No CrossRef data available.
We use cookies to distinguish you from other users and to provide you with a better experience on our websites. Close this message to accept cookies or find out how to manage your cookie settings.
We use cookies to distinguish you from other users and to provide you with a better experience on our websites. Close this message to accept cookies or find out how to manage your cookie settings.
Published online by Cambridge University Press: 02 September 2013
Canada has recently instituted a significant war-time fiscal plan. As a federal state, the Dominion has been plagued by the complicated problems of federal finance; and to meet the severe burdens of war finance, it has found it necessary to simplify the federal financial structure. This change has been accomplished by formal agreements between the Dominion and the provinces whereby the latter have agreed to retire from certain fields of taxation for the duration of the war.
The agreements do not require amendment of the British North America Act (1867), but they do necessitate abstinence of the provinces from exercising a portion of their authority under it. By the terms of that fundamental law, the provinces are authorized to levy “direct taxation within the province in order to the raising of a revenue for provincial purposes” and “shop, saloon, tavern, auctioneer, and other licenses in order to the raising of a revenue for provincial, local, or municipal purposes.” The Dominion, however, is granted the power to raise revenue by “any mode or system of taxation.” Under this distribution of tax authority, it was natural that various sources should eventually be taxed by both the Dominion and the provinces. By 1940, not only the provinces and the Dominion, but also in some instances municipalities, were levying income and corporate taxes. Inasmuch as the rates varied from province to province and from municipality to municipality, there was inequality of the tax burden throughout the Dominion. In order to secure a maximum of revenue for war purposes, the Dominion government deemed it necessary to tax corporations and incomes at the same rate throughout Canada; and for this reason, the government requested the provinces (and municipalities) to retire from these fields of taxation for the war period.
1 30 Victoria, Chap. 3, Sec. 92, Subsec. 2.
2 Ibid., Subsec. 9.
3 Ibid., Sec. 91, Subsec. 8.
4 Budget Speech, Apr. 29, 1941 (Ottawa, 1941), pp. 10–13Google Scholar.
5 Tax Agreements (hereafter this will refer to all the agreements taken col lectively; sections are similarly numbered in each one), Sec. 23, Subsec. 1.
6 Ibid., Subsec. 2.
7 Ibid., Subsec. 3.
8 Ibid., Sec. 21.
9 Ibid., Sec. 23, Subsec. 5.
10 Ibid., Sec. 2.
11 As an illustration, the Alberta agreement lists the following acts: the Corporations Taxation Act, the Income Tax Act, the Railway Taxation Act, the Pipe Line Taxation Act, the Electric Power Taxation Act, the Banking Corporations Temporary Additional Taxation Act, the Corporations Temporary Additional Taxation Act, the Fuel Oil Licensing Act, and the Licensing of Trade and Businesses Act.
12 Tax Agreements, Sec. 2.
13 Ibid., Sec. 6.
14 Ibid., Sec. 1, Subsec. a(i), a(ii), a(iii), a(iv), and a(v).
15 Ibid., Sec. 9, Subsec. 1 and 2.
16 Nova Scotia Agreement, Sec. 2B and 2C; New Brunswick Agreement, Sec. 2B; Alberta Agreement, Sec. 2A and 2B; Price Edward Island Agreement, Sec. 2B, Subsec. 1 and 2; and British Columbia Agreement, Sec. 2A.
17 Tax Agreements, Sec. 3.
18 Ibid., Sec. 4.
19 Ibid., Sec. 5.
20 Ibid., Sec. 11 and 14.
21 Ibid., Sec. 15.
22 The suspended subsidies include: Prince Edward Island, $275,000; Nova Scotia, $1,300,000; New Brunswick, $900,000; Manitoba, $750,000; Saskatchewan, $1,500,000; and British Columbia, $750,000.
23 Prince Edward Island Agreement, Sec. 10; Nova Scotia Agreement, Sec. 10; New Brunswick Agreement, Sec. 10; Manitoba Agreement, Sec. 10A; Saskatchewan Agreement, Sec. 10A; and British Columbia Agreement, Sec. 10A.
24 Compiled from Tax Agreements, Sec. 10 and Appendix D (all fractions of a dollar have been eliminated).
25 Tax Agreements, Sec. 16, Subsec. 2.
26 Ibid., Subsec. 3.
27 Ibid., Subsec. 4.
28 Ibid., The composition and function of the arbitral tribunals are explained in the second following paragraph.
29 The London Free Press (Ontario), May 26, 1942, p. 18.
30 Tax Agreements, Sec. 21, Subsec. 1.
31 Ibid., Subsec. 2 and 4.
32 Ibid., Sec. 22, Subsec. 1.
33 Ibid., Subsec. 3.
34 Ibid., Subsec. 4.
35 Ibid., Subsec. 5.
36 Ibid., Sec. 21, Subsec. 3 and 5.
37 See Gettys, Luella, “Canadian Federalism: Report of the Royal Commission on Dominion-Provincial Relations,” in this Review, Vol. 35 (Feb., 1941), pp. 100–107.Google Scholar
38 Budget Speech of Hon. Stuart G. Garson (Winnipeg, 1942), p. 20.
39 If the United States wishes to retain its federal system, it should avoid a plan recently instituted in Australia. A Commonwealth tax law practically forced the states from the income tax field by prescribing a uniform income tax, and by placing the state tax departments under Commonwealth supervision. This act was upheld by the Australian High Court on July 23, 1942.
Comments
No Comments have been published for this article.