Federal-Provincial Fiscal Arrangements Regulations, 2007

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.