Category Archives: Tax

A Questionable Equity: Rectification and Tax Avoidance

By: Drew Yewchuk

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Case Commented On: Harvest Operations Corp. v Attorney General of Canada, 2017 ABCA 393 (CanLII)

Harvest Operations Corp. v Attorney General of Canada (Harvest Operations Corp. CA) is a case about an elaborate but unsuccessful tax avoidance maneuver and an attempt to get contract rectification. The details of the attempted tax avoidance are unreasonably complicated, and so I will focus on the facts necessary for the rectification issue (if you want to learn how to correctly perform the “bump transaction” method of avoiding capital gains tax, this post will not help you). Continue reading →

How the Canada Child Benefit Affects Separated Parents: The Post-relationship Breakdown Family Unit of Taxation

By: Kyle Gardiner

PDF Version: How the Canada Child Benefit Affects Separated Parents: The Post-relationship Breakdown Family Unit of Taxation

Matter Commented On: The Liberal Government’s Fall Economic Update, Indexing Canada Child Benefit Payments to Inflation

In its fall economic update last Tuesday, the Liberals announced that beginning in July 2018, Canada Child Benefit (CCB) payments will be increased amidst a smaller-than-expected deficit (of $18.4 billion this year, down from the spring projection of $25.5 billion), and a generally favourable economic outlook. This increase of $5.6 billion over five years is significant because it addresses what was the primary criticism of the CCB when it first came into place – that the benefit amounts were not indexed to inflation. The Liberals previously committed to indexing the amount to inflation if they were re-elected in 2019, and this upward adjustment represents a realization of that promise.

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Charter Equality Challenges to the Income Tax Act: The Unsuccessful Streak is Strong, 30 Years On

By: Kyle Gardiner

PDF Version: Charter Equality Challenges to the Income Tax Act: The Unsuccessful Streak is Strong, 30 Years On

Research Commented On: Shea Nerland Law LLP Fellowship Project on Tax Law and Equality, Summer 2016

On 2 May, 2016, I began a research project with Jonnette Watson Hamilton, Jennifer Koshan and Saul Templeton examining the role section 15 of the Charter plays in tax law. Over 50 variables were recorded from each of the 134 equality challenges to tax law that we analyzed. To read my post on one of these cases, Grenon v. Canada, 2016 FCA 4 (CanLII), see here. The data promises to be a rich tool for examining equality in the realm of tax law.

When I was conducting a literature review for this project, I reviewed Kathleen Lahey’s “The Impact of the Canadian Charter of Rights and Freedoms on Income Tax Law and Policy” in David Schneiderman & Kate Sutherland, eds, Charting the Consequences: The Impact of Charter Rights on Canadian Law and Politics (Toronto: University of Toronto Press, 1997) 109. In that study, Lahey conducted a review of 300 cases in which Charter challenges were brought to various income tax provisions between 1985 and 1995. The current research extends Lahey’s study, systematically reviewing section 15(1) Charter challenges to tax law that have been brought since the conclusion of her study in October, 1995. While many taxation provisions outside of the Income Tax Act, RSC 1985, c 1 (5^th Supp) have seen their share of section 15(1) challenges, the cases examined in our study were specifically section 15(1) equality challenges to a section or sections of the Income Tax Act. Our data awaits further statistical analysis beyond what has been done preliminarily here. Continue reading →

The Deductibility of Legal Fees Incurred in Child Support Proceedings and Section 15 of the Charter

By: Kyle Gardiner

PDF Version:The Deductibility of Legal Fees Incurred in Child Support Proceedings and Section 15 of the Charter

Case commented on: Grenon v. Canada, 2016 FCA 4 (CanLII), leave to appeal dismissed, 2016 CanLII 41074 (SCC)

On June 30^th, 2016, the Supreme Court of Canada denied leave to appeal in the case of Grenon v. Canada, 2016 FCA 4 (CanLII), which was heard in Calgary at both trial and on appeal. The Appellant Grenon was seeking to challenge certain aspects of tax law and policy under section 15 of the Canadian Charter of Rights and Freedoms. The Supreme Court of Canada has only heard two previous challenges to tax law based on the equality rights guarantee in section 15 of the Charter. In Symes v. Canada, [1993] 4 SCR 695, 1993 CanLII 55, a challenge based on the inability to deduct childcare expenses as business expenses was unsuccessful. In Thibaudeau v. Canada, [1995] 2 SCR 627, 1995 CanLII 99, a provision requiring custodial parents to include child support payments in their income was also found not to violate section 15. It has been 21 years since the Supreme Court of Canada last heard an equality challenge to tax law. This post will focus on the missed opportunities resulting from the Supreme Court’s refusal to hear the Grenon appeal and some of the issues that have arisen in the past 20 years which it could have confronted. Continue reading →

Trinity Western University: Policing Gender and Requiring LGBTQI+ People to Pay for It

By: Saul Templeton

PDF Version: Trinity Western University: Policing Gender and Requiring LGBTQI+ People to Pay for It

This post is a follow-up to my previous post, Trinity Western University: Your Tax Dollars at Work. The first two parts respond to issues raised in the comments to that post. The first part explains my position on the “irreducible conflict” between freedom of religion and freedom from discrimination on the basis of sexual orientation. The second part deals with whether a line can, or should, be drawn between TWU and other religious institutions and charities that discriminate. (Answer: all charities that discriminate on a Charter protected ground should have their charitable status revoked where the discrimination meets the charity law test of actions contrary to public policy). The third and last part explores TWU’s history of exploiting Canada’s charitable tax credit regime.