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Bill C-19

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First Session, Forty-fourth Parliament,

70-71 Elizabeth II, 2021-2022

HOUSE OF COMMONS OF CANADA

BILL C-19
An Act to implement certain provisions of the budget tabled in Parliament on April 7, 2022 and other measures

Reprinted as amended by the Standing Committee on Finance as a working copy for the use of the House of Commons at Report Stage and as reported to the House on June 1, 2022

DEPUTY PRIME MINISTER AND MINISTER OF FINANCE

91010


RECOMMENDATION

Her Excellency the Governor General recommends to the House of Commons the appropriation of public revenue under the circumstances, in the manner and for the purposes set out in a measure entitled “An Act to implement certain provisions of the budget tabled in Parliament on April 7, 2022 and other measures”.

SUMMARY

Part 1 implements certain income tax measures by

(a)providing a Labour Mobility Deduction for the temporary relocation of tradespeople to a work location;

(b)allowing for the immediate expensing of eligible property by certain Canadian businesses;

(c)allowing the Children’s Special Allowance to be paid in respect of a child who is maintained by an Indigenous governing body and providing consistent tax treatment of kinship care providers and foster parents receiving financial assistance from an Indigenous governing body and those receiving such assistance from a provincial government;

(d)doubling the allowable qualifying expense limit under the Home Accessibility Tax Credit;

(e)expanding the criteria for the mental functions impairment eligibility as well as the life-sustaining therapy category eligibility for the Disability Tax Credit;

(f)providing clarity in respect of the determination of the one-time additional payment under the GST/HST tax credit for the period 2019-2020;

(g)changing the delivery of Climate Action Incentive payments from a refundable credit claimed annually to a credit that is paid quarterly;

(h)temporarily extending the period for incurring eligible expenses and other deadlines under film or video production tax credits;

(i)providing a tax incentive for specified zero-emission technology manufacturing activities;

(j)providing the Canada Revenue Agency (CRA) the discretion to accept late applications for the Canada Emergency Wage Subsidy, the Canada Emergency Rent Subsidy and the Canada Recovery Hiring Program;

(k)including postdoctoral fellowship income in the definition of “earned income” for RRSP purposes;

(l)enabling registered charities to enter into charitable partnerships with organizations other than qualified donees under certain conditions;

(m)allowing automatic and immediate revocation of the registration of an organization as a charity where that organization is listed as a terrorist entity under the Criminal Code;

(n)enabling the CRA to use taxpayer information to assist in the collection of Canada Emergency Business Account loans; and

(o)expanding capital cost allowance deductions to include new clean energy equipment.

It also makes related and consequential amendments to the Excise Tax Act, the Children’s Special Allowances Act, the Excise Act, 2001, the Income Tax Regulations and the Children’s Special Allowance Regulations.

Part 2 implements certain Goods and Services Tax/Harmonized Sales Tax (GST/HST) measures by

(a)ensuring that all assignment sales in respect of newly constructed or substantially renovated residential housing are taxable supplies for GST/HST purposes; and

(b)extending eligibility for the expanded hospital rebate to health care services supplied by charities or non-profit organizations with the active involvement of, or on the recommendation of, either a physician or a nurse practitioner, irrespective of their geographic location.

Part 3 amends the Excise Act, 2001, the Excise Act and other related texts in order to implement three measures.

Division 1 of Part 3 implements a new federal excise duty framework for vaping products by, among other things,

(a)requiring that manufacturers of vaping products obtain a vaping licence from the CRA;

(b)requiring that all vaping products that are removed from the premises of a vaping licensee to be entered into the Canadian market for retail sale be affixed with an excise stamp;

(c)imposing excise duties on vaping products to be paid by vaping product licensees;

(d)providing for administration and enforcement rules related to the excise duty framework on vaping products;

(e)providing the Governor in Council with authority to provide for an additional excise duty in respect of provinces and territories that enter into a coordinated vaping product taxation agreement with Canada; and

(f)making related amendments to other legislative texts, including to allow for a coordinated federal/provincial-territorial vaping product taxation system and to ensure that the excise duty framework applies properly to imported vaping products.

Division 2 of Part 3 amends the excise duty exemption under the Excise Act, 2001 for wine produced in Canada and composed wholly of agricultural or plant product grown in Canada.

Division 3 of Part 3 amends the Excise Act to eliminate excise duty for beer containing no more than 0.‍5% alcohol by volume.

Part 4 enacts the Select Luxury Items Tax Act. That Act creates a new taxation regime for domestic sales, and importations into Canada, of certain new motor vehicles and aircraft priced over $100,000 and certain new boats priced over $250,000. It provides that the tax applies if the total price or value of the subject select luxury item at the time of sale or importation exceeds the relevant price threshold. It provides that the tax is to be calculated at the lesser of 10% of the total price of the item and 20% of the total price of the item that exceeds the relevant price threshold. To promote compliance with the new taxation regime, that Act includes modern elements of administration and enforcement aligned with those found in other taxation statutes. Finally, this Part also makes related and consequential amendments to other texts to ensure proper implementation of the new tax and to ensure a cohesive and efficient administration by the CRA.

Division 1 of Part 5 retroactively renders a provision of the contract that is set out in the schedule to An Act respecting the Canadian Pacific Railway, chapter 1 of the Statutes of Canada, 1881, to be of no force or effect. It retroactively extinguishes any obligations and liabilities of Her Majesty in right of Canada and any rights and privileges of the Canadian Pacific Railway Company arising out of or acquired under that provision.

Division 2 of Part 5 amends the Nisga’a Final Agreement Act to give force of law to the entire Nisga’a Nation Taxation Agreement during the period that that Taxation Agreement is, by its terms, in force.

Division 3 of Part 5 repeals the Safe Drinking Water for First Nations Act.

It also amends the Income Tax Act to exempt from taxation under that Act any income earned by the Safe Drinking Water Trust in accordance with the Settlement Agreement entered into on September 15, 2021 relating to long-term drinking water quality for impacted First Nations.

Division 4 of Part 5 authorizes payments to be made out of the Consolidated Revenue Fund for the purpose of addressing transit shortfalls and needs and improving housing supply and affordability.

Division 5 of Part 5 amends the Canada Deposit Insurance Corporation Act by adding the President and Chief Executive Officer of the Canada Deposit Insurance Corporation and one other member to that Corporation’s Board of Directors.

Division 6 of Part 5 amends the Federal-Provincial Fiscal Arrangements Act to authorize additional payments to the provinces and territories.

Division 7 of Part 5 amends the Borrowing Authority Act to, among other things, count previously excluded borrowings made in the spring of 2021 in the calculation of the maximum amount that may be borrowed. It also amends the Financial Administration Act to change certain reporting requirements in relation to amounts borrowed under orders made under paragraph 46.‍1(c) of that Act.

Division 8 of Part 5 amends the Pension Benefits Standards Act, 1985 to, among other things, permit the establishment of a solvency reserve account in the pension fund of certain defined benefit plans and require the establishment of governance policies for all pension plans.

Division 9 of Part 5 amends the Special Import Measures Act to, among other things,

(a)provide that assessments of injury are to take into account impacts on workers;

(b)require the Canadian International Trade Tribunal to make inquiries with respect to massive importations when it is acting under section 42 of that Act;

(c)require that Tribunal to initiate expiry reviews of certain orders and findings;

(d)modify the deadline for notifying the government of the country of export of properly documented complaints;

(e)modify the criteria for imposing duties in cases of massive importations;

(f)modify the criteria for initiating anti-circumvention investigations; and

(g)remove the requirement that, in order to find circumvention, the principal cause of the change in a pattern of trade must be the imposition of anti-dumping or countervailing duties.

It also amends the Canadian International Trade Tribunal Act to provide that trade unions may, with the support of domestic producers, file global safeguard complaints.

Division 10 of Part 5 amends the Trust and Loan Companies Act and the Insurance Companies Act to, among other things, modernize corporate governance communications of financial institutions.

Division 11 of Part 5 amends the Insurance Companies Act to permit property and casualty companies and marine companies to not include the value of certain debt obligations when calculating their borrowing limit.

Division 12 of Part 5 enacts the Prohibition on the Purchase of Residential Property by Non-Canadians Act. The Act prohibits the purchase of residential property in Canada by non-Canadians unless they are exempted by the Act or its regulations or the purchase is made in certain circumstances specified in the regulations.

Division 13 of Part 5 amends the Parliament of Canada Act and makes consequential and related amendments to other Acts to, among other things,

(a)change the additional annual allowances that are paid to senators who occupy certain positions so that the government’s representatives and the Opposition in the Senate are eligible for the allowances for five positions each and the three other recognized parties or parliamentary groups in the Senate with the greatest number of members are eligible for the allowances for four positions each;

(b)provide that the Leader of the Government in the Senate or Government Representative in the Senate, the Leader of the Opposition in the Senate and the Leader or Facilitator of every other recognized party or parliamentary group in the Senate are to be consulted on the appointment of certain officers and agents of Parliament; and

(c)provide that the Leader of the Government in the Senate or Government Representative in the Senate, the Leader of the Opposition in the Senate and the Leader or Facilitator of every other recognized party or parliamentary group in the Senate may change the membership of the Standing Senate Committee on Internal Economy, Budgets and Administration.

Division 14 of Part 5 amends the Financial Administration Act in order to, among other things, allow the Treasury Board to provide certain services to certain entities.

Division 15 of Part 5 amends the Competition Act to enhance the Commissioner of Competition’s investigative powers, criminalize wage fixing and related agreements, increase maximum fines and administrative monetary penalties, clarify that incomplete price disclosure is a false or misleading representation, expand the definition of anti-competitive conduct, allow private access to the Competition Tribunal to remedy an abuse of dominance and improve the effectiveness of the merger notification requirements and other provisions.

Division 16 of Part 5 amends the Copyright Act to extend certain terms of copyright protection, including the general term, from 50 to 70 years after the life of the author and, in doing so, implements one of Canada’s obligations under the Canada–United States–Mexico Agreement.

Division 17 of Part 5 amends the College of Patent Agents and Trademark Agents Act to, among other things,

(a)ensure that the College has sufficient independence and flexibility to exercise its corporate functions;

(b)provide statutory immunity to certain persons involved in the regulatory activities of the College; and

(c)grant powers to the Registrar and Investigations Committee that will allow for improved efficiency in the complaints and discipline process.

Division 18 of Part 5 enacts the Civil Lunar Gateway Agreement Implementation Act to implement Canada’s obligations under the Memorandum of Understanding between the Government of Canada and the Government of the United States of America concerning Cooperation on the Civil Lunar Gateway. It provides for powers to protect confidential information provided under the Memorandum. It also makes related amendments to the Criminal Code to extend its application to activities related to the Lunar Gateway and to the Government Employees Compensation Act to address the cross-waiver of liability set out in the Memorandum.

Division 19 of Part 5 amends the Corrections and Conditional Release Act to restrict the use of detention in dry cells to cases where the institutional head has reasonable grounds to believe that an inmate has ingested contraband or that contraband is being carried in the inmate’s rectum.

Division 20 of Part 5 amends the Customs Act in order to authorize its administration and enforcement by electronic means and to provide that the importer of record of goods is jointly and severally, or solidarily, liable to pay duties on the goods under section 17 of that Act with the importer or person authorized to account for the goods, as the case may be, and the owner of the goods.

Division 21 of Part 5 amends the Criminal Code to create an offence of wilfully promoting antisemitism by condoning, denying or downplaying the Holocaust through statements communicated other than in private conversation.

Division 22 of Part 5 amends the Judges Act, the Federal Courts Act, the Tax Court of Canada Act and certain other acts to, among other things,

(a)implement the Government of Canada’s response to the report of the sixth Judicial Compensation and Benefits Commission regarding salaries and benefits and to create the office of supernumerary prothonotary of the Federal Court;

(b)increase the number of judges for certain superior courts and include the new offices of Associate Chief Justice of the Court of Queen’s Bench of New Brunswick and Associate Chief Justice of the Court of Queen’s Bench for Saskatchewan;

(c)create the offices of prothonotary and supernumerary prothonotary of the Tax Court of Canada; and

(d)replace the term “prothonotary” with “associate judge”.

Division 23 of Part 5 amends the Immigration and Refugee Protection Act to, among other things,

(a)authorize the Minister of Citizenship and Immigration to give instructions establishing categories of foreign nationals for the purposes of determining to whom an invitation to make an application for permanent residence is to be issued, as well as instructions setting out the economic goal that that Minister seeks to support in establishing the category;

(b)prevent an officer from issuing a visa or other document to a foreign national invited in respect of an established category if the foreign national is not in fact eligible to be a member of that category;

(c)require that the annual report to Parliament on the operation of that Act include a description of any instructions that establish a category of foreign nationals, the economic goal sought to be supported in establishing the category and the number of foreign nationals invited to make an application for permanent residence in respect of the category; and

(d)authorize that Minister to give instructions respecting the class of permanent residents in respect of which a foreign national must apply after being issued an invitation, if the foreign national is eligible to be a member of more than one class.

Division 24 of Part 5 amends the Old Age Security Act to correct a cross-reference in that Act to the Budget Implementation Act, 2021, No. 1.

Division 25 of Part 5

(a)amends the Canada Emergency Response Benefit Act to set out the consequences that apply in respect of a worker who received, for a four-week period, an income support payment and who received, for any week during the four-week period, any benefit, allowance or money referred to in subparagraph 6(1)‍(b)‍(ii) or (iii) of that Act;

(b)amends the Canada Emergency Student Benefit Act to set out the consequences that apply in respect of a student who received, for a four-week period, a Canada emergency student benefit and who received, for any week during the four-week period, any benefit, allowance or money referred to in subparagraph 6(1)‍(b)‍(ii) or (iii) of that Act; and

(c)amends the Employment Insurance Act to set out the consequences that apply in respect of a claimant who received, for any week, an employment insurance emergency response benefit and who received, for that week, any payment or benefit referred to in paragraph 153.‍9(2)‍(c) or (d) of that Act.

Division 26 of Part 5 amends the Employment Insurance Act to, among other things,

(a)replace employment benefits and support measures set out in Part II of that Act with employment support measures that are intended to help insured participants and other workers — including workers in groups underrepresented in the labour market — to obtain and keep employment; and

(b)allow the Canada Employment Insurance Commission to enter into agreements to provide for the payment of contributions to organizations for the costs of measures that they implement and that are consistent with the purpose and guidelines set out in Part II of that Act.

It also makes a consequential amendment to the Income Tax Act.

Division 27 of Part 5 amends the Employment Insurance Act to specify the maximum number of weeks for which benefits may be paid in a benefit period to certain seasonal workers and to extend, until October 28, 2023, the increase in the maximum number of weeks for which those benefits may be paid. It also amends the Budget Implementation Act, 2021, No. 1 to add a transitional measure in relation to amendments to the Employment Insurance Regulations that are found in that Act.

Division 28 of Part 5 amends the Canada Pension Plan to make corrections respecting

(a)the calculation of the minimum qualifying period and the contributory period for the purposes of the post-retirement disability benefit;

(b)the determination of values for contributors who have periods excluded from their contributory periods by reason of disability; and

(c)the attribution of amounts for contributors who have periods excluded from their contributory periods because they were family allowance recipients.

Division 29 of Part 5 amends An Act to amend the Criminal Code and the Canada Labour Code to, among other things,

(a)shorten the period before which an employee begins to earn one day of medical leave of absence with pay per month;

(b)standardize the conditions related to the requirement to provide a medical certificate following a medical leave of absence, regardless of whether the leave is paid or unpaid;

(c)authorize the Governor in Council to make regulations in certain circumstances, including to modify certain provisions respecting medical leave of absence with pay;

(d)ensure that, for the purposes of medical leave of absence, an employee who changes employers due to the lease or transfer of a work, undertaking or business or due to a contract being awarded through a retendering process is deemed to be continuously employed with one employer; and

(e)provide that the provisions relating to medical leave of absence come into force no later than December 1, 2022.

Division 30 of Part 5 amends the Canada Business Corporations Act to, among other things,

(a)require certain corporations to send to the Director appointed under that Act information on individuals with significant control on an annual basis or when a change occurs;

(b)allow that Director to provide all or part of that information to an investigative body, the Financial Transactions and Reports Analysis Centre of Canada or any prescribed entity; and

(c)clarify that, for the purposes of subsection 21.‍1(7) of that Act, it is the securities of a corporation, not the corporation itself, that are listed and posted for trading on a designated stock exchange.

Division 31 of Part 5 amends the Special Economic Measures Act and the Justice for Victims of Corrupt Foreign Officials Act (Sergei Magnitsky Law) to, among other things,

(a)create regimes allowing for the forfeiture of property that has been seized or restrained under those Acts;

(b)specify that the proceeds resulting from the disposition of those properties are to be used for certain purposes; and

(c)allow for the sharing of information between certain persons in certain circumstances.

It also makes amendments to the Seized Property Management Act in relation to those forfeiture of property regimes.

Available on the House of Commons website at the following address:
www.ourcommons.ca


TABLE OF PROVISIONS

An Act to implement certain provisions of the budget tabled in Parliament on April 7, 2022 and other measures
Short Title
1

Budget Implementation Act, 2022, No. 1

PART 1
Amendments to the Income Tax Act and Other Legislation
2
PART 2
Amendments to the Excise Tax Act (GST/HST Measures)
52
PART 3
Amendments to the Excise Act, 2001, the Excise Act and Other Related Texts
DIVISION 1
Excise Act, 2001 and Other Related Texts (Vaping Products)
54
DIVISION 2
Excise Act, 2001 (Wine)
129
DIVISION 3
Excise Act (Beer)
133
PART 4
Select Luxury Items Tax Act
135

Enactment of Act

An Act respecting the taxation of select luxury items
Short Title
1

Select Luxury Items Tax Act

PART 1
Select Luxury Items Tax
DIVISION 1
Interpretation and Application
SUBDIVISION A 
Interpretation
2

Definitions

3

Meaning of administration or enforcement of this Act

4

Person resident in Canada

5

Arm’s length

6

Negative amounts

7

Sale — subject item

8

Improvement to subject item

9

Price threshold

10

Definition of business

11

Where vessel journeys originate and terminate

12

Registration of vehicle

SUBDIVISION B 
Consideration and Retail Value
13

Definitions

14

Value of consideration

15

Levies included in consideration

16

Retail value of subject item

SUBDIVISION C 
Her Majesty
17

Her Majesty

DIVISION 2
Application of Tax
SUBDIVISION A 
Tax on Sale
18

Tax — sale of subject item

19

Tax not payable — registered vendor of vehicles

SUBDIVISION B 
Tax on Importation
20

Tax — importation into Canada

21

Tax not payable — registered vendor

22

Definition of determination of the tax status

SUBDIVISION C 
Tax in Other Circumstances
23

Tax — registration of registered vendor’s vehicle

24

Tax — lease of subject vehicle

25

Tax — lease of aircraft or vessel

26

Tax — use of aircraft or vessel

27

Tax — ceasing to be registered vendor

28

Tax — ceasing to be qualifying aircraft user

SUBDIVISION D 
Tax on Improvements
29

Rules — improvement after sale

30

Rules — improvement in other circumstances

31

Improvement period — regulations

32

Non-arm’s length — joint and several, or solidary, liability

SUBDIVISION E 
General Rules
33

Tax not payable — regulations

34

Amount of tax — general

35

Amount of tax — improvement

DIVISION 3
Certificates
36

Exemption certificate

37

Tax certificate

38

Application for special import certificate

DIVISION 4
Rebates
SUBDIVISION A 
Rebates to Net Tax
39

Rebate to net tax — export

40

Rebate to net tax — regulations

41

Application for rebate to net tax

SUBDIVISION B 
Other Rebates
42

Rebate — foreign representative

43

Rebate — payment in error

44

Rebate — regulations

45

Restriction on rebate

SUBDIVISION C 
General Rules for Rebates
46

Restriction on rebate

47

Single application

48

Restriction — bankruptcy

49

Statutory recovery rights

DIVISION 5
Registration, Reporting Periods, Returns and Requirement to Pay
50

Qualifying sale

51

Application for registration

52

Cancellation of registration

53

Security — registration

54

Reporting periods

55

Filing of return

56

Form and content

57

Net tax — obligation

58

Overpayment of rebate or interest

59

Information return

PART 2
Administration
DIVISION 1
Miscellaneous
SUBDIVISION A 
Trustees, Receivers and Personal Representatives
60

Definitions

61

Estate or succession of deceased individual

62

Definitions

63

Distribution by trust

SUBDIVISION B 
Amalgamation and Winding-up
64

Amalgamations

65

Winding-up

SUBDIVISION C 
Partnerships and Joint Ventures
66

Partnerships

67

Joint ventures

SUBDIVISION D 
Anti-avoidance
68

Definitions

69

Definitions

DIVISION 2
Administration and Enforcement
SUBDIVISION A 
Payments
70

Set-off of rebate

71

Definition of electronic payment

72

Small amounts owing

73

Authority for separate returns

74

Definition of electronic filing

75

Execution of returns, etc.

76

Extension of time

77

Demand for return

SUBDIVISION B 
Administration and Officers
78

Minister’s duty

79

Staff

80

Administration of oaths

81

Inquiry

SUBDIVISION C 
Interest
82

Specified rate of interest

83

Compound interest on amounts owed by Her Majesty

84

Interest if Act amended

85

Waiving or reducing interest

86

Cancellation of penalties and interest

87

Dishonoured instruments

SUBDIVISION D 
Records and Information
88

Keeping records

89

Electronic funds transfer

90

Requirement to provide information or record

91

Definitions

SUBDIVISION E 
Assessments
92

Assessment

93

Assessment of rebate

94

Restriction on payment by Minister

95

Notice of assessment

96

Limitation period for assessments

SUBDIVISION F 
Objections to Assessment
97

Objection to assessment

98

Extension of time by Minister

SUBDIVISION G 
Appeal
99

Extension of time by Tax Court of Canada

100

Appeal to Tax Court of Canada

101

Extension of time to appeal

102

Limitation on appeals to Tax Court of Canada

103

Institution of appeals

104

Disposition of appeal

105

References to Tax Court of Canada

106

Reference of common questions to Tax Court of Canada

SUBDIVISION H 
Penalties
107

Failure to file return

108

Failure to file by electronic transmission

109

Failure to register

110

Penalty — false statement

111

Penalty for false declaration — special import certificate

112

Failure to apply — tax certificate

113

Failure to notify — tax certificate

114

Penalty — unregistered importer

115

Failure to answer demand

116

Failure to provide information

117

Failure to provide information

118

False statements or omissions

119

General penalty

120

Waiving or cancelling penalties

SUBDIVISION I 
Offences and Punishment
121

Offence for failure to file return or to comply with demand or order

122

Offences for false or deceptive statement

123

Definition of confidential information

124

Failure to pay tax

125

General offence

126

Compliance orders

127

Officers of corporations, etc.

128

No power to decrease punishment

129

Information or complaint

SUBDIVISION J 
Inspections
130

Definition of dwelling-house

131

Compliance order

132

Search warrant

133

Definition of foreign-based information or record

134

Copies

135

Compliance

136

Information respecting non-resident persons

SUBDIVISION K 
Collection
137

Definitions

138

Security

139

Collection restrictions

140

Over $10,000,000 — security

141

Certificates

142

Garnishment

143

Recovery by deduction or set-off

144

Acquisition of debtor’s property

145

Money seized from debtor

146

Seizure

147

Person leaving Canada or defaulting

148

Definitions

149

Compliance by unincorporated bodies

150

Definition of transaction

SUBDIVISION L 
Evidence and Procedure
151

Service

152

Timing of receipt

153

Proof of service

DIVISION 3
Regulations
154

Regulations

155

Positive or negative amount — regulations

156

Incorporation by reference — limitation removed

157

Certificates and registrations not statutory instruments

PART 5
Various Measures
DIVISION 1
Provisions Relating to Canadian Pacific Railway Company Tax Exemption
174
DIVISION 2
Nisga’a Final Agreement Act
177
DIVISION 3
Safe Drinking Water for First Nations
178
DIVISION 4
Payments in Relation to Transit and Housing
180
DIVISION 5
Canada Deposit Insurance Corporation Act
181
DIVISION 6
Federal-Provincial Fiscal Arrangements Act
182
DIVISION 7
Borrowings
183
DIVISION 8
Pension Benefits Standards Act, 1985
186
DIVISION 9
Trade Remedies
191
DIVISION 10
Corporate Governance of Financial Institutions
220
DIVISION 11
Insurance Companies Act
233
DIVISION 12
Prohibition on the Purchase of Residential Property by Non-Canadians Act
235

Enactment of Act

An Act to prohibit the purchase of residential property by non-Canadians
1

Prohibition on the Purchase of Residential Property by Non-Canadians Act

2

Definitions

3

Designation of Minister

4

Prohibition

5

Validity

6

Offence

7

Order

8

Regulations

DIVISION 13
Parliament of Canada Act
238
DIVISION 14
Financial Administration Act
255
DIVISION 15
Competition Act
256
DIVISION 16
Copyright Act
276
DIVISION 17
College of Patent Agents and Trademark Agents Act
282
DIVISION 18
Civil Lunar Gateway Agreement Implementation Act
294

Enactment of Act

An Act to implement the Memorandum of Understanding between the Government of Canada and the Government of the United States of America concerning Cooperation on the Civil Lunar Gateway and to make related amendments to other Acts
Short Title
1

Civil Lunar Gateway Agreement Implementation Act

Interpretation
2

Definitions

General
3

Purpose

4

Binding on Her Majesty

5

Order designating Minister

6

Delegation of powers

Information
7

Power to order production

8

Prohibition

9

Goods and data

10

Compliance order

11

Interpretation

Regulations
12

Regulations

DIVISION 19
Corrections and Conditional Release Act
299
DIVISION 20
Customs Act
302
DIVISION 21
Criminal Code
332
DIVISION 22
Judges and Prothonotaries
333
DIVISION 23
Immigration and Refugee Protection Act
377
DIVISION 24
Old Age Security Act
382
DIVISION 25
COVID-19 Benefits Adjustments
384
DIVISION 26
Employment Insurance Act
389
DIVISION 27
Benefits Related to Employment
410
DIVISION 28
Canada Pension Plan
417
DIVISION 29
Medical Leave with Pay
425
DIVISION 30
Canada Business Corporations Act
432
DIVISION 31
Economic Sanctions
438
DIVISION 32
Employment Insurance Board of Appeal
454

[Deleted]

SCHEDULE 1
SCHEDULE 2
SCHEDULE 3


1st Session, 44th Parliament,

70-71 Elizabeth II, 2021-2022

HOUSE OF COMMONS OF CANADA

BILL C-19

An Act to implement certain provisions of the budget tabled in Parliament on April 7, 2022 and other measures

Her Majesty, by and with the advice and consent of the Senate and House of Commons of Canada, enacts as follows:

Short Title

Short title

1This Act may be cited as the Budget Implementation Act, 2022, No. 1.

PART 1
Amendments to the Income Tax Act and Other Legislation

R.‍S.‍, c. 1 (5th Supp.‍)

Income Tax Act

2(1)Subsection 8(1) of the Income Tax Act is amended by striking out “and” at the end of paragraph (r), by adding “and” at the end of paragraph (s) and by adding the following after paragraph (s):

  • Labour mobility deduction

    (t)if the taxpayer is an eligible tradesperson for the year, an amount equal to the lesser of

    • (i)$4,000, and

    • (ii)the total of all amounts each of which is a temporary relocation deduction of the taxpayer for the year in respect of an eligible temporary relocation of the taxpayer.

(2)Section 8 of the Act is amended by adding the following after subsection (13):

Labour mobility deduction — interpretation

(14)For the purposes of this subsection and para­graph (1)‍(t),

  • (a)a taxpayer is an eligible tradesperson for a taxation year if, in the taxation year, the taxpayer has income from employment as a tradesperson or apprentice and performs their duties of employment in construction activities described in subsection 238(1) of the Income Tax Regulations;

  • (b)a temporary work location of a taxpayer is a location in Canada

    • (i)at which the taxpayer performs their duties of employment under a temporary employment contract, and

    • (ii)that is not situated in the locality where the taxpayer is ordinarily employed or carrying on business;

  • (c)an eligible temporary relocation of a taxpayer is a temporary relocation that meets the following conditions:

    • (i)the relocation is undertaken by the taxpayer to enable the taxpayer to perform their duties of employment as an eligible tradesperson at one or more temporary work locations of the taxpayer within the same locality,

    • (ii)prior to the relocation, the taxpayer ordinarily resided at a residence in Canada (in this subsection referred to as the “ordinary residence”),

    • (iii)the taxpayer was required by their duties of employment referred to in subparagraph (i) to be away from the ordinary residence for a period of not less than 36 hours,

    • (iv)during the temporary relocation, the taxpayer temporarily resided at one or more lodgings in Canada (in this subsection referred to as the “temporary lodging”), and

    • (v)the distance between the ordinary residence and each temporary work location of the taxpayer referred to in subparagraph (i) is not less than 150 kilometres greater than the distance between each temporary lodging referred in subparagraph (iv) and each temporary work location of the taxpayer referred to in subparagraph (i);

  • (d)subject to paragraph (e), an eligible temporary relocation expense of a taxpayer for a taxation year is a reasonable expense incurred by the taxpayer during the taxation year, the previous taxation year or prior to February 1 of the following taxation year, in respect of

    • (i)transportation for one round trip per eligible temporary relocation by the taxpayer between the ordinary residence and the temporary lodging,

    • (ii)meals consumed by the taxpayer during the round trip described in subparagraph (i), and

    • (iii)the taxpayer’s temporary lodging if, throughout the period of the taxpayer’s temporary relocation,

      • (A)the taxpayer maintains their ordinary residence as their principal place of residence, and

      • (B)the ordinary residence remains available for the taxpayer’s occupancy and is not rented to any other person;

  • (e)an eligible temporary relocation expense described in paragraph (d) does not include an expense incurred by the taxpayer to the extent that

    • (i)the expense is deducted (other than under paragraph (1)‍(t)) in computing the taxpayer’s income for any taxation year,

    • (ii)the expense was deductible under paragraph (1)‍(t) by the taxpayer for the immediately preceding taxation year, or

    • (iii)the taxpayer is entitled to receive a reimbursement, allowance or any other form of assistance (other than an amount that is included in computing the income for any taxation year of the taxpayer and that is not deductible in computing the income of the taxpayer) in respect of the expense; and

  • (f)a taxpayer’s temporary relocation deduction for a taxation year in respect of an eligible temporary relocation of the taxpayer is the lesser of

    • (i)the total eligible temporary relocation expenses of the taxpayer for the taxation year incurred in respect of the eligible temporary relocation, and

    • (ii)half of the taxpayer’s total income for the taxation year from employment as an eligible tradesperson at all temporary work locations referred to in subparagraph (c)‍(i) in respect of the eligible temporary relocation (computed without reference to this section).

(3)Subsections (1) and (2) apply to the 2022 and subsequent taxation years.

3(1)Subsection 13(2) of the Act is replaced by the following:

Recapture — Class 10.‍1 Passenger Vehicle

(2)Notwithstanding subsection 13(1), where an excess amount is determined under that subsection at the end of a taxation year in respect of a passenger vehicle having a cost to a taxpayer in excess of $20,000 or such other amount as may be prescribed, unless it was, at any time, designated immediate expensing property as defined in subsection 1104(3.‍1) of the Income Tax Regulations, that excess amount shall not be included in computing the taxpayer’s income for the year but shall be deemed, for the purposes of B in the definition undepreciated capital cost in subsection 13(21), to be an amount included in the taxpayer’s income for the year by reason of this section.

(2)The portion of paragraph 13(7)‍(i) of the Act before subparagraph (ii) is replaced by the following:

  • (i)if the cost to a taxpayer of a zero-emission passenger vehicle exceeds the prescribed amount in subsection 7307(1.‍1) of the Income Tax Regulations, or if the cost of a passenger vehicle that was, at any time, designated immediate expensing property as defined in subsection 1104(3.‍1) of the Income Tax Regulations exceeds the prescribed amount in subsection 7307(1) of the Income Tax Regulations,

    • (i)the capital cost to the taxpayer of the vehicle is deemed to be equal to the prescribed amount under subsection 7307(1) or (1.‍1), as the case may be, and

(3)Subsections (1) and (2) are deemed to have come into force for taxation years ending on or after April 19, 2021.

4(1)The portion of paragraph 81(1)‍(h) before subparagraph (i) of the Act is replaced by the following:

  • Social assistance

    (h)where the taxpayer is an individual (other than a trust), a social assistance payment (other than a prescribed payment) ordinarily made on the basis of a means, needs or income test under a program provided for by an Act of Parliament, a law of a province or a law of an Indigenous governing body (as defined in section 2 of the Children’s Special Allowances Act), to the extent that it is received directly or indirectly by the taxpayer for the benefit of another individual (other than the taxpayer’s spouse or common-law partner or a person who is related to the taxpayer or to the taxpayer’s spouse or common-law partner), if

(2)The portion of paragraph 81(1)‍(h.‍1) before subparagraph (i) of the Act is replaced by the following:

  • Social assistance for informal care programs

    (h.‍1)if the taxpayer is an individual (other than a trust), a social assistance payment ordinarily made on the basis of a means, needs or income test provided for under a program of the Government of Canada, the government of a province or of an Indigenous governing body (as defined in section 2 of the Children’s Special Allowances Act), to the extent that it is received directly or indirectly by the taxpayer for the benefit of a particular individual, if

(3)Subsections (1) and (2) are deemed to have come into force on January 1, 2020.

5(1)Paragraph (a) of the description of B in subsection 118.‍041(3) of the Act is replaced by the following:

(a)$20,000, and

(2)Paragraphs 118.‍041(5)‍(a) and (b) of the Act are replaced by the following:

  • (a)a maximum of $20,000 of qualifying expenditures for a taxation year in respect of a qualifying individual can be claimed under subsection (3) by the qualifying individual and all eligible individuals in respect of the qualifying individual;

  • (b)if there is more than one qualifying individual in respect of an eligible dwelling, a maximum of $20,000 of qualifying expenditures for a taxation year in respect of the eligible dwelling can be claimed under subsection (3) by the qualifying individuals and all eligible individuals in respect of the qualifying individuals; and

(3)Subsections (1) and (2) apply to the 2022 and subsequent taxation years.

6(1)Subparagraph 118.‍3(1)‍(a.‍1)‍(ii) of the Act is replaced by the following:

  • (ii)is required to be administered at least two times each week for a total duration averaging not less than 14 hours a week, and

(2)The portion of subsection 118.‍3(1.‍1) of the Act before paragraph (a) is replaced by the following:

Time spent on therapy

(1.‍1)For the purpose of paragraph 118.‍3(1)‍(a.‍1), in determining whether therapy is required to be administered at least two times each week for a total duration averaging not less than an average of 14 hours a week, the time spent on administering therapy

(3)Paragraphs 118.‍3(1.‍1)‍(b) to (d) of the Act are replaced by the following:

  • (b)in the case of therapy that requires

    • (i)a regular dosage of medication that is required to be adjusted on a daily basis, includes time spent on activities that are directly related to the determination of the dosage of the medication, and

    • (ii)the daily consumption of a medical food or medical formula to limit intake of a particular compound to levels required for the proper development or functioning of the body, includes the time spent on activities that are directly related to the determination of the amount of the compound that can be safely consumed;

  • (c)in the case of

    • (i)a child who is unable to perform the activities related to the administration of the therapy as a result of the child’s age, includes the time spent by another person to perform or supervise those activities for the child, and

    • (ii)an individual who is unable to perform the activities related to the administration of the therapy because of the effects of an impairment or impairments in physical or mental functions, includes the time required to be spent by another person to assist the individual in performing those activities; and

  • (d)does not include time spent on

    • (i)activities (other than activities described in paragraph (b)) related to dietary or exercise restrictions or regimes,

    • (ii)travel time,

    • (iii)medical appointments (other than medical appointments to receive therapy or to determine the daily dosage of medication, medical food or medical formula),

    • (iv)shopping for medication, or

    • (v)recuperation after therapy (other than medically required recuperation).

Start of inserted block

(3.‍1)Section 118.‍3 of the Act is amended by adding the following after subsection (1.‍1):

End of inserted block
Deeming
Start of inserted block

(1.‍2)Despite subsection (1.‍1), an individual who is diagnosed with type 1 diabetes mellitus is deemed to require therapy to be administered at least two times each week for a total duration averaging not less than 14 hours a week.

End of inserted block

(4)Subsections (1) to ( Insertion start 3.‍1 Insertion end ) apply to the 2021 and subsequent taxation years in respect of certificates described in paragraph 118.‍3(1)‍(a.‍2) or (a.‍3) of the Income Tax Act that are filed with the Minister of National Revenue after this Act receives royal assent.

7(1)Subparagraphs 118.‍4(1)‍(c.‍1)‍(i) to (iii) of the Act are replaced by the following:

  • (i)attention,

  • (ii)concentration,

  • (iii)memory,

  • (iv)judgement,

  • (v)perception of reality,

  • (vi)problem solving,

  • (vii)goal setting,

  • (viii)regulation of behaviour and emotions,

  • (ix)verbal and non-verbal comprehension, and

  • (x)adaptive functioning;

(2)Subsection (1) applies to the 2021 and subsequent taxation years in respect of certificates described in paragraph 118.‍3(1)‍(a.‍2) or (a.‍3) of the Income Tax Act that are filed with the Minister of National Revenue after this Act receives royal assent.

8(1)Subsection 122.‍5(3.‍001) of the Act is replaced by the following:

COVID-19 — additional deemed payment

(3.‍001)An eligible individual in relation to a month specified for a taxation year who files a return of income for the taxation year is deemed to have paid during the specified month on account of their tax payable under this Part for the taxation year an amount determined by the formula

A − B − C
where

A
is the total of

(a)$580,

(b)$580 for the qualified relation, if any, of the individual in relation to the specified month,

(c)if the individual has no qualified relation in relation to the specified month and is entitled to deduct an amount for the taxation year under subsection 118(1) because of paragraph (b) of the description of B in that subsection in respect of a qualified dependant of the individual in relation to the specified month, $580,

(d)$306 times the number of qualified dependants of the individual in relation to the specified month, other than a qualified dependant in respect of whom an amount is included under paragraph (c) in computing the total for the specified month,

(e)if the individual has no qualified relation and has one or more qualified dependants, in relation to the specified month, $306, and

(f)if the individual has no qualified relation and no qualified dependant, in relation to the specified month, the lesser of $306 and 2% of the amount, if any, by which the individual’s income for the taxation year exceeds $9,412;

B
is 5% of the amount, if any, by which the individual’s adjusted income for the taxation year in relation to the specified month exceeds $37,789; and

C
is the total amount that the eligible individual is deemed to have paid under subsection (3) on account of their tax payable for the specified months of July 2019, October 2019, January 2020 and April 2020.

(2)Subsection (1) is deemed to have come into effect on March 25, 2020.

9(1)Paragraph (i) of the definition eligible individual in section 122.‍6 of the Act is replaced by the following:

  • (i)an individual shall not fail to qualify as a parent (within the meaning assigned by section 252) of another individual solely because of the receipt of a social assistance amount that is payable under a program of the Government of Canada, the government of a province or an Indigenous governing body (as defined in section 2 of the Children’s Special Allowances Act) for the benefit of the other individual; (particulier admissible)

(2)Subsection (1) is deemed to have come into force on January 1, 2020.

10(1)Subsection 122.‍7(1.‍2) of the Act is replaced by the following:

Receipt of social assistance

(1.‍2)For the purposes of applying the definitions eligible dependant and eligible individual in subsection (1) for a taxation year, an individual shall not fail to qualify as a parent (within the meaning assigned by section 252) of another individual solely because of the receipt of a social assistance amount that is payable under a program of the Government of Canada, the government of a province or an Indigenous governing body (as defined in section 2 of the Children’s Special Allowances Act) for the benefit of the other individual, unless the amount is a special allowance under the Children’s Special Allowances Act in respect of the other individual in the taxation year.

(2)Subsection (1) is deemed to have come into force on January 1, 2020.

11(1)The definitions eligible individual, qualified dependant and qualified relation in subsection 122.‍8(1) of the Act are replaced by the following:

eligible individual, in relation to a month specified for a taxation year, means an individual (other than a trust) who

  • (a)has, before the specified month, attained the age of 19 years; or

  • (b)was, at any time before the specified month,

    • (i)a parent who resided with their child, or

    • (ii)married or in a common-law partnership. (particulier admissible)

qualified dependant, of an individual in relation to a month specified for a taxation year, means a person who at the beginning of the specified month

  • (a)is the individual’s child or is dependent for support on the individual or on the individual’s cohabiting spouse or common-law partner;

  • (b)resides with the individual;

  • (c)is under the age of 19 years;

  • (d)is not an eligible individual in relation to the specified month; and

  • (e)is not a qualified relation of any individual in relation to the specified month.‍ (personne à charge admissible)

qualified relation, of an individual in relation to a month specified for a taxation year, means the person, if any, who, at the beginning of the specified month, is the individual’s cohabiting spouse or common-law partner. (proche admissible)

(2)Subsection 122.‍8(2) of the Act is replaced by the following:

Persons not eligible or qualified

(2)Despite subsection (1), a person is not an eligible individual, is not a qualified relation and is not a qualified dependant, in relation to a month specified for a taxation year, if the person

  • (a)died before the specified month;

  • (b)is confined to a prison or similar institution for a period of at least 90 days that includes the first day of the specified month;

  • (c)is at the beginning of the specified month a non-resident person, other than a non-resident person who

    • (i)is at that time the cohabiting spouse or common-law partner of a person who is deemed under subsection 250(1) to be resident in Canada throughout the taxation year that includes the first day of the specified month, and

    • (ii)was resident in Canada at any time before the specified month;

  • (d)is at the beginning of the specified month a person described in paragraph 149(1)‍(a) or (b); or

  • (e)is a person in respect of whom a special allowance under the Children’s Special Allowances Act is payable for the specified month.

(3)Subsections 122.‍8(4) to (8) of the Act are replaced by the following:

Deemed payment on account of tax

(4)An eligible individual in relation to a month specified for a taxation year who files a return of income for the taxation year is deemed to have paid, during the specified month, on account of their tax payable under this Part for the taxation year, an amount equal to the amount, if any, determined by the formula

(A + B + C × D) × E
where

A
is the amount specified by the Minister of Finance for an eligible individual in relation to the specified month for the province (in this subsection and subsection (6) referred to as the “relevant province”) in which the eligible individual resides at the beginning of the specified month;

B
is

(a)the amount specified by the Minister of Finance for a qualified relation in relation to the specified month for the relevant province, if

(i)the eligible individual has a qualified relation at the beginning of the specified month, or

(ii)subparagraph (i) does not apply and the eligible individual has a qualified dependant at the beginning of the specified month, and

(b)in any other case, nil;

C
is the amount specified by the Minister of Finance for a qualified dependant in relation to the specified month for the relevant province;

D
is the number of qualified dependants of the eligible individual at the beginning of the specified month, other than a qualified dependant in respect of whom an amount is included because of subparagraph (a)‍(ii) of the description of B in relation to the specified month; and

E
is

(a)1.‍1, if there is a census metropolitan area, as determined in the last census published by Statistics Canada before the taxation year, in the relevant province and the individual does not reside in a census metropolitan area at the beginning of the specified month, and

(b)1, in any other case.

Shared-custody parent

(4.‍1)Despite subsection (4), if an eligible individual is a shared-custody parent (as defined in section 122.‍6, but the definition qualified dependent in that section having the meaning assigned by subsection (1)) in respect of one or more qualified dependants at the beginning of a month, the amount deemed by subsection (4) to have been paid during a specified month is equal to the amount determined by the formula

0.‍5(A + B)
where

A
is the amount determined under subsection (4), calculated without reference to this subsection; and

B
is the amount determined under subsection (4), calculated without reference to this subsection and subparagraph (b)‍(ii) of the definition eligible individual in section 122.‍6.

Months specified

(4.‍2)For the purposes of this section, the months specified for a taxation year are April, July and October of the immediately following taxation year and January of the second immediately following taxation year.

Authority to specify amounts

(5)The Minister of Finance may specify amounts for a province in relation to a month specified for a taxation year for the purposes of this section. If the Minister of Finance does not specify a particular amount that is relevant for the purposes of this section, that particular amount is deemed to be nil for the purpose of applying this section.

Deemed rebate in respect of fuel charges

(6)The amount deemed by this section to have been paid during a specified month on account of tax payable for a taxation year is deemed to have been paid during the specified month as a rebate in respect of charges levied under Part 1 of the Greenhouse Gas Pollution Pricing Act in respect of the relevant province.

Only one eligible individual

(7)If an individual is a qualified relation of another individual in relation to a month specified for a taxation year and both those individuals would be, but for this subsection, eligible individuals in relation to the specified month, only the individual that the Minister designates is the eligible individual in relation to the specified month.

Exception — qualified dependant

(8)If a person would, if this Act were read without reference to this subsection, be the qualified dependant of two or more individuals, in relation to a month specified for a taxation year,

  • (a)the person is deemed to be a qualified dependant, in relation to that month, of the one of those individuals on whom those individuals agree;

  • (b)in the absence of an agreement referred to in paragraph (a), the person is deemed to be, in relation to that month, a qualified dependant of the individuals, if any, who are, at the beginning of that month, eligible individuals (as defined in section 122.‍6, but the definition qualified dependant in that section having the meaning assigned by subsection (1)) in respect of that person; and

  • (c)in any other case, the person is deemed to be, in relation to that month, a qualified dependant only of the individual that the Minister designates.

Notification to Minister

(8.‍1)An individual shall notify the Minister of the occurrence of any of the following events before the end of the month following the month in which the event occurs:

  • (a)the individual ceases to be an eligible individual;

  • (b)a person becomes or ceases to be the individual’s qualified relation; and

  • (c)a person ceases to be a qualified dependant of the individual, otherwise than because of attaining the age of 19 years.

(4)Subsections (1) to (3) apply to payments made after June 2022 in respect of the 2021 and subsequent taxation years.

12(1)The Act is amended by adding the following after section 125.‍1:

Definitions

125.‍2(1)The following definitions apply in this section.

adjusted business income, of a corporation for a taxation year, has the same meaning as in Part LII of the Income Tax Regulations.‍ (revenu rajusté tiré d’une entreprise)

cost of capital, of a corporation for a taxation year, has the same meaning as in Part LII of the Income Tax Regulations. (coût en capital)

cost of labour, of a corporation for a taxation year, has the same meaning as in Part LII of the Income Tax Regulations. (coût en main-d’œuvre)

zero-emission technology manufacturing profits, of a corporation for a taxation year, means the amount determined by the formula

A × B × C
where

A
is the corporation’s adjusted business income for the taxation year;

B
is the fraction determined by the formula

D ÷ E
where

D
is the total of the corporation’s ZETM cost of capital and ZETM cost of labour for the taxation year, and

E
is the total of the corporation’s cost of capital and cost of labour for the taxation year; and

C
is

(a)if the fraction determined for B is at least 0.‍9, the fraction determined by the formula

F ÷ G
where

F
is the amount determined for E, and

G
is the amount determined for D; and

(b)1, in any other case. (bénéfices de fabrication de technologies à zéro émission)

ZETM cost of capital, of a corporation for a taxation year, has the same meaning as in Part LII of the Income Tax Regulations. (coût en capital de FTZE)

ZETM cost of labour, of a corporation for a taxation year, has the same meaning as in Part LII of the Income Tax Regulations. (coût en main-d’œuvre de FTZE)

Zero-emission technology manufacturing

(2)There may be deducted from the tax otherwise payable under this Part by a corporation for a taxation year the amount determined by the formula

(A × B) + (C × D)
where

A
is

(a)0.‍075, if the taxation year begins after 2021 and before 2029,

(b)0.‍05625, if the taxation year begins after 2028 and before 2030,

(c)0.‍0375, if the taxation year begins after 2029 and before 2031,

(d)0.‍01875, if the taxation year begins after 2030 and before 2032, and

(e)nil, in any other case;

B
is the least of

(a)the corporation’s zero-emission technology manufacturing profits for the taxation year,

(b)the amount of the corporation’s adjusted business income for the taxation year (determined without reference to section 5203 of the Income Tax Regulations) less

(i)if the corporation was a Canadian-controlled private corporation throughout the taxation year, the least of the amounts, if any, determined under paragraphs 125(1)‍(a) to (c) in respect of the corporation for the taxation year, and

(ii)in any other case, nil, and

(c)the amount, if any, by which the corporation’s taxable income for the taxation year exceeds the total of

(i)if the corporation was a Canadian-controlled private corporation throughout the taxation year, the least of the amounts, if any, determined under paragraphs 125(1)‍(a) to (c) in respect of the corporation for the taxation year,

(ii)the corporation’s aggregate investment income (as defined in subsection 129(4)) for the taxation year, and

(iii)the amount determined by multiplying the total of the amounts deducted under subsection 126(2) from its tax for the taxation year otherwise payable under this Part, by the relevant factor for the taxation year;

C
is

(a)0.‍045, if the taxation year begins after 2021 and before 2029,

(b)0.‍03375, if the taxation year begins after 2028 and before 2030,

(c)0.‍0225, if the taxation year begins after 2029 and before 2031,

(d)0.‍01125, if the taxation year begins after 2030 and before 2032, and

(e)nil, in any other case; and

D
is

(a)if the corporation was a Canadian-controlled private corporation throughout the taxation year, the lesser of

(i)the least of the amounts, if any, determined under paragraphs 125(1)‍(a) to (c) in respect of the corporation for the taxation year, and

(ii)the amount determined by the formula

E − F
where

E
is the corporation’s zero-emission technology manufacturing profits for the taxation year, and

F
is the amount determined for B, and

(b)nil, in any other case.

(2)Subsection (1) is deemed to have come into force on January 1, 2022.

13Section 125.‍4 of the Act is amended by adding the following after subsection (1):

COVID-19 — production commencement time

(1.‍1)The reference to “two years” in subparagraph (b)‍(iii) of the definition production commencement time in subsection (1) is to be read as a reference to “three years” in respect of film or video productions for which the labour expenditure of the corporation in respect of the production for the taxation year ending in 2020 or 2021 was greater than nil.

14(1)Section 125.‍7 of the Act is amended by adding the following after subsection (15):

Extension of time by Minister

(16)For the purposes of determining whether an eligible entity is a qualifying entity, a qualifying recovery entity or a qualifying renter, the Minister may, at any time, extend the time for filing an application under this section.

(2)Subsection (1) is deemed to have come into force on April 11, 2020.

15(1)The definition earned income in subsection 146(1) of the Act is amended by adding the following after paragraph (b):

  • (b.‍01)an amount included under paragraph 56(1)‍(n) in computing the taxpayer’s income for a period in the year throughout which the taxpayer was resident in Canada in connection with a program that consists primarily of research and does not lead to a diploma from a college or a collège d’enseignement général et professionnel, or a bachelor, masters, doctoral or equivalent degree,

(2)Subject to subsection (3), subsection (1) applies in respect of income received in the 2021 and subsequent taxation years.

(3)Before 2026, the taxpayer may file an election with the Minister of National Revenue to include income that is described in paragraph (b.‍01) of the definition earned income in subsection 146(1) of the Act, and received by the taxpayer after 2010 and before 2021, for the purposes of computing the taxpayer’s RRSP deduction limit (as defined in that subsection) on or after the date the election is filed.

16(1)The definition charitable purposes in subsection 149.‍1(1) of the Act is replaced by the following:

charitable purposes includes making qualifying disbursements; (fins de bienfaisance)

(2)Paragraph (a.‍1) of the definition charitable organization in subsection 149.‍1(1) of the Act is replaced by the following:

  • (a.‍1)all the resources of which are devoted to charitable activities carried on by the organization itself or to making qualifying disbursements,

(3)Subsection 149.‍1(1) of the Act is amended by adding the following in alphabetical order:

grantee organization includes a person, club, society, association or organization or prescribed entity, but does not include a qualified donee; (organisation donataire)

qualifying disbursement means a disbursement by a charity, by way of a gift or by otherwise making resources available,

  • (a)subject to subsection (6.‍001), to a qualified donee, or

  • (b)to a grantee organization, if

    • (i)the disbursement is in furtherance of a charitable purpose (determined without reference to the definition charitable purposes in this subsection) of the charity,

    • (ii)the charity ensures that the disbursement is exclusively applied to charitable activities in furtherance of a charitable purpose of the charity, and

    • (iii) Insertion start the charity maintains documentation sufficient to demonstrate Insertion end ;

      • Start of inserted block

        (A)the purpose for which the disbursement is made, and

      • (B)that the disbursement is exclusively applied by the grantee organization to charitable activities in furtherance of a charitable purpose of the charity; (versement admissible)

        End of inserted block

(4)Paragraphs 149.‍1(2)‍(b) and (c) of the Act are replaced by the following:

  • (b)fails to expend in any taxation year, on charitable activities carried on by it and by way of gifts made by it that are qualifying disbursements, amounts the total of which is at least equal to the organization’s disbursement quota for that year; or

  • (c)makes a disbursement, other than

    • (i)a disbursement made in the course of charitable activities carried on by it, or

    • (ii)a qualifying disbursement.

(5)Paragraphs 149.‍1(3)‍(b) and (b.‍1) of the Act are replaced by the following:

  • (b)fails to expend in any taxation year, on charitable activities carried on by it and by way of gifts made by it that are qualifying disbursements, amounts the total of which is at least equal to the foundation’s disbursement quota for that year;

  • (b.‍1)makes a disbursement, other than

    • (i)a disbursement made in the course of charitable activities carried on by it, or

    • (ii)a qualifying disbursement;

(6)Paragraphs 149.‍1(4)‍(b) and (b.‍1) of the Act are replaced by the following:

  • (b)fails to expend in any taxation year, on charitable activities carried on by it and by way of gifts made by it that are qualifying disbursements, amounts the total of which is at least equal to the foundation’s disbursement quota for that year;

  • (b.‍1)makes a disbursement, other than

    • (i)a disbursement made in the course of charitable activities carried on by it, or

    • (ii)a qualifying disbursement;

(7)Paragraph 149.‍1(4.‍1)‍(d) of the Act is replaced by the following:

  • (d)of a registered charity, if it has in a taxation year received a gift of property (other than a designated gift) from another registered charity with which it does not deal at arm’s length and it has expended, before the end of the next taxation year, in addition to its disbursement quota for each of those taxation years, an amount that is less than the fair market value of the property, on charitable activities carried on by it or by way of gifts that are qualified disbursements to qualified donees or grantee organizations, with which it deals at arm’s length;

(8)Subsection 149.‍1(6) of the Act is replaced by the following:

Devotion of resources — charitable activity

(6)A charitable organization shall be considered to be devoting its resources to charitable activities carried on by it to the extent that it uses those resources in carrying on a related business.

Qualifying disbursement limit — charitable organizations

(6.‍001)In any taxation year, disbursements of income of a charitable organization by way of gifts to a qualified donee (other than disbursements of income to a registered charity that the Minister has designated in writing as a charity associated with the charitable organization) in excess of 50% of the charitable organization’s income for that year are not qualifying disbursements.

(9)Subsection 149.‍1(10) of the Act is repealed.

(10)Subsections 149.‍1(20) and (21) of the Act are replaced by the following:

Rule regarding disbursement excess

(20)Where a registered charity has expended a disbursement excess for a taxation year, the charity may, for the purpose of determining whether it complies with the requirements of paragraph (2)‍(b), (3)‍(b) or (4)‍(b), as the case may be, for the immediately preceding taxation year of the charity and five or less of its immediately subsequent taxation years, include in the computation of the amounts expended on charitable activities carried on by it and by way of gifts made by it that are qualifying disbursements, such portion of that disbursement excess as was not so included under this subsection for any preceding taxation year.

Definition of disbursement excess

(21)For the purpose of subsection (20), disbursement excess, for a taxation year of a charity, means the amount, if any, by which the total of amounts expended in the year by the charity on charitable activities carried on by it and by way of gifts made by it that are qualifying disbursements exceeds its disbursement quota for the year.

17(1)Paragraph 152(1.‍2)‍(d) of the Act is replaced by the following:

  • (d)if the Minister determines the amount deemed by subsection 122.‍5(3), (3.‍001) or 122.‍8(4) to have been paid by an individual for a taxation year to be nil, subsection (2) does not apply to the determination unless the individual requests a notice of determination from the Minister.

(2)Subsection (1) applies to payments made after June 2022 in respect of the 2021 and subsequent taxation years.

18(1)Paragraph 160.‍1(1)‍(b) of the Act is replaced by the following:

  • (b)the taxpayer shall pay to the Receiver General interest at the prescribed rate on the excess (other than any portion thereof that can reasonably be considered to arise as a consequence of the operation of section 122.‍5, 122.‍61 or 122.‍8) from the day it became payable to the date of payment.

(2)Section 160.‍1 of the Act is amended by adding the following after subsection (1.‍1):

Liability for refund — Climate Action Incentive

(1.‍2)If a person is a qualified relation of an individual (within the meaning assigned by subsection 122.‍8(1)), in relation to one or more months specified for a taxation year, the person and the individual are jointly and severally, or solidarily, liable to pay the lesser of

  • (a)any excess described in subsection (1) that was refunded in respect of the taxation year to, or applied to a liability of, the individual as a consequence of the operation of section 122.‍8; and

  • (b)the total of the amounts deemed by subsection 122.‍8(4) to have been paid by the individual during those specified months.

(3)Subsection 160.‍1(2) of the Act is replaced by the following:

Liability under other provisions

(2)Subsections (1.‍1) and (1.‍2) do not limit a person’s liability under any other provision of this Act.

(4)Subsection 160.‍1(3) of the Act is replaced by the following:

Assessment

(3)The Minister may at any time assess a taxpayer in respect of any amount payable by the taxpayer because of any of subsections (1) to (1.‍2) or for which the taxpayer is liable because of subsection (2.‍1) or (2.‍2), and the provisions of this Division (including, for greater certainty, the provisions in respect of interest payable) apply, with any modifications that the circumstances require, in respect of an assessment made under this section, as though it were made under section 152 in respect of taxes payable under this Part, except that no interest is payable on an amount assessed in respect of an excess referred to in subsection (1) that can reasonably be considered to arise as a consequence of the operation of section 122.‍5, 122.‍61 or 122.‍8.

(5)Subsections (1) to (4) apply to payments made after June 2022 in respect of the 2021 and subsequent taxation years.

19(1)Paragraph 163(2)‍(c.‍4) of the Act is replaced by the following:

  • (c.‍4)the amount, if any, by which

    • (i)the total of all amounts each of which is an amount that would be deemed by section 122.‍8 to be paid by that person during a month specified for the year or, where that person is the qualified relation of an individual in relation to that specified month (within the meaning assigned by subsection 122.‍8(1)), by that individual, if that total were calculated by reference to the information provided in the person’s return of income (within the meaning assigned by subsection 122.‍8(1)) for the year

  • exceeds

    • (ii)the total of all amounts each of which is an amount that is deemed by section 122.‍8 to be paid by that person or by an individual of whom the person is the qualified relation in relation to a month specified for the year (within the meaning assigned by subsection 122.‍8(1)),

(2)Subsection (1) applies to payments made after June 2022 in respect of the 2021 and subsequent taxation years.

20(1)Section 164 of the Act is amended by adding the following after subsection (2.‍2):

Application respecting refunds — Climate Action Incentive

(2.‍21)Where an amount deemed under section 122.‍8 to be paid by an individual during a month specified for a taxation year is applied under subsection (2) to a liability of the individual and the individual’s return of income for the year is filed on or before the individual’s balance-due day for the year, the amount is deemed to have been so applied on the day on which the amount would have been refunded if the individual were not liable to make a payment to Her Majesty in right of Canada.

(2)The portion of subsection 164(3) of the Act before paragraph (a) is replaced by the following:

Interest on refunds and repayments

(3)If, under this section, an amount in respect of a taxation year (other than an amount, or a portion of the amount, that can reasonably be considered to arise from the operation of section 122.‍5, 122.‍61, 122.‍8 or 125.‍7) is refunded or repaid to a taxpayer or applied to another liability of the taxpayer, the Minister shall pay or apply interest on it at the prescribed rate for the period that begins on the day that is the latest of the days referred to in the following paragraphs and that ends on the day on which the amount is refunded, repaid or applied:

(3)Subsections (1) and (2) apply to payments made after June 2022 in respect of the 2021 and subsequent taxation years.

21Paragraph 168(1)‍(f) of the Act is replaced by the following:

  • (f)in the case of a registered charity, registered Canadian amateur athletic association or registered journalism organization, accepts a gift the granting of which was expressly or implicitly conditional on the charity, association or organization making a gift to another person, club, society, association or organization other than a qualified donee.

22(1)Subsection 188(1.‍2) of the Act is replaced by the following:

Winding-up period

(1.‍2)In this Part, the winding-up period of a charity is the period

  • (a)that begins immediately after the earliest of the days on which

    • (i)the Minister issues a notice of intention to revoke the registration of the charity under any of subsections 149.‍1(2) to (4.‍1) and 168(1),

    • (ii)the charity becomes a listed terrorist entity, and

    • (iii)it is determined, under subsection 7(1) of the Charities Registration (Security Information) Act, that a certificate served in respect of the charity under subsection 5(1) of that Act is reasonable on the basis of information and evidence available, and

  • (b)that ends on the day that is the latest of

    • (i)the day, if any, on which the charity files a return under subsection 189(6.‍1) for the taxation year deemed by subsection (1) to have ended, but not later than the day on which the charity is required to file that return,

    • (ii)the day on which the Minister last issues a notice of assessment of tax payable under subsection (1.‍1) for that taxation year by the charity, and

    • (iii)if the charity has filed a notice of objection or appeal in respect of that assessment, the day on which the Minister may take a collection action under section 225.‍1 in respect of that tax payable.

(2)Subsection (1) is deemed to have come into force on June 29, 2021.

23(1)Paragraph 188.‍1(5)‍(c) of the Act is replaced by the following:

  • (c)a qualifying disbursement.

(2)Subsection 188.‍1(12) of the Act is replaced by the following:

Gifts not at arm’s length

(12)If a registered charity has in a taxation year received a gift of property (other than a designated gift) from another registered charity with which it does not deal at arm’s length and it has expended, before the end of the next taxation year — in addition to its disbursement quota for each of those taxation years — an amount that is less than the fair market value of the property on charitable activities carried on by it or by way of gifts made by it that are qualifying disbursements to qualified donees or grantee organizations, with which it deals at arm’s length, the registered charity is liable to a penalty under this Act for that subsequent taxation year equal to 110% of the difference between the fair market value of the property and the additional amount expended.

24Paragraph 241(4)‍(d) of the Act is amended by striking out “or” at the end of subparagraph (xvii), by adding “or” at the end of subparagraph (xviii) and by adding the following after subparagraph (xviii):

  • (xix)to an official of the Canada Revenue Agency solely for the purpose of the collection of amounts owing to Her Majesty in right of Canada under the Canada Emergency Business Account program established by Export Development Canada in accordance with an authorization made under subsection 23(1) of the Export Development Act;

R.‍S.‍, c. E-15

Excise Tax Act

25Paragraph 295(5)‍(d) of the Excise Tax Act is amended by striking out “or” at the end of subparagraph (viii), by adding “or” at the end of subparagraph (ix) and by adding the following after subparagraph (ix):

  • (x)to an official of the Canada Revenue Agency solely for the purpose of the collection of amounts owing to Her Majesty in right of Canada under the Canada Emergency Business Account program established by Export Development Canada in accordance with an authorization made under subsection 23(1) of the Export Development Act;

1992, c. 48, Sch.

Children’s Special Allowances Act

26(1)Section 2 of the Children’s Special Allowances Act is amended by adding the following in alphabetical order:

Indigenous governing body means an Indigenous governing body (as defined in section 1 of An Act respecting First Nations, Inuit and Métis children, youth and families) that

  • (a)has given notice under subsection 20(1) of that Act;

  • (b)has requested a coordination agreement under subsection 20(2) of that Act; or

  • (c)meets prescribed conditions.‍ (corps dirigeant autochtone)

(2)Subsection (1) is deemed to have come into force on January 1, 2020.

27(1)Paragraphs 3(1)‍(a) and (b) of the Act are replaced by the following:

  • (a)resides in an institution, a group foster home, the private home of foster parents or in the private home of a guardian, tutor or other individual occupying a similar role for the month, under a decree, order or judgment of a competent tribunal and is maintained by

    • (i)a department or agency of the government of Canada or a province, or

    • (ii)an agency appointed by a province, including an authority established under the laws of a province, or by an agency appointed by such an authority, for the purpose of administering any law of the province for the protection and care of children;

  • (b)is maintained by an institution licensed or otherwise authorized under the law of the province to have the custody or care of children; or

  • (c)resides in an institution, a group foster home, the private home of foster parents or in the private home of a guardian, tutor or other individual occupying a similar role for the month, under the laws of an Indigenous governing body and is maintained by

    • (i)the Indigenous governing body,

    • (ii)a department or agency of the Indigenous governing body, or

    • (iii)an agency appointed by the Indigenous governing body, including an authority established under the laws of the Indigenous governing body, or by an agency appointed by such an authority, for the purpose of administering any law of the Indigenous governing body for the protection and care of children.

(2)Subsection (1) is deemed to have come into force on January 1, 2020.

28(1)Paragraph 4(1)‍(a) of the Act is replaced by the following:

  • (a)an application therefor has been made in the prescribed manner by the department, agency, institution or Indigenous governing body referred to in subsection 3(1) that maintains the child; and

(2)Subsection 4(3) of the Act is replaced by the following:

No allowance payable

(3)No special allowance is payable for the month in which the child in respect of whom the special allowance is payable commences to be maintained by a department, agency, institution or Indigenous governing body, and no special allowance is payable in respect of a child for the month in which the child is born or commences to reside in Canada.

(3)Paragraph 4(4)‍(a) of the Act is replaced by the following:

  • (a)ceases to be maintained by the department, agency, institution or Indigenous governing body;

(4)Subsections (1) to (3) are deemed to have come into force on January 1, 2020.

29(1)Sections 5 and 6 of the Act are replaced by the following:

Recipient of special allowance

5Where payment of a special allowance is approved in respect of a child, the special allowance shall, in such manner and at such times as are determined by the Minister, be paid to the department, agency, institution or Indigenous governing body referred to in subsection 3(1) that maintains the child or, in the prescribed circumstances, to a foster parent.

Report

6Where a special allowance ceases to be payable in respect of a child for a reason referred to in paragraph 4(4)‍(a), (b) or (c), the chief executive officer of the department, agency, institution or Indigenous governing body that made the application under paragraph 4(1)‍(a) in respect of the child shall, as soon as possible after the special allowance ceases to be payable in respect of the child, notify the Minister in the prescribed form and manner.

(2)Subsection (1) is deemed to have come into force on January 1, 2020.

30(1)Subsections 9(1) and (2) of the English version of the Act are replaced by the following:

Return of special allowance

9(1)Any person, department, agency, institution or Indigenous governing body that has received or obtained by cheque or otherwise payment of a special allowance under this Act to which the person, department, agency, institution or Indigenous governing body is not entitled, or payment in excess of the amount to which the person, department, agency, institution or Indigenous governing body is entitled, shall, as soon as possible, return the cheque or the amount of the payment, or the excess amount, as the case may be.

Recovery of amount of payment

(2)Where a person, department, agency, institution or Indigenous governing body has received or obtained payment of a special allowance under this Act to which the person, department, agency, institution or Indigenous governing body is not entitled, or payment in excess of the amount to which the person, department, agency, institution or Indigenous governing body is entitled, the amount of the special allowance or the amount of the excess, as the case may be, constitutes a debt due to Her Majesty.

(2)Subsection 9(3) of the Act is replaced by the following:

Deduction from subsequent special allowance

(3)Where any person, department, agency, institution or Indigenous governing body has received or obtained payment of a special allowance under this Act to which the person, department, agency, institution or Indigenous governing body is not entitled, or payment in excess of the amount to which the person, department, agency, institution or Indigenous governing body is entitled, the amount of the special allowance or the amount of the excess, as the case may be, may be deducted and retained in such manner as is prescribed out of any special allowance to which the person, department, agency, institution or Indigenous governing body is or subsequently becomes entitled under this Act.

(3)Subsections (1) and (2) are deemed to have come into force on January 1, 2020.

31(1)Section 11 of the Act is replaced by the following:

Agreements for exchange of information

11The Minister may enter into an agreement with the government of any province, or an Indigenous governing body, for the purpose of obtaining information in connection with the administration or enforcement of this Act or the regulations and of furnishing to that government, or Indigenous governing body, under prescribed conditions, any information obtained by or on behalf of the Minister in the course of the administration or enforcement of this Act or the regulations, if the Minister is satisfied that the information to be furnished to that government, or Indigenous governing body, under the agreement is to be used for the purpose of the administration of a social program, income assistance program or health insurance program in the province or of the Indigenous governing body.

(2)Subsection (1) is deemed to have come into force on January 1, 2020.

32(1)Paragraph 13(a) of the English version of the Act is replaced by the following:

  • (a)providing for the suspension of payment of a special allowance during any investigation respecting the eligibility of a department, agency, institution or Indigenous governing body to receive the special allowance and specifying the circumstances in which payment of a special allowance, the payment of which has been suspended, may be resumed;

(2)Paragraph 13(c) of the Act is replaced by the following:

  • (c)specifying for the purposes of this Act the circumstances in which a child shall be considered to be maintained by a department, agency, institution or Indigenous governing body; and

(3)Subsections (1) and (2) are deemed to have come into force on January 1, 2020.

2002, c. 22

Excise Act, 2001

33Paragraph 211(6)‍(e) of the Excise Act, 2001 is amended by striking out “or” at the end of subparagraph (ix), by adding “or” at the end of subparagraph (x) and by adding the following after subparagraph (x):

  • (xi)to an official of the Agency solely for the purpose of the collection of amounts owing to Her Majesty in right of Canada under the Canada Emergency Business Account program established by Export Development Canada in accordance with an authorization made under subsection 23(1) of the Export Development Act;

C.‍R.‍C.‍, c. 945

Income Tax Regulations

34(1)Section 1100 of the Income Tax Regulations is amended by adding the following before subsection (1):

Immediate expensing

(0.‍1)For the purposes of paragraph 20(1)‍(a) of the Act, a deduction is allowed in computing an eligible person or partnership’s income for each taxation year equal to the lesser of

  • (a)the eligible person or partnership’s immediate expensing limit for the taxation year,

  • (b)the undepreciated capital cost to the eligible person or partnership as of the end of the taxation year (before making any deduction under this Part for the taxation year) of property that is designated immediate expensing property for the taxation year, and

  • (c)if the eligible person or partnership is not a Canadian-controlled private corporation, the amount of income, if any, earned from the source of income that is a business or property (computed without regard to paragraph 20(1)‍(a) of the Act) in which the relevant designated immediate expensing property is used for the eligible person or partnership’s taxation year.

Undepreciated capital cost — immediate expensing

(0.‍2)Before computing any other deduction permitted under this Part and Schedules II to VI, the amount of any deduction made under subsection (0.‍1) by an eligible person or partnership in respect of a designated immediate expensing property of a prescribed class shall be deducted from the undepreciated capital cost of the particular class to which the property belongs.

Expenditures excluded from paragraph (0.‍1)‍(b)

(0.‍3)For the purposes of paragraph (0.‍1)‍(b), in respect of property of a class in Schedule II that is immediate expensing property of an eligible person or partnership solely because of subparagraph (c)‍(i) of the definition immediate expensing property in subsection 1104(3.‍1), amounts incurred by any person or partnership in respect of the property are not to be included in determining the undepreciated capital cost to the eligible person or partnership as of the end of the taxation year (before making any deduction under this Part for the taxation year) of property that is designated immediate expensing property for the taxation year if the amounts are incurred before April 19, 2021 (if the eligible person or partnership is a Canadian-controlled private corporation) or before 2022 (if the eligible person or partnership is an individual or Canadian partnership), unless

  • (a)the property was acquired by an eligible person or partnership from another person or partnership (referred to in this paragraph as the “transferee” and the “transferor”, respectively)

    • (i)if the transferee is a Canadian-controlled private corporation, after April 18, 2021, or

    • (ii)if the transferee is an individual or a Canadian partnership, after December 31, 2021;

  • (b)the transferee was either

    • (i)the eligible person or partnership, or

    • (ii)a person or partnership that does not deal at arm’s length with the eligible person or partnership; and

  • (c)the transferor

    • (i)dealt at arm’s length with the transferee, and

    • (ii)held the property as inventory.

(2)The portion of subsection 1100(1.‍1) of the Regulations before paragraph (a) is replaced by the following:

(1.‍1)Despite subsections (0.‍1), (1) and (3), the amount deductible by a taxpayer for a taxation year in respect of a property that is a specified leasing property at the end of the year is the lesser of

(3)Subsection 1100(1.‍12) of the Regulations is replaced by the following:

(1.‍12)Despite subsections (0.‍1), (1) and (1.‍1), where, in a taxation year, a taxpayer has acquired a property that was not used by the taxpayer for any purpose in that year and the first use of the property by the taxpayer is a lease of the property in respect of which subsection (1.‍1) applies, the amount allowed to the taxpayer under subsections (0.‍1) and (1) in respect of the property for the year shall be deemed to be nil.

(4)The portion of subsection 1100(11) of the Regulations before paragraph (a) is replaced by the following:

(11)Despite subsections (0.‍1) and (1), in no case shall the aggregate of deductions, each of which is a deduction in respect of property of a prescribed class owned by a taxpayer that includes rental property owned by him, otherwise allowed to the taxpayer by virtue of subsection (0.‍1) or (1) in computing his income for a taxation year, exceed the amount, if any, by which

(5)The portion of subsection 1100(15) of the Regulations before paragraph (a) is replaced by the following:

(15)Despite subsections (0.‍1) and (1), in no case shall the aggregate of deductions, each of which is a deduction in respect of property of a prescribed class that is leasing property owned by a taxpayer, otherwise allowed to the taxpayer under subsection (0.‍1) or (1) in computing his income for a taxation year, exceed the amount, if any, by which

(6)The portion of subsection 1100(20.‍1) of the Regulations before paragraph (a) is replaced by the following:

(20.‍1)The total of all amounts each of which is a deduction in respect of computer tax shelter property allowed to the taxpayer under subsection (0.‍1) or (1) in computing a taxpayer’s income for a taxation year shall not exceed the amount, if any, by which

(7)Subsection 1100(21.‍1) of the Regulations is replaced by the following:

(21.‍1)Despite subsections (0.‍1) and (1), where a taxpayer has acquired property described in paragraph (s) of Class 10 in Schedule II, or in paragraph (m) of Class 12 of Schedule II, the deduction in respect of the property otherwise allowed to the taxpayer under subsection (0.‍1) or (1) in computing the taxpayer’s income for a taxation year shall not exceed the amount that it would be if the capital cost to the taxpayer of the property were reduced by the portion of any debt obligation of the taxpayer outstanding at the end of the year that is convertible into an interest or, for civil law, a right in the property or an interest in the taxpayer.

(8)The portion of subsection 1100(24) of the Regulations before paragraph (a) is replaced by the following:

(24)Despite subsections (0.‍1) and (1), in no case shall the total of deductions, each of which is a deduction in respect of property of Class 34, 43.‍1, 43.‍2, 47 or 48 in Schedule II that is specified energy property owned by a taxpayer, otherwise allowed to the taxpayer under subsection (0.‍1) or (1) in computing the taxpayer’s income for a taxation year, exceed the amount, if any, by which

(9)Subsections (1) to (8) are deemed to have come into force on April 19, 2021.

35(1)Subsection 1102(20.‍1) of the Regulations is replaced by the following:

(20.‍1)For the purposes of subsections 1100(0.‍3) and (2.‍02) and 1104(3.‍1) and (4), a particular person or partnership and another person or partnership shall be considered not to be dealing at arm’s length with each other in respect of the acquisition or ownership of a property if, in the absence of this subsection, they would be considered to be dealing at arm’s length with each other and it may reasonably be considered that the principal purpose of any transaction or event, or a series of transactions or events, is to cause

  • (a)the property to qualify as accelerated investment incentive property or immediate expensing property; or

  • (b)the particular person or partnership and the other person or partnership to satisfy the condition in subclause 1100(2.‍02)‍(a)‍(i)‍(C)‍(I) or subparagraph 1100(0.‍3)‍(c)‍(i).

(2)Subsection (1) is deemed to have come into force on April 19, 2021.

36(1)Section 1104 of the Regulations is amended by adding the following after subsection (3):

Definitions

(3.‍1)The following definitions apply in this Part and Schedules II to VI.

designated immediate expensing property for a taxation year, means property of an eligible person or partnership that

  • (a)is immediate expensing property of the eligible person or partnership;

  • (b)became available for use by the eligible person or partnership in the taxation year; and

  • (c)is designated as designated immediate expensing property in prescribed form filed by the eligible person or partnership with the Minister for the taxation year

    • (i)if the eligible person or partnership is a partnership, on or before the day that is 12 months after the day on which any member of the partnership is required to file an information return under section 229 for the fiscal period to which the designation relates, and

    • (ii)in any other case, on or before the day that is 12 months after the eligible person or partnership’s filing-due date for the taxation year to which the designation relates. (bien relatif à la passation en charges immédiate désigné)

eligible person or partnership for a taxation year, means

  • (a)a corporation that was a Canadian-controlled private corporation throughout the year;

  • (b)an individual (other than a trust) who was resident in Canada throughout the year; or

  • (c)a Canadian partnership all of the members of which were, throughout the period, persons described in paragraph (a) or (b). (personne ou société de personnes admissible)

immediate expensing property for a taxation year, means property of a prescribed class (other than property included in any of Classes 1 to 6, 14.‍1, 17, 47, 49 and 51 in Schedule II) of an eligible person or partnership that

  • (a)is acquired by the eligible person or partnership

    • (i)if the eligible person or partnership is a Canadian-controlled private corporation, after April 18, 2021, or

    • (ii)if the eligible person or partnership is an individual or a Canadian partnership, after Decem­ber 31, 2021;

  • (b)becomes available for use

    • (i)if the eligible person or partnership is an individual or a Canadian partnership all the members of which are individuals throughout the taxation year, before 2025, and

    • (ii)in any other case, before 2024; and

  • (c)meets either of the following conditions:

    • (i)the property

      • (A)has not been used for any purpose before it was acquired by the eligible person or partnership, and

      • (B)is not a property in respect of which an amount has been deducted under paragraph 20(1)‍(a) or subsection 20(16) of the Act by any person or partnership for a taxation year ending before the time the property was acquired by the eligible person or partnership, or

    • (ii)the property was not

      • (A)acquired in circumstances where

        • (I)the eligible person or partnership was deemed to have been allowed or deducted an amount under paragraph 20(1)‍(a) of the Act in respect of the property in computing income for previous taxation years, or

        • (II)the undepreciated capital cost of depreciable property of a prescribed class of the eligible person or partnership was reduced by an amount determined by reference to the amount by which the capital cost of the property to the eligible person or partnership exceeds its cost amount, or

      • (B)previously owned or acquired by the eligible person or partnership or by a person or partnership with which the eligible person or partnership did not deal at arm’s length at any time when the property was owned or acquired by the person or partnership. (bien relatif à la passation en charges immédiate)

taxpayer unless the context otherwise requires, includes an eligible person or partnership.‍ (contribuable)

Immediate expensing limit

(3.‍2)For the purposes of this Part and Schedules II to VI, an eligible person or partnership’s immediate expensing limit for a taxation year is $1,500,000 unless the eligible person or partnership is associated (within the meaning of section 256 of the Act, as modified by subsection (3.‍6)) in the taxation year with one or more other eligible persons or partnerships, in which case, except as otherwise provided in this section, its immediate expensing limit is nil.

Associated eligible persons or partnerships

(3.‍3)Despite subsection (3.‍2), if all the eligible persons or partnerships that are associated with each other (within the meaning of section 256 of the Act, as modified by subsection (3.‍6)) in a taxation year file with the Minister in prescribed form an agreement that assigns for the purpose of this Part and Schedules II to VI a percentage to one or more of them for the year, the immediate expensing limit for the year of each of the eligible persons or partnerships is

  • (a)if the total of the percentages assigned in the agreement does not exceed 100%, $1,500,000 multiplied by the percentage assigned to that eligible person or partnership in the agreement; and

  • (b)in any other case, nil.

Failure to file agreement

(3.‍4)If any of the eligible persons or partnerships that are associated with each other (within the meaning of section 256 of the Act, as modified by subsection (3.‍6)) in a taxation year has failed to file with the Minister an agreement described in subsection (3.‍3) within 30 days after notice in writing by the Minister has been forwarded to any of them that such an agreement is required for the purpose of any assessment of tax under Part I of the Act, the Minister shall, for the purpose of this Part and Schedules II to VI, allocate an amount to one or more of them for the taxation year.

Special rules for immediate expensing limit

(3.‍5)Despite subsections (3.‍2) to (3.‍4),

  • (a)where an eligible person or partnership (in this paragraph referred to as the “first person”) has more than one taxation year ending in the same calendar year and it is associated (within the meaning of section 256 of the Act, as modified by subsection (3.‍6)) in two or more of those taxation years with another eligible person or partnership (in this paragraph referred to as the “other person”) that has a taxation year ending in that calendar year, the immediate expensing limit of the first person for each taxation year ending in the calendar year in which it is associated (within the meaning of section 256 of the Act, as modified by subsection (3.‍6)) with the other person that ends after the first such taxation year ending in that calendar year is, subject to the application of paragraph (b), an amount equal to the lesser of

    • (i)its immediate expensing limit determined under subsection (3.‍3) or (3.‍4) for the first such taxation year ending in the calendar year, and

    • (ii)its immediate expensing limit determined under subsection (3.‍3) or (3.‍4) for the particular taxation year ending in the calendar year; and

  • (b)where an eligible person or partnership has a taxation year that is less than 51 weeks, its immediate expensing limit for the year is that proportion of its immediate expensing limit for the year determined without reference to this paragraph that the number of days in the year is of 365.

Associated - interpretation

(3.‍6)For the purposes of this Part and Schedules II to VI, in determining whether an eligible person or partnership is associated (within the meaning of section 256 of the Act, as modified by this subsection) with another eligible person or partnership in a taxation year

  • (a)if the eligible person or partnership is a partnership,

    • (i)the partnership is deemed to be a corporation (in this subsection referred to as a “deemed corporation”) for the year,

    • (ii)the deemed corporation is deemed to have a capital stock of a single class of shares, with a total of 100 issued and outstanding shares,

    • (iii)each member (in this subsection referred to as a “deemed shareholder”) of the deemed corporation is deemed to be a shareholder of the deemed corporation,

    • (iv)each deemed shareholder of the deemed corporation is deemed to hold a number of shares in the capital stock of the deemed corporation determined by the formula

      A × 100
      where

      A
      is equal to

      (A)the deemed shareholder’s specified proportion for the last fiscal period of the deemed corporation, or

      (B)if the deemed shareholder does not have a specified proportion described in clause (A), the proportion that the fair market value of the deemed shareholder’s interest in the deemed corporation at that time is of the fair market value of all interests in the deemed corporation at that time, and

    • (v)the deemed corporation’s fiscal period is deemed to be its taxation year; and

  • (b)if the eligible person or partnership is an individual (other than a trust) who carries on a business or has acquired immediate expensing property

    • (i)the individual, in respect of that business or property, is deemed to be a corporation that is controlled by the individual, and

    • (ii)the corporation’s taxation year is deemed to be the same as the individual’s taxation year.

(2)Subsection (1) is deemed to have come into force on April 19, 2021.

37(1)The definitions biogas and producer gas in subsection 1104(13) of the Regulations are replaced by the following:

biogas means the gas produced by the anaerobic digestion of specified waste material.‍ (biogaz)

producer gas means

  • (a)in respect of a property of a taxpayer that becomes available for use by the taxpayer before 2025, fuel the composition of which, excluding its water content, is all or substantially all non-condensable gases that is generated primarily from eligible waste fuel or specified waste material using a thermo-chemical conversion process and that is not generated from any feedstock other than eligible waste fuel, specified waste material or fossil fuel; and

  • (b)in respect of a property of a taxpayer that becomes available for use by the taxpayer after 2024, fuel

    • (i)the composition of which, excluding its water content, is all or substantially all non-condensable gases,

    • (ii)that is generated using a thermo-chemical conversion process,

    • (iii)that is generated from feedstock of which no more than 25% is fossil fuel when measured in terms of energy content (expressed as a higher heating value of the feedstock), and

    • (iv)that is not generated from any feedstock other than eligible waste fuel, specified waste material or fossil fuel. (gaz de gazéification)

(2)The definitions plant residue and separated organics in subsection 1104(13) of the Regulations are replaced by the following:

plant residue means residue of plants (not including wood waste and waste that no longer has the chemical properties of the plants of which it is a residue) that would otherwise be waste material. (résidus végétaux)

separated organics means organic waste (other than waste that is considered to be toxic or hazardous waste under any law of Canada or a province) that could be disposed of in an eligible waste management facility or eligible landfill site. (matières organiques séparées)

(3)Subsection 1104(13) of the Regulations is amended by adding the following in alphabetical order:

gaseous biofuel means a fuel produced all or substantially all from specified waste material that is a gas at a temperature of 15.‍6°C (60°F) and a pressure of 101 kPa (14.‍7 psia). (biocarburants gazeux)

liquid biofuel means a fuel produced all or substantially all from specified waste material or carbon dioxide that is a liquid at a temperature of 15.‍6°C (60°F) and a pressure of 101 kPa (14.‍7 psia). (biocarburants liquides)

solid biofuel  means a fuel produced all or substantially all from specified waste material that is a solid at a temperature of 15.‍6°C (60°F) and a pressure of 101 kPa (14.‍7 psia) (other than charcoal that is used for cooking or fuels with fossil fuel-derived ignition accelerants) and that has undergone

  • (a)a thermo-chemical conversion process to increase its carbon fraction and densification; or

  • (b)densification into pellets or briquettes. (biocarburants solides)

specified waste material  means wood waste, plant residue, municipal waste, sludge from an eligible sewage treatment facility, spent pulping liquor, food and animal waste, manure, pulp and paper by-product and separated organics. (déchets déterminés)

(4)Subsection (1) applies in respect of property acquired after April 18, 2021 that has not been used or acquired for use before April 19, 2021.

(5)Subsections (2) and (3) are deemed to have come into force on April 19, 2021.

38(1)Clause 1104(17)‍(a)‍(ii)‍(A) of the Regulations is replaced by the following:

  • (A)any of subparagraphs (d)‍(vii) to (ix), (xi), (xiii), (xiv), (xvi), (xvii) and (xix) to (xxii) of Class 43.‍1, or

(2)Subsection (1) applies to property acquired after April 18, 2021 that has not been used or acquired for use before April 19, 2021.

39Section 1106 of the Regulations is amended by adding the following after subsection (1):

COVID-19 — Application for a Certificate of Completion

(1.‍1)In respect of applications filed with the Minister of Canadian Heritage in respect of film or video productions for which the labour expenditure of the corporation in respect of the production for the taxation years ending in 2020 or 2021 was greater than nil, the definition application for a certificate of completion in subsection (1) is to be read as follows:

application for a certificate of completion, in respect of a film or video production, means an application by a prescribed taxable Canadian corporation in respect of the production, filed with the Minister of Canadian Heritage before the day (in this Division referred to as “the production’s application deadline”) that is the later of

  • (a)the day that is 24 months after the end of the corporation’s taxation year in which the production’s principal photography began,

  • (b)the day that is 18 months after the day referred to in paragraph (a), if the corporation has filed, with the Canada Revenue Agency, and provided to the Minister of Canadian Heritage a copy of, a waiver described in subparagraph 152(4)‍(a)‍(ii) of the Act, within the normal reassessment period for the corporation in respect of the first and second taxation years ending after the production’s principal photography began, or

  • (c)the day that is 12 months after the day referred to in paragraph (b), if the corporation has filed, with the Canada Revenue Agency, and provided to the Minister of Canadian Heritage a copy of, a waiver described in subparagraph 152(4)‍(a)‍(ii) of the Act, within the normal reassessment period for the corporation in respect of the first, second and third taxation years ending after the production’s principal photography began. (demande de certificat d’achèvement)

COVID-19 — Excluded Production

(1.‍2)The reference to “2-year period” in subparagraph (a)‍(iv) of the definition excluded production in subsection (1) is to be read as a reference to “three-year period” in respect of film or video productions for which the labour expenditure of the corporation in respect of the production for the taxation years ending in 2020 or 2021 was greater than nil.

40The Regulations are amended by adding the following after section 3702:

Information Returns

Insertion start 3703 Insertion end For the purpose of subsection 149.‍1(14) of the Act, the following is prescribed information for the public information return of a charity in a taxation year:

  • (a)in respect of each grantee organization that received total qualifying disbursements from the charity in excess of $5,000 in the taxation year, the name of the grantee organization;

  • (b)the purpose of each qualifying disbursement made to a grantee organization referred to in paragraph (a) in the taxation year; and

  • (c)the total amount disbursed by the charity to each grantee organization referred to in paragraph (a) in the taxation year.

41(1)Section 5202 of the Regulations is amended by adding the following in alphabetical order:

qualified zero-emission technology manufacturing activities means

  • (a)qualified activities that are

    • (i)performed in connection with the manufacturing or processing of

      • (A)solar energy conversion equipment, including solar thermal collectors, photovoltaic solar arrays and custom supporting structures or frames, but excluding passive solar heating equipment,

      • (B)wind energy conversion equipment, including wind turbine towers, nacelles and rotor blades,

      • (C)water energy conversion equipment, including hydroelectric, water current, tidal and wave energy conversion equipment,

      • (D)geothermal energy equipment,

      • (E)equipment for a ground source heat pump system,

      • (F)electrical energy storage equipment used for storage of renewable energy or for providing grid-scale storage or other ancillary services, including battery, compressed air and flywheel storage systems,

      • (G)equipment used to charge, or to dispense hydrogen to, property included in clause (J),

      • (H)equipment used for the production of hydrogen by electrolysis of water,

      • (I)equipment that is a component of property included in clauses (A) to (H), if such equipment is purpose-built or designed exclusively to form an integral part of that property,

      • (J)property that

        • (I)would be a zero-emission vehicle (as defined in subsection 248(1) of the Act if that definition were read without reference to its paragraphs (b) and (c)), or

        • (II)is described in subparagraph (a)‍(i) of Class 56 of Schedule II, and

      • (K)integral components of the powertrain of property included in clause (J), including batteries or fuel cells, and

    • (ii)not the manufacturing or processing of general purpose components or equipment which components or equipment are suitable for integration into property other than property described in subparagraph (i);

  • (b)qualified activities that are performed in connection with production in Canada of

    • (i)hydrogen by electrolysis of water,

    • (ii)gaseous biofuel (as defined in subsection 1104(13)),

    • (iii)liquid biofuel (as defined in subsection 1104(13)), and

    • (iv)solid biofuel (as defined in subsection 1104(13)); and

  • (c)the conversion of a vehicle, performed in Canada, into a property described in clause (a)‍(i)‍(J); (activités admissibles de fabrication de technologies à zéro émission)

ZETM cost of capital, of a corporation for a taxation year, means the portion of the cost of capital of the corporation for the year that reflects the extent to which each property included in the calculation of the cost of capital was used directly in qualified zero-emission technology manufacturing activities of the corporation during the year; (coût en capital de FTZE)

ZETM cost of labour, of a corporation for a taxation year, means the portion of the cost of labour of the corporation for that year that reflects the extent to which  

  • (a)the salaries and wages included in the calculation of the cost of labour were paid or payable to persons for the portion of their time that they were directly engaged in qualified zero-emission technology manufacturing activities of the corporation during the year, and

  • (b)the other amounts included in the calculation of the cost of labour were paid or payable to persons for the performance of functions that would be directly related to qualified zero-emission technology manufacturing activities of the corporation during the year if those persons were employees of the corporation; (coût en main-d’œuvre de FTZE)

(2)Subsection (1) is deemed to have come into force on January 1, 2022.

42(1)The portion of section 5204 of the Regulations before the definition cost of capital is replaced by the following:

5204If a corporation is a member of a partnership at any time in a taxation year of the corporation, the following definitions apply:

(2)Section 5204 of the Regulations is amended by adding the following in alphabetical order:

ZETM cost of capital, of the corporation for the year, means the portion of the cost of capital of the corporation for that year that reflects the extent to which each property included in the calculation of the cost of capital was used directly in qualified zero-emission technology manufacturing activities 

  • (a)of the corporation during the year, or

  • (b)of the partnership during its fiscal period coinciding with or ending in the year, as the case may be; (coût en capital de FTZE)

ZETM cost of labour, of the corporation for the year, means the portion of the cost of labour of the corporation for that year that reflects the extent to which

  • (a)the salaries and wages included in the calculation of the cost of labour were paid or payable to persons for the portion of their time that they were directly engaged in qualified zero-emission technology manufacturing activities

    • (i)of the corporation during the year, or

    • (ii)of the partnership during its fiscal period coinciding with or ending in the year, and

  • (b)the other amounts included in the calculation of the cost of labour were paid or payable to persons for the performance of functions that would be directly related to qualified zero-emission technology manufacturing activities of the corporation during the year, or of the partnership during its fiscal period coinciding with or ending in the year, if those persons were employees of the corporation or the partnership, as the case may be; (coût en main-d’œuvre de FTZE)

(3)Subsections (1) and (2) are deemed to have come into force on January 1, 2022.

43Section 9300 of the Regulations is amended by adding the following after subsection (1):

(1.‍1)The references to “24 months” in paragraphs 9300(1)‍(a) and (b) are to be read as references to “36 months” in respect of film or video productions for which the Canadian labour expenditure of the corporation in respect of the production for the taxation years ending in 2020 or 2021 was greater than nil.

44(1)Subparagraphs (c)‍(i) and (ii) of Class 43.‍1 in Schedule II to the Regulations are replaced by the following:

  • (i)part of a system that

    • (A)is used by the taxpayer, or by a lessee of the taxpayer, to generate electrical energy, or both electrical and heat energy, using only fuel that is eligible waste fuel, fossil fuel, producer gas, spent pulping liquor or any combination of those fuels,

    • (B)if the system is rated to generate more than three megawatts of electrical energy, meets the following condition on an annual basis:

      A ≥ (2 × B + C)/(D + E/3412)
      where

      A
      is 11,000 BTU per kilowatt-hour,

      B
      is the energy content of fossil fuel other than solution gas (expressed as the higher heating value of the fuel) consumed by the system in BTU,

      C
      is the energy content of the eligible waste fuel, producer gas and spent pulping liquor (expressed as the higher heating value of the fuel) consumed by the system in BTU,

      D
      is the gross electrical energy produced by the system in kilowatt-hours, and

      E
      is the net useful energy in the form of heat exported from the system to a thermal host in BTU, and

    • (C)uses fuel of which no more than 25% of the energy content (expressed as the higher heating value of the fuel) is from fossil fuel, as determined on an annual basis, or

(2)Clause (d)‍(i)‍(B) of Class 43.‍1 in Schedule II to the Regulations is replaced by the following:

  • (B)it is not a building, part of a building (other than a solar collector that is not a window and that is integrated into a building), energy equipment that backs up equipment described in subclause (A)‍(I) or (II) nor equipment that distributes heated or cooled air or water in a building,

(3)Subparagraph (d)‍(iv) of Class 43.‍1 in Schedule II to the Regulations is replaced by the following:

  • (iv)heat recovery equipment used by the taxpayer, or by a lessee of the taxpayer, primarily for the purpose of conserving energy, reducing the requirement to acquire energy or extracting heat for sale, by extracting for reuse thermal waste that is generated directly in an industrial process (other than an industrial process that generates or processes electrical energy), including such equipment that consists of heat exchange equipment, compressors used to upgrade low pressure steam, vapour or gas, waste heat boilers and other ancillary equipment such as control panels, fans, instruments or pumps, but not including property that is employed in re-using the recovered heat (such as property that is part of the internal heating or cooling system of a building or electrical generating equipment) or is a building,

(4)Subparagraph (d)‍(vii) of Class 43.‍1 in Schedule II to the Regulations is replaced by the following:

  • (vii)equipment used by the taxpayer, or by a lessee of the taxpayer, primarily for the purpose of generating electrical energy or heat energy, or both electrical and heat energy, solely from geothermal energy, including such equipment that consists of piping (including above or below ground piping and the cost of completing a well (including the wellhead and production string), or trenching, for the purpose of installing that piping), pumps, heat exchangers, steam separators, electrical generating equipment and ancillary equipment used to collect the geothermal heat, but not including buildings, distribution equipment, equipment described in subclause (i)‍(A)‍(II), property otherwise included in Class 10 and property that would be included in Class 17 if that Class were read without reference to its paragraph (a.‍1),

(5)Subparagraph (d)‍(ix) of Class 43.‍1 in Schedule II to the Regulations is replaced by the following:

  • (ix)equipment that

    • (A)is used by the taxpayer, or by a lessee of the taxpayer, for the sole purpose of generating heat energy, not using any fuel other than eligible waste fuel, fossil fuel, producer gas or a combination of those fuels,

    • (B)uses fuel of which no more than 25% of the energy content (expressed as the higher heating value of the fuel) is from fossil fuel, as determined on an annual basis,

    • (C)may include

      • (I)fuel handling equipment used to upgrade the combustible portion of the fuel,

      • (II)control, feedwater and condensate systems, and

      • (III)other ancillary equipment, and

    • (D)does not include

      • (I)equipment used for the purpose of producing heat energy to operate electrical generating equipment,

      • (II)buildings or other structures,

      • (III)heat rejection equipment (such as condensers and cooling water systems),

      • (IV)fuel storage facilities,

      • (V)other fuel handling equipment, and

      • (VI)property otherwise included in Class 10 or 17,

(6)Subparagraphs (d)‍(xi) and (xii) of Class 43.‍1 in Schedule II to the Regulations are replaced by the following:

  • (xi)equipment all or substantially all of the use of which by the taxpayer, or by a lessee of the taxpayer, is to produce liquid biofuel, including storage, materials handling and ash-handling equipment and equipment used to remove non-combustibles and contaminants from the fuels produced, but not including

    • (A)equipment used to produce spent pulping liquor,

    • (B)equipment used for the collection or transportation of specified waste material or carbon dioxide,

    • (C)equipment used for the transmission or distribution of liquid biofuel,

    • (D)property that would otherwise be included in Class 17,

    • (E)automotive vehicles, and

    • (F)buildings or other structures,

  • (xii)fixed location fuel cell equipment used by the taxpayer, or by a lessee of the taxpayer, that uses hydrogen generated only from ancillary electrolysis equipment (or, if the fuel cell is reversible, the fuel cell itself) using electricity all or substantially all of which is generated by using kinetic energy of flowing water or wave or tidal energy or by geothermal, photovoltaic, wind energy conversion, or hydro-electric equipment, of the taxpayer or the lessee, and equipment ancillary to the fuel cell equipment other than buildings or other structures, transmission equipment, distribution equipment, auxiliary electrical generating equipment and property otherwise included in Class 10 or 17,

(7)Subparagraph (d)‍(xiv) of Class 43.‍1 in Schedule II to the Regulations is replaced by the following:

  • (xiv)property that is used by the taxpayer, or by a lessee of the taxpayer, primarily for the purpose of generating electricity using kinetic energy of flowing water or wave or tidal energy, including support structures, control and conditioning equipment, submerged cables and transmission equipment, but not including buildings, distribution equipment, auxiliary electricity generating equipment, property otherwise included in Class 10 and property that would be included in Class 17 if that class were read without reference to its subparagraph (a.‍1)‍(i),

(8)Subparagraph (d)‍(xvi) of Class 43.‍1 in Schedule II to the Regulations is replaced by the following:

  • (xvi)equipment used by the taxpayer, or by a lessee of the taxpayer, primarily for the purpose of generating producer gas (other than producer gas that is to be converted into liquid fuels or chemicals), including related piping (including fans and compressors), air separation equipment, storage equipment, equipment used for drying or shredding feedstock, ash-handling equipment, equipment used to upgrade the producer gas into biomethane and equipment used to remove non-combustibles and contaminants from the producer gas, but not including, buildings or other structures, heat rejection equipment (such as condensers and cooling water systems), equipment used to convert producer gas into liquid fuels or chemicals, and property otherwise included in Class 10 or 17,

(9)Subparagraph (d)‍(xvi) of Class 43.‍1 in Schedule II to the Regulations is replaced by the following:

  • (xvi)equipment that

    • (A)is used by the taxpayer, or by a lessee of the taxpayer, primarily for the purpose of generating producer gas (other than producer gas that is to be converted into liquid fuels or chemicals),

    • (B)uses feedstock of which no more than 25% of the energy content (expressed as the higher heating value of the feedstock) is from fossil fuel, as determined on an annual basis,

    • (C)may include

      • (I)related piping (including fans and compressors),

      • (II)air separation equipment,

      • (III)storage equipment,

      • (IV)equipment used for drying or shredding feedstock,

      • (V)ash-handling equipment,

      • (VI)equipment used to upgrade the producer gas into biomethane, and

      • (VII)equipment used to remove non-combustibles and contaminants from the producer gas, and

    • (D)does not include

      • (I)buildings or other structures,

      • (II)heat rejection equipment (such as condensers and cooling water systems),

      • (III)equipment used to convert producer gas into liquid fuels or chemicals, and

      • (IV)property otherwise included in Class 10 or 17,

(10)Paragraph (d) of Class 43.‍1 in Schedule II to the Regulations is amended by striking out “or” at the end of subparagraph (xvii) and by adding the following after subparagraph (xviii):

  • (xix)a pumped hydroelectric energy storage installation all or substantially all of the use of which by the taxpayer, or by a lessee of the taxpayer, is to store electrical energy including reversing turbines, transmission equipment, dams, reservoirs and related structures, and that meets the condition in either subclause (d)‍(xviii)‍(B)‍(I) or (II) in this Class, but not including

    • (A)property used solely for backup electrical energy, and

    • (B)buildings,

  • (xx)equipment all or substantially all of the use of which by the taxpayer, or by a lessee of the taxpayer, is to produce solid biofuel, including storage, materials handling and ash-handling equipment, but not including

    • (A)equipment used to make wood chips, hog fuel or black liquor,

    • (B)property that would otherwise be included in Class 17,

    • (C)automotive vehicles, and

    • (D)buildings and other structures,

  • (xxi)equipment used by the taxpayer, or by a lessee of the taxpayer, to dispense hydrogen for use in automotive equipment powered by hydrogen, including vaporization, compression, cooling and storage equipment, but not including

    • (A)equipment used for the production or transmission of hydrogen,

    • (B)equipment used for the transmission or distribution of electricity,

    • (C)automotive vehicles,

    • (D)auxiliary electrical generating equipment, and

    • (E)buildings and other structures, or

  • (xxii)equipment all or substantially all of the use of which by the taxpayer, or by a lessee of the taxpayer, is to produce hydrogen through electrolysis of water, including electrolysers, rectifiers and other ancillary electrical equipment, water treatment and conditioning equipment and equipment used for hydrogen compression and storage, but not including

    • (A)equipment used for the transmission or distribution of hydrogen,

    • (B)equipment used for the transmission or distribution of electricity,

    • (C)automotive vehicles,

    • (D)auxiliary electrical generating equipment, and

    • (E)buildings and other structures, and

(11)Subsections (1), (5) and (9) apply in respect of property of a taxpayer that becomes available for use by the taxpayer after 2024.

(12)Subsections (2) to (4), (6) to (8) and (10) apply to property acquired after April 18, 2021 that has not been used or acquired for use before April 19, 2021.

45(1)Paragraph (a) of Class 43.‍2 in Schedule II to the Regulations is replaced by the following:

  • (a)otherwise than because of paragraph (d) of that Class; or

(2)Subparagraph (b)‍(i) of Class 43.‍2 in Schedule II to the Regulations is repealed.

(3)Subsections (1) and (2) apply in respect of property of a taxpayer that becomes available for use by the taxpayer after 2024.

SOR/93-12

Children’s Special Allowance Regulations

46(1)The definition applicant in section 2 of the Children’s Special Allowance Regulations is replaced by the following:

applicant means a department, agency, institution or Indigenous governing body referred to in subsection 3(1) of the Act; (demandeur)

(2)Subsection (1) is deemed to have come into force on January 1, 2020.

47(1)The portion of section 7 of the Regulations before paragraph (a) is replaced by the following:

7The information referred to in section 11 of the Act may be furnished to the government of a province or to an Indigenous governing body, under the terms of an agreement between the Minister and that government or Indigenous governing body, for the purpose of the administration of a social, income assistance or health insurance program of that province or Indigenous governing body that is specified in the agreement, on condition that

(2)Subsection (1) is deemed to have come into force on January 1, 2020.

48(1)Paragraphs 9(a) and (b) of the Regulations are replaced by the following:

  • (a)the applicant, at the end of the month, provides for the child’s care, maintenance, education, training and advancement to a greater extent than any other department, agency, institution, Indigenous governing body or any person; or

  • (b)the applicant is an entity referred to in any of paragraphs 3(1)‍(a) to (c) of the Act that has applied in respect of a child who

    • (i)was formerly in the care of foster parents or was formerly maintained by an entity referred to in any of paragraphs 3(1)‍(a) to (c) of the Act, and

    • (ii)has been placed in the permanent or temporary custody of a guardian, tutor or other individual occupying a similar role for the month, under a decree, order or judgment of a competent tribunal, or under the laws of an Indigenous governing body, who has received financial assistance from the applicant for the month in respect of the child’s maintenance.

(2)Subsection (1) is deemed to have come into force on January 1, 2020.

Coordinating Amendments

Bill C-222

49If Bill C-222, introduced in the 1st session of the 44th Parliament and entitled An Act to amend the Income Tax Act (travel expenses deduction for tradespersons), receives royal assent before or on the same day as this Act receives royal assent, then, on the day this Act receives royal assent, that Act is deemed never to have come into force and is repealed.

Bill C-241

50If Bill C-241, introduced in the 1st session of the 44th Parliament and entitled An Act to amend the Income Tax Act (deduction of travel expenses for tradespersons), receives royal assent before or on the same day as this Act receives royal assent, then, on the day this Act receives royal assent, that Act is deemed never to have come into force and is repealed.

Bill S-216

51If Bill S-216, introduced in the 1st session of the 44th Parliament and entitled An Act to amend the Income Tax Act (use of resources of a registered charity), receives royal assent before or on the same day as this Act receives royal assent, then, on the day this Act receives royal assent, that Act is deemed never to come into force and is repealed.

PART 2
Amendments to the Excise Tax Act (GST/HST Measures)

R.‍S.‍, c. E-15

52(1)The Excise Tax Act is amended by adding the following after section 192:

New housing — assignment of agreement

192.‍1If a taxable supply by way of sale of a single unit residential complex (as defined in subsection 254(1)) or of a residential condominium unit is made in Canada under an agreement of purchase and sale (in this section referred to as the “purchase agreement”) entered into with a builder of the single unit residential complex or of the residential condominium unit and if another supply by way of assignment of the purchase agreement is made by a person (other than the builder) under another agreement, then the following rules apply for the purposes of this Part:

  • (a)the other supply is deemed to be a taxable supply, by way of sale, of real property that is an interest in the single unit residential complex or residential condominium unit; and

  • (b)the consideration for the other supply is deemed to be equal to the amount determined by the formula

    A − B
    where

    A
    is the consideration for the other supply as otherwise determined for the purposes of this Part, and

    B
    is

    (i)if the other agreement indicates in writing that a part of the consideration for the other supply is attributable to the reimbursement of a deposit paid under the purchase agreement, the part of the consideration for the other supply, as otherwise determined for the purposes of this Part, that is solely attributable to the reimbursement of the deposit paid under the purchase agreement, and

    (ii)in any other case, zero.

(2)Subsection (1) applies in respect of any supply by way of assignment of an agreement of purchase and sale if the supply is made after May 6, 2022.

53(1)Clause (a)‍(ii)‍(C) of the definition facility supply in subsection 259(1) of the Act is replaced by the following:

  • (C)a nurse practitioner acting in the course of the practise of a nurse practitioner, or

(2)Clause (a)‍(iii)‍(B) of the definition facility supply in subsection 259(1) of the Act is replaced by the following:

  • (B)a physician or nurse practitioner be at, or be on-call to attend at, the public hospital or qualifying facility at all times when the individual is at the public hospital or qualifying facility,

(3)Subparagraph (a)‍(ii) of the definition home medical supply in subsection 259(1) of the Act is replaced by the following:

  • (ii)after a physician acting in the course of the practise of medicine, a nurse practitioner acting in the course of the practise of a nurse practitioner or a prescribed person acting in prescribed circumstances has identified or confirmed that it is appropriate for the process to take place at the individual’s place of residence or lodging (other than a public hospital or a qualifying facility),

(4)Paragraph (b) of the definition home medical supply in subsection 259(1) of the Act is replaced by the following:

  • (b)in respect of which the property is made available, or the service is rendered, to the individual at the individual’s place of residence or lodging (other than a public hospital or a qualifying facility), on the authorization of a person who is responsible for coordinating the process and under circumstances in which it is reasonable to expect that the person will carry out that responsibility in consultation with, or with ongoing reference to instructions for the process given by, a physician acting in the course of the practise of medicine, a nurse practitioner acting in the course of the practise of a nurse practitioner or a prescribed person acting in prescribed circumstances,

(5)Subsections (1) to (4) apply for the purposes of determining a rebate of a person under section 259 of the Act for claim periods ending after April 7, 2022, except that, in determining a rebate of a person for the claim period that includes April 7, 2022, the rebate is to be determined as if those subsections did not apply in respect of

  • (a)an amount of tax that became payable by the person on or before April 7, 2022;

  • (b)an amount that is deemed to have been paid or collected by the person on or before April 7, 2022; and

  • (c)an amount that is required to be added in determining the person’s net tax

    • (i)as a result of a branch or division of the person becoming a small supplier division on or before April 7, 2022, or

    • (ii)as a result of the person ceasing to be a registrant on or before April 7, 2022.

PART 3
Amendments to the Excise Act, 2001, the Excise Act and Other Related Texts

DIVISION 1
Excise Act, 2001 and Other Related Texts (Vaping Products)

2002, c. 22

Excise Act, 2001

54(1)The definitions container, excise stamp and manufacture in section 2 of the Excise Act, 2001 are replaced by the following:

container, in respect of a tobacco product, a cannabis product or a vaping product, means a wrapper, package, carton, box, crate, bottle, vial or other container that contains the tobacco product, cannabis product or vaping product. (contenant)

excise stamp means a tobacco excise stamp, a cannabis excise stamp or a vaping excise stamp.‍ (timbre d’accise)

manufacture includes

  • (a)in respect of a tobacco product, any step in the preparation or working up of raw leaf tobacco into the tobacco product, including packing, stemming, reconstituting, converting or packaging the raw leaf tobacco or tobacco product; and

  • (b)in respect of a vaping product, any step in the production of the vaping product, including inserting a vaping substance into a vaping device or packaging the vaping product. (fabrication)

(2)Paragraph (a) of the definition packaged in section 2 of the Act is replaced by the following:
  • (a)in respect of raw leaf tobacco, a tobacco product, a cannabis product or a vaping product, packaged in a prescribed package; or

(3)The definition stamped in section 2 of the Act is amended by striking out “and” at the end of paragraph (a), by adding “and” at the end of paragraph (b) and by adding the following after paragraph (b):
  • (c)in respect of a vaping product, that a vaping excise stamp, and all prescribed information in a prescribed format in respect of the vaping product, are stamped, impressed, printed or marked on, indented into or affixed to the vaping product or its container in the prescribed manner to indicate that duty has been paid on the vaping product.‍ (estampillé)

(4)Paragraph (b) of the definition take for use in section 2 of the Act is replaced by the following:
  • (b)in respect of a cannabis product or a vaping product, to consume, analyze or destroy the cannabis product or vaping product.‍ (utilisation pour soi)

(5)Section 2 of the Act is amended by adding the following in alphabetical order:

additional vaping duty means a duty imposed under section 158.‍58.‍ (droit additionnel sur le vapotage)

immediate container, in respect of a vaping substance, means the container that is in direct contact with the vaping substance. It does not include a vaping device.‍ (contenant immédiat)

specified vaping province means a prescribed province.‍ (province déterminée de vapotage)

vaping device means property (other than prescribed property) that is

  • (a)a device that produces emissions in the form of an aerosol and is intended to be brought to the mouth for inhalation of the aerosol;

  • (b)a vaping pod or another part that may be used with a device referred to in paragraph (a); or

  • (c)a prescribed property. (dispositif de vapotage)

vaping duty means a duty imposed under section 158.‍57.‍ (droit sur le vapotage)

vaping excise stamp means a stamp that is issued by the Minister under subsection 158.‍36(1) and that has not been cancelled under section 158.‍4.‍ (timbre d’accise de vapotage)

vaping product means

  • (a)a vaping substance that is not contained within a vaping device; or

  • (b)a vaping device that contains a vaping substance.

It does not include a cannabis product or a tobacco product.‍ (produit de vapotage)

vaping product drug means a vaping product (other than a prescribed vaping product) that is

  • (a)a drug that has been assigned a drug identification number under the Food and Drug Regulations; or

  • (b)a prescribed vaping product. (drogue de produit de vapotage)

vaping product licensee means a person that holds a vaping product licence issued under section 14.‍ (titulaire de licence de produits de vapotage)

vaping product marking means prescribed information that is required under this Act to be printed on, or affixed to, a container of vaping products that are not required under this Act to be stamped.‍ (mention obligatoire pour vapotage)

vaping substance means

  • (a)a substance or mixture of substances, whether or not it contains nicotine, that is produced to be used, or sold for use, with a vaping device to produce emissions in the form of an aerosol; or

  • (b)a prescribed substance, material or thing.

It does not include a prescribed substance, material or thing. (substance de vapotage)

55(1)Subsection 5(1) of the Act is replaced by the following:
Constructive possession

5(1)For the purposes of section 25.‍2, subsections 25.‍3(1), 30(1), 32(1) and 32.‍1(1), section 61, subsections 70(1) and 88(1), section 158.‍04, subsections 158.‍05(1) and 158.‍11(1) and (2), section 158.‍37, subsections 158.‍38(1) and 158.‍44(1) and (2), sections 230 and 231 and subsection 238.‍1(1), if one of two or more persons, with the knowledge and consent of the rest of them, has anything in the person’s possession, it is deemed to be in the custody and possession of each and all of them.

(2)The portion of subsection 5(2) of the Act before paragraph (a) is replaced by the following:
Definition of possession

(2)In this section and in section 25.‍2, subsections 25.‍3(1), 30(1), 32(1) and 32.‍1(1), section 61, subsections 70(1) and 88(1), section 158.‍04, subsections 158.‍05(1) and 158.‍11(1) and (2), section 158.‍37 and subsections 158.‍38(1), 158.‍44(1) and (2) and 238.‍1(1), possession means not only having in one’s own personal possession but also knowingly

56Subsection 14(1) of the Act is amended by striking out “or” at the end of paragraph (d), by adding “or” at the end of paragraph (e) and by adding the following after paragraph (e):
  • (f)a vaping product licence, authorizing the person to manufacture vaping products.

57Subsection 19(1) of the Act is replaced by the following:
Issuance of licence

19(1)Subject to the regulations, on application, the Minister may issue an excise warehouse licence to a person that is not a retailer of alcohol authorizing the person to possess in their excise warehouse manufactured tobacco, cigars or vaping products that are not stamped or non-duty-paid packaged alcohol.

58Paragraph 23(3)‍(b) of the Act is replaced by the following:
  • (b)shall, in the case of a spirits licence, a tobacco licence, a cannabis licence or a vaping product licence, require security in a form satisfactory to the Minister and in an amount determined in accordance with the regulations; and

59The Act is amended by adding the following after section 158.‍34:
PART 4.‍2
Vaping Products
Manufacturing and Stamping
Manufacturing without licence prohibited

158.‍35(1)No person shall, other than in accordance with a vaping product licence issued to the person, manufacture vaping products.

Deemed manufacturer

(2)A person that, whether for consideration or otherwise, provides or offers to provide in their place of business equipment for use in that place by another person in the manufacturing of a vaping product is deemed to be manufacturing the vaping product and the other person is deemed not to be manufacturing the vaping product.

Exception — manufacture for personal use

(3)An individual who is not a vaping product licensee may manufacture vaping products for their personal use.

Exception — regulations

(4)Subsection (1) does not apply in respect of a prescribed person that manufactures prescribed vaping products in prescribed circumstances or for a prescribed purpose.

Issuance of vaping excise stamps

158.‍36(1)On application in the prescribed form and manner, the Minister may issue, to a vaping product licensee or to a prescribed person that is importing vaping products, stamps the purpose of which is to indicate that vaping duty and, if applicable, additional vaping duty have been paid on a vaping product.

Quantity of vaping excise stamps

(2)The Minister may limit the quantity of vaping excise stamps that may be issued to a person under subsection (1).

Security

(3)No person shall be issued a vaping excise stamp unless the person has provided security in a form satisfactory to the Minister and in an amount determined in accordance with the regulations.

Supply of vaping excise stamps

(4)The Minister may authorize a producer of vaping excise stamps to supply, on the direction of the Minister, vaping excise stamps to a person to which those stamps are issued under subsection (1).

Design and construction

(5)The design and construction of vaping excise stamps shall be subject to the approval of the Minister.

Counterfeit vaping excise stamps

158.‍37No person shall produce, possess, sell or otherwise supply, or offer to supply, without lawful justification or excuse the proof of which lies on the person, anything that is intended to resemble or pass for a vaping excise stamp.

Unlawful possession of vaping excise stamps

158.‍38(1)No person shall possess a vaping excise stamp that has not been affixed to the container of a vaping product in the manner prescribed for the purposes of the definition stamped in section 2 to indicate that duty has been paid on the vaping product.

Exceptions — possession

(2)Subsection (1) does not apply to the possession of a vaping excise stamp by

  • (a)the person that lawfully produced the vaping excise stamp;

  • (b)the person to which the vaping excise stamp is issued;

  • (c)a sufferance warehouse licensee that possesses the vaping excise stamp in their sufferance warehouse on behalf of the person described under paragraph (b); or

  • (d)a prescribed person.

Unlawful supply of vaping excise stamps

158.‍39No person shall dispose of, sell or otherwise supply, or offer to supply, a vaping excise stamp otherwise than in accordance with this Act.

Cancellation of vaping excise stamps

158.‍4The Minister may

  • (a)cancel a vaping excise stamp that has been issued; and

  • (b)direct that it be returned or destroyed in a manner specified by the Minister.

Unlawful packaging or stamping

158.‍41No person shall package or stamp a vaping product unless

  • (a)the person is a vaping product licensee;

  • (b)the person is the importer or owner of the vaping product and the vaping product has been placed in a sufferance warehouse for the purpose of being stamped; or

  • (c)the person is a prescribed person.

Unlawful removal

158.‍42(1)Except as permitted under section 158.‍52 or if prescribed circumstances exist, no person shall remove a vaping product from the premises of a vaping product licensee unless it is packaged and

  • (a)if the vaping product is intended for the duty-paid market,

    • (i)it is stamped to indicate that vaping duty has been paid, and

    • (ii)if additional vaping duty in respect of a specified vaping province is imposed on the vaping product, it is stamped to indicate that the additional vaping duty has been paid; or

  • (b)if the vaping product is not intended for the duty-paid market, all vaping product markings that are required under this Act to be printed on, or affixed to, its container are so printed or affixed.

Exceptions

(2)Subsection (1) does not apply to a vaping product licensee that removes from their premises a vaping product if it is

  • (a)being removed for

    • (i)delivery to another vaping product licensee,

    • (ii)export, or

    • (iii)delivery to a person for analysis or destruction in accordance with subparagraph 158.‍66(a)‍(iv); or

  • (b)a vaping product drug.

Removal by Minister

(3)Subsection (1) does not apply to the removal of a vaping product for analysis or destruction by the Minister.

Prohibition — vaping products for sale

158.‍43No person shall purchase or receive for sale a vaping product

  • (a)from a manufacturer that the person knows, or ought to know, is not a vaping product licensee;

  • (b)that is required under this Act to be packaged and stamped unless it is packaged and stamped in accordance with this Act; or

  • (c)that the person knows, or ought to know, is fraudulently stamped.

Unlawful possession or sale of vaping products

158.‍44(1)Except if prescribed circumstances exist, no person, other than a vaping product licensee, shall dispose of, sell, offer for sale, purchase or have in their possession a vaping product unless

  • (a)it is packaged; and

  • (b)it is stamped to indicate that vaping duty has been paid.

Unlawful possession or sale — specified vaping province

(2)Except if prescribed circumstances exist, no person, other than a vaping product licensee, shall dispose of, sell, offer for sale, purchase or have in their possession a vaping product in a specified vaping province unless it is stamped to indicate that additional vaping duty in respect of the specified vaping province has been paid.

Exception — possession of vaping products

(3)Subsections (1) and (2) do not apply to the possession of vaping products

  • (a)in the case of imported vaping products,

    • (i)by an excise warehouse licensee in their excise warehouse,

    • (ii)by a sufferance warehouse licensee in their sufferance warehouse, or

    • (iii)by a customs bonded warehouse licensee in their customs bonded warehouse;

  • (b)by a prescribed person that is transporting the vaping products under prescribed circumstances and conditions;

  • (c)by a person that possesses the vaping products for analysis or destruction in accordance with subparagraph 158.‍66(a)‍(iv);

  • (d)by an accredited representative for their personal or official use;

  • (e)by an individual who has imported the vaping products for their personal use in quantities not in excess of prescribed limits;

  • (f)by an individual who has manufactured the vaping products in accordance with subsection 158.‍35(3); or

  • (g)if the vaping products are vaping product drugs.

Exception — sale or offer for sale

(4)Subsections (1) and (2) do not apply to the disposal, sale, offering for sale or purchase of a vaping product if

  • (a)the vaping product is an imported vaping product, an excise warehouse licensee or a customs bonded warehouse licensee sells or offers to sell the vaping product for export and the vaping product is exported by the licensee in accordance with this Act;

  • (b)the vaping product is an imported vaping product and an excise warehouse licensee or a customs bonded warehouse licensee sells or offers to sell the vaping product to an accredited representative for their personal or official use; or

  • (c)the vaping product is a vaping product drug.

Sale or distribution by licensee

158.‍45(1)Except if prescribed circumstances exist, no vaping product licensee shall distribute a vaping product or sell or offer for sale a vaping product to a person unless

  • (a)it is packaged;

  • (b)it is stamped to indicate that vaping duty has been paid; and

  • (c)if additional vaping duty in respect of a specified vaping province is imposed on the vaping product, it is stamped to indicate that the additional vaping duty has been paid.

Exceptions

(2)Subsection (1) does not apply to the distribution, sale or offering for sale of a vaping product by a vaping product licensee

  • (a)if the distribution, sale or offering for sale is to

    • (i)another vaping product licensee, or

    • (ii)an accredited representative for their personal or official use;

  • (b)if the vaping product is exported by the vaping product licensee in accordance with this Act; or

  • (c)if the vaping product is a vaping product drug.

Packaging and stamping of vaping products

158.‍46A vaping product licensee that manufactures a vaping product shall not enter the vaping product into the duty-paid market unless

  • (a)the vaping product has been packaged by the licensee;

  • (b)the package has printed on it prescribed information;

  • (c)the vaping product is stamped at the time of packaging to indicate that vaping duty has been paid; and

  • (d)if the vaping product is to be entered in the duty-paid market of a specified vaping province, the vaping product is stamped at the time of packaging to indicate that additional vaping duty in respect of the specified vaping province has been paid.

Packaging and stamping of imported vaping products

158.‍47(1)Except if prescribed circumstances exist, if a vaping product is imported, it must, before it is released under the Customs Act for entry into the duty-paid market,

  • (a)be packaged in a package that has printed on it prescribed information;

  • (b)be stamped to indicate that vaping duty has been paid; and

  • (c)if the vaping product is to be entered in the duty-paid market of a specified vaping province, be stamped to indicate that additional vaping duty in respect of the specified vaping province has been paid.

Exceptions for certain importations

(2)Subsection (1) does not apply to a vaping product

  • (a)that is imported by a vaping product licensee for further manufacturing by the licensee;

  • (b)that a vaping product licensee is authorized to import under subsection 158.‍53(2); or

  • (c)that is imported by an individual for their personal use in quantities not in excess of prescribed limits.

Notice — absence of stamping

158.‍48(1)The absence on a vaping product of stamping that indicates that vaping duty has been paid is notice to all persons that vaping duty has not been paid on the vaping product.

Notice — specified vaping province

(2)The absence on a vaping product of stamping that indicates that additional vaping duty in respect of a specified vaping province has been paid is notice to all persons that additional vaping duty in respect of the specified vaping province has not been paid on the vaping product.

Unstamped products to be warehoused

158.‍49If vaping products manufactured in Canada are not stamped by a vaping product licensee, the vaping product licensee must immediately enter the vaping products into the licensee’s excise warehouse.

Vaping product markings — warehousing

158.‍5(1)Subject to subsection (4), no person shall enter into an excise warehouse a container of vaping products unless the container has printed on it, or affixed to it, vaping product markings and other prescribed information.

Vaping product markings — imports

(2)Subject to subsections (3) and (4), no person shall deliver a container of imported vaping products that does not have printed on it, or affixed to it, vaping product markings and other prescribed information to

  • (a)an accredited representative; or

  • (b)a customs bonded warehouse.

Delivery of imported stamped vaping products

(3)A container of imported vaping products that were manufactured outside Canada and are stamped may be delivered to a customs bonded warehouse.

Exception in prescribed circumstances

(4)A container of vaping products does not require vaping product markings to be printed on it, or affixed to it, if prescribed circumstances exist.

Non-compliant imports

158.‍51(1)If an imported vaping product intended for the duty-paid market is not stamped to indicate that vaping duty has been paid when it is reported under the Customs Act, it shall be placed in a sufferance warehouse for the purpose of being so stamped.

Non-compliant imports — specified vaping province

(2)If an imported vaping product intended for the duty-paid market of a specified vaping province is not stamped to indicate that additional vaping duty in respect of the province has been paid when it is reported under the Customs Act, it shall be placed in a sufferance warehouse for the purpose of being so stamped.

Exception

(3)Subsections (1) and (2) do not apply in prescribed circumstances.

Vaping products — waste removal

158.‍52(1)No person shall remove a vaping product that is waste from the premises of a vaping product licensee other than the licensee or a person authorized by the Minister.

Removal requirements

(2)If a vaping product that is waste is removed from the premises of a vaping product licensee, it shall be dealt with in the manner authorized by the Minister.

Re-working or destruction of vaping products

158.‍53(1)A vaping product licensee may re-work or destroy a vaping product in the manner authorized by the Minister.

Importation for re-working or destruction

(2)The Minister may authorize a vaping product licensee to import vaping products manufactured in Canada by the licensee for re-working or destruction by the licensee in accordance with subsection (1).

Responsibility for Vaping Products
Responsibility — vaping products manufactured in Canada

158.‍54(1)Subject to section 158.‍55, a person is responsible for a vaping product manufactured in Canada at any time if

  • (a)the person is

    • (i)the vaping product licensee that owns the vaping product at that time, or

    • (ii)if the vaping product is not owned at that time by a vaping product licensee, the vaping product licensee that last owned it; or

  • (b)the person is a prescribed person.

Responsibility — imported vaping products

(2)Subject to sections 158.‍55 and 158.‍56, a person is responsible for an imported vaping product at any time if the person

  • (a)imported the vaping product; or

  • (b)is a prescribed person.

Person not responsible

158.‍55A person that is responsible for a vaping product ceases to be responsible for it if

  • (a)it is packaged and stamped and the duty on it is paid;

  • (b)it is consumed or used in the manufacturing of a vaping product that is

    • (i)a vaping product drug, or

    • (ii)a prescribed vaping product;

  • (c)it is taken for use and the duty on it is paid;

  • (d)it is taken for use in accordance with any of subparagraphs 158.‍66(a)‍(i) to (iv);

  • (e)it is exported;

  • (f)it is delivered to an accredited representative for their personal or official use;

  • (g)it is lost in prescribed circumstances and the person fulfils any prescribed conditions; or

  • (h)prescribed circumstances exist.

Imports for personal use

158.‍56An individual that imports vaping products for their personal use in quantities not in excess of prescribed limits is not responsible for those vaping products.

Imposition and Payment of Duty on Vaping Products
Imposition

158.‍57Duty is imposed on vaping products manufactured in Canada or imported in the amount determined under Schedule 8 and is payable

  • (a)in the case of vaping products manufactured in Canada, by the vaping product licensee that packaged the vaping products and at the time they are packaged; and

  • (b)in the case of imported vaping products, by the importer, owner or other person that is liable under the Customs Act to pay duty levied under section 20 of the Customs Tariff or that would be liable to pay that duty on the vaping products if they were subject to that duty.

Imposition — additional vaping duty

158.‍58In addition to the duty imposed under section 158.‍57, a duty in respect of a specified vaping province is imposed on vaping products manufactured in Canada, or imported, in prescribed circumstances in the amount determined in a prescribed manner and is payable

  • (a)in the case of vaping products manufactured in Canada, by the vaping product licensee that packaged the vaping products and at the time they are packaged; and

  • (b)in the case of imported vaping products, by the importer, owner or other person that is liable under the Customs Act to pay duty levied under section 20 of the Customs Tariff or that would be liable to pay that duty on the vaping products if they were subject to that duty.

Application of Customs Act

158.‍59The duties imposed under sections 158.‍57 and 158.‍58 on imported vaping products shall be paid and collected under the Customs Act, and interest and penalties shall be imposed, calculated, paid and collected under that Act, as if the duties were a duty levied under section 20 of the Customs Tariff, and, for those purposes, the Customs Act applies with any modifications that the circumstances require.

Duty on vaping products taken for use

158.‍6(1)If a particular person is responsible for vaping products at a particular time when the vaping products are taken for use, the following rules apply:

  • (a)if the vaping products are packaged, they are relieved of the duty imposed under section 158.‍57; and

  • (b)duty is imposed on the vaping products in the amount determined in respect of the vaping products under Schedule 8.

Specified vaping province — taken for use

(2)If a particular person is responsible for vaping products at a particular time when the vaping products are taken for use, a duty in respect of a specified vaping province is imposed on the vaping products in prescribed circumstances in the amount determined in prescribed manner. That duty is in addition to the duty imposed under subsection (1).

Duty payable

(3)The duty imposed under subsection (1) or (2) is payable at the particular time, and by the particular person, referred to in that subsection.

Duty on unaccounted vaping products

158.‍61(1)If a particular person that is responsible at a particular time for vaping products cannot account for the vaping products as being, at the particular time, in the possession of a vaping product licensee or in the possession of another person in accordance with subsection 158.‍44(3), the following rules apply:

  • (a)if the vaping products are packaged, they are relieved of the duty imposed under section 158.‍57; and

  • (b)duty is imposed on the vaping products in the amount determined in respect of the vaping products under Schedule 8.

Specified vaping province — unaccounted vaping products

(2)If a particular person that is responsible at a particular time for vaping products cannot account for the vaping products as being, at the particular time, in the possession of a vaping product licensee or in the possession of another person in accordance with subsection 158.‍44(3), a duty in respect of a specified vaping province is imposed on the vaping products in prescribed circumstances in the amount determined in prescribed manner. That duty is in addition to the duty imposed under subsection (1).

Duty payable

(3)The duty imposed under subsection (1) or (2) is payable at the particular time, and by the particular person, referred to in that subsection.

Exception

(4)Subsection (1) does not apply in circumstances in which the particular person referred to in that subsection is convicted of an offence under section 218.‍2.

Duty relieved — unstamped vaping products

158.‍62(1)The duties imposed under sections 158.‍57 and 158.‍58 are relieved on a vaping product that is not stamped.

Vaping products imported for personal use

(2)Subsection (1) does not apply to the importation of vaping products by an individual for their personal use to the extent that the quantity of the products imported exceeds the quantity permitted under Chapter 98 of the List of Tariff Provisions set out in the schedule to the Customs Tariff to be imported without the payment of duties, as defined in Note 4 to that Chapter.

Duty relieved — importation by an individual

158.‍63(1)The duties imposed under sections 158.‍57 and 158.‍58 are relieved on vaping products imported by an individual for their personal use if they were manufactured in Canada and are stamped.

Duty relieved — reimportation

(2)The duties imposed under sections 158.‍57 and 158.‍58 are relieved on vaping products imported by an individual for their personal use if they were manufactured outside Canada, were previously imported into Canada and are stamped.

Duty relieved — importation for destruction

158.‍64The duties imposed under paragraphs 158.‍57(b) and 158.‍58(b) are relieved on a stamped vaping product that was manufactured in Canada by a vaping product licensee and that is imported for re-working or destruction in accordance with section 158.‍53.

Duty relieved — prescribed circumstances

158.‍65The duties imposed under section 158.‍57 or 158.‍58 are relieved on a vaping product in prescribed circumstances.

Duty not payable

158.‍66Duty is not payable on a vaping product

  • (a)that is

    • (i)taken for analysis, or destroyed, by the Minister,

    • (ii)taken for analysis by a vaping product licensee in a manner approved by the Minister,

    • (iii)destroyed by a vaping product licensee in a manner approved by the Minister,

    • (iv)delivered by a vaping product licensee to another person for analysis or destruction by that person in a manner approved by the Minister,

    • (v)a vaping product drug, or

    • (vi)a prescribed vaping product; or

  • (b)in prescribed circumstances.

Excise Warehouses
Restriction — entering vaping products

158.‍67No person shall enter into an excise warehouse

  • (a)a vaping product that is stamped; or

  • (b)any other vaping product except in accordance with this Act.

Prohibition on removal

158.‍68(1)Except if prescribed circumstances exist, no person shall remove from an excise warehouse vaping products manufactured in Canada.

Removal of Canadian manufactured vaping products

(2)Subject to the regulations, a vaping product manufactured in Canada may be removed from the excise warehouse of the vaping product licensee that manufactured it only if it is

  • (a)for export by the licensee in accordance with this Act; or

  • (b)for delivery to an accredited representative for their official or personal use.

Removal from warehouse for re-working or destruction

(3)Subject to the regulations, vaping products manufactured in Canada may be removed from the excise warehouse of the vaping product licensee that manufactured them if they are removed for re-working or destruction by the licensee in accordance with section 158.‍53.

Removal of imported vaping products

158.‍69(1)Except if prescribed circumstances exist, no person shall remove imported vaping products from an excise warehouse.

Exception

(2)Subject to the regulations, imported vaping products may be removed from an excise warehouse

  • (a)for delivery to another excise warehouse;

  • (b)for delivery to an accredited representative for their official or personal use; or

  • (c)for export by the excise warehouse licensee in accordance with this Act.

60(1)The portion of subsection 159(1) of the Act before paragraph (a) is replaced by the following:
Determination of fiscal months

159(1)The fiscal months of a person other than a cannabis licensee or a vaping product licensee shall be determined in accordance with the following rules:

(2)Subsection 159(1.‍01) of the Act is replaced by the following:
Fiscal months — cannabis or vaping product licensee

(1.‍01)For the purposes of this Act, the fiscal months of a cannabis licensee or a vaping product licensee are calendar months.

61Section 180 of the Act is replaced by the following:
No refund — exportation

180Subject to this Act, the duty paid on any tobacco product, cannabis product, vaping product or alcohol entered into the duty-paid market shall not be refunded on the exportation of the tobacco product, cannabis product, vaping product or alcohol.

62The Act is amended by adding the following after section 187.‍1:
Refund of duty — destroyed vaping product

187.‍2The Minister may refund to a vaping product licensee the duty paid on a vaping product that is re-worked or destroyed by the licensee in accordance with section 158.‍53 if the licensee applies for the refund within two years after the vaping product is re-worked or destroyed.

63(1)Paragraph 206(1)‍(d) of the Act is replaced by the following:
  • (d)every person that transports a tobacco product, cannabis product or vaping product that is not stamped or non-duty-paid packaged alcohol.

(2)Section 206 of the Act is amended by adding the following after subsection (2.‍01):
Keeping records — vaping product licensee

(2.‍02)Every vaping product licensee shall keep records that will enable the determination of the amount of vaping product manufactured, received, used, packaged, re-worked, sold or disposed of by the licensee.

64(1)The portion of section 214 of the Act before paragraph (a) is replaced by the following:

Unlawful production, sale, etc.

214Every person that contravenes any of sections 25, 25.‍2 to 25.‍4, 27 and 29, subsection 32.‍1(1) and sections 60, 62, 158.‍02, 158.‍04 to 158.‍06, 158.‍08, 158.‍1 and 158.‍37 to 158.‍39 is guilty of an offence and liable

(2)The portion of section 214 of the Act before paragraph (a), as enacted by subsection (1), is replaced by the following:

Unlawful production, sale, etc.

214Every person that contravenes any of sections 25, 25.‍2 to 25.‍4, 27 and 29, subsection 32.‍1(1) and sections 60, 62, 158.‍02, 158.‍04 to 158.‍06, 158.‍08, 158.‍1, 158.‍35, 158.‍37 to 158.‍39, 158.‍41 and 158.‍43 is guilty of an offence and liable

65The Act is amended by adding the following after section 218.‍1:
Punishment — sections 158.‍44 and 158.‍45

218.‍2(1)Every person that contravenes section 158.‍44 or 158.‍45 is guilty of an offence and liable

  • (a)on conviction on indictment, to a fine of not less than the amount determined under subsection (2) and not more than the amount determined under subsection (3) or to imprisonment for a term of not more than five years, or to both; or

  • (b)on summary conviction, to a fine of not less than the amount determined under subsection (2) and not more than the lesser of $500,000 and the amount determined under subsection (3) or to imprisonment for a term of not more than 18 months, or to both.

Minimum amount

(2)The amount determined under this subsection for an offence under subsection (1) is the greater of

  • (a)the amount determined by the formula

    (A + B) × 200%
    where

    A
    is the amount determined under Schedule 8 in respect of the vaping products to which the offence relates, using the rates of duty applicable at the time the offence was committed, and

    B
    is

    (i)if the offence occurred in a specified vaping province, the amount determined for A, and

    (ii)in any other case, 0, and

  • (b)$1,000 in the case of an indictable offence and $500 in the case of an offence punishable on summary conviction.

Maximum amount

(3)The amount determined under this subsection for an offence under subsection (1) is the greater of

  • (a)the amount determined by the formula

    (A + B) × 300%
    where

    A
    is the amount determined under Schedule 8 in respect of the vaping products to which the offence relates, using the rates of duty applicable at the time the offence was committed, and

    B
    is

    (i)if the offence occurred in a specified vaping province, the amount determined for A, and

    (ii)in any other case, 0, and

  • (b)$2,000 in the case of an indictable offence and $1,000 in the case of an offence punishable on summary conviction.

66Paragraph 230(1)‍(a) of the Act is replaced by the following:
  • (a)the commission of an offence under section 214 or subsection 216(1), 218(1), 218.‍1(1), 218.‍2(1) or 231(1); or

67Paragraph 231(1)‍(a) of the Act is replaced by the following:
  • (a)the commission of an offence under section 214 or subsection 216(1), 218(1), 218.‍1(1) or 218.‍2(1); or

68Subsection 232(1) of the Act is replaced by the following:
Part XII.‍2 of Criminal Code applicable

232(1)Sections 462.‍3 and 462.‍32 to 462.‍5 of the Criminal Code apply, with any modifications that the circumstances require, in respect of proceedings for an offence under section 214, subsection 216(1), 218(1), 218.‍1(1) or 218.‍2(1) or section 230 or 231.

69The Act is amended by adding the following after section 233.‍1:
Contravention of section 158.‍46 or 158.‍49

233.‍2Every vaping product licensee that contravenes section 158.‍46 or 158.‍49 is liable to a penalty equal to the amount determined by the formula

(A + B) × 200%
where

A
is the amount determined under Schedule 8 in respect of the vaping products to which the contravention relates, using the rates of duty applicable at the time the contravention occurred; and

B
is

(a)if the contravention occurred in a specified vaping province, the amount determined for A, and

(b)in any other case, 0.

70(1)Subsection 234(1) of the Act is replaced by the following:
Contravention of certain sections

234(1)Every person that contravenes section 38, 40, 49, 61, 62.‍1, 99, 149, 151, 158.‍15, 158.‍5 or 158.‍67 is liable to a penalty of not more than $25,000.

(2)Subsection 234(1) of the Act, as enacted by subsection (1), is replaced by the following:
Contravention of certain sections

234(1)Every person that contravenes section 38, 40, 49, 61, 62.‍1, 99, 149, 151, 158.‍15, 158.‍5, 158.‍52 or 158.‍67 is liable to a penalty of not more than $25,000.

(3)Section 234 of the Act is amended by adding the following after subsection (3):
Failure to comply

(4)Every person that fails to return or destroy stamps as directed by the Minister under paragraph 158.‍4(b) is liable to a penalty of not more than $25,000.

(4)Subsection 234(4) of the Act, as enacted by subsection (3), is replaced by the following:
Failure to comply

(4)Every person that fails to return or destroy stamps as directed by the Minister under paragraph 158.‍4(b), or that fails to re-work or destroy a vaping product in the manner authorized by the Minister under section 158.‍53, is liable to a penalty of not more than $25,000.

71The Act is amended by adding the following after section 234.‍1:
Contravention — sections 158.‍35 and 158.‍43 to 158.‍45

234.‍2Every person that contravenes section 158.‍35, that receives for sale vaping products in contravention of section 158.‍43 or that sells or offers to sell vaping products in contravention of section 158.‍44 or 158.‍45 is liable to a penalty equal to the amount determined by the formula

(A + B) × 200%
where

A
is the amount determined under Schedule 8 in respect of the vaping products to which the contravention relates, using the rates of duty applicable at the time the contravention occurred; and

B
is

(a)if the contravention occurred in a specified vaping province, the amount determined for A, and

(b)in any other case, 0.

72Subsection 237(6) of the Act is replaced by the following:
Diversion of unstamped vaping products

(5.‍1)Every vaping product licensee is liable to a penalty in respect of a vaping product manufactured in Canada that is removed from the excise warehouse of the licensee for a purpose described in subsection 158.‍68(2) if the product is not delivered or exported, as the case may be, for that purpose.

Diversion of imported vaping products

(5.‍2)Every excise warehouse licensee is liable to a penalty in respect of an imported vaping product that is removed from the excise warehouse of the licensee for a purpose described in subsection 158.‍69(2) if the product is not delivered or exported, as the case may be, for that purpose.

Amount of penalty for diversion of vaping products

(5.‍3)The amount of a penalty for each vaping product that is removed from an excise warehouse for a purpose referred to in subsection (5.‍1) or (5.‍2) and that is not delivered or exported, as the case may be, for that purpose is equal to the amount determined by the formula

(A + B) × 200%
where

A
is the amount determined under Schedule 8 in respect of the vaping product, using the rates of duty applicable at the time the vaping product is removed from the excise warehouse; and

B
is

(a)if at least one province is prescribed for the purposes of the definition specified vaping province in section 2 at the time the vaping product is removed from the excise warehouse, the amount determined for A, and

(b)in any other case, 0.

Exception

(6)A licensee that would otherwise be liable to a penalty under this section is not liable if the licensee proves to the satisfaction of the Minister that the alcohol, tobacco product or vaping product that was removed from their excise warehouse or special excise warehouse was returned to that warehouse.

73The Act is amended by adding the following after section 238:
Penalty in respect of unaccounted vaping products

238.‍01(1)Every excise warehouse licensee is liable to a penalty in respect of a vaping product entered into their excise warehouse if the licensee cannot account for the vaping product

  • (a)as being in the warehouse;

  • (b)as having been removed from the warehouse in accordance with this Act; or

  • (c)as having been destroyed by fire while kept in the warehouse.

Amount of penalty

(2)The amount of a penalty for each vaping product that cannot be accounted for is equal to the amount determined by the formula

(A + B) × 200%
where

A
is the amount determined under Schedule 8 in respect of the vaping product, using the rates of duty applicable at the time the vaping product is entered into the excise warehouse; and

B
is

(a)if at least one province is prescribed for the purposes of the definition specified vaping province in section 2 at the time the vaping product is entered into the excise warehouse, the amount determined for A, and

(b)in any other case, 0.

74(1)Paragraph 238.‍1(1)‍(a) of the Act is replaced by the following:
  • (a)the person can demonstrate that the stamps were affixed to tobacco products, cannabis products, vaping products or their containers in the manner prescribed for the purposes of the definition stamped in section 2 and that duty, other than special duty, has been paid on the tobacco products, cannabis products or vaping products; or

(2)Subsection 238.‍1(2) of the Act is amended by striking out “or” at the end of paragraph (a), by adding “or” at the end of paragraph (b) and by adding the following after paragraph (b):
  • (c)in the case of a vaping excise stamp

    • (i)if the stamp is in respect of a specified vaping province, $10.‍00, and

    • (ii)in any other case, $5.‍00.

75The portion of section 239 of the Act before paragraph (a) is replaced by the following:
Other diversions

239Unless section 237 applies, every person is liable to a penalty equal to 200% of the duty that was imposed on packaged alcohol, a tobacco product, a cannabis product or a vaping product if

76Section 264 of the Act is replaced by the following:
Certain things not to be returned

264Despite any other provision of this Act, any alcohol, specially denatured alcohol, restricted formulation, raw leaf tobacco, excise stamp, tobacco product, cannabis product or vaping product that is seized under section 260 must not be returned to the person from whom it was seized or any other person unless it was seized in error.

77Subsection 266(2) of the Act is amended by striking out “and” at the end of paragraph (d), by adding “and” at the end of paragraph (e) and by adding the following after paragraph (e):
  • (f)a seized vaping product only to a vaping product licensee.

78(1)Paragraph 304(1)‍(c.‍1) of the Act is replaced by the following:
  • (c.‍1)respecting the types of security that are acceptable for the purposes of subsection 158.‍03(3) or 158.‍36(3), and the manner by which the amount of the security is to be determined;

(2)Paragraph 304(1)‍(f) of the Act is replaced by the following:
  • (f)respecting the information to be provided on tobacco products, packaged alcohol, cannabis products and vaping products and on containers of tobacco products, packaged alcohol, cannabis products and vaping products;

(3)Paragraph 304(1)‍(i) of the Act is replaced by the following:
  • (i)respecting the entry and removal of tobacco products, alcohol or vaping products from an excise warehouse or a special excise warehouse;

(4)Paragraph 304(1)‍(n) of the Act is replaced by the following:
  • (n)respecting the sale under section 266 of alcohol, tobacco products, raw leaf tobacco, specially denatured alcohol, restricted formulations, cannabis products or vaping products seized under section 260;

79The Act is amended by adding the following after section 304.‍2:
Definition of coordinated vaping duty system

304.‍3(1)In this section, coordinated vaping duty system means the system providing for the payment, collection and remittance of duty imposed under any of section 158.‍58 and subsections 158.‍6(2) and 158.‍61(2) and any provisions relating to duty imposed under those provisions or to refunds in respect of any such duty.

Coordinated vaping duty system regulations — transition

(2)The Governor in Council may make regulations, in relation to the joining of a province to the coordinated vaping duty system,

  • (a)prescribing transitional measures, including

    • (i)a tax on the inventory of vaping products held by a vaping product licensee or any other person, and

    • (ii)a duty or tax on vaping products that are delivered prior to the province joining that system; and

  • (b)generally to effect the implementation of that system in relation to the province.

Coordinated vaping duty system regulations — rate variation

(3)The Governor in Council may make regulations

  • (a)prescribing rules in respect of whether, how and when a change in the rate of duty for a specified vaping province applies (in this section any such change in the rate of duty is referred to as a “rate variation”), including rules deeming, in specified circumstances and for specified purposes, the status of anything to be different than what it would otherwise be, including when duty is imposed or payable and when duty is required to be reported and accounted for;

  • (b)if a manner of determining an amount of duty is to be prescribed in relation to the coordinated vaping duty system,

    • (i)specifying the circumstances or conditions under which a change in the manner applies, and

    • (ii)prescribing transitional measures in respect of a change in the manner, including

      • (A)a tax on the inventory of vaping products held by a vaping product licensee or any other person, and

      • (B)a duty or tax on vaping products that are delivered prior to the change; and

  • (c)prescribing amounts and rates to be used to determine any refund that relates to, or is affected by, the coordinated vaping duty system, excluding amounts that would otherwise be included in determining any such refund, and specifying circumstances under which any such refund shall not be paid or made.

Coordinated vaping duty system regulations — general

(4)For the purpose of facilitating the implementation, application, administration and enforcement of the coordinated vaping duty system or a rate variation or the joining of a province to the coordinated vaping duty system, the Governor in Council may make regulations

  • (a)prescribing rules in respect of whether, how and when that system applies and rules in respect of other aspects relating to the application of that system in relation to a specified vaping province, including rules deeming, in specified circumstances and for specified purposes, the status of anything to be different than what it would otherwise be, including when duty is imposed or payable and when duty is required to be reported and accounted for;

  • (b)prescribing rules related to the movement of vaping products between provinces, including a duty, tax or refund in respect of such movement;

  • (c)providing for refunds relating to the application of that system in relation to a specified vaping province;

  • (d)adapting any provision of this Act or of the regulations made under this Act to the coordinated vaping duty system or modifying any provision of this Act or those regulations to adapt it to the coordinated vaping duty system;

  • (e)defining, for the purposes of this Act or the regulations made under this Act, or any provision of this Act or those regulations, in its application to the coordinated vaping duty system, words or expressions used in this Act or those regulations including words or expressions defined in a provision of this Act or those regulations;

  • (f)providing that a provision of this Act or of the regulations made under this Act, or a part of such a provision, does not apply to the coordinated vaping duty system;

  • (g)prescribing compliance measures, including penalties and anti-avoidance rules; and

  • (h)generally in respect of the application of that system in relation to a province.

Conflict

(5)If a regulation made under this Act in respect of the coordinated vaping duty system states that it applies despite any provision of this Act, in the event of a conflict between the regulation and this Act, the regulation prevails to the extent of the conflict.

80The Act is amended by adding, after Schedule 7, the Schedule 8 set out in Schedule 1 to this Act.

Related Amendments

R.‍S.‍, c. C-46

Criminal Code

81(1)Subparagraph (g)‍(i) of the definition offence in section 183 of the Criminal Code is replaced by the following:
  • (i)section 214 (unlawful production, sale, etc.‍, of tobacco, alcohol, cannabis or vaping products),

(2)Paragraph (g) of the definition offence in section 183 of the Act is amended by adding the following after subparagraph (iii.‍1):
  • (iii.‍2)section 218.‍2 (unlawful possession, sale, etc.‍, of unstamped vaping products),

R.‍S.‍, c. E-15

Excise Tax Act

82The definition excisable goods in subsection 123(1) of the Excise Tax Act is replaced by the following:

excisable goods means beer or malt liquor (within the meaning assigned by section 4 of the Excise Act) and spirits, wine, tobacco products, cannabis products and vaping products (within the meaning assigned by section 2 of the Excise Act, 2001); (produit soumis à l’accise)

R.‍S.‍, c. F-8; 1995, c. 17, s. 45(1)

Federal-Provincial Fiscal Arrangements Act

83Subsection 2(1) of the Federal-Provincial Fiscal Arrangements Act is amended by adding the following in alphabetical order:

coordinated vaping product taxation agreement means an agreement or arrangement entered into by the Minister on behalf of the Government of Canada under Part III.‍3, including any amendments or variations to the agreement or arrangement made in accordance with that Part; (accord de coordination de la taxation des produits de vapotage)

84The Act is amended by adding the following after section 8.‍82:
PART III.‍3
Coordinated Vaping Product Taxation Agreements
Coordinated Vaping Product Taxation Agreement

8.‍9(1)The Minister, with the approval of the Governor in Council, may on behalf of the Government of Canada enter into an agreement or arrangement with the government of a province respecting the taxation of vaping products and, without restricting the generality of the foregoing, respecting

  • (a)the collection, administration and enforcement of taxes on vaping products in respect of the province under a single Act of Parliament;

  • (b)the provision to the Government of Canada by the government of the province, or to the government of the province by the Government of Canada, of

    • (i)information acquired in the administration and enforcement of Acts imposing taxes on vaping products and Acts providing for rebates, refunds or reimbursements of taxes on vaping products, paid or payable, or of amounts paid or payable as or on account of the taxation of vaping products, and

    • (ii)other information related to the regulation of vaping and the distribution of vaping products relevant to the system of taxation of vaping products under a single Act of Parliament;

  • (c)the accounting for taxes collected in accordance with the agreement;

  • (d)the implementation of and transition to the system of taxation of vaping products contemplated under the agreement;

  • (e)payments, and the eligibility for payments, by the Government of Canada to the government of the province in respect of the revenues from the system of taxation contemplated under the agreement and to which the province is entitled under the agreement, the time when such payments will be made, and the remittance by the government of the province to the Government of Canada of any overpayments by the Government of Canada or the right of the Government of Canada to set off any overpayments against other amounts payable by the Government of Canada to the government of the province, whether under the agreement or any other agreement or arrangement or any Act of Parliament;

  • (f)the payment by the Government of Canada and its agents and subservient bodies, and by the government of the province and its agents and subservient bodies, of the taxes on vaping products payable under the system of taxation of vaping products contemplated under the agreement and the accounting for the taxes on vaping products so paid;

  • (g)the compliance by the Government of Canada and its agents and subservient bodies, and by the government of the province and its agents and subservient bodies, with the Act of Parliament under which the system of taxation of vaping products is administered and regulations made under that Act; and

  • (h)other matters that relate to, and that are considered advisable for the purposes of implementing or administering, the system of taxation of vaping products contemplated under the agreement.

Amending agreements

(2)The Minister, with the approval of the Governor in Council, may on behalf of the Government of Canada enter into an agreement with the government of a province amending or varying an agreement or arrangement with the province entered into under subsection (1) or this subsection.

Payments

8.‍91If there is a coordinated vaping product taxation agreement with the government of a province, the appropriate minister may pay to the province out of amounts received in a fiscal year under the Act of Parliament referred to in paragraph 8.‍9(1)‍(a)

  • (a)amounts determined in accordance with the agreement as provided, and at such times as are specified, in the agreement; and

  • (b)subject to the regulations, advances in respect of the amounts referred to in paragraph (a).

Statutory authority to make payments

8.‍92Despite any other Act, the payments paid under a coordinated vaping product taxation agreement under the authority of section 8.‍91 may be made without any other or further appropriation or authority.

85(1)Paragraph 40(b) of the Act is replaced by the following:
  • (b)respecting the calculation and payment to a province of advances on account of any amount that may become payable to the province under this Act, an administration agreement, a reciprocal taxation agreement, a sales tax harmonization agreement, a coordinated cannabis taxation agreement or a coordinated vaping product taxation agreement and the adjustment, by way of reduction or set off, of other payments to the province because of those advances;

(2)Paragraph 40(d) of the Act is replaced by the following:
  • (d)prescribing the time and manner of making any payment under this Act, an administration agreement, a sales tax harmonization agreement, a coordinated cannabis taxation agreement or a coordinated vaping product taxation agreement;

R.‍S.‍, c. 1 (2nd Supp.‍)

Customs Act

86Subsection 2(1) of the Customs Act is amended by adding the following in alphabetical order:

immediate container has the same meaning as in section 2 of the Excise Act, 2001; (contenant immédiat)

vaping device has the same meaning as in section 2 of the Excise Act, 2001; (dispositif de vapotage)

vaping product has the same meaning as in section 2 of the Excise Act, 2001; (produit de vapotage)

vaping product licensee has the same meaning as in section 2 of the Excise Act, 2001; (titulaire de licence de produits de vapotage)

vaping substance has the same meaning as in section 2 of the Excise Act, 2001; (substance de vapotage)

87Subsection 97.‍25(3) of the Act is amended by adding the following after paragraph (c):
  • (c.‍1)if the good is a vaping product, to a vaping product licensee;

88Subsection 109.‍2(2) of the Act is replaced by the following:
Contravention relating to tobacco, cannabis and vaping products and to designated goods

(2)Every person that

  • (a)removes tobacco products, cannabis products, vaping products or designated goods or causes tobacco products, cannabis products, vaping products or designated goods to be removed from a customs office, sufferance warehouse, bonded warehouse or duty free shop in contravention of this Act or the Customs Tariff or the regulations made under those Acts, or

  • (b)sells or uses tobacco products or designated goods designated as ships’ stores in contravention of this Act or the Customs Tariff or the regulations made under those Acts,

is liable to a penalty equal to double the total of the duties that would be payable on like tobacco products, cannabis products, vaping products or designated goods released in like condition at the rates of duties applicable to like tobacco products, cannabis products, vaping products or designated goods at the time the penalty is assessed, or to such lesser amount as the Minister may direct.

89Subsection 117(2) of the Act is replaced by the following:
No return of certain goods

(2)Despite subsection (1), if spirits, wine, specially denatured alcohol, restricted formulations, cannabis, raw leaf tobacco, excise stamps, tobacco products or vaping products are seized under this Act, they shall not be returned to the person from whom they were seized or any other person unless they were seized in error.

90Subsection 119.‍1(1.‍1) of the Act is amended by striking out “and” at the end of paragraph (c) and by adding the following after that paragraph:
  • (c.‍1)a vaping product may only be to a vaping product licensee; and

91The portion of subsection 142(1) of the Act before paragraph (a) is replaced by the following:
Disposal of things abandoned or forfeit

142(1)Unless the thing is spirits, specially denatured alcohol, a restricted formulation, wine, raw leaf tobacco, an excise stamp, a tobacco product or a vaping product, anything that has been abandoned to Her Majesty in right of Canada under this Act and anything the forfeiture of which is final under this Act shall

92(1)Subsection 142.‍1(1) of the Act is replaced by the following:
Dealing with abandoned or forfeited alcohol, etc.

142.‍1(1)If spirits, specially denatured alcohol, a restricted formulation, wine, raw leaf tobacco, a tobacco product or a vaping product is abandoned or finally forfeited under this Act, the Minister may sell, destroy or otherwise deal with it.

(2)Subsection 142.‍1(2) of the Act is amended by striking out “and” at the end of paragraph (c) and by adding the following after that paragraph:
  • (c.‍1)a vaping product may only be to a vaping product licensee; and

93Paragraph 164(1)‍(h.‍2) of the Act is replaced by the following:
  • (h.‍2)respecting the sale of alcohol, a tobacco product, raw leaf tobacco, specially denatured alcohol, a restricted formulation or a vaping product detained, seized, abandoned or forfeited under this Act;

1997, c. 36

Customs Tariff

94Paragraph 83(a) of the Customs Tariff is replaced by the following:
  • (a)in the case of goods that would have been classified under tariff item No. 9804.‍10.‍00 or 9804.‍20.‍00, the value for duty of the goods shall be reduced by an amount equal to that maximum specified value and, in the case of alcoholic beverages, vaping products and tobacco, the quantity of those goods shall, for the purposes of assessing duties other than a duty under section 54 of the Excise Act, 2001, be reduced by the quantity of alcoholic beverages, vaping products and tobacco and up to the maximum quantities specified in tariff item No. 9804.‍10.‍00 or 9804.‍20.‍00, as the case may be;

95Subsection 89(2) of the Act is replaced by the following:
Exception

(2)Relief of the duties or taxes levied or imposed under sections 21.‍1 to 21.‍3, the Excise Act, 2001 or the Excise Tax Act may not be granted under subsection (1) on tobacco products, vaping products or designated goods.

96Subsection 113(2) of the Act is replaced by the following:
No refund

(2)No refund or drawback of the duties imposed on tobacco products or vaping products under the Excise Act, 2001 shall be granted under subsection (1), except if a refund of the whole or the portion of the duties is required to be granted under Division 3.

97(1)The Description of Goods of tariff item No. 9804.‍10.‍00 in the List of Tariff Provisions set out in the schedule to the Act is amended by replacing the reference beginning with “For the purpose of this tariff item,” and ending with “of manufactured tobacco.‍” with a reference to “For the purpose of this tariff item, goods may include either wine not exceeding 1.‍5 litres or any alcoholic beverages not exceeding 1.‍14 litres, tobacco not exceeding fifty cigars, two hundred cigarettes, two hundred tobacco sticks and two hundred grams of manufactured tobacco, and vaping products not exceeding 120 millilitres of vaping substance in liquid form, or 120 grams of vaping substance in solid form, within any combination of not more than twelve vaping devices and immediate containers.‍”
(2)Paragraphs (a) and (b) of the Description of Goods of tariff item No. 9804.‍20.‍00 in the List of Tariff Provisions set out in the schedule to the Act are replaced by the following:
  • (a)goods may include either wine not exceeding 1.‍5 litres or any alcoholic beverages not exceeding 1.‍14 litres, tobacco not exceeding fifty cigars, two hundred cigarettes, two hundred tobacco sticks and two hundred grams of manufactured tobacco, and vaping products not exceeding 120 millilitres of vaping substance in liquid form, or 120 grams of vaping substance in solid form, within any combination of not more than twelve vaping devices and immediate containers, if included in the baggage accompanying the person at the time of return to Canada; and

  • (b)if goods (other than alcoholic beverages, cigars, cigarettes, tobacco sticks, manufactured tobacco and vaping products) acquired abroad are not included in the baggage accompanying the person, they may be classified under this tariff item if they are reported by the person at time of return to Canada.

(3)The Description of Goods of tariff item No. 9804.‍30.‍00 in the List of Tariff Provisions set out in the schedule to the Act is amended by replacing the reference beginning with “For the purpose of this tariff item,” and ending with “or manufactured tobacco.‍” with a reference to “For the purpose of this tariff item, goods shall not include those which could otherwise be imported into Canada free of duties, nor alcoholic beverages, cigars, cigarettes, tobacco sticks, manufactured tobacco or vaping products.‍”
(4)The Description of Goods of tariff item No. 9804.‍40.‍00 in the List of Tariff Provisions set out in the schedule to the Act is amended by replacing the reference beginning with “For the purpose of this tariff item,” and ending with “or manufactured tobacco.‍” with a reference to “For the purpose of this tariff item, goods shall not include alcoholic beverages, cigars, cigarettes, tobacco sticks, manufactured tobacco or vaping products.‍”
(5)Paragraphs (a) and (b) of the Description of Goods of tariff item No. 9805.‍00.‍00 in the List of Tariff Provisions set out in the schedule to the Act are replaced by the following:
  • (a)the provisions shall apply to either wine not exceeding 1.‍5 litres or any alcoholic beverages not exceeding 1.‍14 litres, tobacco not exceeding fifty cigars, two hundred cigarettes, two hundred tobacco sticks and two hundred grams of manufactured tobacco, and vaping products not exceeding 120 millilitres of vaping substance in liquid form, or 120 grams of vaping substance in solid form, within any combination of not more than twelve vaping devices and immediate containers, if they are included in the baggage accompanying the importer, and no relief from payment of duties is being claimed in respect of alcoholic beverages, tobacco or vaping products under another item in this Chapter at the time of importation;

  • (b)if goods (other than alcoholic beverages, cigars, cigarettes, tobacco sticks, manufactured tobacco and vaping products) are not accompanying the person returning from abroad, they may be classified under this item when imported at a later time if they are reported by the person at the time of return to Canada; and

(6)The Description of Goods of tariff item No. 9807.‍00.‍00 in the List of Tariff Provisions set out in the schedule to the Act is amended by striking out “and” at the end of subparagraph (a)‍(i), by adding “and” at the end of subparagraph (a)‍(ii), and by adding the following after subparagraph (a)‍(ii):
  • (iii)vaping products not exceeding 120 millilitres of vaping substance in liquid form, or 120 grams of vaping substance in solid form, within any combination of not more than twelve vaping devices and immediate containers;

(7)Paragraph (c) of the Description of Goods of tariff item No. 9807.‍00.‍00 in the List of Tariff Provisions set out in the schedule to the Act is amended by replacing the reference to “(other than alcoholic beverages, cigars, cigarettes, tobacco sticks and manufactured tobacco)” with a reference to “(other than alcoholic beverages, cigars, cigarettes, tobacco sticks, manufactured tobacco and vaping products)”.
(8)The Description of Goods of tariff item No. 9816.‍00.‍00 in the List of Tariff Provisions set out in the schedule to the Act is amended by replacing the reference to “and not being advertising matter, tobacco or alcoholic beverages,” with a reference to “and not being advertising matter, tobacco, alcoholic beverages or vaping products,”.
(9)The Description of Goods of heading No. 98.‍25 in the List of Tariff Provisions set out in the schedule to the Act is amended by replacing the reference to “alcoholic beverages; tobacco; tobacco products;” with a reference to “alcoholic beverages; tobacco; tobacco products; vaping products;”.
(10)The Description of Goods of heading No. 98.‍26 in the List of Tariff Provisions set out in the schedule to the Act is amended by replacing the reference to “alcoholic beverages; tobacco; tobacco products;” with a reference to “alcoholic beverages; tobacco; tobacco products; vaping products;”.
(11)The Description of Goods of tariff item No. 9827.‍00.‍00 in the List of Tariff Provisions set out in the schedule to the Act is amended by replacing the reference beginning with “Goods, which may include” and ending with “of manufactured tobacco,” with a reference to “Goods, which may include either wine not exceeding 1.‍5 litres or any alcoholic beverages not exceeding 1.‍14 litres, tobacco products not exceeding fifty cigars, two hundred cigarettes, two hundred tobacco sticks and two hundred grams of manufactured tobacco, and vaping products not exceeding 120 millilitres of vaping substance in liquid form, or 120 grams of vaping substance in solid form, within any combination of not more than twelve vaping devices and immediate containers,”.
(12)The Description of Goods of tariff item No. 9906.‍00.‍00 in the List of Tariff Provisions set out in the schedule to the Act is amended by replacing the reference to “other than alcoholic beverages and tobacco products,” with a reference to “other than alcoholic beverages, tobacco products and vaping products,”.

SOR/81-701

Tariff Item No. 9805.‍00.‍00 Exemption Order

98Section 3 of the Tariff Item No. 9805.‍00.‍00 Exemption Order is amended by adding the following after paragraph (b):
  • (b.‍1)vaping products owned by and in the possession of the importer;

SI/85-181

Postal Imports Remission Order

99(1)Paragraph (a) of the definition goods in section 2 of the Postal Imports Remission Order is replaced by the following:
  • (a)alcoholic beverages, cannabis products, vaping products, cigars, cigarettes and manufactured tobacco;

(2)Section 2 of the Order is amended by adding the following in alphabetical order:

vaping product has the same meaning as in section 2 of the Excise Act, 2001.‍ (produit de vapotage)

SI/85-182; SI/92-128, s. 2(F)

Courier Imports Remission Order

100(1)Paragraph (a) of the definition goods in section 2 of the Courier Imports Remission Order is replaced by the following:
  • (a)alcoholic beverages, cannabis products, vaping products, cigars, cigarettes and manufactured tobacco;

(2)Section 2 of the Order is amended by adding the following in alphabetical order:

vaping product has the same meaning as in section 2 of the Excise Act, 2001.‍ (produit de vapotage)

SOR/86-1065

Customs Sufferance Warehouses Regulations

101Subsection 15(4) of the Customs Sufferance Warehouses Regulations is replaced by the following:

(4)For the purposes of subsection 39.‍1(1) of the Act, firearms, prohibited ammunition, prohibited devices, prohibited or restricted weapons, tobacco products and vaping products are goods of a prescribed class that are forfeit if they are not removed from a sufferance warehouse within 14 days after the day on which they were reported under section 12 of the Act.

102Paragraph 17(a) of the Regulations is replaced by the following:
  • (a)stamping the goods, if the goods consist of

    • (i)imported raw leaf tobacco or imported tobacco products that are placed in the sufferance warehouse in accordance with section 39 of the Excise Act, 2001, or

    • (ii)imported vaping products that are placed in the sufferance warehouse in accordance with section 158.‍51 of the Excise Act, 2001;

SOR/87-720

Non-residents’ Temporary Importation of Baggage and Conveyances Regulations

103Section 2 of the Non-residents’ Temporary Importation of Baggage and Conveyances Regulations is amended by adding the following in alphabetical order:

immediate container has the same meaning as in section 2 of the Excise Act, 2001; (contenant immédiat)

vaping device has the same meaning as in section 2 of the Excise Act, 2001; (dispositif de vapotage)

vaping substance has the same meaning as in section 2 of the Excise Act, 2001; (substance de vapotage)

104Subsection 4(1) of the Regulations is amended by striking out “or” at the end of paragraph (b) and by adding the following after that paragraph:
  • (b.‍1)120 millilitres of vaping substance in liquid form, or 120 grams of vaping substance in solid form, within any combination of not more than twelve vaping devices and immediate containers; or

SOR/90-225

Tariff Item No. 9807.‍00.‍00 Exemption Order

105Paragraph 2(b) of the Tariff Item No. 9807.‍00.‍00 Exemption Order is replaced by the following:
  • (b)tobacco products and vaping products;

SOR/96-46

Customs Bonded Warehouses Regulations

106Section 2 of the Customs Bonded Warehouses Regulations is amended by adding the following in alphabetical order:

vaping product has the same meaning as in section 2 of the Excise Act, 2001; (produit de vapotage)

107Section 14 of the Regulations is amended by striking out “and” at the end of paragraph (e), by adding “and” at the end of paragraph (f) and by adding the following after paragraph (f):
  • (g)vaping products that are not stamped.

108The Regulations are amended by adding the following after section 16:

16.‍1No licensee shall receive into or remove from a bonded warehouse imported vaping products unless they are to be removed from the warehouse for sale to a foreign diplomat in Canada or export from Canada.

109Section 18 of the Regulations is replaced by the following:

18For the purposes of subsections 37(2) and 39.‍1(2) of the Customs Act, tobacco products, packaged spirits and vaping products are a prescribed class of goods and are forfeit if they have not been removed from the bonded warehouse within five years of the day on which the goods are described in the form prescribed under subsection 19(2) of that Act.

SOR/2003-115

Regulations Respecting Excise Licences and Registrations

110Subparagraph 2(2)‍(b)‍(i) of the Regulations Respecting Excise Licences and Registrations is replaced by the following:
  • (i)failed to comply with any Act of Parliament, other than the Act, or of the legislature of a province respecting the taxation of or controls on alcohol, tobacco products or vaping products or any regulations made under it, or

111Section 4 of the Regulations is replaced by the following:

4A licence is valid for the period specified in the licence, which period shall not exceed

  • (a)in the case of a vaping product licence, three years; and

  • (b)in any other case, two years.

112(1)The portion of subsection 5(1) of the Regulations before paragraph (a) is replaced by the following:

5(1)For the purposes of paragraph 23(3)‍(b) of the Act, the amount of security to be provided by an applicant for a spirits licence, a tobacco licence, a cannabis licence or a vaping product licence is an amount of not less than $5,000 and

(2)Paragraph 5(1)‍(b) of the Regulations is replaced by the following:
  • (b)in the case of a tobacco licence, a cannabis licence or a vaping product licence, be sufficient to ensure payment of the amount of duty referred to in paragraph 160(b) of the Act up to a maximum amount of $5 million per licence.

113Paragraph 12(1)‍(e) of the Regulations is replaced by the following:
  • (e)fails to comply with any Act of Parliament, other than the Act, or of the legislature of a province respecting the taxation of or controls on alcohol, tobacco products or vaping products, or any regulations made under it; or

SOR/2003-203; 2018, c. 12, s. 106

Regulations Respecting the Possession of Tobacco Products or Cannabis Products That Are Not Stamped

114The title of the Regulations Respecting the Possession of Tobacco Products or Cannabis Products That Are Not Stamped is replaced by the following:
Regulations Respecting the Possession of Tobacco, Cannabis or Vaping Products That Are Not Stamped
115The Regulations are amended by adding the following after section 1.‍3:

1.‍4For the purposes of paragraph 158.‍44(3)‍(b) of the Excise Act, 2001, a person may possess a vaping product that is not stamped if

  • (a)the person is authorized by an officer under section 19 of the Customs Act to transport vaping products that have been reported under section 12 of that Act and is acting in accordance with that authorization; or

  • (b)the person has in their possession documentation that provides evidence that the person is transporting the vaping product on behalf of

    • (i)a vaping product licensee,

    • (ii)an excise warehouse licensee, or

    • (iii)an accredited representative.

SOR/2003-288; 2018, c. 12, s. 108

Stamping and Marking of Tobacco and Cannabis Products Regulations

116The title of the Stamping and Marking of Tobacco and Cannabis Products Regulations is replaced by the following:
Stamping and Marking of Tobacco, Cannabis and Vaping Products Regulations
117Paragraph 2(c) of the Regulations is replaced by the following:
  • (c)a cannabis product or a vaping product is packaged in a prescribed package when it is packaged in the smallest package — including any outer wrapper, package, box or other container — in which it is sold to the consumer.

118(1)Subsection 4(1) of the Regulations is replaced by the following:

4(1)For the purposes of subsections 25.‍1(1) and 158.‍36(1) of the Act, a prescribed person is a person that satisfies the requirements set out in paragraphs 2(2)‍(a) to (e) of the Regulations Respecting Excise Licences and Registrations.

(2)Section 4 of the Regulations is amended by adding the following after subsection (3):

(4)For the purposes of paragraph 158.‍38(2)‍(d) of the Act, the following persons are prescribed:

  • (a)a person that transports a vaping excise stamp on behalf of a person described in paragraph 158.‍38(2)‍(a) or (b) of the Act; and

  • (b)a person that has in their possession vaping excise stamps only for the purpose of applying adhesive to the stamps on behalf of the vaping product licensee to which the stamps are issued.

119The Regulations are amended by adding the following after section 4:

4.‍01(1)If the Minister holds, at any time in a calendar month, security that a person has provided under subsection 158.‍36(3) of the Act and if the person is not a vaping product licensee throughout the calendar month, the person must file with the Minister an information return for the calendar month in respect of the possession and use of any vaping excise stamps issued to the person.

(2)The information return of a person for a particular calendar month must

  • (a)be made in prescribed form containing prescribed information; and

  • (b)be filed in prescribed manner on or before the last day of the first calendar month following the particular calendar month.

120The Regulations are amended by adding the following after section 4.‍1:

4.‍11(1)Subject to subsections (2) to (4), the amount of security for the purpose of subsection 158.‍36(3) of the Act is the greater of

  • (a)$1.‍00 multiplied by the number of vaping excise stamps that either are in the applicant’s possession at the time of application or are to be issued in respect of the application, and

  • (b)$5,000.

(2)Subject to subsections (3) and (4), if the amount determined under paragraph (1)‍(a) is greater than $5 million, the amount of security for the purpose of subsection 158.‍36(3) of the Act is $5 million.

(3)If a person has provided security under paragraph 23(3)‍(b) of the Act in an amount that is equal to or greater than the amount of security determined in accordance with subsections (1) and (2), the amount of security for the purpose of subsection 158.‍36(3) of the Act is nil.

(4)If a person has provided security under paragraph 23(3)‍(b) of the Act in an amount that is less than the amount of security determined in accordance with subsections (1) and (2), the amount of security for the purpose of subsection 158.‍36(3) of the Act is the difference between the amount of security determined in accordance with subsections (1) and (2) and the amount of security provided by the person under paragraph 23(3)‍(b) of the Act.

121The portion of section 4.‍2 of the Regulations before paragraph (a) is replaced by the following:

4.‍2For the purposes of the definition stamped in section 2 of the Act and subsections 25.‍3(1), 158.‍05(1) and 158.‍38(1) of the Act, the prescribed manner of affixing an excise stamp to a package is by affixing the stamp

122The Regulations are amended by adding the following after section 5:

5.‍1(1)For the purposes of paragraphs 158.‍44(3)‍(e) and 158.‍47(2)‍(c) and section 158.‍56 of the Act, the prescribed limit is five units of vaping products.

(2)For the purposes of subsection (1), a unit of vaping products consists of 120 millilitres of vaping substance in liquid form, or 120 grams of vaping substance in solid form, within any combination of not more than 12 vaping devices and immediate containers.

123The heading after section 7 of the Regulations is replaced by the following:
Vaping Product Marking

8(1)For the purposes of subsection 158.‍5(1) of the Act, the required vaping product markings are

  • (a)for containers of vaping products manufactured in Canada, the marking set out in Schedule 7; and

  • (b)for containers of vaping products manufactured outside Canada, the marking set out in Schedule 8.

(2)The vaping product markings must be printed on or affixed to the container in a conspicuous manner and in accordance with the specifications set out in the appropriate Schedule.

9(1)For the purposes of subsection 158.‍5(2) of the Act, the required vaping product marking is the marking set out in Schedule 8.

(2)The vaping product marking must be printed on or affixed to the container in a conspicuous manner and in accordance with the specifications set out in Schedule 8.

124Schedule 7 to the Regulations is amended by replacing the reference after the heading “SCHEDULE 7” with the following:
(Sections 6 and 8)
125The heading of Schedule 7 to the Regulations is replaced by the following:
Marking for Containers of Manufactured Tobacco, Cigars and Vaping Products Manufactured in Canada
126Schedule 8 to the Regulations is amended by replacing the reference after the heading “SCHEDULE 8” with the following:
(Sections 6 to 9)
127The heading of Schedule 8 to the Regulations is replaced by the following:
Marking for Containers of Manufactured Tobacco, Cigars and Vaping Products Manufactured Outside Canada, Containers of Cigars Manufactured in Canada and Intended for Delivery to a Duty Free Shop or as Ships’ Stores and Containers of Imported Manufactured Tobacco and Cigars Referred to in Subsection 38(2) of the Act

Application

128(1)Sections 158.‍35, 158.‍51 to 158.‍53, 158.‍68 and 158.‍69 of the Excise Act, 2001, as enacted by section 59, subsection 64(2), sections 65 to 69, subsections 70(2) and (4), sections 71, 72 and 75, subsection 81(2) and sections 82, 87 to 105, 115 and 122 come into force on October 1, 2022.

(2)Sections 158.‍41, 158.‍57 and 158.‍58 of the Excise Act, 2001, as enacted by section 59, apply in respect of vaping products manufactured in Canada that are packaged on or after October 1, 2022 and to vaping products that are imported into Canada or released (as defined in subsection 2(1) of the Customs Act) on or after that day. Those sections of the Excise Act, 2001 also apply in respect of

  • (a)vaping products manufactured in Canada that are packaged before October 1, 2022 if the vaping products are stamped after the day on which this Act receives royal assent; and

  • (b)vaping products that are imported into Canada or released (as defined in subsection 2(1) of the Customs Act) after the day on which this Act receives royal assent but before October 1, 2022 if the vaping products are stamped when they are reported under the Customs Act.

(3)Sections 158.‍42 to 158.‍47 and 158.‍49, subsection 158.‍5(2), sections 158.‍54 to 158.‍56, 158.‍6 and 158.‍61 of the Excise Act, 2001, as enacted by section 59, subsection 63(1) and sections 107 to 109 come into force on October 1, 2022. However, those provisions of the Excise Act, 2001, subsection 63(1) and sections 107 to 109 do not apply before 2023 in respect of

  • (a)vaping products manufactured in Canada that are packaged before October 1, 2022 and that are not stamped; and

  • (b)vaping products that are imported into Canada or released (as defined in subsection 2(1) of the Customs Act) before October 1, 2022 and that are not stamped.

(4)In applying sections 158.‍57 and 158.‍58 of the Excise Act, 2001, as enacted by section 59, in respect of vaping products manufactured in Canada that are packaged before October 1, 2022, paragraph (a) of each of those sections 158.‍57 and 158.‍58 is to be read as follows:

  • (a)in the case of vaping products manufactured in Canada, by the vaping product licensee that packaged the vaping products and at the later of the beginning of October 1, 2022 and the time they are stamped; and

DIVISION 2
Excise Act, 2001 (Wine)

2002, c. 22

129(1)Section 87 of the Excise Act, 2001 is amended by adding “and” at the end of paragraph (a) and by repealing paragraph (a.‍1).

(2)Subsection (1) comes into force, or is deemed to have come into force, on June 30, 2022.

130(1)Paragraph 88(2)‍(i) of the Act is replaced by the following:

  • (i)that is wine referred to in paragraph 135(2)‍(b) may be possessed by any person; and

(2)Subsection (1) comes into force, or is deemed to have come into force, on June 30, 2022, but does not apply to wine packaged before that day.

131(1)Subsection 134(3) of the Act is replaced by the following:

Exception

(3)Subsection (1) does not apply to wine

  • Insertion start (a) Insertion end that is produced by an individual for their personal use and that is consumed in the course of that use; Insertion start or Insertion end

  • Start of inserted block

    (b)that is produced in Canada from honey or apples and composed wholly of agricultural or plant product grown in Canada.

    End of inserted block

(2)Subsection (1) applies after June Insertion start 29 Insertion end , 2022.

132(1)Paragraph 135(2)‍(a) of the Act is Insertion start replaced by the following Insertion end :

  • Start of inserted block

    (a)produced in Canada from honey or apples and composed wholly of agricultural or plant product grown in Canada;

    End of inserted block

(2)Subsection (1) applies to wine packaged on or after June 30, 2022.

DIVISION 3
Excise Act (Beer)

R.‍S.‍, c. E-12

133(1)The portion of the definition beer or malt liquor in section 4 of the Excise Act before paragraph (a) is replaced by the following:

beer or malt liquor means any product (other than wine, as defined in section 2 of the Excise Act, 2001) containing more than 0.‍5% absolute ethyl alcohol by volume that is

(2)Subsection (1) comes into force, or is deemed to have come into force, on July 1, 2022.

134(1)Subsection 170.‍1(3) of the Act is replaced by the following:

Exclusion of exports

(3)In subsection (1), the reference to “first 75,000 hectolitres of beer and malt liquor brewed in Canada” does not include beer or malt liquor that is exported or deemed to be exported under section 173.

(2)Subsection (1) comes into force, or is deemed to have come into force, on July 1, 2022.

PART 4
Select Luxury Items Tax Act

Enactment of Act

Enactment

135(1)The Select Luxury Items Tax Act, whose text is as follows and whose schedule is set out in Schedule 2 to this Act, is enacted:

An Act respecting the taxation of select luxury items
Short Title
Short title

1This Act may be cited as the Select Luxury Items Tax Act.

PART 1
Select Luxury Items Tax
DIVISION 1
Interpretation and Application
SUBDIVISION A 
Interpretation
Definitions

2(1)The following definitions apply in this Act.

assessment means an assessment under this Act and includes a reassessment.‍ (cotisation)

bank means a bank as defined in section 2 of the Bank Act or an authorized foreign bank, as defined in that section, that is not subject to the restrictions and requirements referred to in subsection 524(2) of that Act.‍ (banque)

calendar quarter means a period of three months beginning on the first day of January, April, July or October.‍ (trimestre civil)

Commissioner means, except in sections 80 and 81 and subsections 153(1) to (8) and (19), the Commissioner of Revenue appointed under section 25 of the Canada Revenue Agency Act. (commissaire)

common-law partner of an individual at a particular time means a person who is the common-law partner of the individual at the particular time for the purposes of the Income Tax Act.‍ (conjoint de fait)

confirmed delivery service means certified or registered mail or any other service that provides a record that a notice or document has been sent or delivered.‍ (service de messagerie)

consideration includes any amount that is payable by operation of law.‍ (contrepartie)

credit union has the same meaning as in subsection 137(6) of the Income Tax Act.‍ (caisse de crédit)

export means export from Canada.‍ (exportation)

government entity means

  • (a)a department or agency of the government of Canada or of a province;

  • (b)a municipality;

  • (c)an aboriginal government as defined in subsection 2(1) of the Federal-Provincial Fiscal Arrangements Act;

  • (d)a corporation all of the shares (except directors’ qualifying shares) of the capital stock of which are owned by one or more persons each of which is

    • (i)Her Majesty in right of Canada or a province,

    • (ii)a municipality, or

    • (iii)a corporation described in this paragraph; or

  • (e)a board or commission, established by Her Majesty in right of Canada or a province, that performs an administrative or regulatory function of government, or by a municipality, that performs an administrative or regulatory function of a municipality. (entité gouvernementale)

guest of a particular person on a subject item means an individual that uses or enjoys the subject item and that

  • (a)does not deal at arm’s length with the particular person;

  • (b)is an employee of the particular person or of a person that does not deal at arm’s length with the particular person; or

  • (c)uses or enjoys the subject item, at the invitation of the particular person or a person referred to in paragraph (a) or (b), for no consideration or for nominal consideration.‍ (invité)

identification number of a subject item means an identification number that is satisfactory to the Minister and is unique to the subject item.‍ (numéro d’identification)

import means import into Canada.‍ (importation)

Indigenous governing body has the same meaning as in section 2 of the Department of Indigenous Services Act.‍ (corps dirigeant autochtone)

judge, in respect of any matter, means a judge of a superior court having jurisdiction in the province in which the matter arises or a judge of the Federal Court.‍ (juge)

military authority means the Canadian Forces, within the meaning of section 14 of the National Defence Act, the Department of National Defence or a visiting force, as defined in section 2 of the Visiting Forces Act.‍ (autorité militaire)

Minister means the Minister of National Revenue.‍ (ministre)

municipality means

  • (a)an incorporated city, town, village, metropolitan authority, township, district, county or rural municipality or other incorporated municipal body however designated; or

  • (b)any other local authority that the Minister may determine to be a municipality for the purposes of this Act.‍ (municipalité)

officer means, except in sections 75, 127 and 149,

  • (a)a person who is appointed or employed in the administration or enforcement of this Act; and

  • (b)with respect to imported goods that have not been released under the Customs Act, an officer as defined in subsection 2(1) of that Act.‍ (préposé)

passenger seat means a seat on an aircraft other than a pilot seat.‍ (siège passager)

person means an individual, a partnership, a corporation, the estate or succession of a deceased individual, a trust, a joint venture, a government or a body that is a society, a union, a club, an association, a commission or another organization of any kind.‍ (personne)

personal representative, of a deceased individual or the estate or succession of a deceased individual, means the executor of the individual’s will, the liquidator of the individual’s succession, the administrator of the estate or any person that is responsible under the appropriate law for the proper collection, administration, disposition and distribution of the assets of the estate or succession.‍ (représentant personnel)

pilot seat includes a flight engineer seat or a flight deck observer seat. (siège destiné au pilote)

police authority means

  • (a)the Royal Canadian Mounted Police, the Ontario Provincial Police, the Sûreté du Québec, the Canadian Coast Guard or a municipal or regional police force established in accordance with provincial legislation;

  • (b)a government entity that is responsible for the preservation and maintenance of the public peace; or

  • (c)a prescribed person. (corps policier)

prescribed means

  • (a)in the case of a form or the manner of filing a form, authorized by the Minister;

  • (b)in the case of the information to be given on or with a form, specified by the Minister; and

  • (c)in any other case, prescribed by regulation or determined in accordance with rules prescribed by regulation.‍ (Version anglaise seulement)

qualifying aircraft user means a person (other than a prescribed person) that is

  • (a)Her Majesty in right of Canada or a province;

  • (b)a person that is an agent of Her Majesty in right of Canada or a province;

  • (c)a municipality;

  • (d)an Indigenous governing body;

  • (e)a police authority;

  • (f)a government entity that has as its primary responsibility the conduct of emergency medical response activities or emergency fire response activities;

  • (g)a government entity that has as its primary responsibility the operation, management and maintenance of a hospital;

  • (h)a person that has as its primary responsibility the operation, management and maintenance of a listed airport, as defined in section 2 of the Air Travellers Security Charge Act;

  • (i)NAV CANADA, a corporation incorporated on May 26, 1995 under Part II of the Canada Corporations Act; or

  • (j)a prescribed person. (utilisateur admissible d’aéronef)

record means any material on which representations, in any form, of information or concepts are recorded or marked and that is capable of being read or understood by a person, a computer system or other device.‍ (registre)

registered vendor, in respect of a type of subject item, means a person that is registered under Division 5 as a vendor in respect of that type of subject item.‍ (vendeur inscrit)

select subject vessel means

  • (a)a subject vessel (other than a prescribed subject vessel) that is equipped with a bed, bunk, berth or similar sleeping amenity; or

  • (b)a prescribed subject vessel. (navire assujetti désigné)

subject aircraft means an aircraft that is

  • (a)an aeroplane, glider or helicopter, as those terms are defined in subsection 101.‍01(1) of the Canadian Aviation Regulations, that has a date of manufacture after 2018 if the aircraft

    • (i)is equipped only with one or more pilot seats and cannot have any other seating configuration,

    • (ii)is equipped only with one or more pilot seats, or is not equipped with any seats, and cannot have a seating configuration, excluding pilot seats, of 40 or greater, or

    • (iii)is equipped with one or more pilot seats and one or more passenger seats and has a seating configuration, excluding pilot seats, of 39 or fewer, or

  • (b)a prescribed aircraft,

but does not include

  • (c)an aircraft that is designed and equipped for military activities,

  • (d)an aircraft that is equipped for the carriage of goods only,

  • (e)an aircraft

    • (i)that is registered with a government before September 2022 otherwise than solely for a purpose incidental to its manufacture, offering for sale or transportation, and

    • (ii)in respect of which a user of the aircraft has possession before September 2022,

  • (f)a subject vehicle, or

  • (g)a prescribed aircraft. (aéronef assujetti)

subject item means a subject aircraft, a subject vehicle or a subject vessel.‍ (bien assujetti)

subject vehicle means

  • (a)a motor vehicle that

    • (i)is designed or adapted primarily to carry individuals on highways and streets,

    • (ii)has a seating capacity of not more than 10 individuals,

    • (iii)has a gross vehicle weight rating, as that term is defined in subsection 2(1) of the Motor Vehicle Safety Regulations, that is less than or equal to 3,856 kg,

    • (iv)has a date of manufacture after 2018, and

    • (v)is designed to travel with four or more wheels in contact with the ground, or

  • (b)a prescribed motor vehicle,

but does not include

  • (c)an ambulance,

  • (d)a hearse,

  • (e)a motor vehicle that is clearly marked for policing activities,

  • (f)a motor vehicle that is clearly marked and equipped for emergency medical response activities or emergency fire response activities,

  • (g)a recreational vehicle that is designed or adapted to provide temporary residential accommodations, and is equipped with at least four of the following elements:

    • (i)cooking facilities,

    • (ii)a refrigerator or ice box,

    • (iii)a self-contained toilet,

    • (iv)a heating or air-conditioning system that can function independently of the vehicle engine,

    • (v)a potable water supply system that includes a faucet and sink, and

    • (vi)a 110-V to 125-V electric power supply, or a liquefied petroleum gas supply, that can function independently of the vehicle engine,