Ottawa, July 16, 2010

Archived - Government of Canada Releases Revised Income Tax Technical Proposals

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The Department of Finance today released draft legislative proposals to implement outstanding income tax technical measures.

The proposals released today include measures previously included in technical tax legislation introduced in the 39th Parliament that will implement:

  • a large number of technical amendments that provide tax relief;
  • other technical amendments that are important to the integrity of the tax system; and
  • amendments to ensure that both the common law and civil law are properly referred to and reflected in the Income Tax Act.

Draft legislative proposals released today include:

  • modifications to the provisions relating to restrictive covenants;
  • modifications to the provisions in section 143.3 of the Income Tax Act relating to non-monetary consideration;
  • updated amendments to reflect previously announced reductions in the general corporate income tax rate;
  • modifications to the provisions concerning the rate to be applied to investment income earned by cooperatives and credit unions; and
  • draft amendments to the Income Tax Regulations.

The draft legislative proposals do not include two aspects that had been part of technical tax legislation in the 39th Parliament:

  • the provisions relating to foreign investment entities and non-resident trusts, in respect of which Budget 2010 proposed to consult on modified proposals; and
  • the amendments related to the Canadian Film or Video Production Tax Credit.

The amendments to the Canadian Film or Video Production Tax Credit, as announced on
November 14, 2003, will be reintroduced at a later date. However, the Government will not proceed with the proposed public policy test included in the aforementioned November 14, 2003 announcement.

Full explanatory notes are included with the legislative proposals. Interested parties are invited to provide comments on the draft legislative proposals by September 17, 2010. Comments may be sent to:

Tax Policy Branch
Department of Finance
140 O’Connor Street
Ottawa, Ontario
K1A 0G5

For further information, media may contact:

Jack Aubry
Media Relations
Department of Finance

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