Finance Committee on May 13th, 2021

[Pierre Leblanc]

The main change of the measure would basically do two things. It would allow people to keep their RDSP open. Right now under the current rules, you essentially have a couple of years if you become DTC ineligible. It will allow those people to keep their plan open. It would also allow people to retain entitlement to the bonds and grants that they've already received.

Under the existing rules—the previous rules—you would have been required to pay those back in fairly short order, whereas this basically puts you roughly on par with those who retain DTC eligibility. Generally, the rule there is that, because of the 10-year rule, once someone turns 50, they can stop getting grants and bonds. Basically, when someone turns 60, they'd have to start receiving the amount. It provides that extension as well.

[The Chair, Liberal, Wayne Easter]

Is there no one else?

All right, we'll go to part 1(i), which is “increasing the basic personal amount for certain taxpayers”.

There are no questions on that one.

The next one is part 1(j), “providing a temporary special reading of certain rules relating to the child care expense deduction and the disability supports deduction for the 2020 and 2021 taxation years”.

There are no further questions. I know there were questions the other night during the briefing, so some may already be answered.

We'll go on to part 1(k), “providing flow-through share issuers with temporary additional time to incur eligible expenses to be renounced to investors under their flow-through share agreements”.

Mr. Ste-Marie.

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

I would like an explanation regarding one part of the note.

It reads as follows:

...is entitled to claim deductions on account of Canadian Exploration Expenses (100% immediate deduction...

What does “100% immediate deduction” mean?

[Maude Lavoie]

It means that Canadian exploration expenses can be deducted, up to 100%, from revenue when calculating taxes.

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

Okay. Thank you.

[The Chair, Liberal, Wayne Easter]

Are there any other questions? Okay.

We'll move to part 1(l), “applying the short taxation year rule to the accelerated investment incentive for resource expenditures”.

Are there any further questions there? No.

If anybody from finance has something they want to raise, just interrupt.

We'll move to part 1(m), “introducing the Canada Recovery Hiring Program refundable tax credit to support the post-pandemic recovery”.

Pat Kelly, go ahead.

[Pat Kelly, Conservative, Calgary Rocky Ridge, AB]

On the pandemic recovery benefit, could officials comment on the eligibility criteria? This came up in our meeting last week. The eligibility criteria here, if I understand correctly, is very similar to the criteria for the wage subsidy and the rent subsidy, which new enterprises don't quality for. In her response, the minister said, if I remember correctly, that there were new enterprises that would qualify for this benefit.

How does the qualification here differentiate from that of the other programs? Which enterprises are eligible to receive it?

[Maude Lavoie]

For the Canada recovery hiring program, the types of businesses or employers that can apply are Canadian-controlled private corporations, non-profit organizations, charities and partnerships. This resembles the list of organizations that are eligible for the wage subsidy, for instance, but for a corporation to qualify, it needs to be a Canadian-controlled private corporation. In that sense, the eligibility is similar.

In terms of new businesses, they will not be able to qualify if they cannot demonstrate that there was a reduction in revenue compared with a pre-pandemic period. However, I understand there are other programs announced in the budget that new businesses may be eligible for. When I say “new” I mean those created after the start of the pandemic.

[Pat Kelly, Conservative, Calgary Rocky Ridge, AB]

You still need the year-over-year reduction to qualify.

[Maude Lavoie]

That's correct.

[Pat Kelly, Conservative, Calgary Rocky Ridge, AB]

It's exactly like the rent subsidy and the wage subsidy.

[Maude Lavoie]

That's correct.

[Pat Kelly, Conservative, Calgary Rocky Ridge, AB]

I just wanted to clarify that. Thank you.

[The Chair, Liberal, Wayne Easter]

Thank you, Pat.

Ms. Jansen.

[Tamara Jansen, Conservative, Cloverdale—Langley City, BC]

Thank you.

I was talking to TIAC earlier today, and they were saying they don't believe this is going to be of any help to them because lockdowns are still in effect.

They're wondering if this program can help them in any way. They don't see how, with lockdowns in effect and no timeline on the horizon for anything to get started again, they could even begin hiring.

[Maude Lavoie]

Perhaps I would note that this program is scheduled to be in place until the end of November. I believe, with the speed of the vaccination campaign, it is everyone's hope that we will be starting the recovery in the coming months and that businesses will be able to benefit from the incentive as time goes by.

[The Chair, Liberal, Wayne Easter]

Thank you, Tamara.

[Tamara Jansen, Conservative, Cloverdale—Langley City, BC]

Can I follow up on that?

[The Chair, Liberal, Wayne Easter]

Go ahead.

[Tamara Jansen, Conservative, Cloverdale—Langley City, BC]

Most of those tourism industries.... Obviously if you're a ski place or somewhere like that, maybe this would help, but most of these industries are seasonal, and they're losing their summer. This basically doesn't take effect until they're closed down again.

Is there something on the horizon that's going to help them?

[Maude Lavoie]

The program will start in June and end by the end of November. To the extent that they're able to open during the summer, if the sanitary restrictions are lifted, they would be expected to be able to benefit from this program.

[The Chair, Liberal, Wayne Easter]

Are there any further questions on (m)?

Go ahead, Mr. Fast.

[Ed Fast, Conservative, Abbotsford, BC]

Ms. Lavoie, I don't think you answered Ms. Jansen's question, and it's a fair one to ask.

The Tourism Industry Association and tourism stakeholders want to see the economy open, but quite frankly, if we're making the assumption that this summer the economy is going to be open with everybody being vaccinated twice, that's just not in the cards. Even the Prime Minister has as much as admitted that.

How do we get support to the tourism industry and all the different companies across the country that have seen very little, if any, targeted support from the government? I know there's a little bit of money, about a half a billion dollars, to support the tourism industry, but again, it's not targeted for emergency relief. It's targeted for adaptation and a whole bunch of other things that don't address the immediate needs of these companies and businesses.

[Maude Lavoie]

I cannot speak to any standing programs that may have been put in place. I'm really just familiar with what we have in terms of the hiring subsidy, the wage subsidy and the rent subsidy. These programs they could benefit from are available to all industries if they have demonstrated a decline in revenues, but in terms of whether there is additional support, I cannot speak to that, unfortunately.

[The Chair, Liberal, Wayne Easter]

I think that's a question for the minister, Ed.

Is there anything further, Mr. Fast, before I go to Ms. Jansen again?