Finance Committee on April 25th, 2023

[The Chair, Liberal, Peter Fonseca]

Thank you very much, MP Blaikie. Thank you, Mr. Shoom.

Now we will go to MP Lawrence for five minutes.

[Philip Lawrence, Conservative, Northumberland—Peterborough South, ON]

Perfect.

When I first got some of the highlights of the budget coming through—some of the copious leaks seemed to get to the media before they got to us—one of the things that seemed beneficial to the government getting out there was the grocery rebate. I was thinking it maybe would be something to reduce the carbon tax or to give individuals a benefit.

I'm really troubled. I can't see the difference between this and the GST rebate increase that was done the previous year.

Can anyone tell me what's different about this grocery rebate and a GST rebate?

[Pierre Leblanc]

If we look at the legislation, it's essentially the same.

[Philip Lawrence, Conservative, Northumberland—Peterborough South, ON]

Why would you call it a grocery rebate when it's just a GST rebate? That seems odd to me.

[Pierre Leblanc]

That's a decision for the government. I think when we go to grocery stores, we all find that prices are pretty high. However, in terms of the mechanics, you're right....

[Philip Lawrence, Conservative, Northumberland—Peterborough South, ON]

For clarity, there are no restrictions on these rebates—they are HST or GST rebates— with respect to food or groceries.

I've had numerous constituents call my office asking me how this grocery rebate works. To clarify, there are absolutely no restrictions on how this money is spent. It really has no connection to food whatsoever.

[Pierre Leblanc]

It will be a payment that people receive.

[Philip Lawrence, Conservative, Northumberland—Peterborough South, ON]

There are no qualifications or conditions on this money. People can use this for whatever they want.

[Pierre Leblanc]

That's correct.

[Philip Lawrence, Conservative, Northumberland—Peterborough South, ON]

This was simply some cheap marketing that the Liberal government put out there to help them maybe push back some of the trouble that people are feeling. Food, in some cases, has doubled in cost over the last couple of years. Food inflation, consistently near or above 10%, continues to be a challenge. This Liberal government's response is cheap marketing. I think we know where that goes.

I want to spend some time on the technical side. Everyone here values the tremendous work our veterans have done in being willing to pay the ultimate sacrifice so that we can maintain a peaceful, free country.

I want to spend a little time on the taxation of veterans and active benefits. This is simply for clarity, so that our veterans are aware. Maybe I could hand the floor over to someone who is comfortable giving an explanation of what this budget implementation act seeks to do with respect to the taxation of benefits going to our veterans.

[Mark Maxson]

Thank you for the question.

Effectively, this is a legislative change that confirms and clarifies the existing and long-standing non-taxability of a number of benefits being offered by the Department of Veteran Affairs and/or the Department of National Defence. Individual members or veterans do not need to do anything. Amounts that they have received have been non-taxable in the past. They have not been reporting these amounts. They have not been receiving tax slips, and they will not receive those slips going forward. They don't need to amend any returns. It simply says that the treatment that has been administratively taken historically is confirmed in law retroactively.

[Philip Lawrence, Conservative, Northumberland—Peterborough South, ON]

Thank you very much, Mr. Maxson.

Just to clarify again, veterans don't have to take any action. There was just a potential disconnect between the legislation and the policies as they were administered. They have been administered as non-taxable, but I guess there was some ambiguity. Veterans don't have to take any actions and all of their benefits will continue to be tax-free.

I just want to make sure that veterans are perfectly clear about that.

[Mark Maxson]

That's right.

This pertains to a number or very specific benefits. There are certain benefits received by veterans and members of national defence that are taxable and have always been taxable, but for these particular benefits—certain payments for persons with disabilities or their families that might be for medical expenses or equipment—they do not take any action. There is no change from their perspective. It's just clarifying some questions that have been raised about these existing benefits.

[The Chair, Liberal, Peter Fonseca]

Thank you, MP Lawrence.

Now we will go to our final questioner for this round and this meeting.

We'll have MP Baker for five minutes, please.

[Yvan Baker, Liberal, Etobicoke Centre, ON]

Thanks very much, Mr. Chair.

I'd like to go back to what Mr. Lawrence was just saying to the committee. I thought it would be worthwhile for us to reflect on that for just one moment.

He referred to the grocery rebate as “cheap marketing”. The premise of his argument was that the mechanism to deliver relief for folks who are struggling with the cost of groceries is similar to the mechanisms used to provide the GST rebate. I think that is really disappointing.

When COVID-19 hit and we provided the CERB to folks who needed that support or supports to businesses, we used mechanisms, some of which were new and some of which were similar to mechanisms that had been used in the past. I don't remember Mr. Lawrence or the Conservatives calling that cheap marketing. People out there are struggling with the cost of groceries in my community and across this country. The government is responding to that by saying that it's going to deliver help to them as quickly as possible.

Obviously, we need to pass this bill, so hopefully the Conservatives will pass it quickly. At the end of the day, to suggest that help provided to the folks who are struggling to pay their bills—their grocery bills specifically—is cheap marketing is, I think, disappointing and shameful.

I think it's a reflection of where the Conservatives are right now. On the one hand, they talk about how folks are struggling with the cost of living, but when we propose measures to help them with the cost of living, they either vote against it or they try to pare it down and call it cheap marketing.

I just wanted to point out that contradiction and hypocrisy.

With that, I'd like to come back to our witness and the BIA.

Could someone speak a little bit about the way the Department of Finance undertook consultations on some of the measures listed in part 1 of the bill?

[Lindsay Gwyer]

I can speak to that.

The consultation process has been different for different measures. In general, all of the measures in part 1 of the BIA were previously released in draft form for public consultation. In some cases, additional consultation would have occurred earlier in the process. When we release draft legislation for public comment, we typically receive a number of written submissions. We also often hold meetings with stakeholders or people who reach out to us with different interests on the legislation, including technical points or policy concerns.

We hold a number of those meetings and we receive written submissions. We review all of those very carefully. We take that into consideration in determining whether to or how to revise draft legislation.

That occurred with respect to the vast majority of the measures here, which were released last year or earlier. A few of them were released more recently in budget 2023, but some of those would have had consultation before or would have been the reflection of ongoing feedback that we receive from stakeholders and interested Canadians.

[Yvan Baker, Liberal, Etobicoke Centre, ON]

Thank you for that.

I want to go back to the changes to income tax as they relate to veterans and active members of the Canadian Armed Forces.

For the folks at home, could someone clarify the changes and how the changes in the BIA will impact veterans? I just want to make sure that is clear.

[Mark Maxson]

Thank you for the question.

These amendments pertain to a specific list of benefits. Individual members who have been receiving these benefits should not notice anything changing. It confirms the treatment that has been there in the past, which is that they've been non-taxable. Individual recipients who have been receiving these amounts have not reported them on their tax returns. That's fine; that's great. That is the treatment that this amendment confirms. They don't need to do anything in respect of this.

[Yvan Baker, Liberal, Etobicoke Centre, ON]

Thank you very much.

Chair, those are all of my questions.

[The Chair, Liberal, Peter Fonseca]

Thank you, MP Baker.

On that note, let's take this opportunity to thank our hard-working officials at the Department of Finance.

Thank you for coming and for your testimony. Thanks for answering our many questions for this study. We really appreciate it. On behalf of the entire finance committee, thank you.

Members, perhaps I can quickly catch your attention. The budget for this meeting was distributed. I'm wondering if I can have approval.

Are we good? Are we thumbs-up on that?

(Motion agreed to [See Minutes of Proceedings])

[A voice]

Headsets cost lot less than flights sometimes.

[The Chair, Liberal, Peter Fonseca]

Yes. We have a lot of headsets here, so we have a lot of officials coming in. We thank them for the work they do and that they're going to be able to come to us virtually or in person—although we do like them to be here in person.

Thank you very much, everybody.

The meeting is adjourned.