Draft Legislation to Amend the Income Tax Act (Tobacco Manufacturers' Surtax)
Archived information is provided for reference, research or recordkeeping purposes. It is not subject to the Government of Canada Web Standards and has not been altered or updated since it was archived. Please contact us to request a format other than those available.
1. (1) The definition "tobacco manufacturing" in subsection 182(2) of the Income Tax Act is replaced by the following:
« fabrication du tabac »
"tobacco manufacturing" means any activity, other than an exempt activity, relating to the manufacture or processing in Canada of tobacco or tobacco products in or into any form that is, or would after any further activity become, suitable for smoking;
(2) Subsection 182(2) of the Act is amended by adding the following in alphabetical order:
« activité exclue »
"exempt activity", of a particular corporation, means
(a) farming; or
(b) processing leaf tobacco, if
(i) that processing is done by, and is the principal business of, the particular corporation,
(ii) the particular corporation does not manufacture any tobacco product, and
(iii) the particular corporation is not related to any other corporation that carries on tobacco manufacturing (determined, in respect of the other corporation, as if the particular corporation did not exist and the definition "tobacco manufacturing" were read without reference to the words "in Canada");
(3) Subsections (1) and (2) apply to taxation years that end after 2006.