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Rebate: Increasing the GST credit for the 2022-2023 benefit year (July 1,
2022 to June 30, 2023), by an additional payment for January 2023 based on the
2021 tax return. Included in Bill C-46. The additional payment will be
delivered to eligible Canadians on July 5, 2023.
Income Tax to be amended so that fees or premiums paid to secure or renew
a letter of credit (or a surety bond) for an RCA that is supplemental to a
registered pension plan will not be subject to the refundable Part XI.3 tax.
Effective for fees or premiums paid on or after Budget Day
Proposal to allow employer to request a refund of previously remitted
refundable Part XI.3 taxes, based on the retirement benefits paid out of the
employer's corporate revenues to employees that had RCA benefits secured by
letters of credit (or surety bonds). Employers would be eligible for a
refund of 50% of the retirement retirement benefits paid, up to the amount
of the refundable tax previously paid.
Effective for retirement benefits paid after 2023.
temporary measure which is set to expire on December 31, 2023, which
allows a qualifying family member to open an RDSP and be the plan holder for
an adult whose capacity to enter into an RDSP contract is in doubt, will be
extended by 3 years to December 31, 2026.
AMT exemption to be raised from $40,000 to start of 4th tax bracket (will
be approximately $173,000 in 2024)
AMT rate to be increased from 15% to 20.5%
50% of certain deductions would be disallowed in the AMT calculation
allow only 50% of certain non-refundable tax credits to be allowed to
reduce the AMT
increase the AMT capital gains inclusion rate from 80% to 100%, with
capital loss carry forwards and allowable business investment losses
remaining at 50% rate
include 100% of the benefit associated with employee stock options in the
include 30% of capital gains on donations of publicly listed securities in
the AMT base. The 30% rate would also apply to the full benefit associated
with the employee stock options to the extent that a deduction is available.
A rule would be added to the GAAR so that it better meets its initial objective of requiring economic substance in addition to literal compliance with the words of the Income Tax Act.
A penalty of 25% of the amount of the tax benefit would be introduced for
transactions subject to the GAAR.
A 3-year extension to the normal reassessment period would be provided for
GAAR assessments, unless the transaction had been disclosed to the CRA.
Consultation: Interested parties are invited to send written
representations expressing their views on the proposals, to the Department
of Finance Canada, Tax Policy Branch at GAAR-RGAE@fin.gc.ca
by May 31, 2023
BC added as an eligible jurisdiction for dedicated geological storage of CO2
applicable to expenses incurred on or after January 1, 2022
processes for using and storing the gas in concrete to be validated by
a qualified third party, instead of Environment and Climate Change
changes proposed to CCUS Tax Credits related to eligible refurbishment
costs (Refurbishment ITCs) and to Refurbishment ITC Recovery
these measures would apply to eligible expenses incurred after 2021 and
Businesses would be able to claim only one of the CCUS Tax Credit, the Investment Tax Credit for Clean Technology, the Investment Tax Credit for Clean Electricity, or the Investment Tax Credit for Clean Hydrogen, if a particular property is eligible for more than one of these tax credits.
Eligible expenses related to lithium from brines made after Budget Day would qualify as Canadian exploration expenses and Canadian development expenses. The expansion of the eligibility for the CMETC to lithium from brines would apply to flow-through share agreements entered into after Budget Day and before April 2027.
Budget 2023 includes a proposal to amend the GST/HST definition of
"financial service" to clarify that payment card clearing services
rendered by a payment card network operator are excluded from the definition to
ensure that such services general continue to be subject to the GST/HST, in
light of a recent court decision that that found that the GST/HST does not apply
to supplies of these services.
proposal to increase the Air Travellers Security Charge (ATSC) by 32.85%,
to apply to air transportation services that include a chargeable emplanement on or after May 1, 2024, for which any payment is made on or after that date.
the increase is meant to fund an increase to the level of service provided
by the Canadian Air Transport Security Authority (CATSA), which is
responsible for the security screening of air passengers and their baggage.
a federal Digital Services Tax (DST) would be payable as of January 1,
2024 in respect of revenues earned as of January 1, 2022 if the
multilateral convention implementing the Pillar One framework has not
come into force.
Pillar Two - Global Minimum Tax
multilateral framework for a global minimum tax regime designed to
ensure that MNEs with annual revenues of €750 million or more are
subject to a minimum effective tax rate of 15% on their profits in every
jurisdiction in which they operate, to reduce the incentive for MNEs to
shift profits into low-tax jurisdictions.
primary charging rule is known as the Income Inclusion Rule (IIR), and
there is a "backstop" rule, known as the Undertaxed Profits
Budget 2023 announces the government's intention to introduce
implementing the IIR and a domestic minimum top-up tax applicable
to Canadian entities of MNEs that are within scope of Pillar Two,
for fiscal years beginning on or after December 31, 2023.
draft legislative proposals for the UTPR with effect for fiscal
years of MNEs beginning on or after December 31, 2024.