Summary#

This bill changes the federal Income Tax Act to let certain construction workers deduct their travel costs from taxable income. It covers tradespersons and indentured apprentices who travel to job sites at least 120 km from their usual home. It applies to the 2022 tax year and onward (Bill Section 1, para 8(1)(q.1); Section 2).

• Allows a new deduction for amounts spent on travel “to and from” distant construction job sites (Bill Section 1, para 8(1)(q.1)).
• Eligible only if the worker is a duly qualified tradesperson or an indentured apprentice in construction (Bill Section 1).
• Distance threshold: job site must be 120 km or more from the worker’s ordinary residence (usual home) (Bill Section 1).
• No explicit dollar cap; no double-claim if an allowance was received tax‑free or if claimed elsewhere (Bill Section 1).
• Applies to 2022 and later tax years (retroactive to 2022) (Bill Section 2).

What it means for you#

• Households (trades workers and apprentices)

  • You may deduct what you paid for travel to and from a construction job site 120 km or more from your home, if your employment contract required you to pay those costs and you did not get a non-taxable allowance for them (Bill Section 1).
  • The deduction lowers your taxable income. The tax savings depend on your tax bracket. If you owe little or no income tax, the benefit is small because this is a deduction, not a refundable credit (Bill Section 1).
  • Keep records. You will need proof of your travel spending and that your contract required you to cover it. The bill does not create a special form; normal audit rules apply (Bill Section 1).
  • You cannot also claim these same travel costs under any other deduction or credit (no double-claim) (Bill Section 1).

• Workers comparing with the existing federal Labour Mobility Deduction for Tradespeople (LMDT)

  • The LMDT (in place since 2022) lets eligible construction workers deduct certain travel, temporary lodging, and meal costs for jobs 150 km or more from home, up to $4,000/year (Budget 2022; CRA guidance on LMDT).
  • This bill’s deduction has a shorter distance threshold (120 km) and no stated dollar cap, but it covers only travel “to and from” the site, not lodging or meals (Bill Section 1; Budget 2022).
  • You cannot claim the same expense under both. You would need to choose which deduction fits your situation (Bill Section 1(iii); Budget 2022).

• Businesses (employers in construction)

  • No new filings or taxes for employers. However, workers can only claim if their contract requires them to pay their own travel costs and they did not receive a non-taxable allowance for those costs (Bill Section 1).

• Tax preparers and advisors

  • Check three tests: worker status (duly qualified tradesperson or indentured apprentice in construction), distance (≥120 km), and contract requirement to self-fund travel with no non-taxable allowance received (Bill Section 1).

Expenses#

Estimated net cost: Data unavailable.

• No appropriation in the bill; it creates a new tax deduction that would reduce federal income tax revenue (Bill Section 1).
• No official fiscal note identified for this specific bill. Data unavailable.
• Key design features that affect cost:
  • No explicit annual dollar cap on the deduction (Bill Section 1).
  • Eligibility limited to construction tradespersons and indentured apprentices, and only for travel to and from distant job sites (Bill Section 1).
  • Applies starting in the 2022 tax year (retroactive) (Bill Section 2).

Proponents' View#

• Lowers out-of-pocket costs for construction workers who must travel far for work by letting them deduct required travel expenses from income (Bill Section 1).
• Broader reach than the existing LMDT on distance: 120 km threshold vs. 150 km, which could make more workers eligible in medium-distance scenarios (Bill Section 1; Budget 2022).
• Simple rule set: three clear conditions (contract requires payment, no non-taxable allowance, no double-claim) and no dollar cap, which avoids small annual limits (Bill Section 1).
• Retroactive start in 2022 provides immediate relief for past eligible travel (Bill Section 2).

Opponents' View#

• Ambiguity risk: “duly qualified tradesperson,” “indentured apprentice,” and “construction activity” are not defined in the bill, which could lead to disputes and uneven administration (Bill Section 1).
• Fiscal uncertainty: no explicit cap means potentially large, uneven deductions; total revenue loss cannot be forecast without a limit or fiscal estimate. Data unavailable (Bill Section 1).
• Overlap and complexity with the existing LMDT may confuse filers and require extra CRA enforcement to prevent double-claims, since each program covers different costs and thresholds (Bill Section 1(iii); Budget 2022).
• Unequal benefit distribution: deductions give larger dollar tax savings to higher‑bracket taxpayers, while lower‑income workers may see little benefit if they owe little tax (Bill Section 1).
• Line-drawing effects: workers traveling 100–119 km receive no benefit under this bill even if their costs are high, while those at 120+ km qualify (Bill Section 1).