Chrystia Freeland Liberal
This bill has received Royal Assent and is, or will soon become, law.
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 and the Income Tax Regulations by
(a) limiting the deductibility of net interest and financing expenses by certain corporations and trusts, consistent with certain Organisation for Economic Co-operation and Development and the Group of Twenty Base Erosion and Profit Shifting project recommendations;
(b) implementing hybrid mismatch rules consistent with the Organisation for Economic Co-operation and Development and the Group of Twenty Base Erosion and Profit Shifting project recommendations regarding cross-border tax avoidance structures that exploit differences in the income tax laws of two or more countries to produce “deduction/non-inclusion mismatches”;
(c) allowing expenditures incurred in the exploration and development of all lithium to qualify as Canadian exploration expenses and Canadian development expenses;
(d) ensuring that only genuine intergenerational business transfers are excluded from the anti-surplus stripping rule in section 84.1 of the Income Tax Act ;
(e) denying the dividend received deduction for dividends received by Canadian financial institutions on certain shares that are held as mark-to-market property;
(f) increasing the rate of the rural supplement for Climate Action Incentive payments (CAIP) from 10% to 20% for the 2023 and subsequent taxation years as well as referencing the 2016 census data for the purposes of the CAIP rural supplement eligibility for the 2023 and 2024 taxation years;
(g) providing a refundable investment tax credit to qualifying businesses for eligible carbon capture, utilization and storage equipment;
(h) providing a refundable investment tax credit to qualifying businesses for eligible clean technology equipment;
(i) introducing, under certain circumstances, labour requirements in relation to the new refundable investment tax credits for eligible carbon capture, utilization and storage equipment as well as eligible clean technology equipment;
(j) removing the requirement that credit unions derive no more than 10% of their revenue from sources other than certain specified sources;
(k) permitting a qualifying family member to acquire rights as successor of a holder of a Registered Disability Savings Plan following the death of that plan’s last remaining holder who was also a qualifying family member;
(l) implementing consequential changes of a technical nature to facilitate the operation of the existing rules for First Home Savings Accounts;
(m) introducing a tax of 2% on the net value of equity repurchases by certain Canadian corporations, trusts and partnerships whose equity is listed on a designated stock exchange;
(n) exempting certain fees from the refundable tax applicable to contributions under retirement compensation arrangements;
(o) introducing a technical amendment to the provision that authorizes the sharing of taxpayer information for the purposes of the Canadian Dental Care Plan;
(p) implementing a number of amendments to the general anti-avoidance rule (GAAR) as well as introducing a new penalty applicable to transactions subject to the GAAR and extending the normal reassessment period for the GAAR by three years in certain circumstances;
(q) facilitating the creation of employee ownership trusts;
(r) introducing specific anti-avoidance rules in relation to corporations referred to as substantive CCPCs; and
(s) extending the phase-out by three years, and expanding the eligible activities, in relation to the reduced tax rates for certain zero-emission technology manufacturers.
It also makes related and consequential amendments to the Excise Tax Act and the Excise Act, 2001 .
Part 2 enacts the Digital Services Tax Act and its regulations. That Act provides for the implementation of an annual tax of 3% on certain types of digital services revenue earned by businesses that meet certain revenue thresholds. It sets out rules for the purposes of establishing liability for the tax and also sets out applicable reporting and filing requirements. To promote compliance with its provisions, that Act includes modern administration and enforcement provisions generally aligned with those found in other taxation statutes. Finally, this Part also makes related and consequential amendments to other texts to ensure proper implementation of the tax and cohesive and efficient administration by the Canada Revenue Agency.
Part 3 implements certain Goods and Services Tax/Harmonized Sales Tax (GST/HST) measures by
(a) ensuring that an interest in a corporation that does not have its capital divided into shares is treated as a financial instrument for GST/HST purposes;
(b) ensuring that interest and dividend income from a closely related partnership is not included in the determination of whether a person is a de minimis financial institution for GST/HST purposes;
(c) ensuring that an election related to supplies made within a closely related group of persons that includes a financial institution may not be revoked on a retroactive basis without the permission of the Minister of National Revenue;
(d) making technical amendments to an election that allows electing members of a closely related group to treat certain supplies made between them as having been made for nil consideration;
(e) ensuring that certain supplies between the members of a closely related group are not inadvertently taxed under the imported taxable supply rules that apply to financial institutions;
(f) raising the income threshold for the requirement to file an information return by certain financial institutions;
(g) allowing up to seven years to assess the net tax adjustments owing by certain financial institutions in respect of the imported taxable supply rules;
(h) expanding the GST/HST exemption for services rendered to individuals by certain health care practitioners to include professional services rendered by psychotherapists and counselling therapists;
(i) providing relief in relation to the GST/HST treatment of payment card clearing services;
(j) allowing the joint venture election to be made in respect of the operation of a pipeline, rail terminal or truck terminal that is used for the transportation of oil, natural gas or related products;
(k) raising the input tax credit (ITC) documentation thresholds from $30 to $100 and from $150 to $500 and allowing billing agents to be treated as intermediaries for the purposes of the ITC information rules; and
(l) extending the 100% GST rebate in respect of new purpose-built rental housing to certain cooperative housing corporations.
It also implements an excise tax measure by creating a joint election mechanism to specify who is eligible to claim a rebate of excise tax for goods purchased by provinces for their own use.
Part 4 implements certain excise measures by
(a) allowing vaping product licensees to import packaged vaping products for stamping by the licensee and entry into the Canadian duty-paid market as of January 1, 2024;
(b) permitting all cannabis licensees to elect to remit excise duties on a quarterly rather than a monthly basis, starting from the quarter that began on April 1, 2023;
(c) amending the marking requirements for vaping products to ensure that the volume of the vaping substance is marked on the package;
(d) requiring that a person importing vaping products must be at least 18 years old; and
(e) introducing administrative penalties for certain infractions related to the vaping taxation framework.
Part 5 enacts and amends several Acts in order to implement various measures.
Subdivision A of Division 1 of Part 5 amends Subdivision A of Division 16 of Part 6 of the Budget Implementation Act, 2018, No. 1 to clarify the scope of certain non-financial activities in which federal financial institutions may engage and to remove certain discrepancies between the English and French versions of that Act.
Subdivision B of Division 1 of Part 5 amends the Trust and Loan Companies Act , the Bank Act and the Insurance Companies Act to, among other things, permit federal financial institutions governed by those Acts to hold certain meetings by virtual means without having to obtain a court order and to permit voting during those meetings by virtual means.
Division 2 of Part 5 amends the Canada Labour Code to, among other things, provide a leave of absence of three days in the event of a pregnancy loss and modify certain provisions related to bereavement leave.
Division 3 of Part 5 enacts the Canada Water Agency Act . That Act establishes the Canada Water Agency, whose role is to assist the Minister of the Environment in exercising or performing that Minister’s powers, duties and functions in relation to fresh water. The Division also makes consequential amendments to other Acts.
Division 4 of Part 5 amends the Tobacco and Vaping Products Act to, among other things,
(a) authorize the making of regulations respecting fees or charges to be paid by tobacco and vaping product manufacturers for the purpose of recovering the costs incurred by His Majesty in right of Canada in relation to the carrying out of the purpose of that Act;
(b) provide for related administration and enforcement measures; and
(c) require information relating to the fees or charges to be made available to the public.
Division 5 of Part 5 amends the Canadian Payments Act to, among other things, provide that additional persons are entitled to be members of the Canadian Payments Association and clarify the composition of that Association’s Stakeholder Advisory Council.
Division 6 of Part 5 amends the Competition Act to, among other things,
(a) modernize the merger review regime, including by modifying certain notification rules, clarifying that Act’s application to labour markets, allowing the Competition Tribunal to consider the effect of changes in market share and the likelihood of coordination between competitors following a merger, extending the limitation period for mergers that were not the subject of a notification to the Commissioner of Competition and placing a temporary restraint on the completion of certain mergers until the Tribunal has disposed of any application for an interim order;
(b) improve the effectiveness of the provisions that address anti-competitive conduct, including by allowing the Commissioner to review the effects of past agreements and arrangements, ensuring that an order related to a refusal to deal may address a refusal to supply a means of diagnosis or repair and ensuring that representations of a product’s benefits for protecting or restoring the environment must be supported by adequate and proper tests and that representations of a business or business activity for protecting or restoring the environment must be supported by adequate and proper substantiation;
(c) strengthen the enforcement framework, including by creating new remedial orders, such as administrative monetary penalties, with respect to those collaborations that harm competition, by creating a civilly enforceable procedure to address non-compliance with certain provisions of that Act and by broadening the classes of persons who may bring private cases before the Tribunal and providing for the availability of monetary payments as a remedy in those cases; and
(d) provide for new procedures, such as the certification of agreements or arrangements related to protecting the environment and a remedial process for reprisal actions.
The Division also amends the Competition Tribunal Act to prevent the Competition Tribunal from awarding costs against His Majesty in right of Canada, except in specified circumstances.
Finally, the Division makes a consequential amendment to one other Act.
Division 7 of Part 5 amends the Bankruptcy and Insolvency Act and the Companies’ Creditors Arrangement Act to exclude from their application prescribed public post-secondary educational institutions.
Subdivision A of Division 8 of Part 5 amends the Proceeds of Crime (Money Laundering) and Terrorist Financing Act to, among other things,
(a) provide that, if a person or entity referred to in section 5 of that Act has reasonable grounds to suspect possible sanctions evasion, the relevant information is reported to the Financial Transactions and Reports Analysis Centre of Canada;
(b) add reporting requirements for persons and entities providing certain services in respect of private automatic banking machines;
(c) require declarations respecting money laundering, the financing of terrorist activities and sanctions evasion to be made in relation to the importation and exportation of goods; and
(d) authorize the Financial Transactions and Reports Analysis Centre of Canada to disclose designated information to the Department of the Environment and the Department of Fisheries and Oceans, subject to certain conditions.
It also amends the Budget Implementation Act, 2023, No. 1 in relation to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and makes consequential amendments to other Acts and a regulation.
Subdivision B of Division 8 of Part 5 amends the Criminal Code to, among other things,
(a) in certain circumstances, provide that a court may infer the knowledge or belief or recklessness required in relation to the offence of laundering proceeds of crime and specify that it is not necessary for the prosecutor to prove that the accused knew, believed they knew or was reckless as to the specific nature of the designated offence;
(b) remove, in the context of the special warrants and restraint order in relation to proceeds of crime, the requirement for the Attorney General to give an undertaking, as well as permit a judge to attach conditions to a special warrant for search and seizure of property that is proceeds of crime; and
(c) modify certain provisions relating to the production order for financial data to include elements specific to accounts associated with digital assets.
It also makes consequential amendments to the Seized Property Management Act and the Forfeited Property Sharing Regulations .
Division 9 of Part 5 retroactively amends section 42 of the Federal-Provincial Fiscal Arrangements Act to specify the payments about which information must be published on a Government of Canada website, as well as the information that must be published.
Division 10 of Part 5 amends the Public Sector Pension Investment Board Act to increase the number of directors in the Public Sector Pension Investment Board, as well as to provide for consultation with the portion of the National Joint Council of the Public Service of Canada that represents employees when certain candidates are included on the list for proposed appointment as directors.
Division 11 of Part 5 enacts the Department of Housing, Infrastructure and Communities Act , which establishes the Department of Housing, Infrastructure and Communities, confers on the Minister of Infrastructure and Communities various responsibilities relating to public infrastructure and confers on the Minister of Housing various responsibilities relating to housing and the reduction and prevention of homelessness. The Division also makes consequential amendments to other Acts and repeals the Canada Strategic Infrastructure Fund Act .
Division 12 of Part 5 amends the Employment Insurance Act to, among other things, create a benefit of 15 weeks for claimants who are carrying out responsibilities related to
(a) the placement with the claimant of one or more children for the purpose of adoption; or
(b) the arrival of one or more new-born children of the claimant into the claimant’s care, in the case where the person who will be giving or gave birth to the child or children is not, or is not intended to be, a parent of the child or children.
The Division also amends the Canada Labour Code to create a leave of absence of up to 16 weeks for an employee to carry out such responsibilities.
All sorts of information on this bill is available at LEGISinfo, an excellent resource from the Library of Parliament. You can also read the full text of the bill.
The House resumed from May 10 consideration of Bill C-59, An Act to implement certain provisions of the fall economic statement tabled in Parliament on November 21, 2023 and certain provisions of the budget tabled in Parliament on March 28, 2023, as reported (with amendments) from the committee, and of Motion No. 1.
The Assistant Deputy Speaker (Mrs. Alexandra Mendès) Alexandra Mendes
The House will now proceed to the deferred recorded division on the motion at report stage of Bill C-59.
The question is on Motion No. 1.
(The House divided on Motion No. 1, which was negatived on the following division:)
The Assistant Deputy Speaker (Mrs. Alexandra Mendès) Alexandra Mendes
I declare the motion defeated.
The Assistant Deputy Speaker (Mrs. Alexandra Mendès) Alexandra Mendes
If a member participating in person wishes that the motion be carried or carried on division, or if a member of a recognized party participating in person wishes to request a recorded division, I would invite them to rise and indicate it to the Chair.
(The House divided on the motion, which was agreed to on the following division:)
The Assistant Deputy Speaker (Mrs. Alexandra Mendès) Alexandra Mendes
I declare the motion carried.
It is my duty, pursuant to Standing Order 38, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Sherwood Park—Fort Saskatchewan, Foreign Affairs; the hon. member for Stormont—Dundas—South Glengarry, Mental Health and Addictions; the hon. member for Battle River—Crowfoot, Carbon Pricing.
The Assistant Deputy Speaker (Mrs. Alexandra Mendès) Alexandra Mendes
Before we proceed, I wish to remind hon. members of the Speaker's ruling of Tuesday, January 30, regarding Bill C-59, an act to implement certain provisions of the fall economic statement tabled in Parliament on November 21, 2023, and certain provisions of the budget tabled in Parliament on March 28, 2023. At the time, the Chair indicated that, pursuant to Standing Order 69.1, the question on the motion for the second reading would be divided to provide for separate votes on measures that were related to each other.
Furthermore, on November 8, 2017, at page 15145 of the Debates, Speaker Regan explained how the Chair intended to implement Standing Order 69.1. He stated, “The vote at third reading will be conducted in a similar way to the vote at second reading, assuming all of the identified elements are still part of the bill by the time it reaches that stage.”
Therefore, pursuant to Standing Order 69.1 the question will be divided at the third reading stage as follows:
First, the measures in clauses 1 to 136, 138 to 143, 168 to 196, 209 to 216, and 278 to 317 appear in the 2023 budget. Since their purpose is to implement certain budget proposals, they would be grouped based on this unifying theme and voted on together.
Second, the measures that can be grouped under the theme of affordability, clauses 137, 144, and 231 to 272, will be subject to a different vote.
Clauses 197 to 208 and 342 to 365 will also be grouped for voting because they amend the Canada Labour Code.
Clauses 145 to 167, 217 and 218 will be subject to a separate vote because they relate to vaping products, cannabis and tobacco.
The remaining divisions of Bill C-59, consisting of clauses 219 to 230, 273 to 277, 318 and 319, 320 to 322 and 323 to 341, will each be voted on separately because they are not linked to any of the common themes mentioned earlier. In all, nine votes will be held.
I would like to remind members that when putting the question on groups of clauses for Bill C-59, I intend to follow a procedure similar to that outlined in Standing Order 76.1(8) for the putting of the question on amendments at report stage.
I thank hon. members for their attention.
Gary Anandasangaree Liberal Scarborough—Rouge Park, ON
moved that Bill C-59, An Act to implement certain provisions of the fall economic statement tabled in Parliament on November 21, 2023 and certain provisions of the budget tabled in Parliament on March 28, 2023, be read the third time and passed.
Mark Gerretsen Liberal Kingston and the Islands, ON
Madam Speaker, I rise today to speak to the very important piece of legislation before us. It is what we call the fall economic statement, which was, yes, introduced in the fall. Unfortunately, because of Conservative delay tactics and their continuing to put forward amendments and having multiple people speak to it, we still have not even gotten to the place where we can pass the fall economic statement. However, I will say that a lot has happened since then, particularly with respect to inflation.
Members may recall that this particular piece of legislation came in at a time when inflation was still working its way downward but had not yet gotten into the range that the Bank of Canada dictates in its policy, which is within a range of 2% to 3%. We were seeing higher inflation. When I think back to when we were having these discussions in the fall, one of the things I think about is what Conservatives were saying about our budgetary measures at the time. They were saying that they were inflationary budgets. The Conservatives were saying to stop spending money because when the government spends money it is just adding to inflation. They said it over and over.
All the experts came out and said that actually the particular programs that the government was running in order to support Canadians were providing money to some of the most vulnerable people, the people who would be utilizing the money for basic necessities, and this was not going to contribute to impacting inflation. However, that did not matter to Conservatives because it was not feeding their narrative, so they continued on, marching along and talking about the supports that we were making for Canadians as something that was going to affect inflation and continue to drive it up.
We see today that the year-over-year inflationary rate is at 2.7%. This is the lowest it has been in three years. It has been within the range of 2% to 3% despite the fact that I know Conservatives were rooting for inflation to continue to rise because that would fit their political narrative, and they do not worry about the impact it has on Canadians. The Conservatives always just want the government to fail in any possible way it can, just so they can get a little political gain out of it, even if it means it comes at the expense of Canadians. We have seen inflation now, for four straight months in a row, within the target that the Bank of Canada sets, which is between 2% and 3%.
Conservatives were wrong. They were wrong when they said that investing in Canadians contributed to inflation, and they were wrong in predicting an outcome where those investments would actually drive inflation up. We knew that was going to be the case, because all the experts were saying it at the time, but what the Conservatives were doing is something that the member for Fredericton was talking about earlier. The Conservatives intentionally used and continue to use against Canadians the anxieties that Canadians feel. The Conservatives use those anxieties and turn them into a weapon against the very people that they are impacting, and they are doing it just for political gain. That is the only reason. It is the exact same reason that Conservatives say over and over that inflation is caused by the Prime Minister and the current government.
An hon. member
Yes, you got it.
Mark Gerretsen Liberal Kingston and the Islands, ON
Madam Speaker, in reality, we know that inflation is something that is going on throughout the entire globe.
I know that the member for Saskatoon—University just ran back in here and sat down so he could heckle me. I challenge him to ask me a question, to actually think about a question that he can ask me when it comes time to do so, because I am looking forward to hearing what he has to say about what I am saying right now. I will, of course, respond to that question. What we heard is not only Conservatives being wrong—
The Assistant Deputy Speaker (Mrs. Alexandra Mendès) Alexandra Mendes
The member for Edmonton—Wetaskiwin is rising on a point of order.
