Canada this week introduced Bill C-56, the Affordable Housing and Groceries Act, the first piece of government legislation introduced in the fall parliamentary sitting.
This legislation would deliver urgent action to help make life more affordable for Canadians by removing the GST on new rental housing construction across the country. This legislation would also increase competition, particularly in the grocery sector.
Bill C-56 will enhance the Goods and Services Tax (GST) Rental Rebate on new rental housing, to incentivize the construction of more apartment buildings, student housing, and senior residences.
This enhancement increases the GST Rental Rebate from 36 per cent to 100 per cent and removes the existing GST Rental Rebate phase-out thresholds, for new rental housing projects. For a two-bedroom rental unit valued at $500,000, the enhanced GST Rental Rebate would deliver $25,000 in tax relief.
The proposed amendments to the Competition Act will give more power to the Competition Bureau to investigate when industries are behaving unfairly, for example where price fixing or price gouging is occurring, and take enforcement action;
It will remove the efficiencies defence, to end anti-competitive mergers that raise prices and limit choices for Canadian consumers.
It will also empower the Bureau to block collaborations that stifle competition and consumer choice, particularly in situations where large grocers prevent smaller competitors from establishing operations nearby.
“More competition and less consolidation means lower prices. Our government is taking action to improve competition in Canada because that is the best way to advance the interests of consumers, and it will also make our economy more dynamic. We heard Canadians’ concerns, and we will always have their back,” said François-Philippe Champagne, Minister of Innovation.
A broad consultation on the future of the Competition Act was first announced in Budget 2022 and undertaken in 2023. A summary of what the government heard through broad, public consultation with stakeholders and citizens on the future of Canada’s competition policy was released September 20, 2023. The report reflects on key points that have helped inform the government’s next steps, including the amendments to the Competition Act prioritized to address the grocery sector.