Evidence of meeting #86 for Finance in the 41st Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was committees.
A video is available from Parliament.
4:45 p.m.
Senior Legislative Chief, Tax Legislation Division, Tax Policy Branch, Department of Finance
There are a few things going on with the employee profit-sharing plan. It was set up as a specific mechanism with respect to the relationship to a particular business. I think the observation is that it hasn't been used with respect to its intended policy purpose.
4:45 p.m.
Liberal
Scott Brison Liberal Kings—Hants, NS
Thank you.
In other cases—for instance, in publicly traded companies—stock options are used similarly, or are intended to be used similarly. What are the changes to the taxation of stock options as part of this budget? If you're taking this approach to privately held companies, is there a similar intention with respect to stock options?
4:45 p.m.
Senior Legislative Chief, Tax Legislation Division, Tax Policy Branch, Department of Finance
This measure is just in respect of employee profit-sharing plans. It doesn't impact upon the taxation of stock options.
4:45 p.m.
Conservative
The Chair Conservative James Rajotte
Thank you, Mr. Brison.
We shall move on, then, to accelerated capital cost allowance for clean energy generation. Go ahead, Mr. Cook.
4:45 p.m.
Senior Legislative Chief, Tax Legislation Division, Tax Policy Branch, Department of Finance
This measure contains a few components. When waste-fueled thermal energy equipment is included in class 43.2, there is currently a requirement that this equipment must be used in an industrial process or a greenhouse. The requirement that it's used for those purposes is taken out by this measure in order to expand the ability to use waste-fueled thermal energy equipment.
Similarly, the definition of what counts as an eligible waste fuel is expanded to include the residue of plants. That includes things like straw, corncobs, and that type of thing. As well, classes 43.1 and 43.2 are expanded to include a district energy system that distributes thermal energy that is primarily generated by waste-fueled thermal energy equipment. The last part of this measure is to provide that this equipment will only be eligible for classes 43.1 and 43.2 treatment if the applicable environmental laws and regulations are complied with at the time the equipment becomes available for use.
4:50 p.m.
Conservative
4:50 p.m.
NDP
Hoang Mai NDP Brossard—La Prairie, QC
Yes. Thank you. Mr. Chair.
In the briefing session, I recall you mentioning an amount. Could you repeat that information for us? How much do you anticipate that this program will cost?
4:50 p.m.
Senior Legislative Chief, Tax Legislation Division, Tax Policy Branch, Department of Finance
Sorry, I'm just checking my notes. I believe it's $4 million.
4:50 p.m.
NDP
Hoang Mai NDP Brossard—La Prairie, QC
Can you tell us the approximate number of businesses that will benefit from this program?
October 31st, 2012 / 4:50 p.m.
Geoff Trueman Director, Business Income Tax Division, Tax Policy Branch, Department of Finance
I don't have an exact number for you. It would be a relatively small subset. The equipment tends to be fairly specialized.
4:50 p.m.
NDP
Hoang Mai NDP Brossard—La Prairie, QC
Who are the stakeholders on this one? Who was consulted? Who asked for it?
4:50 p.m.
Director, Business Income Tax Division, Tax Policy Branch, Department of Finance
The department receives a number of submissions every year regarding eligibility for equipment under class 43.2. This would have been a technology that would have come up in submissions from some stakeholders.
4:50 p.m.
Conservative
4:50 p.m.
Liberal
Scott Brison Liberal Kings—Hants, NS
Just to be clear, it applies to a fairly specific subset of biofuels. Just for us to understand, what are some examples of the type of equipment it would apply to?
4:50 p.m.
Director, Business Income Tax Division, Tax Policy Branch, Department of Finance
One example would be that if you own a commercial building, you could purchase a boiler that would burn wood waste, for example, to heat the property. That would be an example of a qualifying application. Similarly, regarding district energy, heat generated by waste-fueled energy could again be distributed throughout a community or throughout a number of buildings. That type of equipment would also qualify.
4:50 p.m.
Liberal
Scott Brison Liberal Kings—Hants, NS
What other area of clean energy investment is covered by this accelerated capital cost amount?
4:50 p.m.
Director, Business Income Tax Division, Tax Policy Branch, Department of Finance
Class 43.2 generally will cover a range of equipment that uses renewable fuels or waste fuels or makes more efficient use of a fossil fuel.
4:50 p.m.
Liberal
Scott Brison Liberal Kings—Hants, NS
It doesn't apply to other forms of cleaner energy, such as alternative energy, as an example.
4:50 p.m.
Director, Business Income Tax Division, Tax Policy Branch, Department of Finance
It does include equipment that uses various forms of renewable energy.
4:50 p.m.
Director, Business Income Tax Division, Tax Policy Branch, Department of Finance
I would have to check the specific eligibility of a particular item.
4:50 p.m.
Liberal
Scott Brison Liberal Kings—Hants, NS
That would be helpful. Thank you. If you are going to check on them, then just give us an idea of what areas of renewable or cleaner energy it would include. Thanks.
4:50 p.m.
Conservative
The Chair Conservative James Rajotte
Thank you.
We'll do the next section, the corporate mineral exploration and development tax credit.