This is page numbers 2493 - 2524 of the Hansard for the 19th Assembly, 2nd Session. The original version can be accessed on the Legislative Assembly's website or by contacting the Legislative Assembly Library. The word of the day was care.

Some Hon. Members

Question.

The Speaker

The Speaker Frederick Blake Jr.

Question has been called. Government House Leader.

R.J. Simpson

R.J. Simpson Hay River North

Thank you, Mr. Speaker. Cabinet has serious concerns about what is proposed by this bill. If Bill 23 were to become law, it would essentially create a right to receive power while removing the obligation to pay for it. This would have a number of negative impacts on our residents. We would undoubtedly see some customers become burdened with large and perpetually growing debts, and as a consequence, the power companies would see their uncollectible debts grow. This isn't just speculation. We saw it happen last year when NTPC paused collections, ceased disconnections, and removed load limiters during the first months of COVID-19. Ultimately, the lost revenue created as a result of this bill would have to be recouped through the ratepayers meaning higher power rates and higher bills for everyone.

Mr. Speaker, this Assembly made reducing the cost of power a priority, and this bill would almost certainly have the opposite effect. However, Cabinet is willing to let this bill go through the process, and we will be abstaining from this vote. Thank you, Mr. Speaker.

The Speaker

The Speaker Frederick Blake Jr.

Thank you, Government House Leader. Question has been called. All those in favour? All those opposed? Any abstentions? The motion is carried.

---Carried

Bill 23 has received second reading and is referred to standing committee. Second reading of bills. Item 20, consideration in Committee of the Whole of Bills and other matters: Bill 3, An Act to Amend the Public Highways Act; Bill 12, An Act to Amend the Apprenticeship, Trades and Occupational Certification Act; Bill 13, An Act to Amend the Interpretation Act; Bill 14, An Act to Amend the Securities Act; Bill 16, An Act to Amend the Income Tax Act; Bill 20, An Act to Amend the Employment Standards Act; Committee Report 8-19(2), Standing Committee on Rules and Procedures Report on Motion 5-19(2), Referral of Point of Privilege Raised by Member for Monfwi on March 10, 2020; Committee Report 9-19(2), Standing Committee on Rules and Procedures Report on the Chief Electoral Officer's Report on the Administration of the 2019 Territorial General Election; Committee Report 10-19(2), Standing Committee on Economic Development and Environment Report on Bill 3, An Act to Amend the Public Highways Act; Minister's Statement 77-19(2), National Housing Co-Investment Fund; Tabled Document 165-19(2), Government of the Northwest Territories Response to Committee Report 1-19(2), Report on Long-Term Post-Pandemic Recovery, Recommendations to the GNWT; Tabled Document 166-19(2) Government of the Northwest Territories Response to Committee Report 2-19(2), Report on Long-Term Post-Pandemic Recovery, Recommendations to the GNWT; Tabled Document 167-19(2), Government of the Northwest Territories Response to Committee Report 3-19(2), Report on Long-Term Post-Pandemic Recovery, Recommendations to the GNWT; Tabled Document 286-19(2) Main Estimates 2021-2022; Tabled Document 348-19(2), Supplementary Estimates (Infrastructure Expenditures), No. 3, 2020-2021; and Tabled Document 349-19(2), Supplementary Estimates (Operations Expenditures), No. 3, 2020-2021. By the authority given to me as Speaker by Motion 1-19(2), I hereby authorize the House to sit beyond the daily hours of adjournment to consider the business before the House, with the Member for Inuvik Twin Lakes in the chair.

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The Chair

The Chair Lesa Semmler

I now call Committee of the Whole to order. What is the wish of committee? Member for Tu-Nedhe Wiilideh.

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Steve Norn

Steve Norn Tu Nedhe-Wiilideh

Marsi cho, Madam Chair. Committee would like to consider the following items: Bill 16, An Act to Amend the Income Tax Act; Committee Report 10-19(2), Standing Committee on Economic Development and Environment Report on Bill 3, An Act to Amend the Public Highways Act; Bill 3, An Act to Amend the Public Highways Act; Bill 12, An Act to Amend the Apprenticeship, Trades and Occupational Certification Act; Bill 13, An Act to Amend the Interpretation Act; Bill 14, An Act to Amend the Securities Act; Tabled Document 165-19(2), Government of the Northwest Territories Response to Committee Report 1-19(2), Report on Long-Term Post-Pandemic Recovery, Recommendations to the GNWT; Tabled Document 166-19(2) Government of the Northwest Territories Response to Committee Report 2-19(2), Report on Long-Term Post-Pandemic Recovery, Recommendations to the GNWT; Tabled Document 167-19(2), Government of the Northwest Territories Response to Committee Report 3-19(2), Report on Long-Term Post-Pandemic Recovery, Recommendations to the GNWT; and Minister's Statement 77-19(2), National Housing Co-Investment Fund. Marsi cho, Madam Chair.

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The Chair

The Chair Lesa Semmler

Thank you. Does committee agree?

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Some Hon. Members

Agreed.

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The Chair

The Chair Lesa Semmler

Thank you, committee. We will take a short recess and resume with the first item.

---SHORT RECESS

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The Chair

The Chair Lesa Semmler

I now call Committee of the Whole back to order. Committee, we have agreed to first consider Bill 16, An Act to Amend the Income Tax Act. I will ask the Minister of Finance to introduce the bill.

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Caroline Wawzonek

Caroline Wawzonek Yellowknife South

Thank you, Madam Chair. I am here to present Bill 16, An Act to Amend the Income Tax Act. The main purpose of Bill 16 is to reduce the tax burden on our small businesses by reducing the small business tax rate from 4 percent down to 2 percent. With this reduction, Northwest Territories small businesses will incur a tax rate of 2 percent on taxable income under $500,000. Any taxable income over $500,000 will continue to be subject to the general corporate tax rate of 11.5 percent. This proposed measure will become effective on January 1, 2021.

We are also taking this opportunity to propose two housekeeping measures to keep the legislation current and maintain value harmonization with federal income tax legislation. The first housekeeping measure proposes changes in the calculation of the territorial age credit to include taxable split income to ensure seniors are not able to claim a higher age credit than they would otherwise be entitled. The second housekeeping measure proposes changes in the calculation of the territorial pension credit. This measure will allow Canadian veterans with certain income benefits received under the federal Veterans Well-being Act to claim the territorial pension credit.

That concludes my opening remarks, Madam Chair. I would be happy to answer any questions that Members might have.

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The Chair

The Chair Lesa Semmler

Thank you, Minister. I will now turn to the chair of the Standing Committee on Government Operations, the committee which considered the bill, for opening comments.

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Frieda Martselos

Frieda Martselos Thebacha

Thank you, Madam Chair. Bill 16, An Act to Amend the Income Tax Act, received second reading in the Legislative Assembly on November 2, 2020, and was referred to the Standing Committee on Government Operations for review. On February 25, 2021, the standing committee held a public hearing with the Minister of Finance and completed its clause-by-clause review of the bill. I thank the committee for their efforts in reviewing this legislation. Individual Members may have additional comments or questions.

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The Chair

The Chair Lesa Semmler

Thank you. Minister, would you like to bring witnesses into the Chamber?

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Caroline Wawzonek

Caroline Wawzonek Yellowknife South

Yes, Madam Chair.

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The Chair

The Chair Lesa Semmler

Sergeant-at-Arms, please escort the witness into the Chamber. Minister, please introduce your witnesses for the record.

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Caroline Wawzonek

Caroline Wawzonek Yellowknife South

Thank you, Madam Chair. Madam Chair, on my left is Kelly Bluck, director of fiscal policy from the Department of Finance, and on the right, Cherie Jarock, legislative counsel with the legislation division from the Department of Justice.

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The Chair

The Chair Lesa Semmler

Thank you. I will now open the floor to general comments on Bill 16. Member for Kam Lake.

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Caitlin Cleveland

Caitlin Cleveland Kam Lake

Thank you very much, Madam Chair. I just wanted to express my gratitude for this change. I think that this is a time when businesses can use the support and can also use their finances in better ways to grow and evolve their businesses. I appreciate the effort on behalf of the Minister in order to make this change, and I would like to just say thank you. Thank you.

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The Chair

The Chair Lesa Semmler

Thank you. Member for Frame Lake.

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Kevin O'Reilly

Kevin O'Reilly Frame Lake

Thanks, Madam Chair. I don't have any difficulty with the administrative changes here for the most part. I am concerned about the reduction in the small business tax rate. Can the Minister tell me why we are doing this? Thanks, Madam Chair.

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The Chair

The Chair Lesa Semmler

Thank you. Minister.

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Caroline Wawzonek

Caroline Wawzonek Yellowknife South

Thank you, Madam Chair. We are a little bit behind some of the other jurisdictions in terms of our business tax rate for small businesses. This finally is an opportunity to bring us a little bit more in line and make us more competitive with some of our colleagues across the rest of Canada. Up to this point, we were at or near, in fact, the very top of the pile. This is an opportunity to, again, make us more competitive, and it's a good time. I think one of the MLAs has already mentioned that it's an opportunity to give a bit of release at an occasion and during a context where there has been quite a lot of challenges for small businesses, for all businesses, over the last year. Again, this is one where, really, we are getting ourselves to be more aligned with the rates that you see across the rest of Canada. Thank you, Madam Chair.

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The Chair

The Chair Lesa Semmler

Thank you. Member for Frame Lake.

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Kevin O'Reilly

Kevin O'Reilly Frame Lake

Thanks, Madam Chair. I take it from what the Minister said that this is really about tax fairness, being competitive, and so on. That's all good. Can the Minister tell me how much revenue the GNWT is going to lose as a result of this reduction? Thanks, Madam Chair.