Evidence of meeting #87 for Finance in the 41st Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was capital.
A video is available from Parliament.
4:35 p.m.
Conservative
4:35 p.m.
NDP
Dan Harris NDP Scarborough Southwest, ON
I thought you were referencing what happened in the industry committee.
4:35 p.m.
Conservative
4:35 p.m.
A voice
Yes.
4:35 p.m.
Conservative
The Chair Conservative James Rajotte
Thank you.
Okay, we are on part 3.
Do I have any questions dealing with part 3 with respect to the amendments to the Federal-Provincial Fiscal Arrangements Act?
4:35 p.m.
NDP
4:35 p.m.
Conservative
November 1st, 2012 / 4:35 p.m.
Kei Moray Director, Intergovernmental Tax Policy, Evaluation and Research Division, Tax Policy Branch, Department of Finance
Okay.
Part 3 amends the Federal-Provincial Fiscal Arrangements Act to provide legislative authority to make payments to provinces in respect of two taxes.
The first tax is the tax on specified investment flow-through entities. When this tax was introduced in 2006, the government indicated that it would be sharing revenues with provinces and territories that are parties to the tax collection agreements.
The second tax is the tax on excess contributions to employee profit-sharing plans. This tax was introduced in this bill, and you were briefed on it yesterday by Mr. Cook.
Part 3 also amends the act to provide legislative authority to the Minister of Finance to obtain information from the Minister of Revenue in order to administer these shared taxes.
4:35 p.m.
Conservative
The Chair Conservative James Rajotte
Okay, thank you very much for that, Ms. Moray.
Mr. Mai, you have the floor.
4:35 p.m.
NDP
4:35 p.m.
Director, Intergovernmental Tax Policy, Evaluation and Research Division, Tax Policy Branch, Department of Finance
It would just be data so that we could determine the amount of the taxes that should be paid to the provinces.
4:35 p.m.
NDP
Hoang Mai NDP Brossard—La Prairie, QC
Obviously in Quebec it's a bit different. How do the provisions apply with respect to Quebec?
4:35 p.m.
Director, Intergovernmental Tax Policy, Evaluation and Research Division, Tax Policy Branch, Department of Finance
For Quebec, Quebec is not party to a tax collection agreement so we don't impose a tax. We don't have a provincial component on the taxes imposed in Quebec. Quebec has chosen to impose its own tax in both of these cases.
4:35 p.m.
Conservative
The Chair Conservative James Rajotte
I want to thank the officials for explaining that part to us so well.
We will move to part 4, division 1, financial institutions. This amends the Trust and Loan Companies Act, the Bank Act, the Insurance Companies Act, and the Jobs and Economic Growth Act. Just for your reference, it's page 13 of the Library of Parliament briefing.
Are there any questions on part 4, division 1?
4:35 p.m.
Conservative
The Chair Conservative James Rajotte
You want a brief briefing on this section.
Welcome to the officials.
Ms. Hardy, please.
4:35 p.m.
Annie Hardy Chief, Financial Institutions Division, Structural Issues, Financial Sector Policy Branch, Department of Finance
My name is Annie Hardy. I'm going to give you a brief overview of this section.
The first Jobs, Growth and Long-term Prosperity Act permitted certain public sector investment pools to invest directly in Canadian financial institutions to provide access to stable long-term investment. The amendments in part 4, division 1, are consequential to the initial provision in Bill C-38 and implement technical and coordinated changes to support the previously legislated policy.
The objectives of the amendment included in this bill are to ensure the new ownership framework for public sector investment pools is harmonized with the current ownership framework for other types of investors, and to clarify that the minister has the exact same powers for this new framework for public sector investment as he has with other investors. Thank you.
4:40 p.m.
Conservative
4:40 p.m.
NDP
Peggy Nash NDP Parkdale—High Park, ON
Thank you for being here and thank you for that briefing.
Could you restate that in a more plain language format so that we're all on the same page?
4:40 p.m.
Chief, Financial Institutions Division, Structural Issues, Financial Sector Policy Branch, Department of Finance
Yes, I can do that, for sure.
We created a new class of investors in the first Jobs, Growth and Long-term Prosperity Act. What we did was we ensured that the ownership framework for the current investors is harmonized with the new framework so that they all work together more smoothly.
The second thing is we also looked at all the provisions to make sure that all the powers for the minister are exactly the same for both types of investors. The minister has exactly the same tools. We clarified that in the legislation. That's why they are technical. It's not to change a policy; it's to harmonize the framework.
4:40 p.m.
NDP
Peggy Nash NDP Parkdale—High Park, ON
Just so I understand it, if I'm an investor who had invested before Bill C-38, now with these changes to harmonize the investments, what change would I see? If I were a previous investor, what change would I see with these new rules?