]

Madam Speaker, it is always an honour to rise on behalf of my constituents in Halifax West.

Today, I do so to speak to the fall economic statement, the so-called mini-budget, which updates Canadians on the state of our economy and announces new measures to drive growth and make life more affordable.

I think it is important that my constituents and Canadians hear some of the key points, and I want to talk a bit more about some of the measures set out in the statement that I think are particularly welcome.

Let me start with the broader economic context.

After one of the most significant economic disruptions of our lifetime, we have come roaring back. We have experienced stronger economic growth in 2022 than the rest of the G7 countries. In October, our unemployment rate was 5.2%, close to the record lows we observed earlier this year.

There are 400,000 more Canadians working today than before the pandemic.

We are now forecasting a deficit of $36 billion this year, down 30% from what was projected in budget 2022. Among the provinces, Nova Scotia has has had the third-highest change in employment relative to prepandemic levels.

However, high global inflation and rising interest rates are making life more expensive. We only need to look at the prices at the grocery stores or when filling our cars with gas. Believe me, I have done both, so I know.

Our challenge now is to provide relief to Canadians without adding fuel to the inflationary fire. That is why our government is taking prudent, targeted action to grow the economy, support those who need it most and ensure that Canada has room to respond to a potential global economic slowdown. If the forecasts are to be believed, we need to protect our fiscal capacity.

That is the path we are taking.

In this year's fall economic statement, the following measures spoke to me.

We are launching the Canada growth fund to make key strategic investments in our economy that will attract substantial private sector investment and accelerate our net-zero transition and the adoption of clean technologies.

We are automatically issuing advance payments of the enhanced Canada workers benefit, which puts up to $1,200 back into the pockets of Canada's lowest-paid workers each year.

We are providing up to $1 billion through the disaster financial assistance arrangements to support the recovery from hurricane Fiona in my region.

We are making it easier to enter the housing market by creating the new tax-free first home savings account, doubling the first-time homebuyers' tax credit, introducing a new multi-generational home renovation tax credit and fully taxing the profits from flipping properties that are held less than 12 months, with some exceptions.

We are creating a competitive clean technology tax credit to empower our companies to compete internationally, create jobs and reduce their emissions.

We are putting $250 million toward the training and upskilling of Canadian workers to equip them for sustainable, good-paying jobs in the lower-carbon economy we are building.

These important measures are on top of the affordability plan we have already introduced, the GST credit payment we just delivered to some 33,000 recipients in Halifax West and the dental and rental benefits that are working their way through the Senate.

I want to zero in on a few issues I have heard about most in my riding.

The first is our move to permanently eliminate interest on Canada student loans and Canada apprenticeship loans, including on those that are currently being repaid. This is significant support for our students and will put money back into their pockets. Through the repayment assistance plan, borrowers can now pause their repayments until they make at least $40,000 a year.

It was so encouraging for me to hear the response from my community when this measure was unveiled. In fact, after the fall economic statement came out, I went back to my riding and attended the installation ceremony of Dr. Joël Dickinson as president and vice-chancellor of Mount Saint Vincent University. She was so excited by the change and what it will mean for students that she mentioned it in her speech. She also talked about her personal experience as a student.

Just the other day, my assistant pulled me aside to share a message he received from a friend whose partner was thrilled to hear about the measure. I will quote him: “He literally did a happy dance...and once I qualify for loans again it might make it less scary for me to consider going back to school.”

This is what it looks like to have the backs of Canadians as they pursue the education they need to succeed.

The fall economic statement delivers for our small businesses, which is another top priority of mine. It outlines our approach to lower credit card transaction fees for our small businesses without adversely affecting other businesses or consumers.

In conversations with community members after the statement came out, I heard about how our minister's “fix this or we'll fix it for you” message was resonating with small business owners. That was echoed loud and clear when I stopped by at the Atlantic Convenience Expo and the Convenience Industry Council of Canada's retail awards last week. Halifax West has so many incredible small businesses and iconic convenience stores. One example is Fairview's Super Mike's, and I know that this change will benefit it and many more.

What is also included is significant support for youth employment. I spent a lot of time this summer, as I am sure most members did, connecting with employers and employees benefiting from the Canada summer jobs program in Halifax West. The response was incredible. There were jobs for coaches, yard clerks, lifeguards and camp counsellors. Over 450 jobs were created by the program in my riding alone this year, boosting local businesses and non-profits and providing youth with valuable work experience. Suffice to say, I was thrilled to see the fall economic statement include over $800 million to support youth employment through job placements, wraparound support and, of course, the Canada summer jobs program.

I am seeing first-hand the benefit of a whole lot more in my community. The fee reductions for parents that our child care agreement is delivering is another great example. I was out door knocking last week in my riding, and a woman on Forestside Crescent stopped me. She has twins who are 17 months old, and she told me that the 25% cut in fees that we delivered has made a world of difference to her.

For families like hers, fees are scheduled to be reduced further, and I look forward to the commitment on child care for all families. That is vital, because we have a significant labour shortage across sectors and we have to address it. I have heard that loud and clear from builders, from the Canadian Construction Association and from many corners.

Canadians understand that immigration must be part of the solution.

We need more skilled immigrants, more construction workers and more health care providers, among many others. Fortunately, we have a new immigration levels plan that sets us on the path to do just that so we can welcome those who can help us get more homes built, reinforce our struggling health care workforce and drive our economic growth. We need to hit our bold target of 500,000 new permanent residents by 2025, and we need to ensure that those people can settle in regions where housing is available, can have their foreign credentials recognized and can work productively in their fields.

The labour shortage is also why we recently announced the lifting of the 20-hour-per-week cap on hours that our international students can work off campus while studying in Canada. This helps students ease the financial strain of paying for school, supports our businesses and leaves them with more valuable Canadian work experience.

That is why I was thrilled yesterday when I heard that 16 new occupations are eligible for PR through express entry. I know there is a lot more to be done on processing the backlogs, and I am very pleased to have heard the announcements on that as well.

I can also tell members how excited I am to have seen first-hand the benefit of the $500-million cities stream of our extended rapid housing initiative. Halifax was one of the cities announced for that. One good example there is the Adsum for Women and Children's sunflower project in Lakeside, which is also funded by that money, and the 28-bed crisis shelter for indigenous women that we are supporting in Hammonds Plains through the shelter enhancement program.

I believe we have hit the right balance between positioning ourselves for economic and demographic growth and providing targeted relief for the Canadians who need it.

[Mike Lake, Conservative, Edmonton—Wetaskiwin, AB]

Madam Speaker, like so many Liberals, the hon. member was very excited to list off all the spending that the government is doing.

I want to ask a question about the Trudeau legacy. There is a lot of economic disaster in the Trudeau legacy, which gets confusing at times, but back in the 1970s and 1980s—

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Madam Speaker, I have a point of order.

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

I think the hon. member is referring to the former prime minister.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Madam Speaker, just so it is clear, I caught the gist of where the member might be going, but that does not necessarily guarantee that he would have gone in that direction. He would have been far better off making his reference earlier, prior to making the statement.

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

Yes, the hon. member for Edmonton—Wetaskiwin should do so to ensure that he does not break the rules.

[Mike Lake, Conservative, Edmonton—Wetaskiwin, AB]

Madam Speaker, I understand the Liberals' confusion when I mention “economic disaster”. They have a hard time understanding which Liberal government we are talking about, but—

[Mark Gerretsen, Liberal, Kingston and the Islands, ON]

Madam Speaker, on a point of order, the member is trying to do something indirectly that he cannot do directly. He is trying to talk about a former Trudeau government and suggest that it is equal to this one—