Budget 2025 Implementation Bill, No. 1

Moved second reading of Bill C-15, An Act to implement certain provisions of the budget tabled in Parliament on November 4, 2025.

She said: Honourable senators, I hope this will be the most exciting speech — given at 7:50 p.m. — that we’ve heard in some time; it’s a bit of pressure.

It’s my privilege to introduce the government’s Bill C-15, An Act to implement certain provisions of the budget tabled in parliament on November 4, 2025, more commonly referred to as the budget implementation act, or BIA.

As the bill’s sponsor in the Senate, I would like to thank the Minister of Finance and National Revenue for entrusting me with this responsibility.

I appreciate the opportunity to explore in some detail the key elements of Bill C-15, whose purpose is to legislate many of the priorities proposed in Budget 2025.

We are at a critical juncture. We are living in uncertain times and constantly wondering what will happen next.

Bill C-15, the budget bill, aims to address these uncertainties and activate the levers over which the government has control, as the Prime Minister said.

This 638-page document is not for the faint of heart. I plan to go through each line with you; that would be the most helpful way. I was just checking whether you are all truly listening to me.

For brevity, today I won’t address every measure in the bill that would make it worthy of the Senate’s support.

I want to highlight items that Canadians looking for a more affordable life would find helpful, items that would make things easier for businesses and some of the queries put forward by members of various committees that looked at Bill C-15 in pre‑study.

We had the benefit of receiving a copy of the bill when it was introduced in the other place. This allowed us to get a head start and split it up across a number of Senate committees, which then began their pre-study.

I’m feeling the other senator’s pain in his English and mine in my French.

This allowed us to get a head start, since typically there are few changes or amendments to a budget bill. We were able to work almost in parallel with the other place, which was also studying the budget bill in its own committees.

I found this exercise very useful. Ministers responsible for several sections of the bill were able to receive feedback, requests for clarification and even amendments, when necessary, early in the legislative process.

Bill C-15 naturally starts with a number of tax measures, many of them making the lives of individuals more affordable. An example in Part 1 of the bill, which changes the Income Tax Act and the Income Tax Regulations, is that the limit of the Lifetime Capital Gains Exemption would be expanded so it applies to up to $1.25 million of eligible capital gains, applicable to dispositions that occur on or after June 25, 2024, with indexation of the limit to resume in 2026. That’s an increase from just over $1 million and good news for the many people who are homeowners.

Another bill, Bill C-4, aims to provide tax relief to nearly 22 million people by reducing the lowest marginal personal income tax rate from 15% to 14%.

Bill C-15 continues this benefit. It would also exempt the Canada Disability Benefit from income, maximizing its benefits, and proceed with expanding the list of expenses recognized under the disability supports deduction. This expanded list is meant to better support people with disabilities when they’re working, including things like service animals, ergonomic work chairs and navigation devices for low vision.

For the many who work as personal support workers — a field of work we all came to appreciate much more during and after COVID — Bill C-15 introduces a temporary personal support workers tax credit to provide up to $1,100 per year to eligible personal support workers, recognizing their vital contributions in our communities in a very tangible way.

A number of Finance Committee members asked questions about this measure to ensure it captured the personal support workers who work in many areas of health care. They confirmed that it included eligible health care establishments, including hospitals, nursing care facilities, residential care, facilities for care of the elderly, home health care establishments and other similar health care facilities or establishments.

More clarifying language regarding the responsibilities of employers was also added in an amendment, creating an explicit obligation in the Income Tax Act for employers to certify their eligible employees’ eligible earnings in the prescribed form and manner — a request that came from many of the unions that represent personal support workers.

On another important note, Division 44 of Part 5 enacts the national school food program act. This sets out the Government of Canada’s vision for the National School Food Program, which aims to provide meals for up to 400,000 more children each year beyond those served by existing school food programs, with $260 million per year starting in 2029-30. The current $1-billion, five‑year program started in 2025.

This division sets out the government’s commitment to maintaining long-term funding to be provided to provinces, territories and Indigenous Peoples for the ongoing implementation and maintenance of the program. This would, in effect, make the program permanent, something that has long been called for.

For businesses, Part 1 of Bill C-15 aims to enhance Canada’s Scientific Research and Experimental Development, or SR&ED, tax incentive program by increasing the enhanced credit expenditure limit from $3 million to $6 million, extending eligibility for the enhanced credit to certain Canadian public corporations and restoring capital expenditures as eligible costs.

As part of the government’s plan to attract and catalyze private sector investments, the bill would also ensure 100% first-year expensing for eligible manufacturing and processing machinery and equipment as part of Budget 2025’s productivity super-deduction.

We often talk about our lagging productivity. The budget includes concrete measures to encourage businesses to invest in innovation to boost their productivity.

When we discussed the budget bill last autumn, I gave you specific examples of companies, especially small start-ups that don’t have a huge bank account to draw on. These measures are crucial to their growth.

For example, there is an increase in that expenditure limit on which an enhanced 35% tax credit can be earned — from $3 million to $6 million — and a reinstatement of the eligibility of capital expenditures — machinery and equipment, et cetera — for both the deduction against income and investment tax credit components of that Scientific Research and Experimental Development, or SR&ED, program.

This brings our SR&ED tax program back in line with other OECD countries. We used to lead in this area, but we have not renewed those levels or the items that companies could include for many years. We have to keep it up.

As U.S. tariffs continue to raise costs for Canadian manufacturers, this measure will stimulate domestic manufacturing, enhance investment and reduce tax burdens for Canadian businesses. To protect the integrity of Canada’s tax base, Bill C-15 would also reform and modernize transfer pricing rules — the ones that govern where our companies will pay their income tax when they do business outside Canada. These changes come on the heels of public feedback going back to 2021 and better align with OECD standards, which is good.

The revised transfer pricing rules and documentation requirements included in the bill would apply to taxation years beginning after November 4, 2025.

Colleagues, knowing that Canada’s commitment to fighting climate change positions us to surpass economies that fail to adapt to this reality, Canada’s new government is exploring initiatives to further Canada’s standing as a clean energy superpower.

As part of the government’s Climate Competitiveness Strategy, Bill C-15 includes the enabling legislation to deliver the Clean Economy Investment Tax Credits, refundable credits equal to 15% of the capital costs of eligible investments in equipment related to low-emitting electricity generation, electricity storage and the transmission of electricity between provinces and territories — more encouragement to go green and to buy and sell within Canada. Budget 2025 also proposes including the Canada Growth Fund as an eligible entity under the Clean Economy Investment Tax Credits. It also proposes to introduce an exception so that financing provided by the Canada Growth Fund would not reduce the cost of eligible property for the purpose of computing the clean electricity investment tax credits. These measures would apply to eligible properties that are acquired or become available for use on or after budget day.

Furthermore, Bill C-15 enhances the suite of existing investment tax credits to further support investments in decarbonizing technologies and clean technology manufacturing, including the Carbon Capture, Utilization, and Storage Investment Tax Credit, or CCUS ITC. It maintains its full credit rates for an additional five years, up to 2035, which will provide a higher level of support for businesses investing in carbon capture, utilization and storage.

The Clean Technology Manufacturing Investment Tax Credit would be broadened to include more critical minerals essential for clean technology supply chains. The Critical Mineral Exploration Tax Credit would be expanded to cover 12 more minerals necessary for defence, semiconductors, energy and clean technologies, 4 of which I’ve heard of before: manganese, tungsten, tin and chromium. An amended list that some of the organizations forwarded also included phosphate. I am happy to furnish the complete list to all chemists here today.

Colleagues, at the start of my remarks, I mentioned the critical nature of the moment we find ourselves in. Amid a sizable trade shock and lingering uncertainty, times have been tough for Canadian businesses and families alike. Bill C-15 offers relief to businesses. Part 3 of Bill C-15 amends the Excise Tax Act, the Underused Housing Tax Act, the Select Luxury Items Tax Act and other related texts to implement those measures. The bill extends the Enhanced GST Rental Rebate to 100% to qualifying cooperative housing corporations and student residences built by universities, public colleges and school authorities, which will further incentivize the construction of affordable housing in Canada.

As for the Underused Housing Tax Act, Division 2 of Part 3 of the bill would end the underused housing tax in respect of 2025 and future calendar years. It also subsequently repeals the Underused Housing Tax Act and the Underused Housing Tax Regulations. When we asked why at committee, we received a refreshing answer: The amount that the program brought in did not warrant the cost of running it.

Finally, Division 3 of Part 3 would amend the Select Luxury Items Tax Act to end the luxury tax in respect of subject aircraft and vessels and would amend the Select Luxury Items Tax Regulations to provide greater clarity on the tax treatment of those subject items. These actions will reduce burdensome administrative and compliance costs and support the aviation and boating industries at a time of ongoing global uncertainty. It was never applied to Ontario-made cars purchased for under $100,000.

To advance Indigenous tax jurisdiction frameworks, Part 4 of Bill C-15 would amend the First Nations Goods and Services Tax Act to, among other things, establish an opt-in framework for interested Indigenous governments to levy a value-added sales tax under their own laws on fuel, alcohol, cannabis, tobacco and vaping products within their reserves or settlement lands. It also makes process-type improvements and machinery-of-government changes to streamline the administration of taxes under that act.

The government is introducing measures to make life more affordable for Canadians, and it is also advancing legislation that will increase competition and consumer choice.

Ultimately, these measures will give Canadians more control over their personal finances. Part 5 of the bill, for example, would amend several statutes to implement measures to modernize and support Canada’s financial sector.

Division 15 of Part 5 amends the Bank Act to raise the amount of funds that can be withdrawn immediately from a retail deposit account after the deposit of a cheque or other instrument and to remove the delay for the withdrawal of funds deposited by a cheque or other instrument that is not deposited in person. The minimum amount is being raised from $100 to $250. That, too, is an amendment to the bill we initially saw. Cheque payments accounted for only 2% of total payments made in Canada in 2024 but represented 22% of all payment value. Cheques still matter to many people. Some of us still use them, and some of us do not take pictures of them in order to deposit them.

This will allow more Canadians to increase their purchasing power and reduce their reliance on short-term credit, like payday loans or overdraft protection, which would primarily benefit low‑income individuals and seniors.

Meanwhile, Division 17 of Part 5 of the bill would amend the Bank Act, the Canada Deposit Insurance Corporation Act and the Financial Consumer Agency of Canada Act to make it easier for credit unions to enter the federal framework and expand so they can continue to serve more Canadians. Notably, Division 9 of Part 5 of the legislation introduces a complete consumer-driven banking act to ensure that individuals and businesses can safely and securely share their data with participating entities of their choice. This will facilitate access to lower-cost products, clearer choices and better tools to manage debt and reduce financial stress for Canadians. That proposed act addresses, among other things, accreditation and common rules governing national security, data sharing, security safeguards, consent, authentication, liability, complaints, administration, enforcement and screen scraping. This division would also make related amendments to the Access to Information Act, the Financial Consumer Agency of Canada Act and the Budget Implementation Act, 2024, No. 1, and it would repeal the existing Consumer-Driven Banking Act.

Moreover, Division 45 of Part 5 of the bill enacts the stablecoin act, which imposes requirements on persons and entities that create stablecoins and make them available for purchase, directly or indirectly, by persons in Canada.

That act also sets out the objects of the Bank of Canada in respect of that fiat-backed stablecoin — a type of cryptocurrency whose value is intended to remain stable relative to government‑issued currency — and requires the bank to maintain a public registry of stablecoin issuers. It also addresses, among other things, the redemption of stablecoins by issuers, the reserve of assets that issuers must maintain to fulfill their redemption obligations and the policies, such as in the areas of governance, risk management and data security, that they must establish. Well, thankfully, regulation is arriving.

This, honourable colleagues, will foster innovation and competition in the financial sector and build trust in digital payments.

The government is also taking steps to protect Canadians from financial fraud, whether it be SMS phishing, mysterious links, hidden phone calls or fake bank emails. All of these threaten the financial well-being of Canadians and are becoming increasingly sophisticated and hard to detect.

Division 16 of Part 5 would amend the Bank Act to, among other things, prohibit the activation of certain capabilities for a personal deposit account in Canada without the express consent of the person in whose name the account is kept, permit a natural person in whose name such an account is kept to deactivate certain account capabilities, adjust certain transaction limits on the account, require institutions to establish policies and procedures for detecting and preventing consumer-targeted fraud and require institutions and the Commissioner of the Financial Consumer Agency of Canada to prepare annual reports on consumer-targeted fraud.

Division 18 of Part 5 amends the Special Economic Measures Act to protect Canada’s financial system from potential unintended consequences of sanctions and ensure financial institutions do not unduly profit from sanctions obligations so that, for example, banks are not benefiting from an individual’s assets that have been frozen by the government.

You’ve heard the government often speak of making a seismic difference in the building of homes. This budget puts its money where its mouth is.

Government efforts are already helping to scale up the supply of homes and bring down costs. But restoring affordability over the long term will require sustaining this momentum and closing the supply gap. This is where Canada’s new housing agency, Build Canada Homes, comes in. Federal dollars invested in Build Canada Homes will be leveraged to attract private capital, investors and builders to expand housing supply.

By putting conditions in place to catalyze maximum investment while mainstreaming advanced methods of construction, Canada has the potential to cut building timelines by up to 50%, reduce costs by as much as 20% and lower emissions by approximately 20% during construction.

Division 3 of Part 5 of Bill C-15 would provide, among other things, that an aggregate amount not exceeding $11.5 billion to fund the operations and activities of Build Canada Homes and an aggregate amount not exceeding $1.5 billion as a contribution of capital to, or to purchase shares in, Canada Lands Company Limited may be paid out of the Consolidated Revenue Fund.

Bill C-15 would also enact the high-speed rail network act, which establishes a legislative framework to facilitate the implementation of a rail network that allows for the carrying of passengers at high speed between Quebec and Ontario.

I had the chance to mention at committee that this issue is near and dear to a number of senators, and a number had many questions of Alto when they were brought before the Finance Committee. Senator Gignac and I had, in previous roles, spent a few million dollars updating the 16 reports and studies that had been done long before he and I became ministers of economic development and trade in our respective provinces. After lots of talk, now it seems we’re seeing some action. But good process is key, and I expect that the Minister of Transport will field many more questions as he comes before committee members this week.

The act deems the construction of the railway lines that are to be part of the high-speed rail network to have been approved under section 98 of the Canada Transportation Act. It provides that the construction, operation, decommissioning and abandonment of each segment of the high-speed rail network, and any incidental physical activity, are subject to the Impact Assessment Act. It permits certain land to be subject to a notice of right of first refusal or a notice of prohibition on work, amends the expropriation process in relation to the high-speed rail network, provides that Indigenous knowledge that is provided in confidence in relation to the high-speed rail network is treated as confidential, and makes certain parts of the Official Languages Act applicable to certain entities, including those that operate a railway that is part of the high-speed rail network.

We spent a lot of time on Division 5 of Part 5 at committee as well. It amends the Red Tape Reduction Act to authorize ministers to grant temporary exemptions from the application of provisions of certain acts of Parliament and instruments with the aim of facilitating the design, modification or administration of regulatory regimes to encourage innovation, competitiveness or economic growth. This became known as the regulatory sandbox, and there were many questions.

The government heard concerns regarding this clause as it was originally drafted. It supported the proposed guardrails as amended by the other place. The scope now of regulatory sandboxes has been restricted and cannot be used to grant exemptions from certain federal laws. It is limited to the clean technology or financial technology sectors. Parliamentary oversight and reporting have been strengthened by requiring the minister to engage in a public consultation process, and the minister is now required to table a report to Parliament within 90 days of the exemption. A “two-key” solution has also been added. Two ministers must now approve the exemption.

Another clause eliminating red tape for Canada Post, clause 196 of Bill C-15, seeks to amend the Canada Post Corporation Act to modernize the stamp rate-setting process to allow Canada Post to more expediently update stamp rates. However, stakeholders, including the Canadian National Institute for the Blind and the Canadian Urban Libraries Council, warned that the amendments as initially drafted may unintentionally end or jeopardize the long-standing Canada Post practice of delivering materials free of postage to blind Canadians via the Literature for the Blind program as well as providing reduced rates of postage for library materials. Amendments that now appear in this bill clarify that these services will remain in place.

Division 27 of Part 5 of the bill amends the Export and Import Permits Act to authorize the Governor-in-Council to add articles to the Export Control List and the Import Control List for reasons related to Canada’s economic security interests. Items evolve so quickly in that world that we must give our ministers the ability to react quickly to a changing landscape.

Division 28 of Part 5 of the bill amends the Aeronautics Act to further strengthen Canada’s aviation safety and security regimes — a crucial move at a time when global aviation and aerospace are under extreme pressure.

Division 29 of Part 5 amends the Canada Transportation Act to provide the Minister of Transport with the authority to make interim orders to give effect to international standards or ensure compliance with Canada’s international obligations. Again, as the international environment changes daily, our ministers have to be able to respond quickly.

For air passengers, amendments that build on previous reforms will strengthen air passenger protection regulations and make them more effective by broadening their powers. These amendments will include mandatory compensation for baggage disruptions, losses or delays, as well as refunds where government-issued travel advisories result in cancellations.

As we are all aware, Budget 2025 released details on the government’s Comprehensive Expenditure Review with the aim of delivering $13 billion in savings annually by 2028-29. Combined with other measures, Budget 2025 delivers $60 billion in savings and revenues over five years. The government has stated that these savings will involve workforce adjustments to return the size of the public service to a more sustainable level, while also protecting diversity in the public service workforce and ensuring a strong, younger generation of public servants.

Division 7 of Part 5 of the bill amends the Public Service Superannuation Act to provide a temporary early retirement option during a period for which a workforce reduction initiative is in effect. It also makes a related amendment to the Income Tax Regulations. Group 1 includes eligible public servants who are at least 50 years of age or older who joined before January 2013, and Group 2 includes eligible public servants who are 55 years of age or older who joined after January 2013. Both groups will be eligible to apply to retire with an immediate pension based on years of service with no penalty for early retirement, subject to parameters set by the Treasury Board. A number of questions were raised at our committee related to the reduction of the workforce.

In conclusion, honourable senators, as Canadians continue to feel the impact of ongoing challenges, including the uncertainties brought about by the developments on the trade and tariff front, I trust you will find these measures a great start in advancing the government’s agenda, which aims to give Canada’s business community a competitive edge and aims to bring financial relief to many of our fellow Canadians.

I would be happy to speak further to Bill C-15 tomorrow at the Standing Senate Committee on National Finance. The Minister of Finance will be joining us to answer questions directly.

Thank you for your attention and I eagerly look forward to examining budget Bill C-15 further in committee. Merci.

Would the senator take a question?

Yes, thanks.

Thank you, Senator Pupatello. Congratulations on sponsoring this bill, and congratulations on your speech. I’m sure you could have gone on a lot longer with more detail and kept us totally riveted.

My question is about Alto. I am a senator from Ottawa, and I’m very pleased about the idea of high-speed rail coming through Ottawa. There had been earlier proposals that it would go from Montreal to Toronto without coming to Ottawa, so this is welcome news.

I do want to raise with you some of the concerns that have been put forward. You will have heard about this. Many of us in the Senate have heard those voices as well, certainly both in terms of communications to us and in the local media.

The concern includes a couple of things. One is that there is not enough information that Alto has shared so far, and certainly when you are dealing with expropriation on this large scale, there will be some inconvenience felt, whether it’s to individual farms or entire communities. My concern is that we could end up with a debate that’s rural folks versus urban folks. Urban dwellers will benefit most from this high-speed rail.

Given the kinds of exemptions that we’re giving in this bill, how can we ensure that Alto conducts adequate consultation with people? If it’s really not workable in the end, would the government consider using the current corridors of railway lines that exist so that we wouldn’t have to deal with that level of expropriation?

Thank you. I am pleased to receive the question and delighted that Minister MacKinnon, our Minister of Transport, will be appearing before the National Finance Committee on Wednesday, given the number of questions that were raised at the committee’s prior meeting. We have certainly passed those questions along to him. I expect him to come very prepared.

In particular around expropriation, let me give you a little bit of information. First, there is not yet a defined route. In terms of the many emails that I have received — I’m sure you have received them as well — a route has not been determined. Until they actually determine the route, then they would move to the next step of public consultation.

In fact, the measures of the act around expropriation align Canada with the provinces’ regimes, both Ontario and Quebec. Similar measures are well established for major infrastructure projects in both Ontario and Quebec through the Building Transit Faster Act, 2020 as well as the Act respecting expropriation respectively. There were a number of questions that we put to Alto at committee — you were there as well — giving them many examples of where it has been done in the past and just how fairly people have been treated. It will not provide solace, I think, given the uncertainty that is there today because a route has simply not been selected. I anticipate that the minister is going to address this in much more detail on Wednesday.

Would you take another question?

Yes.

Thank you. My question is also about Alto and the high-speed rail.

I know the route hasn’t been completely sorted out, but certainly wherever it goes, it will cross farmland. What do we tell farmers who reside, have properties and conduct business between Toronto and Quebec City and whom have told us that, in fact, this high-speed rail will split their farms — or could split their farms — and make their farming operations unsustainable and not financially viable? What do we tell farmers about that, when and if a route is selected and it goes right through numerous farms between Toronto and Quebec?

Thank you. Not to repeat it, but, again, those are the same questions that I have received in emails from many people, mostly rural Canadians. I think it is true, as Senator Cardozo stated, there are benefits that might be seen by the large populations around urban settings, but the impact will certainly be felt by our rural communities where the train will actually be going through.

When the route is selected, at that point, I think that type of public consultation is going to be key. I heard the mayor from the United Counties of Prescott and Russell this morning on CBC Radio, talking about the impact even in small towns. Where does the road go, et cetera? These are all very good questions. I think they are prepared to answer those and also to deal with landowners when it comes to that.

Unfortunately, in Canada, we don’t have enough exposure to building very large projects. That’s a whole separate issue, but I would like to think that we have to get this methodology done properly so that we can continue to use it. In particular, from the moment that I came in, we have all talked about these large infrastructure projects that are finally coming to Canada, and we need to address how we do it in order to do it properly.

Can you confirm that when the time comes, there will be frank, open, honest and long dialogue with those folks who are farming today and may, in fact, not be able to do so in the future?

I am certain that I’m going to put that question to the minister when we see him on Wednesday, just in case you are not there. We will certainly ask him about all of the landowners, for sure, and farmers in particular who are looking to continue farming for multiple generations.

Senator Pupatello, would you take another question?

Yes.

Thank you.

I wanted to ask about the Red Tape Reduction Act components of the bill. I’m a big fan of regulatory modernization and agility, and I have been pushing for the use of sandboxes.

Can you give me some insight into the pushback from the opposition in the House of Commons to add red tape to the Red Tape Reduction Act process? It doesn’t make any sense to me. It is a well-proven method around the globe. It has been proven to be very helpful as a way for regulators to understand innovators and for innovators to understand the objectives of regulators and how to modernize regulations. What was the reason for these changes? I see them as a step backwards.

Thank you for that question. I don’t want to make assumptions on the part of the opposition in the House of Commons.

However, I will say that there were concerns that were equally expressed at the Senate committee from those who heard the bill and talked about, in particular, the regulatory sandbox and lack of regulation and protection.

We heard from a number of environmental groups, for example, who were worried their laws would be exempt and that people would be running roughshod over environmental objectives just for the sake of it.

Since there were so many questions, the amendments that, in fact, were put forward before the bill actually landed here very much scoped the use of these regulatory sandboxes, so it’s limited to technology sectors. It also limited which acts would be allowed to be in that sandbox.

In addition, it added oversight so that two ministers have to sign off on the exemption. It also obligates the minister to prepare a report within 90 days when they’ve given an exemption.

There are a number of checks and balances that have been added. I think time will tell once it’s actually in use, and we can reference several technology-type companies — the finance sector, for example — they can show what they can do, use their innovation and prove that the laws are not being trodden on, and that it’s actually working well. That will eventually lead to better regulation, in my view.