Bill C-59

Fall Economic Statement Implementation Act, 2023

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

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.

Report Stage

[Don Davies, NDP, Vancouver Kingsway, BC]

Madam Speaker, the member should know about free things from government, because he gets free dental care, and so do his children. I do not see him giving that back. I have not heard of a Conservative giving back their free dental care yet.

By the way, dental care, of course, is not free; it is paid for, but we believe on this side of the House that, collectively, by pooling our resources, we can make sure that every person can get access to primary health care. It is the foundation of our Canadian health care system, so I think that is a wise expenditure of money.

More to the point, I have already gone through a couple of examples where Bill C-59 would return money to taxpayers. It would take 5% of the GST off new homebuilding, which is returning money to our home builders. It would take 5% off the GST for counselling services, returning money so that people can maybe afford to get the mental health support they need.

What I would ask my hon. colleague is this: Why does he not support the bill, which would return money to important parts of our economy, instead of holding us up and costing taxpayers $450,000 tonight to have this absolutely avoidable and nonsensical debate?

[Don Davies, NDP, Vancouver Kingsway, BC]

Madam Speaker, for anybody who may be watching tonight, I think a brief explanation of what their tax dollars are going to is in order.

Tonight, beginning at about 6:30 p.m., due to the Conservatives' motion, we are spending five and a half hours of debate, an entire evening sitting in the Canadians' House of Commons, to debate a Conservative motion on Bill C-59, which is a bill to enact provisions that were announced in the fall economic statement in 2023.

In this long bill with hundreds of provisions in it, the Conservatives' motion and contribution to Canadian democracy is to strip the short title of the bill. I think we have already heard that this has necessitated a late sitting of the House, which is probably going to cost hundreds of thousands of dollars and hold up all sorts of legislation that is of prime importance to Canadians.

Now, one thing that I think we all agree on is that Canadians across this country, millions of them, are in fact enduring pain, hardship, worry, insecurity and need. Bill C-59, while not perfect and certainly with a fair number of problems and omissions, does contain a number of important measures that would address those needs in a myriad of ways.

While the New Democrats are working constructively as an opposition party to move that legislation forward so that Canadians can get the relief they need, the Conservatives are holding it up. When the Conservatives claim to care about the needs of Canadians who are struggling with economic uncertainty, they are going to have to explain to Canadians why they are holding up the very measures that are contained in the legislation before the House that would help ameliorate those needs.

I also want to say a few things about the business community in this country. On the finance committee, along with my colleagues, I sat through testimony for 20 hours, hearing Canadian stakeholders comment on the provisions of this bill. When they did so, there were two very clear statements that were made to us repeatedly by Canadian businesses. Number one, they wanted this bill passed quickly. Number two, they wanted certainty.

As I will talk about in a moment, this bill contains a number of measures that would provide important tax incentives and tax credits to stimulate business activity, and businesses across this country are waiting for this. They are actually holding their investments. They are holding up creating jobs. They are holding up purchasing machinery and equipment, as well as research in technology, until this bill passes.

What is the Conservatives' reaction to this? They hold the bill up. If that is the Conservatives' concept of common sense, I do not think I share the same definition.

I want to talk about some of the important things in this bill. One of the things in this bill is a measure to implement the NDP's dental care plan. It would introduce an amendment to the provision that authorizes the sharing of taxpayer information for the purposes of administering the Canadian dental care plan.

We all know that, as of May 1, about a week ago, the first one million seniors who successfully applied to the CDCP started to access the dental care they need. Over two million seniors have already applied, with children under 18 and people living with disabilities, with a disability tax certificate, able to apply in a little over three weeks.

I want to stop for a moment, because I heard the Conservatives talk about Canadians who are suffering. Let us think of a senior right now who is at home suffering with dental pain, someone who does not have dentures that fit properly or maybe does not have dentures at all. They are unable to eat an apple. They have pain in their mouth. They have a choice to make: they continue living in pain, or they scramble together some form of money and try to go to a dentist, and pay out of pocket.

The Conservatives say they care about people who are suffering economically, yet they are holding up legislation that would help get the CDCP in place so seniors can go to the dentist and have their needs paid for. Imagine a single mother with a couple of kids at home, and a five-year-old or a seven-year-old has dental pain and they do not have enough money to go to the dentist. Like every parent in this room, we know what we would do. We would do whatever we could. We would sell something, take an extra shift or borrow money to get our child to the dentist. That is what Canadians are doing.

What will the Canadian dental care plan do? It will provide that dental care at no cost to Canadians, freeing up their funds. At a time when Canadians are suffering, what could be of more direct assistance than to have the federal government champion a national dental care plan, which, by the way, the Conservatives do not support and will take away? Funnily enough, every one of them on that side has their dental care needs taken care of by taxpayer dollars. They get to go to the dentist, and their kids get to go to the dentist, paid for by taxpayer dollars, but they do not think that senior, that five-year-old and that single mother have the same right.

I will tell members this. To the NDP, dental care is primary health care, and everybody gets to go to the dentist regardless of their ability to pay. That is what this bill will help facilitate, and it is what the Conservatives are stalling. Is that the Conservative common sense? I cannot wait to go to the doorsteps in the next election and put that definition of common sense to my constituents.

[Brenda Shanahan, Liberal, Châteauguay—Lacolle, QC]

Madam Speaker, I also really appreciated my colleague's speech.

It is interesting to me that the members of the Standing Committee on Finance were able to work together. I completely understand that, and an amendment proposed by my Bloc Québécois colleague was even adopted. Nevertheless, he said in his speech that he will be voting against Bill C-59. I am trying to understand why.

I would also like an answer regarding this evening's motion. Is he for or against the short title?

[Don Davies, NDP, Vancouver Kingsway, BC]

Madam Speaker, it is a pleasure to work with my hon. colleague from Joliette on the finance committee.

At the committee hearings on Bill C-59, the opposition members worked together to strengthen many provisions of the bill, as the member pointed out in his speech. I think at least six or seven different amendments were made to strengthen consumer protection and empower the Competition Tribunal's ability to police mergers. In particular, I want to congratulate my colleague, as we had similar motion to strengthen the greenwashing provisions in the Competition Tribunal and in consumer legislation. His motion was the one that was passed. Could he elaborate a little on why he thinks that is an important amendment to the legislation?

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

Madam Speaker, as we know, Bill C-59 is an omnibus bill that is nearly 550 pages long. It contains 60 different measures, about half of which are tax measures, and it amends or creates 31 acts and regulations. We studied this bill at length in committee. We raised various issues, and I think we managed to partially improve it. In my opinion, we made improvements in three areas.

The first good thing that we did was to strengthen the part of the legislation governing greenwashing. We worked with various stakeholders, including the Centre québécois du droit de l'environnement, Quebec's environmental law centre, which has a lot of expertise in this area. The compromise that we managed to come to does not solve all of the problems, but it reminds us of the importance of regulating that practice. I want to recognize the Liberal member for West Vancouver—Sunshine Coast—Sea to Sky Country and the NDP member for Vancouver Kingsway, who made important contributions on this subject.

The second good thing that we did was to strengthen the Competition Act. The testimony of the commissioner of competition was very important. The consumer advocacy group Option consommateurs also made a very valuable contribution. Last but not least, I want to once again recognize the member for Vancouver Kingsway for his hard work. Unfortunately, we did not have time to compare the commissioner's analysis with the senior departmental officials' analysis, which meant we had some tough decisions to make.

The third good thing we did was to strengthen the right to repair.

During the committee study, I came away very disappointed about one aspect that still has not been clarified. I am talking about how the association representing Quebec's orders of mental health professionals is being treated. This association represents the Ordre des psychoéducateurs et psychoéducatrices du Québec, the Ordre des conseillers et conseillères d'orientation du Québec, the Ordre professionnel des sexologues du Québec, the Ordre professionnel des criminologues du Québec, as well as the Ordre des travailleurs sociaux et des thérapeutes conjugaux et familiaux du Québec. We are talking about 2,500 professionals in private practice who must charge their clients tax.

However, clause 137 of Bill C‑59 seeks to remove the GST from psychotherapy and counselling services. The professionals represented by the orders I just listed work in professions that have been covered by Quebec's Professional Code since 2012, such as mental health and human relations. Ordinarily, they should therefore be included in the measure set out in Bill C‑59.

I would like to quote Mr. Soucis, president of the Ordre des psychoéducateurs et psychoéducatrices du Québec, who said:

However, the Canada Revenue Agency's notice 335 concerning the exemption for counselling therapy states that the professional services provided by a person could be exempted if the person “has the qualifications equivalent to those necessary to be so licensed or otherwise certified in another province”.

Under this interpretation of the bill, it would be confusing and time-consuming, for all of the authorities that participate in such a process, for a professional to have to ask another Canadian authority to verify a qualification when it has already been attested to by the permit that authorizes the person to practise their profession. In its present form, the bill would require the members of Quebec's professional orders to verify with a regulatory agency that oversees the profession of counselling therapy in another province, as is the case in New Brunswick, Nova Scotia and Prince Edward Island, that they have qualifications equivalent to the qualifications of the professionals in the province in question.

We would point out that under the Professional Code, our professional orders have a mandate to be the regulatory and supervisory body for their profession in Quebec and that they are capable of doing that.

In committee, the department told us that these Quebec professionals would not have to charge GST and would be included in the measure. However, this conflicts with what the Canada Revenue Agency and Revenu Québec are saying. We tried to clarify this part of Bill C‑59, but we were unsuccessful. I sincerely hope that Quebec professionals are not excluded from the measure.

That was a summary of some of the work we did in committee.

However, given that the bulk of Bill C‑59 was adopted in committee by the majority, we are now seized with the improved text at report stage. At this stage, again, Bill C‑59 contains some good and some bad elements, but the Bloc Québécois is opposing it once again because of two measures.

The first is the $30.3 billion in subsidies to oil companies in the form of tax credits. This means that taxpayers will be paying oil companies to pollute less, when they do not need that money.

The second is the creation of a federal department of municipal affairs called the Department of Housing, Infrastructure and Communities. This is a sign that we can expect more interference, more bickering and more delays, at a time when the housing crisis demands swift action.

Let us look at the oil subsidies.

On April 30, the Parliamentary Budget Officer released a study indicating that the latest budget would lead to a shortfall of $39 billion by 2029. The budget includes $61 billion in new spending, including tax expenditures, and there is $22 billion in new revenue, mostly from capital gains.

Bill C‑59 alone contains more than $30 billion in tax gifts to the oil companies. Roughly half goes to wasting public money on carbon sequestration, while the other half would enable them to use nuclear energy to extract the tar from the tar sands. This represents more than 80% of the $39‑billion shortfall that the Parliamentary Budget Officer unveiled in his recent study, the same shortfall the Conservatives are making such a big fuss about.

Since 2022, the government has announced $83 billion in tax gifts for the oil companies. That is twice the shortfall that the Parliamentary Budget Officer was talking about early last week. Need I remind the House that the oil companies do not need any gifts? According to the Centre for Future Work, the oil and gas extraction sector has made record profits these past few years, specifically $38 billion over three years, in 2020, 2021 and 2022, and half of that in 2022 alone. Apparently, 2023 was just as profitable. Since 70% of the shareholders are foreign, that is money that has left the country.

In the last two budgets, the government announced its intention to introduce six tax credits largely aimed at oil companies. According to information provided by the Department of Finance, these tax credits will total a whopping $83 billion by 2035.

Bill C-59 amends the Income Tax Act to create two of these tax credits, which are tailor-made for oil companies: a clean technology investment tax credit and a tax credit for carbon capture and storage. The first, worth $17.8 billion, aims to replace the use of gas to extract oil from the oil sands with nuclear power, all in order to export more gas. The second tax credit is worth $12.5 billion. Instead of accelerating the transition to renewable energy, the federal government would rather help oil companies pump every last drop of oil, hoping that they will pollute less in the course of their operations. That is the aim of this refundable tax credit for oil companies. It is only available to companies in Saskatchewan, Alberta and British Columbia, and not anywhere else.

As we know, carbon capture and storage is an experimental technique that is supposed to enable major polluters to recover some of their carbon emissions and bury them in the ground, usually in old, empty oil wells. Carbon capture is a central plank of the oil companies' pseudo-environmental strategy, in much the same way as cigarette manufacturers used to argue that filtered cigarettes were better for smokers' health in the 1970s.

The International Energy Agency, an OECD affiliate, believes that countries will be making a serious mistake if they put carbon capture at the heart of their environmental strategy. It believes that carbon capture is an illusion, that the technology is unproven and that, even if could someday be made to work on an industrial scale, it would deliver only marginal results at an exorbitant cost.

Bill C‑59 confirms that the government has acceded to the oil companies' demands. No surprise there. The independent media outlet The Narwhal published a document it had obtained through the Access to Information Act showing that the oil company Suncor had a hand in drafting the government's environmental policy, particularly the section on carbon capture that Bill C‑59 brings to fruition.

This is what former Liberal environment minister Catherine McKenna had to say about the carbon capture tax credit in an interview with the newspaper 24 heures, on December 5, 2023:

It never should have happened, but clearly the oil and gas lobbyists pushed for that.

She went on to say:

We are giving special access to companies that are making historic profits, that are not investing those profits into the transition and clean solutions. They are returning those profits to their shareholders, who for the most part are not Canadian, and then they ask to be subsidized for the pollution they cause, while Canadians have to pay more for oil and gas for heating.

Those are some of the reasons why we are voting against Bill C‑59.

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

Madam Speaker, we have just seen the Minister of Environment announce that there will be a gag order on Bill C‑59, an omnibus bill of nearly 550 pages with 60 different measures and 31 acts and regulations. It is the implementation bill for last year's budget and the fall economic statement.

However, the government delayed introducing it in the House so that we could study it in committee. The government has organized its time poorly and here we are in May sitting until midnight with limited time to debate a subject as important as this.

Does the hon. parliamentary secretary agree with me that the government manages its priorities very badly?

The House resumed 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 amendment) from the committee, and of Motion No. 1.

Bill C-59—Notice of Time Allocation Motion

[Steven Guilbeault, Liberal, Minister of Environment and Climate Change]

Madam Speaker, an agreement could not be reached under the provisions of Standing Orders 78(1) or 78(2) with respect to the report stage and third reading stage 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.

Under the provisions of Standing Order 78(3), I give notice that a minister of the Crown will propose at the next sitting a motion to allow a specific number of days or hours for consideration and disposal of proceedings at the said stages of the bill.

[Ryan Turnbull, Liberal, Whitby, ON]

Yes, I am interested in what impact that will have in the short and maybe medium to long term. Certainly, it's hard to predict, but some of these changes have probably been contemplated for quite a while, and I know that quite a lot of consultation was done.

What I'm interested in is how quickly we will see the impact of these changes. I'm sure it's hard to predict that, but I wonder how quickly markets respond to the signals that go out there. I'm sure industry is paying attention to our proceedings, and certainly to the finance committee and our work.

Mr. Schaan was with us for many hours on Bill C-59, which made an additional round of changes to the Competition Act.

I'm wondering if maybe you can speak to the impact that will have and how quickly we will see the impact.

Motions in Amendment

[The Assistant Deputy Speaker, Carol Hughes]

I just want to bring it back to the original question. The motion is that the bill, Bill C-59, be amended by deleting the short title.

I am not sure that the hon. member actually got to the motion and why the title should be deleted or not, but I want to remind members to speak to the motion as well.

Questions and comments, the hon. parliamentary secretary to the government House leader.

Speaker's Ruling

[The Assistant Deputy Speaker, Carol Hughes]

There is one motion and amendment standing on the Notice Paper for the report stage of Bill C-59. Motion No. 1 will be debated and voted upon.

I will now put Motion No. 1 to the House.

The House proceeded to the 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.

Carbon Pricing

[Terry Duguid, Liberal, Parliamentary Secretary to the Prime Minister and Special Advisor for Water]

Mr. Speaker, there is a common misconception about carbon pollution pricing. It is not a tax. It is a measure recognized as one of the lowest cost and most effective ways of reducing greenhouse gases, and therefore, of tackling the adverse impacts of climate change, which are very real. It is also a measure that the government has designed to make life more affordable for Canadians.

Natural disasters are on the rise due to climate change, and we are all suffering the effects and the costs too. Last summer, forest fires forced tens of thousands of Canadians to evacuate their homes. There were also droughts in the Prairies, where the hon. member is from. There were intense hurricanes on the east coast, extreme flooding on the west coast, and melting permafrost in the north. What does that mean? It means we all need to accelerate climate action.

Carbon pricing is core to serious climate action. It provides an incentive to innovate and reduce emissions, while allowing businesses and households to decide for themselves how best to reduce emissions. Carbon pricing is not about raising revenues. All proceeds from carbon pricing are returned to the jurisdiction they were collected from.

The Canada carbon rebate, the CCR, returns fuel charge proceeds to Canadian residents through direct deposit or cheque every three months. Eight out of 10 households receive more money back through the CCR than they pay toward the fuel charge. Residents of these provinces living in small and rural communities also receive a rural top-up, which the government, under Bill C-59, is proposing to double from 10% of the base amount to 20%. The system actually leaves most families, especially low- and middle-income ones, better off financially.

Carbon pricing is a fair system that does leave more money in the pockets of Canadian workers, and that makes life more affordable for lower-income families. The benefits go way beyond that. It is a tool to help us create healthier communities and usher in clean growth and a more sustainable future for our children and our children's children.

Budget Implementation Act, 2024, No. 1

[Ryan Turnbull, Liberal, Parliamentary Secretary to the Deputy Prime Minister and Minister of Finance and to the Minister of Innovation]

Mr. Speaker, it is a great privilege to lend my voice today in support of Bill C-69, the budget implementation act, 2024. This budget is about what kind of country we want to live in and what kind of country we want to build together.

For generations, Canada has been a place where everyone could secure a better future for themselves and their children, and where a growing economy created opportunities for everyone to succeed. However, to ensure every Canadian succeeds in the 21st century, we know that we must grow our economy to make it more innovative, productive and sustainable. We must build an economy where every Canadian can reach their full potential, where every entrepreneur has the tools needed to grow their business and where hard work pays off.

Building the economy of the future is about creating jobs in the knowledge economy, in manufacturing, in mining and forestry, in the trades, in clean energy and across the economy in all regions of the country. To do this, our government's economic plan is investing in the technologies, incentives and supports critical to increasing productivity, fostering innovation and attracting more private investment to Canada. This is how we will build an economy that unlocks new pathways for every generation to earn their fair share. Bill C-69 is a crucial step in opening up these new pathways.

Bill C-69 takes us forward on the understanding that, in the 21st century, a competitive economy is a clean economy. There is no greater proof than the 2.4 trillion dollars' worth of investment made around the world last year alone in the transition to net-zero economies. Experts say we are at a global inflection point, with clean energy investments surpassing investments in conventional energy, with the cost of renewable technology dropping significantly, including wind, solar and heat pumps, as technology advancements are made and deployed at scale, and with companies that outperform their peers in decarbonizing more competitive and yielding higher returns for stakeholders.

As the big anchor investment decisions around the globe are being made to secure the global supply chains for the emerging clean economy, we need to ensure Canada is best positioned to compete and lead the way by seizing the massive opportunities to attract investment and generate economic growth that will bring decades of prosperity. That is why our government is putting Canada at the forefront of the global race to attract investment and seize the opportunities of the clean economy with a net-zero economic plan that will invest over $160 billion to maintain and extend our lead in this global race.

The cornerstone of our plan is an unprecedented suite of major economic investment tax credits, which will help attract investment through $93 billion in incentives by the year 2034-35. That includes carbon capture, utilization and storage, the clean technology investment tax credit, the clean hydrogen investment tax credit, the clean technology manufacturing investment tax credit, clean electricity and, added in budget 2024, an EV supply chain investment tax credit. These investment tax credits will provide businesses and other investors with the certainty they need to invest and build here in Canada. They are already attracting major job-creating projects, ensuring we remain globally competitive.

For example, just a couple of weeks ago, I attended the announcement in Alliston, Ontario, where Honda made the largest investment in Canadian automotive history, investing over $15 billion. This is a huge vote of confidence in our economy. Out of all the countries in the world, Honda chose Canada to build its comprehensive, end-to-end EV supply chain, which will mean thousands of good-paying jobs for decades to come. The federal investment tax credits were essential in remaining competitive and securing that generational investment. From new clean electricity projects that will provide clean and affordable energy to Canadian homes and businesses to carbon capture projects that will decarbonize heavy industry, our major economic investment tax credits are moving Canada forward on its track to achieve a net-zero economy by 2050.

In November 2023, our government introduced Bill C-59 to deliver the first two investment tax credits and provide businesses with the certainty they need to make investment decisions in Canada today. That bill also included labour requirements to ensure workers are paid prevailing union wages and apprentices have opportunities to gain experience and succeed in the workforce.

With Bill C-69, the budget implementation act, 2024, we would be making two more of these major economic investment tax credits a reality to attract more private investment, create more well-paying jobs and grow the economy.

First, it would implement the 30% clean technology manufacturing investment tax credit, which would be available as of January 1, 2024. This is a refundable investment tax credit for clean technology manufacturing and processing, and extraction and processing of key critical minerals equal to 30% of the capital cost of eligible property associated with eligible activities.

Investments by corporations in certain depreciable property that is used for eligible activities would qualify for the credit. Eligible property would generally include machinery and equipment used in manufacturing, processing or critical mineral extraction, as well as related control systems.

Eligible investments would cover activities that will be key to securing our future, including things like the manufacture of certain renewable energy equipment like solar, wind, water or geothermal. It would cover the manufacturing of nuclear energy equipment and electrical energy storage equipment used to provide grid-scale storage. It would cover the manufacturing of equipment for air and ground storage heat pump systems; the manufacturing of zero-emission vehicles, including the conversion of on-road vehicles; as well as the manufacturing of batteries, fuel cells, recharging systems and hydrogen refuelling stations for zero-emision vehicles, not to mention the manufacturing of equipment used to produce hydrogen from electrolysis. These are the technologies that will power our future.

Bill C-69's clean technology manufacturing investment tax credit would power the investment that is needed to build them today and build them here at home.

The bill would also make the clean hydrogen investment tax credit a reality, which would exclusively support investments in projects that produce clean hydrogen through eligible production pathways. This refundable tax credit would be available as of March 28, 2023, and could be claimed when eligible equipment becomes available for use at an applicable credit rate that is based on the carbon intensity of the hydrogen that is produced.

Eligible equipment could include, but is not limited to, the equipment required to produce hydrogen from electrolysis of water, including electrolyzers, rectifiers and other ancillary electrical equipment; water treatment and conditioning equipment; and certain equipment used for hydrogen compression and storage. Certain equipment required to produce hydrogen from natural gas or other eligible hydrocarbons, with emissions abated using carbon capture, utilization and storage, would also be eligible. Property that is required to convert clean hydrogen to clean ammonia may also be eligible for the credit, subject to certain conditions, at a credit rate of 15%.

It is important to realize that these clean economy investment tax credits work to incentivize investment and remain competitive but also do not stand alone. They are just part of the tool box that also includes legislation like the Canadian Net-Zero Emissions Accountability Act; the Canadian sustainable jobs act and amendments to CEPA, which is the Canadian Environmental Protection Act; regulations like the clean fuel regulations, the carbon pricing and oil and gas emissions cap; programs like the strategic innovation fund and many others; and the blended finance utilities that the government has launched, including the Canada growth fund and the Canada Infrastructure Bank. These all work together, and that is why we are seeing the results we are seeing.

Bill C-69's support for these investments comes at a pivotal moment when we can choose to renew and redouble our investments in the economy of the future, to build an economy that is more productive and more competitive, or risk leaving an entire generation behind.

With Bill C-69, we would not make that mistake. Our major economic investment tax credits are moving Canada forward on its track to achieve a net-zero economy by 2050. I could not be more proud of our work in this area.

[Jasraj Singh Hallan, Conservative, Calgary Forest Lawn, AB]

Thank you, Chair.

I'd like to address some of the comments that were made today, in particular one by Mr. Turnbull.

Usually in the past we've had negotiations outside of committee if things don't get resolved. In this case, there was no discussion. We were not reached out to whatsoever. I'm surprised to know that Mr. Davies actually got this amendment before all of us, and he admitted that.

It does bring up the question about this carbon tax coalition. It makes it more and more clear—to us, at least—that there is a coalition, not just in this committee, but outside.

I would like to propose an amendment to the motion as amended. Before I do that, I would like to say, in the spirit of collaboration on Bill C-59, that Mr. Davies' request was to get this passed as soon as possible. I will remind him that I ended up pulling my two amendments at the end so we could group the rest of the clauses. We passed the bill right away in that collaboration, which is why we got to this point.

We did help to pass his amendment. That's good. We should have some more witnesses.

I'd like to make an amendment. There are a few of them. I'd like to speak to them after I've given them.

In item ii, after May 23, I'd like to add the dates May 28 and May 30, 2024.

In item iii, I'd like to remove the date and put May 30, 2024.

In item iv, I'd like to change the first date to June 3, 2024, and strike everything after “resources on that day”.

In item v, after where it says “Bill C-69”, I would like to add “four meetings on its study of proceeds of crime and money laundering”. Strike everything before that and replace it with that, so “following the completion of the study of Bill C-69” strike out everything and add in "four meetings on its study of proceeds of crime and money laundering”.

I think we've distributed that, or we're going to distribute it. I believe it's been sent to you.