Briefing binder created for the Deputy Minister of Finance on the occasion of his appearance before the Standing Committee on Finance on March 21, 2024 on Bill C-59, An Act to implement certain provisions of the fall economic statement tabled in Parliament on November 21, 2023 and certain provisions of the budget tabled in Parliament on March 28, 2023, and the Main Estimates 2024-25 

Table of Contents

• Meeting Background and Scenario
• Bill C-59 (General Information)
  • Key Messages for Each C-59 Measure
• Questions Raised on Bill C-59
  • Carbon Capture, Utilization, and Storage Investment Tax Credit
  • Clean Technology Investment Tax Credit
  • Digital Services Tax
  • Excessive Interest and Financing Expenses Limitation
• Current Finance Issues Raised in Parliament
  • Alcohol Excise Duty Inflation Adjustment
  • Asian Infrastructure Investment Bank
  • Bank of Canada Negative Equity
  • Canada Emergency Business Account (CEBA) Loans
  • Contracting
  • Debt Management Strategy
  • Projected Deficits
  • Disaster Assistance
  • Economic Growth Comparisons – G7
  • Excess Profit Tax on Large Grocery Companies
  • Grocery Affordability
  • Housing Affordability and Immigration Growth
  • Major Transfers to Provinces and Territories in 2024-25 Main Estimates
  • Mortgage Delinquencies
  • Price on Pollution and the Canada Carbon Rebate
  • Proceeds of Crime, Money Laundering, and Terrorist Financing
  • Public Debt Charges
  • RBC/HSBC Transaction
  • Budget 2023 Spending Reductions – RGS and RPAS
  • Indigenous Engagement on Trans Mountain
• Main Estimates 2024-25
  • Explanation of Changes
  • Page Proofs
  • Reports of Spending Cuts for Indigenous Departments
• Background
  • Committee Member Biographies

Meeting Background and Scenario

House of Commons Standing Committee on Finance (FINA)
Department of Finance Appearance on Bill C-59 and the Main Estimates 2024-25
Thursday, March 21, 2024

Background

• On November 30, 2023, the Deputy Prime Minister and Minister of Finance introduced Bill C-59, An Act to implement certain provisions of the fall economic statement tabled in Parliament on November 21, 2023, and certain provisions of the budget tabled in Parliament on March 28, 2023, in the House of Commons. The bill was debated over four separate days at Second Reading between December 12, 2023, and January 31, 2024.
• On February 29, 2024, the Standing Committee on Finance (FINA) began its pre-study of the bill, where Department of Finance officials testified on measures contained in parts 1 to 4. At its second meeting on March 19, 2024, it heard from Finance and officials from other implicated departments concerning all the remaining measures (Part 5).
• Late in the evening of Monday, March 18, the House adopted C-59 at Second Reading. This was achieved through a series of nine separate votes each encompassing different groupings of measures based on a procedural decision by the Speaker. While the NDP voted in favour of all nine groups, as expected because of the Supply and Confidence Agreement, the Conservatives and Bloc Québécois voted against most measures, and supported some.
  • In addition to the below information on Finance-led C-59 measures, for an overview of how each opposition party voted on all parts of C-59, and related context, see the Party Position Heat Map at Tab 2.
• As this meeting will also cover the 2024-25 Main Estimates, MPs may take the opportunity to ask questions related to the entirety of the department's activities, programs, and policies—especially given the presence of the Deputy Prime Minister. At this time, it is to be determined whether FINA will hold additional meetings on the estimates or vote on them at the end of the March 21 meeting.

Party Positions

• The Conservative Party (CPC) has expressed its opposition to Bill C-59 with members citing concerns around affordability and the state of the economy. The party has focused its questions on stakeholder and international reactions to the Excessive Interest and Financing Expenses Limitation rules and Digital Services Tax, anti-money laundering and terrorist financing measures, and the impact creating a new Housing department will have on building homes.
• Key concerns for the party, as they relate to Finance, also include pollution pricing, and Canada's productivity and economic growth. Despite the March 9, 2024, announcement providing alcohol excise duty relief, the CPC continues to advocate for there to be no inflation adjustment for excise duties on alcohol, at least on April 1, 2024, (they have on notice an opposition day motion to this effect which may be debated on March 21).
• The Bloc Québécois expressed it would oppose Bill C-59 at Second Reading, saying the bill goes against their environmental and jurisdictional values. With respect to Finance-led measures, the Bloc has focused its questions on the Clean Technology Investment Tax Credit (ITC) as it relates to zero-emission vehicles, the provincial administration of the tax exemption on counselling and mental health services, and the Carbon Capture, Utilization and Storage ITC.
• Key concerns for the Bloc, as they relate to Finance, include housing affordability, investments in social assistance programs (e.g., Old Age Security), and incentives for emissions reductions.
• The New Democratic Party voted in favour of Bill C-59 overall at second reading. In committee, with respect to Finance-led measures, the NDP has focused its questions on the Clean Technology ITC and have called for a 30 per cent exemption to apply to Indigenous governments to incentivize their participation.
• Key concerns for the NDP, as they relate to Finance, include housing affordability and profiteering by large companies. With respect to the latter, the NDP may use debate to speak to its committee motion to implement an excess profits tax on large grocery companies using the funds to establish a National School Food Program.