The proposed changes were aimed at strengthening the value of Canadian citizenship and improving the efficiency of the process required to attain it.
"Canadians take as much or more pride in their citizenship than any other country," said Citizenship and Immigration Minister Chris Alexander. "The rate of application is likely to go up in spite of the fact that we're taking certain measures to reinforce the value of citizenship."
Many of the new measures aim to crack down on so-called Canadians of convenience by making it harder to attain citizenship.
When the new laws come into effect, permanent residents will have to maintain a "physical presence" in Canada for four out of six years before applying for citizenship, compared to the previous requirement of three out of four years.
They will also need to be physically present in Canada for 183 days each year for at least four of those six years, and will have to file Canadian income taxes to be eligible for citizenship.
In a new twist, the government also plans to have prospective citizens officially declare their "intent to reside" in the country.
More applicants will also have to meet language requirements and pass a knowledge test before attaining citizenship, with the government expanding its age range for those requirements to those aged 14-64, compared to the current range of those aged 18-54.
"Our government expects new Canadians to take part in the democratic life, economic potential and rich cultural traditions that are involved in becoming a citizen," said Alexander.
As eligibility requirements increase, the government said it would simultaneously speed up processing times for citizenship applications by streamlining its decision-making process.
It's hoped the change will help drastically cut the backlog of citizenship applications, which currently sits at more than 320,000 files with processing times stretching to as much as 36 months. By 2015-2016, the government said it hopes to process successful applications in less than a year.
Liberal immigration critic John McCallum said he would be watching closely to see if the government actually cuts processing times as promised.
"Waiting times over the last five years have mushroomed in all cases," he said. "I hope they get the time down, but I can't say, given their record, that I have great confidence."
In an effort to crack down on fraud, the proposed legislation increases penalties for phoney applications to a $100,000 and or five years in prison. The cost of applying for citizenship is also going up to $400, from the current $200.
The most controversial changes announced Thursday revolved around stripping citizenship from certain dual nationals.
Under the new legislation, citizenship can be revoked from dual nationals who are members of armed forces or groups engaged in an armed conflict with Canada, and from dual nationals convicted of terrorism, high treason or spying.
The legislation will also deny citizenship to permanent residents who are involved in those activities.
When asked how the government would determine whether terrorism charges or convictions in countries with dubious justice systems were legitimate, Alexander said the new provisions in the act would likely apply to exceptional cases that would be carefully examined.
"The government of Canada has very clear criteria for terrorism, terrorism entities, terrorist groups," he said. "Committing an act of terrorism is a Criminal Code violation so that is the threshold that would have to be met."
Nonetheless some observers still worried those provisions would create a two-tiered system.
"We want to make sure it doesn't go against our Charter of Rights. We want to make sure it doesn't create two classes of citizens," said NDP immigration critic Lysane Blanchette-Lamothe.
"We have a justice system, a legal system that is able to deal with criminality and we're not sure it's necessary to go on that dangerous path."
The Canadian Council for Refugees echoed those concerns, saying there were some countries, like Syria for example, where revoking one's original citizenship after becoming Canadian was very hard.
"If they have their citizenship stripped they can't return to Canada to clear their name if they have in fact been wrongly accused," said executive director Janet Dench, pointing to the case of Maher Arar as a cautionary example.
Arar, a Canadian of Syrian descent, was labelled a member of al-Qaeda while switching planes at New York's Kennedy Airport in 2002 en route to Canada. He spent nearly a year in a Syrian prison where he said he was repeatedly tortured. A Canadian judicial inquiry cleared him of any terrorist links in 2007.
"It's a very disturbing direction the government is going in where they're making citizenship something that can be taken away as a form of punishment," said Dench. "Once you open that door, where does it lead to?"
The new legislation would also bar permanent residents with serious foreign criminal charges and convictions from getting citizenship. Current laws only bar citizenship for those with certain domestic criminal charges and convictions.
In another change, permanent residents who are members of the Canadian Armed Forces will have a fast track to citizenship.
Meanwhile, the government plans to extend citizenship to the so-called "lost Canadians" who had been wrongfully denied it in the past.
The group of individuals who fell through the cracks in existing legislation include certain children of war brides born before 1947 when Canada had no citizenship laws of its own.
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