Liberal senators on Wednesday called the bluff of the governing Conservatives on Bill C-10.

Liberals in Canada’s upper house unveiled long-awaited amendments to the controversial tax bill that could allow Bill C-10 to be sent back to the House of Commons for reconsideration minus key film and TV tax credit provisions that have stirred deep industry concern.

Bowing to persistent demands from rival Conservative members of the Senate standing committee on banking, trade and commerce for face-saving Bill C-10 amendments, Liberal Senator Francis Fox proposed that the Heritage minister be stripped of the power to deny tax credits to domestic productions that are deemed contrary to ‘public policy.’

The far-reaching Liberal amendments also propose to stop the Heritage minister from issuing guidelines about film and TV content, as was originally proposed by government drafters of Bill C-10.

At the same time, the Liberals propose that the federal government retain the right to deny funds for film or TV shows that contravene the criminal code.

The CFTPA and other industry representatives have called for the criminal code reference to be retained, while demanding the more subjective criteria for denying tax credits be removed from the bill, on grounds that it would imperil the viability of existing Canadian production financing models.

The Liberal amendments also propose giving producers an ‘efficient judicial appeal mechanism’ if the Heritage minister or her subordinates block or delay funding for film or TV projects.

Finally, the Liberals propose that the government continue to deny tax credits or other funding to ‘pornography, child pornography, and hate propaganda.’

‘What we are proposing are amendments that will protect this vital industry as well as the principle of artistic freedom,’ Fox said in a statement issued Wednesday.

Stephen Waddell, national executive director of ACTRA, welcomed the Liberal fix of Bill C-10, but expressed doubts about the Conservatives agreeing to both the amendments and the passage of Bill C-10 without much-vaunted taxpayer safeguards in place.

Fox said interested parties will have an ‘opportunity to review and comment on these proposals’ before they are voted on in the House of Commons. Consultation will need to take place before the House rises for its summer break on June 27.

The Liberal senators propose the amendments be voted on in a motion by the entire Senate banking committee. If the motion is passed, the amended Bill C-10 could be returned to the House of Commons, where the Conservatives would have to consider how to handle the thorny tax credit provisions.

The Conservatives appear eager to see the back of Bill C-10, as failure to pass it during the current Parliament would only force the government to re-introduce the controversial legislation when the House next resumes its official business.

Federal Finance Minister Jim Flaherty earlier said passage of Bill C-10 would be a confidence measure that could force a national election, but it remains to be seen whether the Liberals would use the bill as the issue to send Canadians to the polls.