Has parliament failed to charge the "tax on SIFT partnerships"?

Resource Information

The work Has parliament failed to charge the "tax on SIFT partnerships"? represents a distinct intellectual or artistic creation found in International Bureau of Fiscal Documentation. This resource is a combination of several types including: Work, Language Material, Continuing Resources.

Label

Has parliament failed to charge the "tax on SIFT partnerships"?

Creator

• Bloom, B. (Brian)
• Wiener, B

Subject

• case law
• partnership
• pass-through entity
• tax liability

Language

eng

Summary

Part IX.1 of the Income Tax Act attempts to impose a tax on a "specified investment flow-through" (SIFT) partnership, in order that such a partnership and its investors be taxed in a manner similar to a public corporation and its shareholders. The purported charge to tax in part IX.1 provides that a SIFT partnership "is liable to a tax". The authors argue that the term "liable to", from a textual and contextual perspective, connotes a possibility or probability of incurring some thing, rather than an obligation to do that thing. Acknowledging that it would be astonishing for Parliament to have failed to charge part IX.1 tax, the authors argue that, owing to the very nature of a charge, as well as from normative and constitutional perspectives, a charge to tax must be drafted unambiguously and must clearly impose an obligation to pay the tax, and that it would be inappropriate for a court employing the so-called modern rule of interpretation to rely on purpose to save a charge. The authors, referring to recent jurisprudence of the Federal Court of Appeal and the Supreme Court of Canada, further argue, focusing squarely on principles of interpretation, that the "modern" rule itself may not even justify having resort to purpose in this case to override conflicting text. They conclude by noting that there is Supreme Court precedent for denying a tax claim on the basis that the legislation in question failed to impose a tax even though the intention to tax was clear, and that Parliament should not adopt retroactive changes to the law as a fix for deficient drafting

Citation source

In: Canadian tax journal = Revue fiscale canadienne. - Toronto. - Vol. 59 (2011), no. 1 ; p. 1-23

Geographic coverage

North America

Language note

English