Archived -Report on Federal Tax Expenditures - Concepts, Estimates and Evaluations 2022: part 4

• As part of Canada’s COVID-19 Economic Response Plan, this measure was implemented as of March 18, 2020 and expired on June 19, 2020.

• Introduced in Budget 1971. Effective for the 1972 and subsequent taxation years
• Technical legislative changes to move the $200 exception for individuals from subsection 39(2) into subsection 39(1.1) were adopted on June 26, 2013.

• The predecessor Class 34, introduced in 1976, provided an accelerated CCA rate of 50% on a straight-line basis for a range of energy generation and conservation equipment.
• Class 43.1 was introduced in Budget 1994, effective for assets acquired after February 21, 1994.
• Class 43.2 was introduced in Budget 2005, effective for assets acquired after February 22, 2005 and before 2012. Budget 2007 extended the eligibility for Class 43.2 to assets acquired before 2020. Budget 2018 extended the eligibility for Class 43.2 to property acquired before 2025.
• The 2018 Fall Economic Statement announced the accelerated investment incentive for specified clean energy equipment included in Classes 43.1 and 43.2 acquired after November 20, 2018 and put in use before 2024. This measure would be gradually phased out starting in 2024, and would no longer be in effect for investments put in use after 2027.
• The range of assets covered by these CCA classes has been expanded several times. Most recently, Budget 2021 proposed to expand eligibility to include equipment used in pumped hydroelectric energy storage, renewable fuel production, hydrogen production by electrolysis of water, and hydrogen refuelling. Certain existing restrictions related to investments in water current, wave and tidal energy, active solar heating, and geothermal energy technologies were also proposed to be removed.
• Budget 2021 also proposed to update the eligibility criteria for Classes 43.1 and 43.2 such that certain fossil-fuelled and low efficiency waste-fuelled electrical generation equipment would no longer be eligible. This would apply in respect of property that becomes available for use after 2024.

• Introduced in 2015 (Prime Minister of Canada news release, February 19, 2015). Effective for capital assets acquired after February 19, 2015 and before 2025.

• The accelerated CCA provided at a rate of 50% on a straight-line basis was introduced in Budget 2007, effective for eligible manufacturing and processing machinery and equipment acquired on or after March 19, 2007.
• Extended in Budgets 2008, 2009, 2011 and 2013.
• Budget 2015 introduced the 50% accelerated CCA on a declining-balance basis, effective for eligible assets acquired after 2015 and before 2026.
• The 2018 Fall Economic Statement announced immediate expensing of machinery and equipment used for the manufacturing or processing of goods included in Class 53 that is put in use before 2024. This measure would be graduallly phased out starting in 2024, and would no longer be in effect for investments put in use after 2027.

• Introduced in Budget 1971, effective 1972.
• Extended in Budget 1996 to in-situ oil sands projects (that is, projects that use oil wells rather than open-pit mining techniques to extract bitumen). This change ensured that both types of oil sands projects are accorded the same CCA treatment. Budget 1996 also extended the accelerated CCA to expenditures on eligible assets acquired in a taxation year for use in a mine or oil sands project, to the extent that the cost of those assets exceeds 5% of the gross revenue for the year from the mine or project.
• Budget 2007 announced the phasing out by 2015 of the accelerated CCA for oil sands projects.
• Budget 2013 announced the phasing out by 2021 of the accelerated CCA for all other mining projects.

• Introduced in 1967 (Order in Council P.C. 1967-1668). Effective for assets acquired on or after March 23, 1967.

• Classes 54 and 55 were introduced in Budget 2019, applicable to eligible zero-emission vehicles acquired on or after March 19, 2019 and that become available for use before 2028.
• On March 2, 2020, Classes 54 and 55 were expanded to include used on-road zero-emission vehicles acquired on or after March 2, 2020 and that become available for use before 2028.
• On March 2, 2020, Class 56 was introduced, applicable to other types of zero-emission automotive equipment and vehicles acquired on or after March 2, 2020 and that become available for use before 2028.

• Introduced in Budget 1996. Effective for expenditures incurred after December 5, 1996.
• CRCE treatment has been expanded several times as a result of the broadening of the range of assets covered by CCA classes 43.1 and 43.2.
• Most recently, Budget 2021 proposed to expand eligibility to include equipment used in pumped hydroelectric energy storage, renewable fuel production, hydrogen production by electrolysis of water, and hydrogen refuelling. Certain existing restrictions related to investments in water current, wave and tidal energy, active solar heating, and geothermal energy technologies were also proposed to be removed.
• Budget 2021 also proposed to update the eligibility criteria for Classes 43.1 and 43.2, such that certain fossil-fuelled and low efficiency waste-fuelled electrical generation equipment would no longer be eligible after 2024. This would apply in respect of property that becomes available for use after 2024.

• Budget 1974 introduced CEE as a category distinct from Canadian Development Expenses (CDE).
• Budget 1978 expanded coverage to include certain expenditures relating to the development of a new mine.
• Budget 2011 announced the phasing out by 2016 of the eligibility for CEE of pre-production development expenses for oil sands mines.
• Budget 2013 announced the phasing out by 2018 of the eligibility for CEE of pre-production development expenses for all other mines.
• Budget 2017 announced the phasing out by 2021 of the eligibility for CEE for expenses associated with oil and gas discovery wells, unless and until they are deemed unsuccessful.

• Introduced in the 2018 Fall Economic Statement.

Corporations that donated medicines from their inventory to an eligible charity could claim an additional deduction equal to the lesser of:

• 50% of the amount by which the fair market value of the donated medicine exceeds its cost; and
• the cost of the medicine.

An eligible charity is a registered charity that meets the conditions prescribed by regulation. In particular, the registered charity was required to:

• deliver the medicine received outside Canada;
• act in a manner consistent with the principles and objectives of the Guidelines for Drug Donations issued by the World Health Organization;
• have expertise in delivering medicines to the developing world; and
• implement appropriate policies and practices with respect to the delivery of international development assistance.

• Introduced in Budget 2007. Effective for gifts made on or after March 19, 2007.
• Amended in Budget 2008 to ensure that the charities to which the medicines are donated have appropriate oversight and accountability practices.
• Budget 2017 announced the elimination of the measure, effective for gifts made on or after March 22, 2017.

• Introduced in Budget 2005. Effective for the 2005 and subsequent taxation years.
• Budget 2013 extended the adoption period to allow for the eligibility of additional adoption-related expenses (e.g., fees for a mandatory home study and adoption courses).
• Budget 2014 increased the maximum eligible expenses claimable to $15,000.

• Introduced as part of the 1987 Tax Reform, effective for the 1988 and subsequent taxation years, to replace the previous age exemption.
• The 2006 Tax Fairness Plan increased the Age Credit amount by $1,000 to $5,066 effective for the 2006 taxation year.
• Budget 2009 increased the Age Credit amount by $1,000 to $6,408 (indexed thereafter).

• Introduced in Budget 2001. Effective for tools acquired after 2001.
• In Budget 2007, the threshold for recognition of tool costs was integrated with the new deduction for tradespeople’s tool expenses and Canada Employment Credit.

• Introduced in Budget 2006. Effective in respect of salaries and wages paid to qualifying apprentices on or after May 2, 2006.

• Introduced in Budget 1977.
• Budget 2012 announced the reduction of the credit rate from 10% to 5% for assets for use in oil and gas and mining activities acquired in 2014 and 2015. The tax credit ceased to be available for such assets acquired after 2015.

• $7,348 in respect of infirm dependants who are parents/grandparents, brothers/sisters, aunts/uncles, nieces/nephews, adult children of the claimant or of the claimant’s spouse or common-law partner;
• $2,295 in respect of an infirm dependent spouse or common-law partner in respect of whom the individual claims the spouse or common-law partner amount, an infirm dependant for whom the individual claims an eligible dependant credit, or an infirm child who is under the age of 18 years at the end of the tax year.

• Introduced in 2017, effective for the 2017 and subsequent taxation years.

• The Child Tax Benefit (the precursor to the Canada Child Tax Benefit) was introduced in Budget 1992 and replaced, effective January 1993, the former refundable child tax credit, family allowance and non-refundable tax credit.
• The Canada Child Tax Benefit and National Child Benefit supplement were introduced in 1998. The Child Disability Benefit was introduced in 2003.
• The Canada Child Benefit was introduced in Budget 2016 and replaced the Canada Child Tax Benefit, including the National Child Benefit supplement, and the Universal Child Care Benefit. Payments of the Canada Child Benefit began in July 2016.
• The 2017 Fall Economic Statement introduced the indexation to inflation of the maximum benefit amounts and phase-out thresholds for the Canada Child Benefit (including the Child Disability Benefit) as of the 2018-19 benefit year.
• Budget 2018 granted retroactive eligibility for child benefits to foreign-born individuals who are Indians under the Indian Act who reside legally in Canada but are neither Canadian citizens nor permanent residents, where all other eligibility requirements are met, from the 2005 taxation year to June 30, 2016.
• Budget Implementation Act, 2018, No. 2 clarified that an individual caring for a child under a kinship care program is eligible for the Canada Child Benefit in respect of that child.
• As part of the Government of Canada’s COVID-19 Economic Response Plan, an additional Canada Child Benefit payment of up to $300 per child was provided to eligible families on May 20, 2020.
• As part of the Government of Canada’s COVID-19 Economic Response Plan, the Government introduced temporary support to be delivered in quarterly payments in 2021, to families entitled to the Canada Child Benefit with children under the age of 6. Payments total up to $1,200 per child under the age of 6 for those with adjusted family net income equal to or less than $120,000, and up to $600 per child under the age of 6 for those with adjusted family net income above $120,000.

• As part of Canada’s COVID-19 Economic Response Plan, this measure was implemented as of September 27, 2020. On November 5, 2020, details for September 27, 2020 to December 19, 2020 were announced.
• In the 2020 Fall Economic Statement, on November 30, 2020, the Government announced details for the CERS program for December 20, 2020 to March 13, 2021
• On March 3, 2021, the Government extended the CERS and Lockdown Support and announced program parameters for the period from March 14 to June 5, 2021.
• In Budget 2021, the Government announced that the CERS and Lockdown Support would be further extended until September 25, 2021, with gradually declining CERS rates, beginning July 4, 2021.
• On July 30, 2021, the Goverment extended the CERS and Lockdown Support until October 23, 2021 and increased the maximum CERS rate for the period between August 29 and September 25, 2021. Technical changes were also announced to provide increased flexibility to organizations not operating on March 1, 2019.

• As part of Canada’s COVID-19 Economic Response Plan, the CEWS was introduced on March 27, 2020, for an initial 12-week period from March 15 to June 6, 2020.
• On May 15, 2020, the Government extended the CEWS by an additional 12 weeks to August 29, 2020 and extended eligibility to the CEWS to certain types of organizations.
• On July 17, 2020, the Government announced the extension and redesign of the CEWS until December 19, 2020, providing details of the program until November 21, 2020.
• On October 9, 2020, the Government confirmed that the CEWS would be extended until June 2021, and announced the details of the program until December 19, 2020 and other enhancements.
• In the 2020 Fall Economic Statement, on November 30, 2020, the Government announced the details of the program until March 13, 2021, including an increase to the maximum top-up rate.
• In March 2021, the Government announced the program parameters from March 14 to June 5, 2021 and amendements to provide increased flexibility for furloughed and non-arms’s length employees.
• In April 2021, Budget 2021 announced a further extension of the CEWS for active employees until September 24, 2021. Program parameters, including changes to the subsidy rate structure and eligibility, were also announced. The wage subsidy for furloughed employees was also extended until August 28, 2021. In addition, Budget 2021 introduced new requirements to prevent publicly listed corporations receiving the wage subsidy from paying its top executives more in 2021 than in 2019.
• On July 30, the Government extended the CEWS for active employees until October 23, 2021 and increased the maximum subsidy rate for the period between August 29 and September 25, 2021. Technical changes were also announced to provide increased flexibility to organizations not operating on March 1, 2019.