Finance Committee on Feb. 14th, 2022

[The Chair, Liberal, Peter Fonseca]

Thank you.

[Yvan Baker, Liberal, Etobicoke Centre, ON]

I have a point of order, Chair.

In the last comment that Mr. Stewart made, he suggested that you, Chair, were trying to respond for the witnesses. I don't think that's an accurate portrayal—

[Adam Chambers, Conservative, Simcoe North, ON]

Is that a point of order?

That's debate.

[Yvan Baker, Liberal, Etobicoke Centre, ON]

I don't think that's appropriate. I think what the chair was trying to do was necessary to keep order in the committee and—

[The Chair, Liberal, Peter Fonseca]

Thank you, MP Chambers.

Thank you, MP Baker.

We want to use as much time as we can here with the officials as efficiently and effectively as possible.

We are moving to the Liberals and MP MacDonald, for five minutes.

[Heath MacDonald, Liberal, Malpeque, PE]

Thank you, Chair.

I just want to go back to the housing tax. In Prince Edward Island we have a non-resident tax, which has been in place for a number of years. It seems to work very well.

There has been a lot of discussion on the housing tax and among the different people sitting around the table and the different provinces.

Can someone tell me what kinds of consultations were conducted with provincial governments in regard to the housing tax?

[Robert Ives]

I'm happy to take that question, Mr. Chair.

A public consultation ran between August 6, 2021 and September 17, 2021. The consultation was open to all Canadians, as well as municipalities, provinces, territories and the like.

[Heath MacDonald, Liberal, Malpeque, PE]

In those consultations, what were the main issues relevant to the 1% tax that we seem to be hearing from around the table? Was there anything from those public consultations that you have seen as a major concern?

[Robert Ives]

On the consultations, we received approximately 40 submissions from Canadians and entities. We did not receive a single submission from a province.

[Heath MacDonald, Liberal, Malpeque, PE]

You're basically telling me that there were no concerns from any of the provinces on the 1% tax relative to any legislation that they already had in place?

[Robert Ives]

Mr. Chair, we did not receive any submissions from any of the provinces or territories as part of the official consultation.

[Heath MacDonald, Liberal, Malpeque, PE]

Thank you.

Last week Minister Champagne announced $80 million, I think, in CanCode funding for non-profit organizations across the country. I know we're talking about tax credits for teachers, which they well deserve as they spend a lot of their own money on their classrooms. Many of these teachers also work within these not-for-profits and do extra work after school.

Are there any exemptions for teachers to purchase new technology if they're working with not-for-profits, relative to the ones that are listed in the new submission by Minister Champagne's office—the $80 million?

[Pierre Leblanc]

This credit is focused on the supplies that teachers and early childhood educators use in the duties of their employment, either at a school or a child care facility.

[Heath MacDonald, Liberal, Malpeque, PE]

Okay. Thank you.

I think that one underlooked, but vitally important change—especially in the seasonal economy where I come from—is the enrolment in the seasonal worker pilot program.

I'm just wondering how these workers will be affected by this change. Do they need to apply for it or it is automatic? What's the scenario relevant to the EI system changes in this bill?

[Anamika Mona Nandy, Executive Director, Temporary Measures and Special Projects Division, Skills and Employment Branch, Department of Employment and Social Development]

Thank you, Chair. I can take that question.

In terms of the workers who will be affected by this amendment, there will be the workers whose seasonal claim pattern has been disrupted by the timing of COVID-19 temporary measures. If they are eligible for this amendment, then once the legislation is passed, receives royal assent and comes into force, the additional weeks would be applied to EI regular benefit claims. The eligible seasonal claimants will be able to receive their additional weeks of benefits once that legislation receives royal assent.

We understand that there may be a gap in benefits between January 9 and full implementation of the proposed measure, but the nature of the amendment is such that all eligible claimants would receive the benefit to which they are entitled, and every effort would be made to ensure that the payments are processed as quickly as possible.

[Heath MacDonald, Liberal, Malpeque, PE]

Thank you.

[The Chair, Liberal, Peter Fonseca]

We are moving now to our third round, members. I have the Conservatives up first with Mr. Chambers for five minutes.

[Adam Chambers, Conservative, Simcoe North, ON]

Thank you very much, Mr. Chair. Happy Valentine's Day to you.

The first question is about the school tax credit—

[The Chair, Liberal, Peter Fonseca]

That was to everybody.

[Adam Chambers, Conservative, Simcoe North, ON]

Of course it's to everyone, but especially to my favourite chair that I've ever had of our finance committee.

Our school tax credit went from 15% to 25%. Is there any analysis that you can provide the committee, or have you conducted any evidence-based assessment of the tax expenditure and the effect of moving it from 15% to 25%?

[Pierre Leblanc]

In the economic and fiscal update, we published the estimated costs of the measure, and it's $5 billion per year.

[Adam Chambers, Conservative, Simcoe North, ON]

Yes, the question, though, is about the previous 15% tax, how well that was working and what we expect the take-up will be in terms of the number of people, etc.

[Pierre Leblanc]

The previous tax was spent here, so for the measure that exists now, it's about $5 million. This would be a doubling.

[Adam Chambers, Conservative, Simcoe North, ON]

Okay, thank you.

If there is analysis, it's always important for the government to do evidence-based reviews of tax expenditures. If there is analysis that exists, I hope that it can be provided to the committee.

Turning to the housing tax, yes, we discussed the two purposes. The main purpose is to raise revenue, so can we get analysis to this committee that provides the buildup of how you get to your revenue projection in terms of the number of homes that are impacted and the locations of those homes?

[Phil King]

Thank you, Mr. Chair. I can respond to this.

As mentioned earlier, there's a real dearth of information on vacancies writ large across the country. What we do have is data from the Canada housing statistics program on foreign ownership. We have that for four provinces. We have some data from the B.C. sales and vacancy tax on foreign ownership and vacancy among that foreign ownership component.

We have to extrapolate and impute what's going on across the country in the various other provinces to build up the estimate of revenues.

This is a new tax; it has not been imposed yet. We don't have any filers. We'll have a lot more information ultimately, but probably it's no surprise that the incidence is larger in Ontario, because of its size and population, B.C., Quebec and Alberta.