Regulatory Initiative: Legislative and Regulatory Proposals Relating to Income Tax and Other Legislation (Budget 2019) - Forward Regulatory Plan 2020-2022

Title or working title of the regulatory initiative:

Legislative and Regulatory Proposals Relating to Income Tax and Other Legislation (Budget 2019)

Description of the objective:

A fair and efficient tax system is fundamental to an economy that works for everyone—making life more affordable for Canada's middle class and people working hard to join it. To support this goal, the Government of Canada routinely seeks public feedback on proposed changes to the tax system. The Department of Finance Canada released for public comment on July 30, 2019 a set of draft legislative proposals to implement certain tax and other related measures announced in Budget 2019 that have not yet been legislated. These proposals include draft regulatory proposals related to measures that would:  

• provide greater flexibility in managing retirement savings by permitting two new types of annuities under the tax rules for certain registered plans;
• bring the specified multi-employer plan rules into line with the tax rules that apply to other defined benefit registered pension plans;
• prohibit an Individual Pension Plan from providing retirement benefits in respect of past years of pensionable service under a defined benefit plan of an employer other than the Individual Pension Plan's participating employer (or its predecessor employer); and
• make the "requirement-for-information" process more efficient by allowing requirements for information to be sent to banks and credit unions electronically.

The draft legislative proposals released would also modify tax measures legislated in Budget Implementation Act, 2019, No. 1 to address feedback from Canadians. These measures relate to the Accelerated Investment Incentive as it applies to resource expenditures and depreciable property, and to the temporary enhanced first-year Capital Cost Allowance rate of 100 per cent in respect of eligible zero-emission vehicles.

Indication of business impacts:

The Small Business Lens is not expected to apply.

Public consultation opportunities:

Details on the initiatives are available in Budget 2019 in the supplementary information on tax measures.

Canadians were consulted on the draft legislative proposals as part of a consultation announced by news release on July 30, 2019. Interested parties were invited to provide comments on the proposal by October 7, 2019.

The news release for the consultation, along with the draft proposals and the explanatory notes, is available on the Finance Canada website.