The Fall Economic Statement Implementation Act, 2022 is a comprehensive bill that amends several existing acts. It changes rules about taxes, housing, and savings accounts. It also deals with the cannabis industry, student loans, and First Nations land management.
Some key changes include a new tax rule for selling homes quickly, a new savings account for first-time homebuyers, and a tax credit for home renovations to create a multigenerational living space. The bill also phases out certain tax benefits for the oil, gas, and coal industries, while introducing a new tax credit for critical mineral exploration.
For the financial sector, the bill introduces a temporary tax on banks and life insurers with income over $1 billion and also increases the corporate income tax rate for these institutions on income above $100 million. It also includes changes to excise duties on cannabis and vaping products, as well as changes to student loan interest.
Finally, the bill includes measures related to First Nations land management, updating previous legislation and enacting the Framework Agreement on First Nation Land Management Act.
Inflation and Cost of Living
This bill includes a few measures related to housing affordability. It doubles the First-Time Homebuyers’ Tax Credit, which helps people buying their first home. It also introduces the Multigenerational Home Renovation Tax Credit, which supports families who want to build a second unit in their home for a senior or an adult with a disability. There is also a rule about gains from selling a home within a year of buying it.
Taxation
This bill includes many changes to different taxes. A new tax rule is introduced, where any profit made from selling a home within one year of buying it is treated as business income. A new Tax-Free First Home Savings Account is also created. The bill phases out flow-through shares for oil, gas, and coal activities, while a new 30% tax credit for mineral exploration is introduced. Banks and life insurers will have to pay a one-time 15% tax on income above $1 billion, and their income tax rate is increased by 1.5% on income above $100 million. There are also some rules about charities, and stronger rules to stop people from avoiding tax debts.
Spending
Division 1 of Part 4 of the bill permits the Minister of Finance to buy shares of a Canada Development Investment Corporation subsidiary that manages the Canada Growth Fund. The amount authorized for the purchase of these shares from the government's bank account is up to $2 billion, though a separate appropriations act could authorize more.
Climate
The bill includes a measure that phases out flow-through shares for oil, gas, and coal activities. It also extends capital cost allowance for clean energy and a tax rate reduction for zero-emission technology manufacturers to include air-source heat pumps.
Energy
The bill includes a measure that phases out flow-through shares for oil, gas, and coal activities. It also introduces a new 30% Critical Mineral Exploration Tax Credit.
Foreign Aid
Division 2 of Part 4 increases the maximum financial help that Canada can give to other countries.