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Highlights
2006 BUDGET
2006 Budget Highlights: Key Aspects of Recent Sales Tax
Budget Proposals
Jim Vincze, Maria Scullion
Jim Vincze and Maria Scullion
summarize key aspects of certain recent
sales tax budget proposals of interest. On
May 2, 2006, the minority Conservative government announced its first Budget. On
May 11, 2006, Minister of Finance, Jim Flaherty, introduced a Bill in the House
of Commons to implement tax measures proposed in the Budget. At the time of
writing, Bill C-13, Budget
Implementation Act, 2006 had received second reading. As was widely anticipated, the government
announced a reduction in the GST/HST rate. Certain general and specific
transitional rules were announced. To protect the integrity of the tax system
and to prevent abusive dealings between non-arms-length parties in connection
with the rate reduction, two new provisions were announced.
LEGISLATIVE AMENDMENTS
Closely Related Group Election Amendments – Helpful
and Hurtful
Craig M. McDougall
Craig McDougall reviews the draft
amendments to section 156 of the Excise Tax Act released by the
Department of Finance on November 17, 2005. The rules have been relaxed to
permit two entities to be treated as closely related where they are owned
through a chain of non-resident or non-registered entities. In addition, certain
other amendments are proposed that, according
to the technical notes accompanying the
draft legislation, are intended to
facilitate income tax-deferred corporate reorganizations. However, those
proposed amendments are very narrow and are expected to have limited
application. Further, the proposed amendments regrettably reinforce a
long-disputed administrative position of the Canada Revenue Agency concerning the application of section 156 to newly
formed corporations or Canadian partnerships that have not yet acquired property
or made taxable supplies.
GST WEB REGISTRY
Canada Revenue Agency Establishes an Online Registry for
Checking GST Numbers
Dalton J. Albrecht
An important administrative change
has been made to the Canada Revenue Agency ("CRA") website following up on the
2005 federal budget commitment to provide an online registry for checking GST
numbers. Dalton Albrecht looks at this change, which was implemented in April of
this year. Purchasers who want to confirm that the suppliers are GST-registered,
and remain so on the date of the supply, can do so by going to the web registry
on the CRA website and fill in the supplier's name in the first box and the
nine-digit GST number in the second box. The web registry will confirm
registration on the effective date of choice if both pieces of
information are correct.
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Board
Dalton J. Albrecht
Editor-in-Chief
Fraser Milner Casgrain LLP
Dwaine G. Arnason
PricewaterhouseCoopers LLP
Terry G. Barnett
Thorsteinssons
Glenn A. Cranker
Stikeman Elliott LLP
Craig M. McDougall
Felesky Flynn LLP
W. Jack Millar
Millar Kreklewetz LLP
Jim Vincze
Deloitte & Touche LLP |