Federal-Provincial Fiscal Arrangements Regulations, 2007 (SOR/2007-303)

Payments

31 If the Minister determines that a territorial formula financing payment is to be made under the Act to a territory for a fiscal year, the Minister shall

• (a) on the first working day in each of the first two months of the fiscal year, pay the territory 16% of the payment; and

• (b) on the first working day of each following month, pay the territory 10% of the remaining amount of the payment.

PART 2Fiscal Stabilization Payments

32 An application referred to in subsection 6(7) of the Act shall be signed by the province’s Minister of Finance or Treasurer and contain the following information:

• (a) a statement that indicates the total amount of the provincial personal income taxes that are payable as the result of assessments or reassessments made in each of the calendar years that begin in the fiscal year and in the immediately preceding fiscal year, as determined in accordance with subsection 34(1), and the amount of each element referred to in that subsection that is used in determining that total amount;

• (b) a statement that indicates the total amount of the provincial corporation income taxes that are payable as the result of assessments or reassessments made in each of the calendar years that begin in the fiscal year and in the immediately preceding fiscal year, as determined in accordance with subsection 34(1.1), and the amount of each element referred to in that subsection that is used in determining that total amount;

• (c) a statement that indicates the total revenues of the province for the fiscal year and for the immediately preceding fiscal year from the revenue source described in subparagraph 7(1)(b)(ii);

• (d) [Repealed, SOR/2023-45, s. 1]

• (e) a statement of the total revenues of the province for the fiscal year and for the immediately preceding fiscal year from each of the revenue sources described in paragraphs 7(1)(c) to (y), (z.1) to (z.3) and (z.5);

• (f) a statement that provides a further breakdown of the revenues from any of the revenue sources referred to in paragraphs (a) to (e) into component taxes, fees, levies, premiums or royalties if there was a change in the rates or structures at which those component taxes, fees, levies, premiums or royalties were levied during the fiscal year or during that part of the immediately preceding fiscal year after its first day;

• (g) a statement that describes any change in the rates or structures at which a provincial tax, fee, levy, premium or royalty was levied during the fiscal year or during that part of the immediately preceding fiscal year after its first day and that indicates the effective date of the change;

• (h) a statement that estimates the change in revenues in the fiscal year from the immediately preceding fiscal year from each of the changes described in the statement referred to in paragraph (g); and

• (i) a statement that describes any change in the accounting practices in the public accounts of the province from those of the immediately preceding fiscal year.

• 33 (1) The Minister shall make the adjustment for a fiscal year referred to in subsection 6(2) of the Act by

  • (a) adding, to the amount that would otherwise be determined, the decrease in the province’s revenues in the fiscal year that results from changes in the rates, or structures, of provincial taxes or other modes of raising the revenue of the province, including

    • (i) the termination of an existing tax, fee, levy, premium or royalty during the fiscal year or during the immediately preceding fiscal year,

    • (ii) a decrease, averaged over a year, in the rate of a tax, fee, levy, premium or royalty,

    • (iii) a change in the base to which the rate of a tax, levy, premium or royalty is applied and that results in a decrease in revenues, averaged over a year, derived from that base,

    • (iv) a change in the classification of taxpayers that results in a decrease in revenues, if the rate of a tax, fee, levy, premium or royalty varies according to an attribute of taxpayers, including the nature of their activity, the form of their business organization, the kind of ownership interest in their business or their age,

    • (v) an increase in deductions, credits or allowances, averaged over a year, that a taxpayer may claim in determining the amount of the tax, or the base to which the taxpayer’s tax rate is to be applied,

    • (vi) the adding, broadening or enlarging of exemptions, averaged over a year, from a tax, fee, levy, premium or royalty,

    • (vii) an increase in rebates, averaged over a year, for a tax, fee, levy, premium or royalty,

    • (viii) a decrease, averaged over a year, in the mark-up on goods or services that are sold to the public by the province or its agencies,

    • (ix) a decrease in the proportion of the profits remitted to the provincial government by its own enterprises, or

    • (x) a decrease in the charges for the rental or use of government property, including water power rentals;

  • (b) subtracting, from the amount that would otherwise be determined, the increase in the province’s revenues in the fiscal year that results from changes in the rates, or structures, of provincial taxes or other modes of raising the revenue of the province, including

    • (i) the introduction of a new tax, fee, levy, premium or royalty during the fiscal year or during the immediately preceding fiscal year,

    • (ii) an increase, averaged over a year, in the rate of a tax, fee, levy, premium or royalty,

    • (iii) a change in the base to which the rate of a tax, levy, premium or royalty is applied and that results in a increase in revenues, averaged over a year, derived from that base,

    • (iv) a change in the classification of taxpayers that results in a increase in revenues, if the rate of a tax, fee, levy, premium or royalty varies according to an attribute of taxpayers, including the nature of their activity, the form of their business organization, the kind of ownership interest in their business or their age,

    • (v) a decrease in deductions, credits or allowances, averaged over a year, that a taxpayer may claim in determining the amount of the tax, or the base to which the taxpayer’s tax rate is to be applied,

    • (vi) the removal, narrowing or restricting, of exemptions, averaged over a year, from a tax, fee, levy, premium or royalty,

    • (vii) a decrease in rebates, averaged over a year, for a tax, fee, levy, premium or royalty,

    • (viii) an increase, averaged over a year, in the mark-up on goods or services that are sold to the public by the province or its agencies,

    • (ix) an increase in the proportion of the profits remitted to the provincial government by its own enterprises, or

    • (x) an increase in the charges for the rental or use of government property, including water power rentals; and

  • (c) if there is an absence of indexation in the province’s personal income tax system, subtracting, from the amount that would otherwise be determined, the amount, if any, by which the revenues of the province in the fiscal year exceed what they would have been had the province’s personal income tax thresholds, basic personal amount and spouse or common law-partner amount that were not subject to an indexation provision referred to in subsection (3) each been adjusted by the percentage change in the Consumer Price Index for the province for the 12-month period ending on September 30 of the previous fiscal year over the preceding 12-month period, rounded to one decimal place, the digit at that first decimal place being increased by one if the digit at the second decimal place is 5 or more.

• (2) A change that results from an indexation provision that has the effect of periodically changing the rate or structure of a tax, or other mode of raising the province’s revenue, as a consequence of a change in the level of prices in the economy as a whole or in the actual or deemed price of certain goods or services shall not be considered, for the purpose of paragraphs (1)(a) and (b), to be a change in the rate or in the structure of that tax or other mode.

• (3) For the purpose of paragraph (1)(c) and paragraph 6(2)(b) of the Act, there is an absence of indexation in a provincial personal income tax system if at least one of the province’s personal income tax thresholds, the province’s basic personal amount or the province’s spouse or common-law partner amount is not subject to an indexation provision that has the effect of periodically changing the rate or structure of personal income tax as a consequence of a change in the level of prices in the economy as a whole or in the actual or deemed price of certain goods or services.

• (4) For the purpose of paragraph (1)(c), the reference to the Consumer Price Index for a province for any 12-month period means the average of the Consumer Price Index (not seasonally adjusted) for that province, as published by Statistics Canada under the authority of the Statistics Act, for each month in that 12-month period.

• 33.1 (1) The Chief Statistician of Canada shall, on or before December 1 of each year, prepare and submit to the Minister a certificate that sets out

  • (a) the population of Canada as of July 1 of the year in which the certificate is submitted and of each previous year beginning with 2018;

  • (b) the population of each province as of July 1 of the year in which the certificate is submitted and of the two previous years;

  • (c) the nominal gross domestic product of Canada for the calendar year before the year in which the certificate is submitted and for each previous calendar year beginning with 2018; and

  • (d) for each province, information from the Government Finance Statistics regarding the revenues described in section 7, other than those described in paragraph 7(1)(a), subparagraph 7(1)(b)(i), paragraph 7(1)(z.4) and subparagraphs 7(1)(z.5)(i) and (ii), for the fiscal year that ends in the calendar year in which the certificate is submitted and for each of the two previous fiscal years.

• (2) The information set out in the certificate shall be based on the most recent publication of Statistics Canada — or the most recent information of Statistics Canada if the publication is not available, its contents have been superseded by more recent information or these Regulations require information that is not published — that is available on or before November 22 of the year in which the certificate is submitted.

• (3) The Chief Statistician of Canada shall indicate in the certificate, as the case may be,

  • (a) any amount that is set out in the certificate that represents the aggregate of two or more revenue sources; and

  • (b) any information that is required to be set out in the certificate that is not available.

• 33.2 (1) When determining, for the purpose of subsection 6(3) or subparagraph 6(4)(a)(i) or (ii) of the Act, the total revenue derived by a province for a fiscal year from a revenue source described in the definition revenue source in subsection 3.9(1) of the Act, the Minister shall use the following information that is available as of the second December 1 following the end of that fiscal year:

  • (a) in respect of revenues from personal income taxes, as described in paragraph 7(1)(a), and corporation income taxes, as described in subparagraph 7(1)(b)(i), for a province that has entered into a tax collection agreement respecting those taxes, the information that is available to the Minister for the administration of the tax collection agreement; and

  • (b) in respect of all other revenues described in subsection 7(1), the information contained in the province’s application and the information set out in the certificate referred to in section 33.1.

• (2) If any information referred to in subsection (1) is incorrect, missing or unavailable, the Minister may use in place of that information an estimate based on any information that is available to the Minister at the time of the determination.

• 34 (1) For the purpose of paragraph 6(5)(b) of the Act, the total amount of provincial personal income taxes that are payable as the result of assessments or reassessments made in a calendar year is equal to the sum of

  • (a) all provincial personal income taxes that are assessed or reassessed in that year, net of all corresponding provincial non-refundable tax credits, non-refundable tax rebates, income tax reductions and capital gains refunds,

  • (b) in respect of a province that has entered into a tax collection agreement respecting personal income tax, the province’s share of unapplied payments for the previous calendar year, as estimated in accordance with the tax collection agreement, and

  • (c) in respect of a province that has not entered into a tax collection agreement respecting personal income tax, the amounts — net of the value of any special abatement referred to in subsection 3.9(2) of the Act — that have not been assessed as of December 31 of the calendar year and that were, according to the information returns submitted by employers and other payers to the province during the one-year period beginning on March 1 of the previous calendar year, deducted at source as personal income tax for the province for any previous calendar year.

• (1.1) For the purpose of paragraph 6(5)(c) of the Act, the total amount of provincial corporation income taxes that are payable as the result of assessments or reassessments made in a calendar year is equal to the sum of all provincial corporation income taxes that are assessed or reassessed in that year, net of all corresponding provincial non-refundable tax credits, non-refundable tax rebates, capital gains refunds and tax remission orders and of the corresponding provincial small business deduction.

• (1.2) For greater certainty, for the purpose of paragraph (1)(a) and subsection (1.1), if a reassessment results in a greater amount of tax payable than the initial assessment or the most recent previous reassessment, as the case may be, the difference — not the full amount of the reassessment — is to be added to the sum referred to in those provisions. If it results in a lesser amount payable, the difference is to be subtracted from that sum.

• (2) In computing the revenue derived by a province from a revenue source for a fiscal year, other than from the revenue sources referred to in paragraphs 7(1)(a) and (b), the Minister may deduct from that revenue source the amounts referred to in paragraph 9(1)(b), without taking into account the reference to subsection 3.5(1) of the Act in subsection 9(1).

• (3) For the purpose of this Part, in computing the revenue derived by a province from a revenue source, the Minister may make any adjustment that is necessary to take into account

  • (a) any change between the accounting practices used in the public accounts of the province in a fiscal year for which an application for a fiscal stabilization payment has been received and those used in the province in the immediately preceding fiscal year; or

  • (b) any change between the methodology of Statistics Canada used for reporting revenue derived by a province from a revenue source in a fiscal year for which an application for a fiscal stabilization payment has been received and that used in the immediately preceding fiscal year.