Thank you, Mr. Chair.
I'll start with two measures in part 1: the small business air quality improvement tax credit and the measure to return fuel charge proceeds to farmers.
In regard to the small business air quality improvement tax credit, the measure would introduce a temporary refundable 25% tax credit for businesses on expenses incurred to undertake air quality improvements that increase outdoor air intake or air cleaning in commercial properties. Eligible businesses would receive the tax credit on eligible expenses of up to $10,000 per location, with a maximum expense of $50,000 across all locations.
The tax credit would be available in respect of eligible expenses incurred between September 1, 2021, and December 31, 2022. Eligible businesses would include Canadian-controlled private corporations with taxable capital employed in Canada of up to $15 million and unincorporated sole proprietors.
Eligible expenses would effectively include two categories.
The first is the purchase, installation, conversion or upgrade of mechanical heating, ventilation and air conditioning systems, or HVAC systems, that satisfy certain conditions in respect of minimum efficiency reporting value, or MERV, or satisfy certain conditions in respect of outdoor air supply rates. The second category of eligible expenses is the purchase of devices designed to filter air using high-efficiency particulate air filters, also known as HEPA filters.
For the second measure—returning fuel charge proceeds to farmers—the measure delivers on the commitment in budget 2021 and proposes to return fuel charge proceeds directly to farming businesses in the backstop jurisdictions of Ontario, Manitoba, Saskatchewan and Alberta via refundable tax credits, starting for the 2021-22 fuel charge year. Eligible farming businesses would include corporations, sole proprietors and trusts, including where they carry on business through a partnership.
To qualify, an entity must incur total farming expenses of $25,000 or more. Refundable tax credit amounts would be determined according to the eligible farming expenses of the business, multiplied by a payment rate specified by the Minister of Finance for each applicable fuel charge year. Those two payment rates were specified in the economic and fiscal updates for the first two years. Eligible farming expenses generally include those expenses deducted when calculating farming income.
That concludes the overview for the first two measures.
I'll hand it over to my colleague, Pierre Leblanc, to continue with part 1.
Thank you, Mr. Chair.