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Notices of Ways and Means Motion
Notice of Ways and Means Motion to Amend the Income Tax Act
That it is expedient to amend the Income Tax Act to provide among other things:
Working Income Tax Benefit
(1) For the introduction of a Working Income Tax Benefit, in accordance with proposals described in the budget documents tabled by the Minister of Finance in the House of Commons on March 19, 2007.
Registered Disability Savings Plan
(2) For the introduction of a Registered Disability Savings Plan, in accordance with proposals described in the budget documents tabled by the Minister of Finance in the House of Commons on March 19, 2007.
Private Foundations
(3) That, subject to paragraph (4), the zero capital gains inclusion rate under paragraph 38(a.1) of the Act, and the special deduction under paragraph 110(1)(d.01) of the Act, in respect of gifts of certain securities to public charities be extended to gifts of such securities made on or after March 19, 2007 to a private foundation.
(4) For the introduction of provisions relating to holdings of private foundations, in accordance with proposals described in the budget documents tabled by the Minister of Finance in the House of Commons on March 19, 2007.
Registered Education Savings Plans
(5) That, for contributions made after 2006 to registered education savings plans (RESPs) in respect of a beneficiary,
(a) the annual limit on contributions be eliminated; and
(b) the lifetime limit on contributions be increased to $50,000 from $42,000.
(6) That, for the 2007 and subsequent taxation years, an RESP be permitted to make an educational assistance payment to a beneficiary for a program that involves at least 12 hours per month on courses, if
(a) the RESP would have been permitted to make the payment as an educational assistance payment to the beneficiary for the program if it had involved at least 10 hours per week on courses or work;
(b) the total of the payment and all other educational assistance payments made in the preceding 13-week period to the beneficiary under the RESP (and all other RESPs administered by the same promoter) does not exceed $2,500 (or such greater amount as is approved in writing with respect to the beneficiary by the Minister designated for the purpose of the Canada Education Savings Act); and
(c) the beneficiary has attained at least 16 years of age at the time of the payment.
(7) That a payment to an RESP under a program, that is established under the laws of the Province of Quebec, and that is consistent with the Canada Education Savings Act, be treated in the same manner as payments under that Act.
(8) That the Minister designated for the purpose of the Canada Education Savings Act be authorized to collect any information in respect of RESPs that the Minister of National Revenue is authorized to collect, and to provide that information to that Minister.
Elementary and Secondary School Scholarships
(9) That, for the 2007 and subsequent taxation years, there be excluded from an individual’s income for a taxation year the total of all amounts received in the taxation year by the individual on account of scholarships and bursaries in connection with the individual’s enrolment in an elementary or secondary school.
New Child Tax Credit
(10) That, for the 2007 and subsequent taxation years,
(a) if a child who is under the age of 18 years at the end of a taxation year resides together with the child’s parents throughout the taxation year, either of those parents be entitled to deduct in computing tax payable for the taxation year under Part I of the Act a child tax credit in respect of the child, equal to the product obtained when the appropriate percentage for the year is multiplied by $2,000 (indexed after 2007), and that any unused portion of a parent’s child tax credit under this subparagraph be transferable to that parent’s spouse or common-law partner;
(b) in the case of a child who is under the age of 18 years at the end of a taxation year and not described in subparagraph (a), the child’s parent who is eligible to claim the wholly dependent person credit for the taxation year in respect of the child (or who would be so eligible if that child were the parent’s only child) be entitled to deduct in computing tax payable for the taxation year under Part I of the Act a child tax credit in respect of the child, equal to the product obtained when the appropriate percentage for the taxation year is multiplied by $2,000 (indexed after 2007); and
(c) the reference to "throughout the taxation year" in paragraph (a) be read as a reference
(i) in the case of a child who is born in a taxation year, to the portion of the taxation year that is after the child’s birth,
(ii) in the case of a child who is adopted in a taxation year, to the portion of the taxation year that is after the child’s adoption, and
(iii) in the case of a child who dies in a taxation year, to the portion of the taxation year that is before the child’s death.
Spousal and Other Amounts
(11) That,
(a) for the 2007 taxation year, each of the spouse or common-law partner amount and the equivalent amount for a wholly dependent relative be $8,929;
(b) for the 2008 taxation year, each of the spouse or common-law partner amount and the equivalent amount for a wholly dependent relative be determined by adding $200 to the amounts otherwise determined (having regard to subparagraph (a)) for each those amounts for the 2008 taxation year;
(c) for the 2009 taxation year, each of the spouse or common-law partner amount and the equivalent amount for a wholly dependent relative be determined by adding the greater of $600 and the amount required to bring each of those amounts to $10,000, to the amounts otherwise determined (having regard to subparagraph (b)) for each those amounts for the 2009 taxation year;
(d) for the 2010 and subsequent taxation years, each of the spouse or common-law partner amount and the equivalent amount for a wholly dependent relative be determined by applying indexation to the amount otherwise determined (having regard to subparagraph (c)) to be each of those amounts for the immediately preceding taxation year; and
(e) for the 2007 and subsequent taxation years, each of the spouse or common-law partner amount and the equivalent amount for a wholly dependent relative be reduced by the income of the spouse, common-law partner or dependant.
Public Transit Tax Credit
(12) That, for the 2007 and subsequent taxation years, an individual be entitled to deduct, in computing tax payable under Part I of the Act for the year, an amount equal to the product obtained when the appropriate percentage for the year is multiplied by the total of all amounts paid in the year in respect of
(a) an eligible cost-per-trip electronic payment card for use by the individual, the individual’s spouse or common-law partner, or a child of the individual who has not before the end of the taxation year attained the age of 19 years (to the extent that the amounts are not included in computing this tax credit by any other individual for the taxation year) and that, for this purpose, an eligible cost-per-trip payment card be a cost-per-trip payment card that is
(i) used for at least 32 one-way trips during an uninterrupted period not exceeding 31 days, and
(ii) issued by a public transit authority that records and receipts that cost and usage; and
(b) an eligible weekly pass for use by the individual, the individual’s spouse or common-law partner, or a child of the individual who has not before the end of the taxation year attained the age of 19 years (to the extent that the amounts are not included in computing this tax credit by any other individual for the taxation year) and that, for this purpose, an eligible weekly pass be one of at least four consecutive passes each of which provides the passholder the right to unlimited public transit use within an uninterrupted period of between five and seven days.
Lifetime Capital Gains Exemption
(13) That, in respect of capital gains arising on dispositions on or after March 19, 2007 by an individual of qualified property, the individual’s capital gains exemption limit be increased to $375,000 from $250,000, and that, to give effect to this measure for the 2007 taxation year, the maximum amount that the individual may deduct in respect of capital gains realized in 2007 be the total of
(a) the amount that the individual would have been entitled to deduct for 2007 if the individual’s capital gains exemption limit for 2007 had remained at $250,000; and
(b) the amount (not exceeding $125,000) by which the increase in the individual’s cumulative gains limit at the end of 2007 that is attributable to net taxable capital gains from dispositions of qualified property on or after March 19, 2007 exceeds the amount determined under subparagraph (a) in respect of those net taxable capital gains.
Meal Expenses of Truck Drivers
(14) That the provisions relating to the deductibility of meal and beverage expenses be modified, for expenses incurred on or after March 19, 2007, to provide that
(a) the reference to "50%" in subsection 67.1(1) of the Act be replaced, in respect of food and beverages consumed by a long-haul truck driver during an eligible travel period, by a reference to the specified percentage in respect of the expense;
(b) a long-haul truck driver be an employee whose principal duty of employment is the transportation of goods, or an individual whose principal business is the transportation of goods, by way of driving a long-haul truck;
(c) a long-haul truck be a truck or tractor that is designed for hauling freight, that is primarily used to earn income from hauling freight and that has a gross vehicle weight rating (as that term is defined in subsection 2(1) of the Motor Vehicle Safety Regulations) in excess of 11,788 kg.;
(d) an eligible travel period in respect of a long-haul truck driver be a period
(i) of at least 24 hours throughout which the driver is away from the municipality and metropolitan area in which
(A) the driver resides (the residential location), in the case of a driver whose principal business is the transportation of goods, or
(B) the employer’s business is located (the business location), in the case of an employed driver whose principal duty is the transportation of goods, and
(ii) during which the driver is driving a long-haul truck that transports goods to, or from, a location that is beyond a radius of at least 160 kilometres from the residential or business location, as the case maybe; and
(e) the specified percentage in respect of an expense be
(i) 60%, if the expense is incurred before 2008,
(ii) 65%, if the expense is incurred in 2008,
(iii) 70%, if the expense is incurred in 2009,
(iv) 75%, if the expense is incurred in 2010, and
(v) 80%, if the expense is incurred after 2010.
Age Limit for Maturing RPPs and RRSPs
(15) That, after 2006, the time by which the following events must occur be changed from the end of the calendar year in which an individual attains 69 years of age to the end of the calendar year in which the individual attains 71 years of age:
(a) maturity of a registered retirement savings plan (RRSP) of the individual;
(b) commencement of payments under an annuity purchased for the individual under a deferred profit sharing plan (DPSP); and
(c) an amount vested in the individual under a DPSP becomes payable.
(16) That, for the 2007 and subsequent taxation years, the terms of an annuity contract purchased for an individual under a registered pension plan or DPSP be permitted to be amended, without adverse tax consequences, to defer commencement of the annuity to no later than the end of the year in which the individual attains 71 years of age.
(17) That,
(a) the minimum amount that must be withdrawn in 2007 from a registered retirement income fund of an individual who attains 70 or 71 years of age in 2007 be nil; and
(b) the minimum amount that must be withdrawn in 2008 from a registered retirement income fund of an individual who attains 71 years of age in 2008 be nil.
RRSP Qualified Investments
(18) That, on and after March 19, 2007, the list of qualified investments for RRSPs and other registered plans include
(a) any debt obligation that has an investment grade rating from a recognized credit rating agency and that is part of a minimum $25 million issuance; and
(b) any security that is listed on a designated stock exchange, other than a futures contract or other derivative instrument in respect of which the holder’s risk of loss may exceed the holder’s cost.
The 2010 Games in Vancouver
(19) That the International Olympic Committee and International Paralympic Committee be exempted from tax under Part XIII of the Act on payments made to them after 2005 and before 2011 in respect of the 2010 Olympic and Paralympic Winter Games.
(20) That the following non-residents of Canada be exempted from income tax under Part I of the Act on income derived from the non-resident’s activities, after 2009 and before April 2010, in connection with the 2010 Olympic and Paralympic Winter Games:
(a) employees, officers and members of the International Olympic Committee and the International Paralympic Committee, and individuals (other than trusts) providing services under contract with those organizations;
(b) athletes representing countries other than Canada;
(c) officially registered support staff associated with teams from countries other than Canada;
(d) persons serving as games officials; and
(e) accredited foreign media organizations and their employees and individuals (other than trusts) providing services under contract with those organizations.
(21) That every person who makes a payment to a non-resident of Canada described in paragraph (20) in respect of the income described in that paragraph be exempted from the withholding obligations described in subsection 153(1) of the Act as they apply to that payment.
Mineral Exploration Tax Credit
(22) That, for flow-through share agreements made on or after April 1, 2007 and on or before March 31, 2008, the definition "flow-through mining expenditure" in subsection 127(9) of the Act include an expense that is otherwise described in that definition and that is incurred, or deemed by subsection 66(12.66) of the Act to have been incurred, before 2009.
Donation of Medicines for the Developing World
(23) That, where a corporation makes an eligible gift of property on or after March 19, 2007,
(a) there be added to the deduction available for gifts of property under subsection 110.1(1) of the Act an amount equal to the lesser of
(i) the cost to the corporation of the property, and
(ii) 50 per cent of the amount, if any, by which the proceeds of disposition of the property exceeds the cost to the corporation of the property; and
(b) an eligible gift be a gift of medicine where
(i) the medicine was, immediately before the gift, described in an inventory in respect of a business of the corporation,
(ii) the gift is made to a registered charity that has received a disbursement under a program of the Canadian International Development Agency, and
(iii) the corporation directs the charity to apply the gift to charitable activities outside of Canada.
International Taxation
(24) That, notwithstanding the general rules applicable to the deductibility of interest, no deduction be allowed to a taxpayer in respect of interest relating to an investment in a foreign affiliate, except as provided under paragraph (28).
(25) That paragraph (24) apply to amounts that would otherwise be deductible and that are in respect of,
(a) in the case of a debt incurred on or after March 19, 2007 (otherwise than pursuant to an agreement in writing entered into before that date), a period that begins after 2007,
(b) in the case of a non-arm’s length debt to which subparagraph (a) does not apply, a period that begins after the earlier of December 31, 2008 and the expiry of its current term, and
(c) in the case of an arm’s length debt to which subparagraph (a) does not apply, a period that begins after the earlier of December 31, 2009 and the expiry of its current term.
(26) That a taxpayer’s "interest relating to an investment in a foreign affiliate" include
(a) interest (and other borrowing costs) in respect of
(i) borrowed money that is used to acquire a share or indebtedness of, to lend to or to contribute to the capital of, or is otherwise used for the purpose of earning income from, a corporation that is a foreign affiliate of the taxpayer or of a person or partnership that does not deal at arm’s length with the taxpayer,
(ii) borrowed money that may reasonably be considered (having regard to all the facts and circumstances) to have been used to assist, directly or indirectly, a particular person or partnership with whom the taxpayer does not deal at arm’s length, to acquire a share or indebtedness of, to lend to or to contribute to the capital of, or otherwise to have been used for the purpose of earning income from, a corporation that is a foreign affiliate of
(A) the particular person or partnership, or
(B) another person or partnership that is related to the particular person or partnership or does not deal at arm’s length with the taxpayer, or
(iii) an amount payable for property that is a share or indebtedness of, or other interest in, a corporation that is a foreign affiliate of the taxpayer, or of a person or partnership that does not deal at arm’s length with the taxpayer, and
(b) any amount, paid or payable as, on account of, or in lieu of payment of or in satisfaction of interest or other borrowing costs, that is otherwise deductible by the taxpayer in computing its income for a taxation year and that may reasonably be considered to be in connection with a transaction or event or series of transactions or events a main purpose of which was to avoid the application of the rules described in paragraphs (24) and (25), this paragraph, and paragraphs (27) and (28).
(27) That the amount of a "disallowed interest pool" of a taxpayer at the end of a particular taxation year in respect of a foreign affiliate be the amount, if any, by which the total of
(a) the amount of that pool at the end of the immediately preceding taxation year (or if control of the corporation was acquired since that time, nil), and
(b) the total of all amounts each of which is an amount of interest relating to an investment in the foreign affiliate, that is because of paragraph (24) not deductible in computing the taxpayer’s income for the particular taxation year
exceeds the total of
(c) all amounts each of which is an amount deductible under paragraph (28) in computing the taxable income of the taxpayer in respect of the foreign affiliate for the immediately preceding taxation year,
(d) all amounts each of which is the net non-taxable portion of a capital gain that was included in computing an amount described in subparagraph (c), and
(e) all amounts each of which is an amount deductible for the particular taxation year under subsection 91(4) of the Act in respect of the foreign affiliate or, in respect of a dividend from the foreign affiliate, under subsection 91(5) or paragraphs 113(1)(a) to (c) of the Act.
(28) That there may be deducted in computing the taxable income for a taxation year of a taxpayer resident in Canada an amount in respect of a corporation that is, at any time in the year, a foreign affiliate of the taxpayer, not exceeding the lesser of
(a) the balance in the taxpayer’s disallowed interest pool in respect of the foreign affiliate at the end of the taxation year, and
(b) the amount, if any, by which the total of
(i) all amounts included in the taxpayer’s income for the taxation year in respect of shares of the foreign affiliate,
(ii) all amounts of interest, included in the taxpayer’s income for the taxation year, on indebtedness of the foreign affiliate in respect of which an amount would not otherwise be deductible because of paragraph (24), and
(iii) the taxpayer’s net taxable capital gains for the taxation year from dispositions of shares or indebtedness of the foreign affiliate
exceeds
(iv) the total of all amounts each of which is an amount deductible for the particular taxation year under subsection 91(4) of the Act in respect of the foreign affiliate or under subsections 91(5) or 113(2) or paragraphs 113(1)(a) to (d) of the Act in respect of a dividend from the foreign affiliate.
(29) That, if a partnership is considered for the purposes of its income determination under the Act to have a foreign affiliate, the income and taxable income of a member of the partnership be determined in a manner consistent with the rules in paragraphs (24) to (28).
Active Business Income of a Foreign Affiliate
(30) That, for taxation years of foreign affiliates that begin after 2008,
(a) the references in subparagraphs 95(2)(a)(i), (iii) and (iv) of the Act to a "non-resident corporation to which the particular affiliate and the taxpayer are related" be replaced with a reference to a "foreign affiliate of the taxpayer in respect of which the taxpayer has a qualifying interest";
(b) clause 95(2)(a)(ii)(A) of the Act be repealed;
(c) the reference in clause 95(2)(a)(ii)(C) of the Act to "by a partnership of which the particular affiliate is a member and of which the particular affiliate is not a specified member at any time in a fiscal period of the partnership that ends in the year" be replaced with a reference to "by a partnership of which the particular foreign affiliate is a qualifying member throughout each period, in a fiscal period of the partnership that ends in the year, in which the particular foreign affiliate was a member of the partnership,";
(d) the reference in clause 95(2)(a)(ii)(D) of the Act to "to which the particular affiliate and the taxpayer are related" be replaced with a reference to "in respect of which the taxpayer has a qualifying interest"; and
(e) for the purpose of this paragraph, where a non-resident corporation is a foreign affiliate of a particular corporation resident in Canada, and the particular corporation has a qualifying interest in respect of the non-resident corporation, the non-resident corporation be deemed, in respect of another corporation resident in Canada that is related to the particular corporation, to be a foreign affiliate of the other corporation in respect of which the other corporation has a qualifying interest;
(f) for the purpose of clause 95(2)(a)(ii)(C) of the Act, a particular person is a qualifying member of a partnership at a particular time if at that time the particular person is a member of the partnership and
(i) the particular person is, on a regular, continuous and substantial basis, actively engaged in the principal business activities of the partnership, or carries on (otherwise than as a member of the partnership), on a regular, continuous and substantial basis, a business similar to that of the partnership’s principal business, or
(ii) the particular person owns a partnership interest in the partnership the fair market value of which is not less than 1 per cent of the fair market value of all of the partnership interests in the partnership, and the particular person and persons related to the particular person together own partnership interests in the partnership the fair market value of which is not less than 10 per cent of the fair market value of all partnership interests in the partnership.
Exempt Surplus of a Foreign Affiliate
(31) That, for the purpose of determining the exempt surplus of a foreign affiliate of a corporation resident in Canada, if a comprehensive tax information exchange agreement ("TIEA") between Canada and another country is in force and has effect at any time after March 19, 2007, that country be deemed to be at that time a designated treaty country.
Foreign Accrual Property Income of a Foreign Affiliate
(32) That income of a foreign affiliate that would otherwise be active business income of the foreign affiliate be instead foreign accrual property income of the foreign affiliate if that income was derived
(a) during a period in which the foreign affiliate was resident in a non-treaty non-TIEA country; or
(b) from a source in a non-treaty non-TIEA country.
(33) That, at any time, a non-treaty non-TIEA country be a country, or other jurisdiction
(a) with which Canada does not have a tax treaty;
(b) with which Canada does not have a TIEA; and
(c) that Canada has, more than 60 months before that time, begun TIEA negotiations with or invited to enter into TIEA negotiations, except that this subparagraph shall not apply before 2014 to a country with which Canada was in the course of negotiating a TIEA on March 19, 2007.
Prescribed Stock Exchanges
(34) That the Minister of Finance may designate stock exchanges for the purposes of the Act, including all stock exchanges that are currently prescribed by the Income Tax Regulations, by way of public Notice, which Notice can be or include publication of the list of designated stock exchanges on the Department of Finance website.
(35) That the reference to "prescribed stock exchange" in the definition "excluded property" in subsection 116(6) of the Act be replaced with a reference to "recognized stock exchange", and that a "recognized stock exchange" be defined for the purposes of the Act as
(a) a designated stock exchange; and
(b) a stock exchange, other than a designated stock exchange, that is
(i) located in Canada, or
(ii) located in a country that is a member of the Organization for Economic Co-operation and Development and that has a tax treaty with Canada.
(36) That each reference to "prescribed stock exchange" in section 260 of the Act be replaced with a reference to "stock exchange".
(37) That each other reference to "prescribed stock exchange" in the Act be replaced with a reference to "designated stock exchange".
(38) That the measures in paragraphs (34) to (37) apply after royal assent.
Investment Tax Credit for Child Care Spaces
(39) That, for taxation years that end on or after March 19, 2007, a taxpayer carrying on a business in Canada, other than a business that is the provision of child care services, be allowed to add, in computing its investment tax credit at the end of the taxation year, an amount incurred on or after March 19, 2007 in respect of the creation of each new child care space in a licensed child care facility, equal to the lesser of $10,000 and 25 per cent of the taxpayer’s eligible expenditures in respect of the child care space.
(40) That, for the purpose of paragraph (39),
(a) an eligible expenditure be an expenditure, incurred for the sole purpose of the creation of the new child care space in a licensed child care facility operated for the benefit of children of the employees of the taxpayer, or of children of the employees and other children, that is
(i) incurred to acquire depreciable property of a prescribed class (other than a specified property), or
(ii) a specified child care start-up cost;
(b) a specified property be a property that is a motor vehicle or a property that is, or is located in or attached to, a residence of
(i) the taxpayer,
(ii) an employee of the taxpayer,
(iii) a person who holds an interest in the taxpayer, or
(iv) a person related to a person referred to in any of clauses (i) to (iii); and
(c) a specified child care start-up cost be the cost (other than the cost of a property included in clause (a)(i)) of
(i) landscaping to create an outdoor play area for children,
(ii) initial fees for licensing, regulatory and building permits,
(iii) architectural fees for designing the child care facility, and
(iv) children’s educational material.
(41) That, if in a specified taxation year in respect of a property the cost of which included one or more eligible expenditures of a taxpayer in respect of a child care space, the taxpayer disposes of the property, or the child care space ceases to be available, there be added to the taxpayer’s tax otherwise payable under Part I of the Act for the specified taxation year, an amount that is 25 per cent of the lesser of
(a) that portion of the cost of the property that was an eligible expenditure that was taken into account in computing the investment tax credit; and
(b) the amount that is
(i) if the property is disposed of to a person with whom the taxpayer deals at arm’s length, the proceeds of disposition of the property, and
(ii) in any other case, the fair market value of the property.
(42) That, for the purposes of paragraph (41),
(a) a disposition of a property include a lease of the property by the taxpayer, or a change of use of the property to a non-specified use (being any use other than the provision of child care services); and
(b) a specified taxation year in respect of a property be a taxation year that ends on or before the day that is 60 months after the day on which the taxpayer acquired the property.
Remittance and Filing Thresholds
(43) That, for the 2008 and subsequent taxation years, "instalment threshold" of an individual for a taxation year for the purpose of section 156.1 of the Act, be defined to be
(a) in the case of an individual resident in the Province of Quebec at the end of the year, $1,800; and
(b) in any other case, $3,000.
(44) That, for taxation years that begin after 2007, the reference to $1,000 in subsection 157(2.1) of the Act be replaced by a reference to $3,000.
(45) That, for taxation years of an eligible CCPC that begin after 2007
(a) the corporation be allowed to pay its income tax by quarterly instalments, each of which is due on the last day of each quarter of its taxation year; and
(b) the amount of each quarterly instalment in respect of the corporation for a taxation year be
(i) 1/4 of the corporation’s estimated income tax payable for the taxation year,
(ii) 1/4 of the corporation’s income tax payable for the preceding taxation year, or
(iii) in the case of the first quarterly instalment, 1/4 of the corporation’s income tax payable for the second preceding taxation year and, in the case of each of the remaining three quarterly instalments, 1/3 of the amount, if any, by which the corporation’s income tax payable for the preceding taxation year exceeds the amount determined to be the first quarterly instalment.
(46) That in respect of a quarterly instalment for a taxation year a Canadian-controlled private corporation be an eligible CCPC if
(a) the corporation has a perfect compliance history at the time that the quarterly instalment is due;
(b) an amount was deducted under section 125 of the Act in computing the corporation’s tax payable under the Act for the particular or previous taxation year; and
(c) the corporation has, together with any corporations associated with it, in the particular or previous taxation year
(i) taxable income not exceeding $400,000, and
(ii) taxable capital employed in Canada for the taxation year not exceeding $10,000,000.
(47) That a corporation has a perfect compliance history at a particular time if, throughout the 12-month period before that time, it has
(a) remitted, on or before the day on which that amount was required to be remitted, each amount that it was required to remit under the Act, under Part IX of the Excise Tax Act, under the Employment Insurance Act or under the Canada Pension Plan; and
(b) filed, on or before the day on which the return was required to be filed, each return that it was required to file under the Act or under Part IX of the Excise Tax Act.
Notice of Ways and Means Motion to Amend the Excise Tax Act Relating to the Goods and Services Tax and the Harmonized Sales Tax (GST/HST)
That it is expedient to amend the Excise Tax Act as follows:
Meal Expenses of Truck Drivers
1. The provisions of the Act that determine the net recovery of GST/HST as input tax credits in respect of supplies of food, beverages or entertainment will be modified to provide that
(a) the reference to "50%" in the formula in subsection 236(1) of the Act be replaced by a specified percentage in the case of any amount that becomes due or is paid without having become due, in respect of a supply of food or beverages consumed by long-haul truck drivers for which the reference to "50%" in subsection 67.1(1) of the Income Tax Act is proposed to be modified in accordance with the proposal described in the Budget documents tabled by the Minister of Finance in the House of Commons on March 19, 2007; and
(b) the specified percentage for a particular period be, where no allowance or reimbursement is paid in respect of a supply of food and beverages and tax under Part IX of the Act in respect of the supply becomes payable, or is paid without having become payable, in the particular period or where an allowance or reimbursement is paid in the particular period in respect of the supply of food and beverages,
(i) 40%, for the particular period that is after March 18, 2007 and before 2008,
(ii) 35%, for the particular period that is after 2007 and before 2009,
(iii) 30%, for the particular period that is after 2008 and before 2010,
(iv) 25%, for the particular period that is after 2009 and before 2011, and
(v) 20%, for the particular period that is after 2010.
Remittance and Filing Thresholds
2. (1) Subsection 237(3) of the Act is replaced by the following:
Minimum instalment base
(3) For the purposes of subsection (1), if a registrant’s instalment base for a reporting period is less than $3,000, it is deemed to be nil.
(2) Subsection (1) applies to reporting periods beginning after 2007.
3. (1) Subsection 248(1) of the Act is replaced by the following:
Election for fiscal years
248. (1) A registrant that is a charity on the first day of a fiscal year of the registrant or whose threshold amount for a fiscal year does not exceed $1,500,000 may make an election to have reporting periods that are fiscal years of the registrant, to take effect on the first day of that fiscal year.
(2) Paragraphs 248(2)(b) and (c) of the Act are replaced by the following:
(b) if the person is not a charity and the threshold amount of the person for the second or third fiscal quarter of the person in a fiscal year of the person exceeds $1,500,000, the beginning of the first fiscal quarter of the person for which the threshold amount exceeds that amount, and
(c) if the person is not a charity and the threshold amount of the person for a fiscal year of the person exceeds $1,500,000, the beginning of that fiscal year.
(3) Subsections (1) and (2) apply to fiscal years beginning after 2007.
Foreign Convention and Tour Incentive Program
4. (1) The portion of subsection 167.2(1) of the Act before paragraph (a) is replaced by the following:
Supplies to non-resident persons of admissions to conventions
167.2 (1) If a sponsor of a convention makes a taxable supply of an admission to the convention to a non-resident person, the following shall not be included in calculating the tax payable under subsection 165(1) in respect of the supply:
(2) Subsection 167.2(2) of the Act is replaced by the following:
Supplies to non-resident exhibitors
(2) If a sponsor of a convention makes a taxable supply by way of lease, licence or similar arrangement to a non-resident person of real property that is acquired by the person exclusively for use as a site for the promotion, at the convention, of property or services supplied by, or of a business of, the person, no tax is payable under subsection 165(1) in respect of that supply to the person or in respect of any supply by the sponsor to the person of property or services that are acquired by the person for consumption or use as related convention supplies in respect of the convention.
(3) Subsections (1) and (2) apply to any supply of an admission to, and to any supply made in connection with, a convention that begins after March 2007, unless the convention begins before April 2009 and the supply is made under an agreement in writing entered into before September 25, 2006.
5. (1) The Act is amended by adding the following after subsection 234(2):
Late filing of information and adjustment for failure to file
(2.1) If a registrant is required to file prescribed information in accordance with subsection 252.1(10) or 252.4(5) in respect of an amount claimed as a deduction under subsection (2) in respect of an amount paid or credited on account of a rebate,
(a) in the case where the registrant files the information on a day (in this subsection referred to as the "filing day") that is after the day on or before which the registrant is required to file its return under Division V for the reporting period in which the registrant claimed the deduction under subsection (2) in respect of the amount paid or credited and before the particular day that is the earlier of
(i) the day that is four years after the day on or before which the registrant was required under section 238 to file a return for the period, and
(ii) the day stipulated by the Minister in a demand to file the information,
the registrant shall, in determining the net tax for the reporting period of the registrant that includes the filing day, add an amount equal to interest, at the prescribed rate, on the amount claimed as a deduction under subsection (2) computed for the period beginning on the day on or before which the registrant was required to file the prescribed information under subsection 252.1(10) or 252.4(5) and ending on the filing day; and
(b) in the case where the registrant fails to file the information before the particular day, the registrant shall, in determining the net tax for the reporting period of the registrant that includes the particular day, add an amount equal to the total of the amount claimed as a deduction under subsection (2) and interest, at the prescribed rate, on that amount computed for the period beginning on the day on or before which the registrant was required to file the information under subsection 252.1(10) or 252.4(5) and ending on the day on or before which the registrant is required under section 238 to file a return for the reporting period of the registrant that includes the particular day.
(2) Subsection (1) applies in respect of any amount claimed as a deduction under subsection 234(2) of the Act in respect of an amount that is paid to, or credited in favour of, a person after March 2007 relating to a supply for which tax under Part IX of the Act becomes payable after March 2007.
6. (1) The portion of subsection 252(1) of the Act before paragraph (a) and paragraph (a) are replaced by the following:
Non-resident rebate in respect of exported goods
(1) If a non-resident person is the recipient of a supply of tangible personal property acquired by the person for use primarily outside Canada, the person is not a consumer of the property, the property is not
(a) excisable goods, or
(2) Subsection (1) applies to any supply of property in respect of which tax under Part IX of the Act became payable after March 2007.
7. (1) Subsection 252.1(2) of the Act is replaced by the following:
Accommodation rebate for tour packages
(2) If
(a) a non-resident person is the recipient of a supply made by a registrant of a tour package that includes short-term accommodation or camping accommodation,
(b) the tour package is acquired by the person otherwise than for supply in the ordinary course of a business of the person of making such supplies, and
(c) the accommodation is made available to a non-resident individual,
the Minister shall, subject to subsection (8) and section 252.2, pay a rebate to the person equal to the tax paid by the person under subsection 165(1) in respect of the accommodation.
(2) The portion of subsection 252.1(3) of the Act after paragraph (a) is replaced by the following:
(b) if the supply is a supply of a tour package, the tour package is acquired by the person for supply in the ordinary course of a business of the person of making supplies of a tour package,
(b.1) if the supply is a supply of accommodation, the accommodation is acquired by the person in the ordinary course of a business of the person for the purpose of making a supply (in this subsection referred to as the "subsequent supply") of a tour package that includes the accommodation,
(c) a supply of the tour package or the subsequent supply is made to another non-resident person and payment of the consideration for the supply of the tour package or subsequent supply, as the case may be, is made at a place outside Canada at which the supplier, or an agent of the supplier, is conducting business, and
(d) the accommodation is made available to a non-resident individual,
the Minister shall, subject to subsection (8) and section 252.2, pay a rebate to the particular person equal to the tax paid by the particular person under subsection 165(1) in respect of the accommodation.
(3) Subsection 252.1(4) of the Act is repealed.
(4) The portion of subsection 252.1(5) of the Act before paragraph (a) is replaced by the following:
Tax paid in respect of tour package
(5) If a person files an application in which a rebate under subsection (2) or (3) is claimed in respect of one or more supplies of tour packages that include short-term accommodation or camping accommodation and in respect of which tax was paid by the person, for the purposes of that subsection, the total amount of tax paid under subsection 165(1) in respect of all of the accommodation is, for each of those tour packages, deemed to be equal to
(5) The descriptions of A and B in paragraph 252.1(5)(a) of the Act are replaced by the following:
A is the total number of nights for which short-term accommodation included in that tour package is made available in Canada under the agreement for the supply, and
B is the total number of nights for which camping accommodation included in that tour package is made available in Canada under the agreement for the supply; and
(6) The description of C in paragraph 252.1(5)(b) of the Act is replaced by the following:
C is the total number of nights for which short-term accommodation, or camping accommodation, included in that tour package is made available in Canada under the agreement for the supply of that tour package,
(7) The description of E in paragraph 252.1(5)(b) of the Act is replaced by the following:
E is the tax paid by the person under subsection 165(1) in respect of the supply of that tour package.
(8) Subsection 252.1(6) of the Act is repealed.
(9) The portion of subsection 252.1(8) of the Act before paragraph (b) is replaced by the following:
Rebate paid by registrant
(8) If
(a) a registrant makes a supply of a tour package that includes short-term accommodation or camping accommodation to a non-resident recipient who either is an individual or is acquiring the tour package for use in the course of a business of the recipient or for supply in the ordinary course of a business of the recipient of making supplies of a tour package,
(10) Paragraph 252.1(8)(c) of the Act is replaced by the following:
(c) the amount paid or credited is equal to the amount that would be determined in respect of the supply under paragraph (5)(b), and
(11) The portion of subparagraph 252.1(8)(d)(ii) of the Act before clause (A) is replaced by the following:
(ii) if the supply of the tour package includes the short-term accommodation or camping accommodation and also includes other property or services (other than meals or property or services that are provided or rendered by the person who provides the accommodation and in connection with it), a deposit of at least 20% of the total consideration for the tour package is paid
(12) Section 252.1 of the Act is amended by adding the following after subsection (9):
Filing of information
(10) If in accordance with subsection (8), a registrant
(a) pays to, or credits in favour of, a person an amount on account of a rebate, and
(b) in determining its net tax for a reporting period, claims a deduction under subsection 234(2) in respect of the amount paid or credited,
the registrant shall file with the Minister prescribed information in respect of the amount in prescribed form and in prescribed manner on or before the day on or before which its return under Division V for the reporting period in which the amount is deducted is required to be filed.
(13) Subsections (1) to (11) apply in respect of any supply of short-term accommodation, camping accommodation or a tour package that includes short-term accommodation or camping accommodation, for which accommodation is first made available after March 2007, unless
(a) the accommodation is not included in a tour package, is first made available before April 2009 and is supplied under an agreement in writing entered into before September 25, 2006; or
(b) the accommodation is included in a tour package, the first night in Canada for which short-term accommodation, or camping accommodation, included in the tour package is made available is before April 2009 and the tour package is supplied under an agreement in writing entered into before September 25, 2006.
(14) Subsection (12) applies in respect of any supply of a tour package
(a) for which tax under Part IX of the Act becomes payable after March 2007; and
(b) for which the supplier claimed an amount as a deduction under subsection 234(2) of the Act in respect of an amount that the supplier paid to, or credited in favour of, a non-resident person after March 2007.
8. (1) Section 252.2 of the Act is amended by adding the word "and" at the end of paragraph (e) and by repealing paragraph (f).
(2) Subsection (1) applies for the purpose of determining any rebate under section 252 or 252.1 of the Act, unless the rebate is in respect of short-term accommodation, or camping accommodation, not included in a tour package and the rebate is determined in accordance with the formula in subsection 252.1(4) of the Act.
9. (1) Paragraphs 252.3(a) and (b) of the Act are replaced by the following:
(a) a rebate equal to the tax paid by the person under subsection 165(1) in respect of that supply; and
(b) a rebate equal to the tax paid by the person under subsection 165(1) in respect of a supply to the person of related convention supplies in respect of the convention.
(2) Subsection (1) applies in respect of the supply of property or services made to a person in relation to, or in connection with, a convention that begins after March 2007, unless the convention begins before April 2009 and the supply is made under an agreement in writing entered into before September 25, 2006.
10. (1) Paragraph 252.4(1)(c) of the Act is replaced by the following:
(c) property that is imported by the sponsor, or an imported taxable supply (as defined in section 217) of property or services that are acquired by the sponsor, for consumption, use or supply by the sponsor as related convention supplies,
(2) Subparagraphs 252.4(1)(d)(i) and (ii) of the Act are replaced by the following:
(i) the tax paid by the sponsor under subsection 165(1) calculated on that part of the consideration for the supply that is reasonably attributable to the convention facility or related convention supplies other than property or services that are food or beverages or are supplied under a contract for catering, and
(ii) 50% of the tax paid by the sponsor under subsection 165(1) calculated on that part of the consideration for the supply that is reasonably attributable to related convention supplies that are food or beverages or are supplied under a contract for catering, and
(3) Subparagraphs 252.4(1)(e)(i) and (ii) of the Act are replaced by the following:
(i) if the property or service is food or beverages or is supplied under a contract for catering, 50% of the tax paid by the sponsor under subsection 165(1) and sections 212 and 218 in respect of the supply or importation of the property or service, and
(ii) in any other case, the tax paid by the sponsor under subsection 165(1) and sections 212 and 218 in respect of the supply or importation of the property or service.
(4) Subsection 252.4(3) of the Act is replaced by the following:
Rebate to organizer
(3) If an organizer of a foreign convention who is not registered under Subdivision d of Division V pays tax in respect of a supply of the convention facility or a supply or importation of related convention supplies, the Minister shall, on the application of the organizer filed within one year after the convention ends, pay a rebate to the organizer equal to the total of
(a) the tax paid by the organizer under subsection 165(1) and sections 212 and 218 calculated on that part of the consideration for the supply or on that part of the value of imported property that is reasonably attributable to the convention facility or related convention supplies other than property or services that are food or beverages or are supplied under a contract for catering, and
(b) 50% of the tax paid by the organizer under subsection 165(1) and sections 212 and 218 calculated on that part of the consideration for the supply or on that part of the value of imported property that is reasonably attributable to related convention supplies that are food or beverages or are supplied under a contract for catering.
(5) Section 252.4 of the Act is amended by adding the following after subsection (4):
Filing of information
(5) If in accordance with subsection (2) or (4), a registrant
(a) pays to, or credits in favour of, a person an amount on account of a rebate, and
(b) in determining its net tax for a reporting period, claims a deduction under subsection 234(2) in respect of the amount paid or credited,
the registrant shall file with the Minister prescribed information in respect of the amount in prescribed form and in prescribed manner on or before the day on or before which its return under Division V for the reporting period in which the amount is deducted is required to be filed.
(6) Subsections (1) to (4) apply in respect of the supply, importation or bringing into a participating province of property or services in relation to, or in connection with, a convention that begins after March 2007, except that those subsections do not apply in respect of a supply of property or services in relation to, or in connection with, a convention that begins before April 2009 if the supply is made under an agreement in writing entered into before September 25, 2006.
(7) Subsection (5) applies in respect of any supply relating to a foreign convention
(a) for which tax under Part IX of the Act becomes payable after March 2007; and
(b) for which the supplier claimed an amount as a deduction under subsection 234(2) of the Act in respect of an amount that the supplier paid to, or credited in favour of, a person after March 2007.
Exports of Intangible Personal Property
11. (1) Part V of Schedule VI to the Act is amended by adding the following after section 10:
10.1 A supply of intangible personal property made to a non-resident person who is not registered under Subdivision d of Division V of Part IX of the Act at the time the supply is made, but not including
(a) a supply made to an individual unless the individual is outside Canada at that time;
(b) a supply of intangible personal property that relates to
(i) real property situated in Canada,
(ii) tangible personal property ordinarily situated in Canada, or
(iii) a service the supply of which is made in Canada and is not a zero-rated supply described by any section of this Part or Part VII or IX;
(c) a supply that is the making available of a telecommunications facility that is intangible personal property for use in providing a service described in paragraph (a) of the definition "telecommunication service" in subsection 123(1) of the Act;
(d) a supply of intangible personal property that may only be used in Canada; or
(e) a prescribed supply.
(2) Subsection (1) is deemed to have come into force on December 17, 1990 except that
(a) section 10.1 of Part V of Schedule VI to the Act, as enacted by subsection (1), does not apply to any supply in respect of which the supplier, before March 20, 2007, charged or collected any amount as or on account of tax under Part IX of the Act; and
(b) for the purposes of section 10.1 of Part V of Schedule VI to the Act, as enacted by subsection (1), the definitions "telecommunication service" and "telecommunications facility" in subsection 123(1) of the Act are deemed to have come into force on December 17, 1990.
(3) If an amount was taken into account in assessing the net tax of a person under section 296 of the Act for a reporting period of the person as tax that became collectible by the person in respect of a supply made by the person before March 20, 2007 and, by reason of the application of section 10.1 of Part V of Schedule VI to the Act, as enacted by subsection (1), no tax was collectible by the person in respect of the supply,
(a) the person shall be entitled until the day that is two years after the day on which the Act enacting this section receives royal assent to request in writing that the Minister of National Revenue make an assessment, reassessment or additional assessment for the purpose of taking into account that no tax was collectible by the person in respect of the supply; and
(b) on receipt of a request under paragraph (a), the Minister shall with all due dispatch
(i) consider the request, and
(ii) under section 296 of the Act and despite section 298 of the Act, assess, reassess or make an additional assessment of the net tax of the person for any reporting period of the person and of any interest, penalty or other obligation of the person, but only to the extent that the assessment, reassessment or additional assessment may reasonably be regarded as relating to the supply.
12. The provisions of Division IV of Part IX of the Act relating to intangible personal property will be modified in accordance with proposals described in the Budget documents tabled by the Minister of Finance in the House of Commons on March 19, 2007.
Exemption for Midwifery Services
13. (1) The portion of the definition "practitioner" in section 1 of Part II of Schedule V to the Act before paragraph (b) is replaced by the following:
"practitioner", in respect of a supply of optometric, chiropractic, physiotherapy, chiropodic, podiatric, osteopathic, audiological, speech-language pathology, occupational therapy, psychological, midwifery or dietetic services, means a person who
(a) practises the profession of optometry, chiropractic, physiotherapy, chiropody, podiatry, osteopathy, audiology, speech-language pathology, occupational therapy, psychology, midwifery or dietetics, as the case may be,
(2) Subsection (1) applies to supplies made after December 28, 2006.
14. (1) Section 7 of Part II of Schedule V to the Act is amended by striking out the word "and" at the end of paragraph (i), by adding the word "and" at the end of paragraph (j) and by adding the following after paragraph (j):
(k) midwifery services.
(2) Subsection (1) applies to supplies made after December 28, 2006.
Notice of Ways and Means Motion to Amend the Customs Tariff Relating to the Travellers’ Exemption
That it is expedient to amend the Customs Tariff as follows:
1. (1) The Description of Goods of tariff item No. 9804.10.00 in the List of Tariff Provisions set out in the schedule to the Customs Tariff is amended by replacing the reference to "two hundred dollars" with a reference to "four hundred dollars".
(2) Subsection (1) is deemed to have come into force on March 20, 2007.
Notice of Ways and Means Motion to Amend the Excise Tax Act Relating to Excise Taxes
That it is expedient to amend the Excise Tax Act as follows:
Removal of Excise Tax Exemption for Renewable Fuels
1. The provisions of the Act that provide that excise tax is not payable in the case of the alcohol portion of gasoline-alcohol and diesel-alcohol blended fuel and bio-diesel fuel – whether blended or not – will be repealed on April 1, 2008.
2. The Act will be amended to provide that the excise tax will be levied on renewable fuels as of April 1, 2008 within the existing structure that applies to gasoline and diesel fuel.
Fuel-Inefficient Vehicles
3. (1) Section 6 of Schedule I to the Excise Tax Act is replaced by the following:
6. (1) Automobiles (including station wagons, vans and sport utility vehicles) designed primarily for use as passenger vehicles but not including pickup trucks, ambulances and hearses, at the following rates:
(a) $1,000, in the case of an automobile that has a weighted fuel consumption rating of 13 litres or more per 100 kilometres but less than 14 litres per 100 kilometres;
(b) $2,000, in the case of an automobile that has a weighted fuel consumption rating of 14 litres or more per 100 kilometres but less than 15 litres per 100 kilometres;
(c) $3,000, in the case of an automobile that has a weighted fuel consumption rating of 15 litres or more per 100 kilometres but less than 16 litres per 100 kilometres;
(d) $4,000, in the case of an automobile that has a weighted fuel consumption rating of 16 litres or more per 100 kilometres.
(2) For the purposes of subsection (1), the weighted fuel consumption rating of an automobile shall be the amount determined by the formula
0.55A + 0.45B
where
A is the city fuel consumption rating (based on the number of litres of fuel, other than E85, per 100 kilometres) for automobiles of the same model with the same attributes as the automobile, as determined by reference to data published by the Government of Canada under the EnerGuide mark, or, if no rating can be so determined that would apply to the automobile, by reference to the best available data, which may include the city fuel consumption rating for the most similar model and attributes; and
B is the highway fuel consumption rating (based on the number of litres of fuel, other than E85, per 100 kilometres) for automobiles of the same model with the same attributes as the automobile, as determined by reference to data published by the Government of Canada under the EnerGuide mark, or, if no rating can be so determined that would apply to the automobile, by reference to the best available data, which may include the highway fuel consumption rating for the most similar model and attributes.
(2) Subsection (1) applies to each automobile delivered by a manufacturer or producer to a purchaser after March 19, 2007, and each automobile imported into Canada after that day unless the automobile had been put into service before March 20, 2007, but does not apply to an automobile for which an agreement in writing has been entered into before March 20, 2007 between a person in the business of selling vehicles to consumers and a final consumer, and for which possession is taken by the final consumer before July 2007.
Excise Tax on Diesel Fuel – End-User Refunds
4. (1) Section 68 of the Excise Tax Act is replaced by the following:
Payment where error
68. (1) If a person, otherwise than pursuant to an assessment, has paid any moneys in error in respect of any goods, whether by reason of mistake of fact or law or otherwise, and the moneys have been taken into account as taxes, penalties, interest or other sums under this Act, an amount equal to the amount of the moneys shall, subject to this Part, be paid to the person if the person applies for the payment of the amount within two years after the payment of the moneys.
Exception
(2) Subsection (1) does not apply if an application for a payment in respect of the goods can be made by any person under section 68.01.
Payment for end-users – diesel fuel
68.01 (1) If tax under this Act has been paid in respect of diesel fuel, the Minister may pay an amount equal to the amount of that tax
(a) in the case where a vendor delivers the diesel fuel to a purchaser
(i) to the vendor, if the vendor applies for the payment, the purchaser certifies that the diesel fuel is for use exclusively as heating oil and the vendor reasonably believes that the purchaser will use it exclusively as heating oil,
(ii) to the purchaser, if the purchaser applies for the payment, the purchaser uses the diesel fuel as heating oil and no application in respect of the diesel fuel can be made by the vendor under subparagraph (i); or
(b) to a purchaser who applies for the payment and who uses the diesel fuel to generate electricity, except if the electricity so generated is used primarily in the operation of a vehicle.
Payment for end-users—fuel used as ships’ stores
(2) If tax under this Act has been paid in respect of fuel and no application is made in respect of the fuel by any person under section 68.17 or section 70, the Minister may pay an amount equal to the amount of that tax to a purchaser who applies for the payment and who uses the fuel as ships’ stores.
Timing of application
(3) No payment shall be made under this section unless
(a) the vendor described in subparagraph (1)(a)(i) applies for it within two years after the vendor sells the diesel fuel to the purchaser described in paragraph (1)(a); or
(b) the purchaser described in subparagraph (1)(a)(ii), paragraph (1)(b) or subsection (2) applies for it within two years after the purchase.
Circumstances in which Minister is not required to pay
(4) The Minister is not required to make a payment under this section unless the Minister is satisfied that all the conditions for the payment have been met.
Deemed tax payable
(5) If, under this section, the Minister pays an amount to a person to which that person is not entitled, or pays an amount to a person in excess of the amount to which that person is entitled, the amount of the payment or the excess is deemed to be a tax payable by that person under this Act on the day on which the Minister made the payment.
(2) Subsection (1) is deemed to have come into force on September 3, 1985 except that, before March 20, 2007,
(a) subsection 68(2) of the Act, as enacted by subsection (1), shall be read as follows:
(2) Subsection (1) does not apply if an application for a payment in respect of the goods is made by any person under section 68.01.
(b) subparagraph 68.01(1)(a)(ii) of the Act, as enacted by subsection (1), shall be read as follows:
(ii) to the purchaser, if the purchaser applies for the payment, the purchaser uses the diesel fuel as heating oil and no application in respect of the diesel fuel is made by the vendor under subparagraph (i); or
(3) If, before the Act enacting this section is assented to, an application under section 68 of the Excise Tax Act has been made by a person who could have made an application under section 68.01 of the Excise Tax Act had that section been in force at that time, the application made under section 68 of the Act is deemed to have been made under subsection 68.01(1) or (2) of the Excise Tax Act, as the case may be.
Notice of Ways and Means Motion to amend the Federal-Provincial Fiscal Arrangements Act
That it is expedient to amend the Federal-Provincial Fiscal Arrangements Act as follows:
1. Section 34 of the Federal-Provincial Fiscal Arrangements Act is replaced by the following:
Payments in respect of provincial tax or fee imposed by participating province
34. Where, in respect of any transaction, matter or thing, a provincial tax or fee is imposed or levied under a law of a participating province and the provincial tax or fee would be payable by a corporation included in Schedule I if that law were applicable to the corporation, the corporation shall, in respect of any such transaction, matter or thing, pay the provincial tax or fee so imposed or levied as and when it would be required to do so if that law were applicable to it.
2. Schedule I to the Act is amended by adding the following at the end of that Schedule:
Any corporation that is a wholly-owned subsidiary, as defined in subsection 83(1) of the Financial Administration Act, of a corporation listed in this Schedule.
3. Sections 1 and 2 are deemed to have come into force on July 1, 2000.
