If you are referring to Canadian tax, no. In Canada capital gains on your primary residence are exempt from tax, but not mortgage interest. This gives Canadians the incentive to get their mortgage paid off asap unless they are renting the home to someone else.
Yes it is. However, you should talk to a professional as there could be a requirement for you to withhold 30% of the payment and then the bank would have to claim this back from the government. As no bank would want to do this, they would just increase your payment by enough to cover the withholding, which you would not want. So, talk to an expert first.