December 01, 2023
Issue 2023-35
On November 30, 2023, the federal government tabled Bill C-59,1 which includes legislation to implement a variety of tax measures, many of which have been long awaited by taxpayers and tax practitioners. Key tax measures:
This Tax Insights highlights the income tax-related and other measures included in Bill C-59. Upcoming Tax Insights, which will be available at www.pwc.com/ca/taxinsights, will discuss a number of these measures in more depth.
Bill C-59 contains legislation for the following measures:
as well as requiring that certain labour requirements be met to qualify for the full ITC rates3
Absent from Bill C-59 is the legislation to enact the Global Minimum Tax Act.3 However, Canada remains committed to adopting the Organisation for Economic Co‑operation and Development/G20 two-pillar plan to reform the international tax system, which includes implementing a 15% global minimum tax that will generally apply for multinational enterprises with global revenues of at least €750 million (Pillar 2). The federal government has also indicated its continued preference for implementing a multilateral system of income reallocation (Pillar 1), but until that time is moving ahead with a digital services tax.
Notably absent from Bill C-59 is the legislation that would significantly change the alternative minimum tax (AMT) regime, effective for taxation years beginning after 2023.3
The legislation in Bill C-59 covers a wide range of tax measures and includes several that make significant tax policy changes in Canada. These include the new EIFEL regime and changes to Canada’s GAAR. Given the late introduction of Bill C-59 and with only a few weeks remaining before Parliament adjourns for the winter break, it is unlikely that the bill will be enacted in 2023. Nevertheless, it is advisable that taxpayers learn about these changes, determine whether any could apply to them and start preparing for their implementation. We look forward to discussing these tax measures with you to facilitate your understanding.
1. Bill C-59, An Act to implement certain provisions of the fall economic statement tabled in Parliament on November 21, 2023 and certain provisions of the budget tabled in Parliament on March 28, 2023 (first reading: November 30, 2023)
2. For more information, see our Tax Insights “2023 Federal budget: Supporting a clean economy.”
3. For details of draft legislative proposals released on August 4, 2023, see our Tax Insights:
- “Updated legislation: Excessive interest and financing expenses limitation (EIFEL) regime (August 2023 release)”
- “Finance releases draft legislation for the clean technology and CCUS investment tax credits”
- "Digital Services Tax: One step closer to becoming a reality”
- “Canada releases draft Global Minimum Tax Act”
- “Proposed changes to the alternative minimum tax: How will it affect individuals and trusts?”
4. For details of draft legislative proposals released on April 29, 2022, see our Tax Insights “Canada introduces first package of hybrid mismatch rules.”
5. For more information, see our Tax Insights “2023 Federal budget: GST/HST and financial institutions.”