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.

Bill C-32—Time Allocation Motion

[Ted Falk, Conservative, Provencher, MB]

Madam Speaker, once again we are seeing the Liberals stifling debate. When they realize that they do not have a solid platform to stand on, what do they do? They remove the platform and shut things down.

If they really understood what this economic statement and budget would do, they would see that giving away more free money to people is going to further exacerbate inflation. Increasing taxes, especially payroll taxes and the carbon tax, is going to increase inflation, which is actually harming the very people they are claiming to help.

What is it about economics that the Liberals not understand?

[Randy Boissonnault, Liberal, Edmonton Centre, AB]

Madam Speaker, I understand the economics of making sure that supports are in place, such as CPP and EI, for people who need it the most when they want it the most. It is a particular Conservative trope to try to raid these important supports that Canadians build up over a lifetime.

Let us just be really clear that, when it comes to the supports in the fall economic statement, they have been very carefully calibrated not only to provide supports to Canadians who need it the most at a time when they need it the most, but also to not increase inflation and to put billions of dollars against the deficit.

Canada has the lowest deficit in the G7, the lowest debt-to-GDP ratio in the G7 and a AAA credit rating based on Moody's and the other agencies. The economic fundamentals of this country are strong and we need to get this bill to committee and to third reading so Canadians can get the supports.

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Madam Speaker, by my count, I think that the vast majority of last week was spent debating Bill C-32. Unfortunately, the House cannot debate two bills at any one time. As a consequence of last week, Bill C-20, the important oversight legislation for both the CBSA and the RCMP, has been bumped to tomorrow.

People have been waiting for years for an effective oversight mechanism for both of these agencies. The CBSA has never had this kind of oversight. There are other interests in play. I know that the Conservatives would like to keep on debating Bill C-32, but indigenous people in Canada, racialized people and so many people who have been at the wrong receiving end of both the RCMP and the CBSA have been waiting years for this important accountability and oversight legislation.

I hope that, after we get through Bill C-32 and it is sent to committee, I have a commitment from the government that Bill C-20 will get the priority it deserves.

We waited in the 42nd Parliament for Bill C-98 when that member was here. We waited in the last Parliament for Bill C-3 and we now, finally, have Bill C-20. I want to see a commitment that this bill will get the time it deserves.

[Randy Boissonnault, Liberal, Edmonton Centre, AB]

Madam Speaker, I respect my hon. colleague and his comments on making sure we use time efficiently in the House. I will take his comment under advisement and discuss it with the government House leader.

Today is about making sure we can get Bill C-32 to committee so we can get back here for third reading, and then we would be able to get housing supports to people, get student loan interest removed for apprentices and students, reduce taxes on small businesses and do all the other good things for growing the economy that are included in the fall economic statement.

[Jeremy Patzer, Conservative, Cypress Hills—Grasslands, SK]

Madam Speaker, the fall economic statement would have been a perfect time for the government to take its commitment to just transition communities seriously. There are many communities not only in my riding and other ridings in Saskatchewan, but also in his home province, that are on the path to being completely left behind in the government's reckless plan to eliminate the workforce from a lot of these communities as they go through this coal transition, which is being forced upon them by the government.

I want a straight answer from the member. Why has he turned his back on these communities and not allowing for the certainty these communities need and deserve by making sure there was proper wording and allocations in this economic statement for these communities, which is something the government promised to do and has failed to do?

[Randy Boissonnault, Liberal, Edmonton Centre, AB]

Madam Speaker, I will point the hon. colleague to my mandate letter, which talks about working with a number of colleagues in cabinet on the futures fund. Quite frankly, we are moving past this conversation of just transition to really talking about the evolution of energy, and more importantly, sustainable jobs.

We are working at the community level to make sure people have the training and supports they need to have the jobs they want and need in a whole range of industries. We are going to continue to do what we need to do to heat our homes, power our communities, power the world, reduce emissions and make sure good-paying jobs are in rural Saskatchewan, rural Alberta and across rural Canada.

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

It is my duty to interrupt the proceedings and put forthwith the question necessary to dispose of the motion now before the House.

The question is on the motion.

If a member of a recognized party present in the House wishes that the motion be carried or carried on division, or wishes to request a recorded division, I would invite them to rise and indicate it to the Chair.

[Jeremy Patzer, Conservative, Cypress Hills—Grasslands, SK]

Madam Speaker, I request a recorded division.

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

Call in the members.

(The House divided on the motion, which was agreed to on the following division:)

Vote #218

Fall Economic Statement Implementation Act, 2022

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

I declare the motion carried.

I wish to inform the House that because of the proceedings on the time allocation motion, Government Orders will be extended by 30 minutes.

The House resumed from November 18 consideration of the motion 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, and of the amendment.

Second Reading

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Madam Speaker, it is always a pleasure to speak in the House on behalf of the people of Calgary Midnapore.

It has been a month now that I have been in the role of shadow minister for the Treasury Board. I would like to once again thank the leader of the official opposition, the member for Carleton, for this role. It gives me an opportunity to work very closely with two of my favourite members of Parliament, the member for Leeds—Grenville—Thousand Islands and Rideau Lakes, the shadow minister for ethics, which we have been doing continuous work on ArriveCAN, and the member for Calgary Forest Lawn, who serves as our shadow minister for finance. It really is a pleasure to have this role.

I am sure members are aware of the crippling inflationary numbers in Canada, 6.9% in the most recent reports, down a slight bit from the 8.1% high we saw in June. Food, of course, is at a 40-year high.

I just came from the government operations committee, and the President of the Treasury Board was there on the supplementary estimates. I am sorry to report that the government has asked for another $21 billion, and I am not making that number up. We have a $36.4 billion deficit this year. That is because of $6.1 billion in new spending even though we are supposed to be moving past the pandemic now. One thing is clear about the Liberal government, and that is that it just does not get it.

As I said, inflation is at a 40-year high, and 1.5 million Canadians are using the food bank in a single month. In the GTA, pre-pandemic food bank usage was at 60,000 people per month. During the pandemic, it was at 120,000 people. Now, under the Liberal government, it is at 182,000 people per month.

Grocery prices are up 11%, the highest rate in 40 years. One in five Canadians are skipping meals and more than half of Canadians are living paycheque to paycheque. What is the Liberals' solution? It is to give up one's subscription to the Disney channel. As I have said, the Liberal government just does not get it.

Consumer insolvencies rose 22.5% compared with a year earlier. This is the largest percentage in 13 years. Small business insolvencies are on the rise. One in six businesses are considering closing their doors. This is very dear to me, since I come from a small business family.

The average credit card balance held by Canadians was at a record high of $2,121 at the end of September. The Royal Bank of Canada estimates that households will soon have to allocate 15% of their income to debt servicing alone. Nine in 10 Canadians are now tightening their household budgets, yet the Deputy Prime Minister is telling us not to worry, that Moody's gave us a AAA credit rating. Quite frankly, that will not put food on the table. The government just does not get it.

Mortgage interest rate costs rose by 11.4% on a year-over-year basis, the largest increase since February 1991. For those whose mortgages are up for renewal this year, they will pay $7,000 more compared to five years ago. Also, the average rent is now $2,000 a month. The average rent for a one bedroom in Toronto was $2,474 in September. In 2015, seven years ago, it was $1,100. In Vancouver, it is $2,300. In 2015, it was $1,079. Toronto has the worst housing bubble in the world and Vancouver is the sixth worst, according to UBS. However, the government is telling us not to worry, here is $500, when people need $2,474 for one month rent alone in Toronto. It just does not get it.

There has been a 32% increase in violent crime since 2015, which is 124,000 more violent crimes last year than in 2015. There were 778 homicides in Canada last year and 611 in 2015, a 29% increase. There has been a 92% increase in gang-related homicides since 2015 and a 61% increase in reported sexual assaults since 2015. Police-reported hate crimes have increased 72% over the last two years, yet the government pushes through Bill C-5, making it easier for offenders to stay home and play video games. The government just does not get it.

About 31,000 Canadians lost their lives to overdose between 2016 and 2022. There were 7,169 deaths from opioid overdose in Canada in 2021. Twenty-one people a day are dying from overdose, and before the pandemic it was 11. More than six million Canadians do not have access to a family doctor and, as brought to light by the member for Fort McMurray—Cold Lake, there has been a shortage of children's Tylenol and Advil. No other country anywhere in the globe is experiencing such shortages. However, people should not to worry, because if their child is sick, there is day care for $10 a day. The government just does not get it.

When it comes to immigration, there is a backlog of 2.6 million people. It has grown by 800,000 people under the current government. Fifty-seven per cent of the files in the system are beyond the processing timelines set by the government, and what is it doing? It is putting up incredible new targets that we know it will never achieve, which is not fair to the people who are applying or for the people who are backlogged in the system already. The government just does not get it.

Toronto's Pearson airport is ranked the most delayed airport in the world, with Montréal-Trudeau International Airport right behind it. We have seen how horrible it is to get a passport in recent days and how difficult it is for families who just want to get away on vacation after the difficult two years they have had. It has been impossible to get a passport. We know this, but what does the Minister of Transport say? He says it is Canadians' fault; they do not know how to travel anymore. The Liberal government just does not get it.

We have the second-slowest time for building permits of any country in the OECD. The average permit time is 250 days. In South Korea, it is 28 days, yet the government continues to shove money into the Canada Infrastructure Bank. It is millions of dollars after millions of dollars. The government just does not get it.

In 2015, there were 50 major LNG infrastructure projects under proposal, yet not a single one has been finished. It is the government that gave us Bill C-68, Bill C-49 and the carbon tax, bringing energy production to a halt in this nation at a time when we need it the most. The government just does not get it.

I will tell members what the Liberals do get. They know how to spend and they know how to tax. Under a Conservative government, there would be no new taxes. For every dollar of spending, we would find a dollar of savings. However, until that day, we are unfortunately stuck with the current government and the government just does not get it.

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Madam Speaker, I genuinely believe that the member and the opposition really and truly just do not get it. At the end of the day, this is about inflation. Canadians are hurting, and the Conservatives consistently vote against policies that are there to help Canadians.

That goes to my question for the member. There is the doubling of the goods and services tax credit for six months. We can talk about eliminating the interest on student loans. We can talk about dental services for children under the age of 12. We can talk about the rental subsidy of some $500. There are many measures there to help Canadians deal with inflation. That, in good part, is what the fall economic statement is about.

Can the member tell us specifically why the Conservative Party today is not supporting Canadians by allowing measures of this nature to pass quickly?

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Madam Speaker, we are supporting Canadians and want to support Canadians. We want to support them with measures that actually help them. If what the member was proposing was actually helpful to Canadians, why would we have a 40-year high in food inflation? Why would we have 6.9% inflation in this country? Why would we have 1.5 million Canadians using a food bank in a single month?

It is very clear why these things are happening: The proposals the government is bringing forward are not working. A Conservative government would change that.