Ottawa, August 16, 2011
2011-067
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The Department of Finance today released for consultation draft legislative proposals to implement tax measures from Budget 2011, the Next Phase of Canada’s Economic Action Plan—A Low-Tax Plan for Jobs and Growth.
The draft legislative proposals would:
Support Families and Communities
- Introduce a new $2,000 Family Caregiver Tax Credit amount to provide tax relief to caregivers of infirm dependent relatives including, for the first time, spouses, common-law partners and minor children.
- Introduce a new Children’s Arts Tax Credit on up to $500 per child of eligible fees associated with children’s artistic, cultural, recreational and developmental activities.
- Introduce a Volunteer Firefighters Tax Credit to allow eligible volunteer firefighters to claim a 15-per-cent non-refundable tax credit based on an amount of $3,000.
- Eliminate the rule that limits the number of claimants for the Child Tax Credit to one per domestic establishment.
- Remove the $10,000 limit on eligible expenses that can be claimed under the Medical Expense Tax Credit in respect of a dependent relative.
- Increase the advance payment threshold for the Canada Child Tax Benefit to $20 per month and for the Goods and Services Tax/Harmonized Sales Tax (GST/HST) Credit to $50 per quarter.
- Align the notification requirements for an individual who receives the Canada Child Tax Benefit with the notification requirements for the GST/HST Credit.
Invest in Education and Training
- Reduce the minimum course duration requirements for the Tuition, Education and Textbook Tax Credits.
- Make all occupational, trade and professional examination fees eligible for tax relief under the Tuition Tax Credit where the examination is required to allow the individual to practise the profession or trade within Canada.
- Make it easier to allocate Registered Education Savings Plan assets among siblings without incurring tax penalties or forfeiting Canada Education Savings Grants.
Support Job Creation and Entrepreneurship
- Extend to the end of 2013 the temporary accelerated capital cost allowance treatment for investment in manufacturing or processing machinery and equipment.
- Expand eligibility for the accelerated capital cost allowance for clean energy generation and conservation equipment to include equipment that generates electricity using waste heat from sources such as industrial processes.
- Extend eligibility for the Mineral Exploration Tax Credit by one year to flow-through share agreements entered into before March 31, 2012.
- Expand the eligibility rules for qualifying environmental trusts to include trusts that are required to be established in the context of pipeline abandonment and to allow a broader range of eligible investments for qualifying environmental trusts.
- Better align the deduction rates for intangible capital costs in the oil sands sector with rates in the conventional oil and gas sector.
- Provide the same income tax treatment to investments made under the Agri-Québec program as is currently provided to investments under the AgriInvest program.
Preserve Canada’s Fiscal Integrity
- Introduce rules to strengthen the tax regime for charitable donations (including the “exclusivity of purpose and function” test for registered Canadian amateur athletic associations, on which a consultation was launched on July 4, 2011).
- Introduce anti-avoidance rules for Registered Retirement Savings Plans.
- Introduce rules to limit tax deferral opportunities for individual pension plans by imposing minimum annual withdrawal requirements similar to those for Registered Retirement Income Funds and by reducing the tax advantages related to making contributions to an individual pension plan in respect of past service.
- Introduce rules to limit tax deferral opportunities for corporations with significant interests in partnerships.
- Extend the tax on split income to transactions that involve capital gains realized by a minor child.
- Extend the dividend stop-loss rules to dividends deemed to be received on the redemption of shares held by certain corporations.
References to “Announcement Date” in the draft legislative proposals are to be read as references to today’s date. Explanatory notes for the draft legislative proposals will be released shortly on the Department of Finance website.
Interested parties are invited to provide comments on the draft legislative proposals by September 16, 2011. Please send your comments to ConsultationB2011tax-fiscalite@fin.gc.ca or to:
Tax Policy Branch
Department of Finance
140 O’Connor Street
Ottawa, Ontario
K1A 0G5
For further information, media may contact:
Mary Ann Dewey-Plante
Press Secretary
Office of the Minister of Finance
613-996-7861
Jack Aubry
Media Relations
Department of Finance
613-996-8080
