Bill C-47, also known as the Budget Implementation Act, 2023, No. 1, puts into action parts of the federal budget that was presented to Parliament on March 28, 2023. The bill includes changes to several acts, such as the Income Tax Act, the Excise Tax Act, and the Canada Transportation Act. These changes affect taxes, GST/HST, alcohol excise duties, air traveler security charges, banking regulations, pension benefits, money laundering, digital assets, tariffs, economic sanctions, service fees, employment insurance, environmental protection, marine liability, air travel complaints, customs, food and drugs, postal services, and more.
Part 1 of the bill changes the Income Tax Act by allowing electronic certification of tax returns, raising the maximum deduction for tradespeople’s tools, and changing how profits from quickly selling Canadian homes are taxed. It also provides tax relief for Canadian Forces members and veterans, and exempts certain income for residential school day scholars from taxes. Additionally, it increases the GST/HST credit, provides automatic Canada Workers Benefit payments, allows divorced spouses to have joint education savings plans, extends Registered Disability Savings Plans, and modifies pension plan rules.
Part 2 focuses on GST/HST measures, clarifying rules for international money transportation, pension entity rebates, cryptoasset mining, and payment card clearing services. Part 3 includes temporary caps on inflation adjustments for excise duties on alcohol and increases air travelers security charges. Part 4 covers a range of measures, including strengthening bank complaint procedures, providing for variable life benefits under pension plans, addressing money laundering and digital assets, extending preferential tariff programs, removing tariff treatment for Belarus and Russia, and enacting the Canada Innovation Corporation Act. It also includes changes to federal-provincial fiscal arrangements, economic sanctions, service fees, employment insurance, environmental protection, marine liability, air travel complaints, customs, food and drugs, postal services, and the Royal Style and Titles Act, 2023.
Inflation and Cost of Living
This bill includes a temporary limit on how much the taxes on beer, wine, and spirits can increase each year. This limit will be set at 2% for one year, starting on April 1, 2023. The bill also includes an additional payment of the Goods and Services Tax/Harmonized Sales Tax (GST/HST) credit equal to double the amount of the regular January 2023 payment.
Jobs
The bill doubles the maximum deduction for tradespeople’s tools, from $500 to $1,000. This could help tradespeople save money on the tools they need for their jobs. It also includes providing for automatic, quarterly advance payments of the Canada Workers Benefit.
Taxation
The bill includes several changes to tax laws. It allows the Canada Revenue Agency (CRA) to accept electronic signatures on tax returns. It increases the maximum amount that tradespeople can deduct for tools. It changes the way profits from selling homes quickly are taxed. It also exempts certain benefits for Canadian Forces members and veterans from taxes. Additionally, it exempts income earned by the Band Class Settlement Trust from taxes. Finally, it changes reporting requirements for certain transactions and tax treatments.
Spending
The bill includes measures related to government spending, such as authorizing additional payments to provinces and territories through the Canada Health Transfer and Equalization and Territorial Formula Financing programs. It also addresses the Bank of Canada's surplus and losses from bond purchases, and increases the amount for the Canada Growth Fund.
Environmental Protection
The bill amends the Canadian Environmental Protection Act, 1999 to establish an Environmental Economic Instruments Fund for administering contributions to certain funding programs and replaces references to “tradeable units” with “compliance units”. It also amends the Marine Liability Act to broaden the compensation regime of the Ship-source Oil Pollution Fund to include certain future losses, and amends the Food and Drugs Act to prohibit cosmetic testing on animals.
Crime
The bill amends the Criminal Code to provide for a new warrant authorizing a peace officer to search for and seize digital assets, including virtual currency. It also creates new offenses related to money services businesses operating without registration and structuring financial transactions to avoid reporting obligations.