Canada To Implement Outstanding Tax Measures
Monday, October 29, 2012
Canadian Finance Minister Jim Flaherty has taken steps to implement a number
of outstanding technical tax amendments to the Income Tax Act, Excise Tax Act
and other related legislation.
Announcing his tabling of a detailed Notice of Ways and Means Motion in parliament,
Flaherty said that the last comprehensive package of technical income tax legislation
was passed in 2001. "This has led to a significant backlog of outstanding
measures", Flaherty added, explaining that the motion will "begin
the process of addressing the backlog”.
The majority of proposals to be implemented by the motion have been previously
released for public consultation. They include technical income tax amendments
relating to the taxation of Canadian multinational corporations with foreign
affiliates, and changes to the taxation of non-resident trusts and their beneficiaries
and of Canadian taxpayers who hold interests in offshore investment fund property.
Amendments will also be made relating to foreign tax credit generators, conversions
of specified investment flow-through trusts and partnerships into corporations,
and the creation of a regime of information reporting on tax avoidance transactions.
The Atlantic investment tax credit will be modified, as will the Apprenticeship
Completion Grant, Employment Insurance for the self-employed, and real estate
investment trusts. The motion also relates to the deductibility of contingent
amounts, withholding tax applicable to certain interest payments made to non-residents,
and certain life insurance corporation reserves.
The more minor technical income tax measures relate to labour-sponsored venture
capital corporations and to the allocation, among provinces and territories,
of the taxable income of airline corporations. Technical amendments to the Excise
Tax Act include relieving the Goods and Services Tax and the Harmonized Sales
Tax (GST/HST) on the administrative service of collecting and distributing the
levy on blank media imposed under the Copyright Act.