Select Luxury Items Tax Act (S.C. 2022, c. 10, s. 135)

Marginal note:Limitation on appeals to Tax Court of Canada

• 102 (1) Despite section 100, if a person has filed a notice of objection to an assessment, the person may appeal to the Tax Court of Canada to have the assessment vacated, or a reassessment made, only with respect to

  • (a) an issue in respect of which the person has complied with subsection 97(2) in the notice and the relief sought in respect of the issue as specified by the person in the notice; or

  • (b) an issue described in subsection 97(5) if the person was not required to file a notice of objection to the assessment that gave rise to the issue.

• Marginal note:No appeal if waiver

  (2) Despite section 100, a person may not appeal to the Tax Court of Canada to have an assessment vacated or varied in respect of an issue for which the right of objection or appeal has been waived in writing by the person.

Marginal note:Institution of appeals

103 An appeal to the Tax Court of Canada under this Act must be instituted in accordance with the Tax Court of Canada Act.

Marginal note:Disposition of appeal

104 The Tax Court of Canada may dispose of an appeal from an assessment by

• (a) dismissing it; or

• (b) allowing it and

  • (i) vacating the assessment, or

  • (ii) referring the assessment back to the Minister for reconsideration and reassessment.

Marginal note:References to Tax Court of Canada

• 105 (1) If the Minister and another person agree in writing that a question arising under this Act, in respect of any assessment or proposed assessment of the person, should be determined by the Tax Court of Canada, that question must be determined by that Court.

• Marginal note:Time during consideration not to count

  (2) For the purpose of making an assessment of a person that agreed in writing to the determination of a question, filing a notice of objection to an assessment or instituting an appeal from an assessment, the time between the day on which proceedings are instituted in the Tax Court of Canada to have a question determined and the day on which the question is finally determined must not be counted in the computation of

  • (a) the four-year period referred to in subsection 96(1);

  • (b) the period within which a notice of objection to an assessment may be filed under section 97; or

  • (c) the period within which an appeal may be instituted under section 100.

Marginal note:Reference of common questions to Tax Court of Canada

• 106 (1) If the Minister is of the opinion that a question arising out of one and the same transaction or occurrence or series of transactions or occurrences is common to assessments or proposed assessments in respect of two or more persons, the Minister may apply to the Tax Court of Canada for a determination of the question.

• Marginal note:Contents of application

  (2) An application must set out

  • (a) the question in respect of which the Minister requests a determination;

  • (b) the names of the persons that the Minister seeks to have bound by the determination; and

  • (c) the facts and reasons on which the Minister relies and on which the Minister based or intends to base assessments of each person named in the application.

• Marginal note:Service

  (3) A copy of the application must be served by the Minister on each of the persons named in it and on any other person that, in the opinion of the Tax Court of Canada, is likely to be affected by the determination of the question.

• Marginal note:Determination by Tax Court of Canada of question

  (4) If the Tax Court of Canada is satisfied that a determination of a question set out in an application will affect assessments or proposed assessments in respect of two or more persons that have been served with a copy of the application and that are named in an order of the Tax Court of Canada under this subsection, it may

  • (a) if none of the persons named in the order has appealed from such an assessment, proceed to determine the question in any manner that it considers appropriate; or

  • (b) if one or more of the persons named in the order has or have appealed, make any order that it considers appropriate joining a party or parties to that appeal or those appeals and proceed to determine the question.

• Marginal note:Determination final and conclusive

  (5) Subject to subsection (6), if a question set out in an application is determined by the Tax Court of Canada, the determination is final and conclusive for the purposes of any assessments of persons named by the Court under subsection (4).

• Marginal note:Appeal

  (6) If a question set out in an application is determined by the Tax Court of Canada, the Minister or any of the persons that have been served with a copy of the application and that are named in an order of the Court under subsection (4) may, in accordance with the provisions of this Act, the Tax Court of Canada Act or the Federal Courts Act, as they relate to appeals from or applications for judicial review of decisions of the Tax Court of Canada, appeal from the determination.

• Marginal note:Parties to appeal

  (7) The parties that are bound by a determination are parties to any appeal from the determination.

• Marginal note:Time during consideration not counted

  (8) For the purpose of making an assessment of a person, filing a notice of objection to an assessment or instituting an appeal from an assessment, the periods described in subsection (9) must not be counted in the computation of

  • (a) the four-year period referred to in subsection 96(1);

  • (b) the period within which a notice of objection to an assessment may be filed under section 97; or

  • (c) the period within which an appeal may be instituted under section 100.

• Marginal note:Excluded periods

  (9) The period that is not to be counted in the computation of the periods described in paragraphs (8)(a) to (c) is the time between the day on which an application that is made under this section is served on a person under subsection (3) and

  • (a) in the case of a person named in an order of the Tax Court of Canada under subsection (4), the day on which the determination becomes final and conclusive and not subject to any appeal; and

  • (b) in the case of any other person, the day on which the person is served with a notice that the person has not been named in an order of the Tax Court of Canada under subsection (4).

SUBDIVISION HPenalties

Marginal note:Failure to file return

107 Every person that fails to file a return (other than an information return) for a reporting period as and when required under this Act is liable to a penalty equal to the sum of

• (a) an amount equal to 1% of the total of all amounts each of which is an amount that is required to be paid for the reporting period and was not paid on the day on which the return was required to be filed; and

• (b) the amount obtained when one quarter of the amount determined under paragraph (a) is multiplied by the number of complete months, not exceeding 12, from the day on which the return was required to be filed to the day on which the return is filed.

Marginal note:Failure to file by electronic transmission

108 In addition to any other penalty under this Act, every person that fails to file a return under this Act for a reporting period as required by subsection 74(3) is liable to a penalty equal to an amount determined in prescribed manner.

Marginal note:Failure to register

109 Every person that is required to be registered under Division 5 of Part 1 but does not apply for registration under that Division as and when required is liable to a penalty of $2,000.

Marginal note:Penalty — false statement

110 Despite any other provision of this Act, if a vendor sells a subject item to a purchaser, if an exemption certificate applies in respect of the sale in accordance with section 36, if a declaration referred to in subparagraph 36(1)(b)(ii) is included in the exemption certificate and if that declaration is false, the following rules apply:

• (a) the purchaser is liable, in addition to any other penalty under this Act, to a penalty equal to the greater of $1,000 and 150% of the total of

  • (i) the amount of tax in respect of the subject item that would have been payable under section 18 if the exemption certificate had not applied to the sale, and

  • (ii) the amount of tax in respect of the subject item that would have been payable by the purchaser under section 29 if the exemption certificate had not applied to the sale; and

• (b) if the vendor knows, or ought to have known, that the declaration is false, the purchaser and the vendor are jointly and severally, or solidarily, liable for the payment of the penalty under paragraph (a) and any related interest.

Marginal note:Penalty for false declaration — special import certificate

111 Despite any other provision of this Act, if a person imports a subject item, if a special import certificate in respect of the importation is in effect in accordance with section 38, if the person, when applying under subsection 38(1) for the special import certificate in respect of the subject item, made a declaration required under paragraph 38(2)(a) to be included in the application and if that declaration is false at the time of importation, the person is liable to, in addition to any other penalty under this Act, a penalty equal to the greater of $1,000 and 150% of the total of

• (a) the amount of tax in respect of the subject item that would have been payable by the person under section 20 if the special import certificate in respect of the importation had not been issued by the Minister; and

• (b) the amount of tax in respect of the subject item that would have been payable by the person under section 30 if the special import certificate in respect of the importation had not been issued by the Minister.

Marginal note:Failure to apply — tax certificate

112 Every person that is required to apply for a tax certificate under section 37 and fails to do so as and when required is liable to a penalty of $1,000.

Marginal note:Failure to notify — tax certificate

113 Every person that is required to provide a notification to the Minister under subsection 37(9) and fails to do so as and when required is liable to a penalty of $1,000.

Marginal note:Penalty — unregistered importer

114 If tax is payable by a person under section 20 and, at the time the tax became payable, the person was required to be registered under Division 5 of Part 1 but has not applied for registration under that Division, the person is liable to, in addition to any other penalty under this Act, a penalty equal to the greater of $1,000 and 50% of the amount of tax payable under section 20 in respect of the subject item.

Marginal note:Failure to answer demand

115 Every person that fails to file a return as and when required under a demand issued under section 77 is liable to a penalty of $1,000.

Marginal note:Failure to provide information

116 Every person that fails to provide any information or record as and when required under this Act is liable to a penalty of $1,000 for every failure unless, in the case of information required in respect of another person, a reasonable effort was made by the person to obtain the information.

Marginal note:Failure to provide information

117 Every person that fails to report an amount prescribed by regulation, or to provide information prescribed by regulation, in a return prescribed by regulation as and when required, or that misstates such an amount or such information in such a return, is liable to a penalty, in addition to any other penalty under this Act, equal to an amount determined in prescribed manner for each such failure or misstatement by the person.

Marginal note:False statements or omissions

118 Every person that knowingly, or under circumstances amounting to gross negligence, makes or participates in, assents to or acquiesces in the making of a false statement or omission in a return, application, form, certificate, statement, invoice or answer (each of which is in this section referred to as a “return”) is liable to a penalty of the greater of $1,000 and 25% of the total of

• (a) if the false statement or omission is relevant to the determination of an amount payable under this Act by the person, the amount, if any, by which

  • (i) the amount payable

  exceeds

  • (ii) the amount that would be payable by the person if the amount payable were determined on the basis of the information provided in the return, and

• (b) if the false statement or omission is relevant to the determination of a rebate or any other payment that may be obtained under this Act, the amount, if any, by which

  • (i) the amount that would be the rebate or other payment payable to the person if the rebate or other payment were determined on the basis of the information provided in the return

  exceeds

  • (ii) the amount of the rebate or other payment payable to the person.

Marginal note:General penalty

119 Every person that fails to comply with any provision of this Act for which no other penalty is specified is liable to a penalty of

• (a) in the case of a prescribed provision, $100; and

• (b) in any other case, $1,000.

Marginal note:Waiving or cancelling penalties

• 120 (1) The Minister may, on or before the day that is 10 calendar years after the end of a reporting period of a person, or on application by the person on or before that day, waive or cancel all or any portion of any penalty under this Act payable by the person in respect of the reporting period.

• Marginal note:Interest if amount waived or cancelled

  (2) If a person has paid an amount of penalty and the Minister waives or cancels that amount under subsection (1), the Minister must pay interest on the amount paid by the person beginning on the day that is 30 days after the day on which the Minister received a request in a manner satisfactory to the Minister to apply that subsection and ending on the day on which the amount is rebated to the person.

SUBDIVISION IOffences and Punishment

Marginal note:Offence for failure to file return or to comply with demand or order

• 121 (1) Every person that fails to file or make a return as and when required under this Act or that fails to comply with an obligation under subsection 88(6) or (9) or section 90, or an order made under section 126, is guilty of an offence and, in addition to any penalty otherwise provided, is liable on summary conviction to a fine of not less than $2,000 and not more than $40,000 or to imprisonment for a term not exceeding 12 months, or to both.

• Marginal note:Saving

  (2) A person that is convicted of an offence under subsection (1) for a failure to comply with a provision of this Act is not liable to pay a penalty under this Act for the same failure, unless a notice of assessment for the penalty was issued before the information or complaint giving rise to the conviction was laid or made.

Marginal note:Offences for false or deceptive statement

• 122 (1) Every person commits an offence that

  • (a) makes, or participates in, assents to or acquiesces in the making of, a false or deceptive statement in a return, application, certificate, statement, document, record or answer filed or made as required under this Act;

  • (b) for the purposes of evading payment of any amount payable under this Act, or obtaining a rebate or other payment payable under this Act to which the person is not entitled,

    • (i) destroys, alters, mutilates, conceals or otherwise disposes of any records of a person, or

    • (ii) makes, or assents to or acquiesces in the making of, a false or deceptive entry, or omits, or assents to or acquiesces in the omission, to enter a material particular in the records of a person;

  • (c) intentionally, in any manner, evades or attempts to evade compliance with this Act or payment of an amount payable under this Act;

  • (d) intentionally, in any manner, obtains or attempts to obtain a rebate or other payment payable under this Act to which the person is not entitled; or

  • (e) conspires with any person to commit an offence described in any of paragraphs (a) to (d).

• Marginal note:Punishment

  (2) Every person that commits an offence under subsection (1) is guilty of an offence punishable on summary conviction and, in addition to any penalty otherwise provided, is liable to

  • (a) a fine of not less than 50%, and not more than 200%, of the amount payable that was sought to be evaded, or of the rebate or other payment sought, or, if the amount that was sought to be evaded cannot be ascertained, a fine of not less than $2,000 and not more than $40,000;

  • (b) imprisonment for a term not exceeding two years; or

  • (c) both a fine referred to in paragraph (a) and imprisonment for a term not exceeding two years.

• Marginal note:Prosecution on indictment

  (3) Every person that is charged with an offence described in subsection (1) may, at the election of the Attorney General of Canada, be prosecuted on indictment and, if convicted, is, in addition to any penalty otherwise provided, liable to

  • (a) a fine of not less than 100%, and not more than 200%, of the amount payable that was sought to be evaded, or of the rebate or other payment sought, or, if the amount that was sought to be evaded cannot be ascertained, a fine of not less than $5,000 and not more than $100,000;

  • (b) imprisonment for a term not exceeding five years; or

  • (c) both a fine referred to in paragraph (a) and imprisonment for a term not exceeding five years.

• Marginal note:Penalty on conviction

  (4) A person that is convicted of an offence under this section is not liable to pay a penalty imposed under this Act for the same evasion or attempt unless a notice of assessment for that penalty was issued before the information or complaint giving rise to the conviction was laid or made.

• Marginal note:Stay of appeal

  (5) If, in any appeal under this Act, substantially the same facts are at issue as those that are at issue in a prosecution under this section, the Minister may file a stay of proceedings with the Tax Court of Canada and, upon that filing, the proceedings before the Tax Court of Canada are stayed pending a final determination of the outcome of the prosecution.