Federal-Provincial Fiscal Arrangements Regulations, 2007

8 (1) For the purpose of sections 3.6 to 3.9 of the Act, the expression revenue base means, in respect of a revenue source for a fiscal year,

• (a) in the case of personal income taxes described in paragraph 7(1)(a), the aggregate of

  • (i) a fraction, expressed as a percentage for the province,

    • (A) whose numerator is the simulated yield of the average provincial personal income tax in the province in the taxation year that ends in the fiscal year determined in accordance with subsection 10(1), and

    • (B) whose denominator is the aggregate, over the 10 provinces, of the amount referred to in clause (A), and

  • (ii) the difference obtained by subtracting

    • (A) a fraction, expressed as a percentage for the province,

      • (I) whose numerator is the aggregate, over all individuals in the province – other than trusts – of the simulated federal income tax for the taxation year that ends in the fiscal year as determined by the micro-simulation model, and

      • (II) whose denominator is the aggregate, over the 10 provinces, of the amount referred to in subclause (I),

    from

    • (B) a fraction, expressed as a percentage for the province,

      • (I) whose numerator is the aggregate, over all individuals in the province – including trusts – of the federal income tax payable for the taxation year that ends in the fiscal year as determined for each individual, and

      • (II) whose denominator is the aggregate, over the 10 provinces, of the amount referred to in subclause (I);

• (b) in the case of the taxes and revenues described in paragraph 7(1)(b), the aggregate of

  • (i) the product of the portion of the aggregate of corporate profits in Canada, before the payment of income taxes and without any deduction of the aggregate of corporate losses in Canada, that is attributable to any of the 10 provinces for the calendar year that ends in the fiscal year, as determined by Statistics Canada for the purpose of its System of National Accounts, and a fraction

    • (A) whose numerator is the allocated corporation taxable income attributable to the province for the fiscal year, and

    • (B) whose denominator is the aggregate, over the 10 provinces, of the amount referred to in clause (A), and

  • (ii) the product, as determined on the basis of data prepared by Statistics Canada for the purpose of the Financial Management System, of

    • (A) the aggregate, over the 10 provinces, of the total profits that are attributable to the province for the calendar year that ends in the fiscal year from business enterprises that have a profit in that calendar year and are owned 90% or more by that province, or by that province and one or more other provinces, excluding the profits for that calendar year

      • (I) of a liquor board, commission or authority,

      • (II) of an enterprise engaged entirely or primarily in the marketing of oil or natural gas, and

      • (III) of an enterprise carrying on a provincial lottery, and

    • (B) a fraction whose numerator is the amount of the total profits referred to in clause (A) for the province less the amount by which any losses that were accumulated in the seven calendar years before that calendar year by a business enterprise referred to in that clause exceed the portion of those losses excluded under this clause for that business enterprise in relation to a previous calendar year, but only to the extent that the amount is not more than the total profits for that calendar year of that business enterprise, and whose denominator is the aggregate of the numerators for each of the 10 provinces;

• (c) in the case of taxes on the capital of corporations, described in paragraph 7(1)(c), the aggregate of

  • (i) the total of the taxable paid-up capital employed in the province in a period – referred to in this paragraph as “the corporate fiscal year” – of 12 consecutive months as determined by Statistics Canada and that ends in the fiscal year, of all corporations classified by Statistics Canada as included in the following industries:

    • (A) agriculture, forestry, fishing and hunting,

    • (B) oil and gas extraction and coal mining,

    • (C) mining and quarrying, other than oil and gas extraction and coal mining,

    • (D) utilities,

    • (E) construction,

    • (F) manufacturing,

    • (G) wholesale trade,

    • (H) retail trade,

    • (I) transportation and warehousing,

    • (J) information and cultural,

    • (K) real estate and rental and leasing companies,

    • (L) professional, scientific and technical services,

    • (M) administration and support, waste management and remediation services,

    • (N) education services,

    • (O) health care and social assistance,

    • (P) arts, entertainment and recreation,

    • (Q) accommodation and food services,

    • (R) other services, except public administration,

    • (S) non-depository credit intermediation,

    • (T) other financial intermediation, and

    • (U) deposit credit intermediation,

    as determined for each industry by the formula

    [(A × C) /At] + [(AA × CC) /AAt]

    where

    A

    is the total assets of firms with more than $1,000,000 of total assets, excluding that portion of the agriculture, forestry, fishing and hunting industries that pertains to the agriculture industry, for all firms that are owned less than 90% by Her Majesty allocated to the province for that industry for the corporate fiscal year, as determined by the Industrial Organization and Finance Division of Statistics Canada,

    AA

    is the total assets of firms with more than $1,000,000 of total assets, for all firms that are owned 90% or more by Her Majesty in right of the province for each province for the corporate fiscal year, as determined by the Industrial Organization and Finance Division of Statistics Canada,

    At

    is the total assets for Canada of that industry for the corporate fiscal year, as determined by the Industrial Organization and Finance Division of Statistics Canada,

    AAt

    is the total assets for Canada of all industries other than credit unions, caisses populaires or other cooperative credit societies, and the insurance industry for the corporate fiscal year, as determined by the Industrial Organization and Finance Division of Statistics Canada,

    C

    is

    • (I) for each industry, excluding the deposit credit intermediation industry and the insurance industry, the amount determined by the formula

      {1 - [(D + E + F + G + H) / (R + (I × (K - J)) / K)]} × {(L + M + N + P + Q) + [I × (K - J) / K]}

      where

      D

      is cash and deposits,

      E

      is investments and accounts with affiliates,

      F

      is portfolio investments, excluding Government of Canada treasury bills,

      G

      is mortgage or hypothecary loans to non-affiliates,

      H

      is non-mortgage or non-hypothecary loans to non-affiliates, excluding loans to individuals, farms, unincorporated businesses, non-profit institutions and local or central credit unions, caisses populaires or other cooperative credit societies,

      I

      is accumulated depreciation,

      J

      is capital cost allowance,

      K

      is book depreciation of the industry for the corporate fiscal year for Canada, as determined by the Industrial Organization and Finance Division of Statistics Canada,

      L

      is the amount owing to parents, subsidiaries and affiliates,

      M

      is borrowing by non-affiliates,

      N

      is deferred income tax,

      P

      is other liabilities, including minority interests in consolidated subsidiaries,

      Q

      is total equity, and

      R

      is total assets of the industry for the corporate fiscal year for Canada, as determined by the Industrial Organization and Finance Division of Statistics Canada, and

    • (II) for the deposit credit intermediation industry, excluding credit unions, caisses populaires and other cooperative credit societies, the product of the total equity employed in the province in that fiscal year by all corporations classified by Statistics Canada as being included in that industry and a fraction

      • 1. whose numerator is the aggregate, over the 10 provinces, of the product of the rate of capital tax that applies in the province to financial institutions and a fraction whose numerator is the total equity employed in the province by all corporations classified by Statistics Canada as being included in the deposit credit intermediation industry, excluding credit unions, caisses populaires and other cooperative credit societies, and whose denominator is the sum of those numerators for each of the 10 provinces, and

      • 2. whose denominator is the aggregate, over the 10 provinces, of the product of the rate of capital tax that applies in the province to non-financial institutions and a fraction whose numerator is the total paid-up capital employed in the province by all corporations classified by Statistics Canada, other than corporations classified in the deposit credit intermediation industry, and whose denominator is the sum of those numerators for each of the 10 provinces, and

    CC

    is 32% of the aggregate for all industries of the amount determined for C,

  • (ii) the product of

    • (A) the aggregate of the amount of the outstanding provincially guaranteed debt of electric utilities owned by the province and all outstanding amounts advanced by the province to those electric utilities, as of the end of the taxation year of each electric utility ending in the previous fiscal year, as determined by the Minister based on the public accounts of the province and other relevant information, and

    • (B) a fraction

      • (I) whose numerator is the quotient that results from dividing the aggregate, over the 10 provinces, of the revenues derived for the fiscal year from the taxes, levies and fees described in subparagraph 7(1)(c)(ii), as determined by the Minister, by the aggregate, over the 10 provinces, of the aggregate amount referred to in clause (A) for that fiscal year, and

      • (II) whose denominator is the quotient that results from dividing the aggregate, over the 10 provinces, of the revenues derived for the fiscal year from the taxes described in subparagraph 7(1)(c)(i), as determined by the Minister, by the aggregate, over the 10 provinces, of the aggregate amount referred to in subparagraph (i) for the fiscal year;

• (d) in the case of general and miscellaneous sales taxes, harmonized sales taxes and amusement taxes, described in paragraph 7(1)(d), the amount determined, based on data provided by Statistics Canada, for the calendar year that ends in the fiscal year by the formula

  A + B + C + D + E + F + G + H

  where

  A

  is the aggregate, over each personal expenditure category, of the product of total personal expenditures for that category in the province and the ratio of total personal expenditures for that category in Canada from which provinces derive net provincial sales tax revenues to total personal expenditures for that category in Canada,

  B

  is the aggregate, over each housing expenditure category, of the product of total housing expenditures for that category in the province and the ratio of total housing expenditures for that category in Canada from which provinces derive net provincial sales tax revenues to total housing expenditures for that category in Canada,

  C

  is the aggregate, over each business sector industry, of the product of total capital expenditures for machinery and equipment by that business sector industry in the province and the ratio of the total of those capital expenditures by that business sector industry in Canada from which provinces derive net provincial sales tax revenues to the total of those capital expenditures by that business sector industry in Canada,

  D

  is the aggregate, over each business sector industry, of the product of total capital expenditures for non-residential construction by that business sector industry in the province and the ratio of the total of those capital expenditures by that business sector industry in Canada from which provinces derive net provincial sales tax revenues to the total of those capital expenditures by that business sector industry in Canada,

  E

  is the aggregate, over each non-business sector industry, of the product of total capital expenditures for machinery and equipment by that non-business sector industry in the province and the ratio of the total of those capital expenditures by that non-business sector industry in Canada from which provinces derive net provincial sales tax revenues to the total of those capital expenditures by that non-business sector industry in Canada,

  F

  is the aggregate, over each non-business sector industry, of the product of total capital expenditures for non-residential construction by that non-business sector industry in the province and the ratio of the total of those capital expenditures by that non-business sector industry in Canada from which provinces derive net provincial sales tax revenues to the total of those capital expenditures by that non-business sector industry in Canada,

  G

  is the aggregate, over each non-business sector industry, of the aggregate, over each intermediate input commodity, of the product of total intermediate input expenditures for that intermediate input commodity by that non-business sector industry in the province and the ratio of the total of those intermediate input expenditures for that intermediate input commodity by that non-business sector industry in Canada from which provinces derive net provincial sales tax revenues to the total of those intermediate input expenditures for that intermediate input commodity by that non-business sector industry in Canada, and

  H

  is the aggregate, over each business sector industry, of the aggregate, over each intermediate input commodity, of the product of total intermediate input expenditures for that intermediate input commodity by that business sector industry in the province and the ratio of the total of those intermediate input expenditures by that business sector industry in Canada from which provinces derive net provincial sales tax revenues to the total of those intermediate input expenditures for that intermediate input commodity by that business sector industry in Canada;

• (e) in the case of tobacco taxes described in paragraph 7(1)(e), the number of cigarettes sold to final purchasers in the province in the fiscal year as determined by dividing the revenue derived from tobacco taxes by the province in the fiscal year, as set out in the certificate, by the average annual tax levy per cigarette that applies in that province for that fiscal year;

• (f) in the case of motive fuel taxes derived from the sale of gasoline, described in paragraph 7(1)(f), the sum of

  • (i) the product of the average tax rate in the calendar year that ends in the fiscal year and the adjusted number of litres of gasoline taxed at road-use rate in the province in that year,

  • (ii) the product of the average tax rate in the calendar year that ends in the fiscal year and the number of litres of aviation fuel sold in the province in that year, as determined by Statistics Canada on the basis of data from its survey Gasoline and Other Petroleum Fuels Sold, and

  • (iii) the product of the average tax rate in the calendar year that ends in the fiscal year and the number of litres of gasoline sold for use by farm trucks in the province in that year;

• (g) in the case of motive fuel taxes derived from the sale of diesel fuel, described in paragraph 7(1)(g), the sum of

  • (i) the product of the average tax rate in the calendar year that ends in the fiscal year and the adjusted number of litres of diesel fuel taxed at road-use rate in the province in that year,

  • (ii) the product of the average tax rate in the calendar year that ends in the fiscal year and the number of litres of railway fuel sold in the province in that year as determined

    • (A) in the case where railway fuel is taxed in the province throughout that year and data on the tax is complete and available, by Statistics Canada on the basis of data from its survey Road Motor Vehicle Survey – Fuel, and

    • (B) in any other case, by the Minister based on data prepared by Statistics Canada for the purpose of its publication entitled Report on Energy Supply-Demand in Canada, and

  • (iii) the product of the average tax rate in the calendar year that ends in the fiscal year and the number of litres of diesel fuel sold for use by farm trucks in the province in that year;

• (h) in the case of non-commercial motor vehicle licensing revenues described in paragraph 7(1)(h), the sum of the following numbers in the province in the calendar year that ends in the fiscal year, each as determined by Statistics Canada for the purpose of CANSIM table 405-0004, or by the Minister if Statistics Canada does not make the determination:

  • (i) the number of passenger automobile registrations,

  • (ii) four tenths of the number of motorcycle registrations, and

  • (iii) four tenths of the number of moped registrations, or of mopeds in use if the province does not register mopeds;

• (i) in the case of commercial motor vehicle licensing revenues described in paragraph 7(1)(i), the aggregate of the amounts for each of the following categories of vehicles, calculated as the product of the number of registered vehicles in each category – as determined by Statistics Canada for the purpose of its publication entitled Canadian Vehicle Survey – and the weighted average licence fee, over the 10 provinces – calculated on the basis of data respecting licence fees charged by each province for each vehicle category – as contained in the R.L. Polk & Co. publication entitled Canadian and International Registration Manual:

  • (i) farm vehicles that are 4,500 kg to 15,000 kg;

  • (ii) farm vehicles that are more than 15,000 kg,

  • (iii) non-farm vehicles that are 4,500 kg to 15,000 kg, and

  • (iv) non-farm vehicles that are more than 15,000 kg;

• (j) in the case of alcoholic beverage revenues described in paragraph 7(1)(j), the aggregate of

  • (i) the product of the revenue derived by all provinces from the sale of spirits in the fiscal year, as determined by the Minister based on information provided by the provinces and Statistics Canada, and a fraction whose numerator is the volume of spirits sold in the province in the fiscal year, as determined by Statistics Canada for the purpose of its publication entitled The Control and Sale of Alcoholic Beverages in Canada, and whose denominator is the sum of those numerators for each of the 10 provinces,

  • (ii) the product of the revenue derived by all provinces from the sale of wine in the fiscal year, as determined by the Minister based on information provided by the provinces and Statistics Canada, and a fraction whose numerator is the volume of wine sold in the province in the fiscal year, as determined by Statistics Canada for the purpose of its publication entitled The Control and Sale of Alcoholic Beverages in Canada, and whose denominator is the sum of those numerators for each of the 10 provinces, and

  • (iii) the product of the revenue derived by all provinces from the sale of beer in the fiscal year, as determined by the Minister based on information provided by the provinces and Statistics Canada, and a fraction whose numerator is the volume of beer sold in the province in the fiscal year, as determined by Statistics Canada for the purpose of its publication entitled The Control and Sale of Alcoholic Beverages in Canada, and whose denominator is the sum of those numerators for each of the 10 provinces;

• (k) in the case of hospital and medical care insurance premiums described in paragraph 7(1)(k), the amount determined by the formula

  (A × B/C) + (D × E/F) + (G × H/I)

  where

  A

  is the value of hospital and medical care insurance premiums, as determined by the micro-simulation model, for the taxation year that ends in the previous fiscal year, that

  • (i) in the case of Alberta, the province derived from its hospital and medical care insurance premium system, and

  • (ii) in the case of any other province, that would have been derived by the province if Alberta’s hospital and medical care insurance premium system applied in the province,

  B

  is the revenue derived by Alberta in the fiscal year from hospital and medical care insurance premiums, as set out in the certificate,

  C

  is the aggregate, over the 10 provinces, of the amount determined for A for each province,

  D

  is the value of hospital and medical care insurance premiums, as determined by the micro-simulation model, for the taxation year that ended in the previous fiscal year, that

  • (i) in the case of British Columbia, the province derived from its hospital and medical care insurance premium system, and

  • (ii) in the case of any other province, that would have been derived by the province if British Columbia’s hospital and medical care insurance premium system applied in the province,

  E

  is the revenue derived by British Columbia in the fiscal year from hospital and medical care insurance premiums, as set out in the certificate,

  F

  is the aggregate, over the 10 provinces, of the amount determined for D for each province,

  G

  is the value of hospital and medical care insurance premiums, as determined by the micro-simulation model, for the taxation year that ended in the previous fiscal year, that

  • (i) in the case of Quebec, the province derived from its hospital and medical care insurance premium system, and

  • (ii) in the case of any other province, that would have been derived by the province if Quebec’s hospital and medical care insurance premium system applied in the province,

  H

  is the revenue derived by Quebec in the fiscal year from hospital and medical care insurance premiums, as set out in the certificate, and

  I

  is the aggregate, over the 10 provinces, of the amount determined for G for each province;

• (l) in the case of forestry revenues described in paragraph 7(1)(l),

  • (i) from Crown land in the province, the value of production from logging on that land in the calendar year that ends in the fiscal year, which is the aggregate of the following products, for each of which the net marketable volume is determined by the Canadian Forest Service for the purpose of its publication entitled the Compendium of Canadian Forestry Statistics:

    • (A) the net marketable volume of hardwood logs and bolts harvested from that land multiplied by the regional price of hardwood logs and bolts,

    • (B) the net marketable volume of softwood logs and bolts harvested from that land multiplied by the regional price of softwood logs and bolts,

    • (C) the net marketable volume of softwood pulpwood harvested from that land multiplied by the regional price of softwood pulpwood,

    • (D) the net marketable volume of hardwood pulpwood harvested from that land multiplied by the regional price of hardwood pulpwood,

    • (E) the net marketable volume of industrial roundwood, other than industrial roundwood referred to in clauses (A) to (D), harvested from that land multiplied by the regional price of industrial roundwood, other than industrial roundwood referred to in clauses (A) to (D), and

    • (F) the net marketable volume of fuelwood and firewood harvested from that land multiplied by the regional price of fuelwood and firewood, and

  • (ii) from private land in the province, the value of production from logging on that land in the calendar year that ends in the fiscal year, which is the aggregate of the products referred to in clauses (i)(A) to (F), for each of which the net marketable volume is determined by the Canadian Forest Service for the purpose of its publication entitled the Compendium of Canadian Forestry Statistics;

• (m) in the case of oil revenues described in paragraph 7(1)(m), the product of

  • (i) the total value of the marketable production of new oil from hydrocarbon deposits in the province in the calendar year that ends in the fiscal year, as determined by the Minister based on relevant data, less the value of the sum of the parts of that marketable production whose value is described in subparagraph (o)(i) and paragraph (p), and

  • (ii) the adjustment factor for oil referred to in subsection (3);

• (n) in the case of oil revenues described in paragraph 7(1)(n), the product of

  • (i) the total value of the marketable production of crude oil from hydrocarbon deposits in the province in a calendar year that ends in the fiscal year, as determined by Statistics Canada for the purpose of its publication entitled Oil and Gas Extraction, less the value of the parts of that marketable production described in subparagraphs (m)(i) and (o)(i), paragraph (p) and subparagraphs (q)(i) and (r)(i), and

  • (ii) the adjustment factor for oil referred to in subsection (3);

• (o) in the case of heavy oil revenues described in paragraph 7(1)(o), the product of

  • (i) the total value of the marketable production of crude oil, having a density of 935 kg/m³ or greater, from hydrocarbon deposits in the province in the calendar year that ends in the fiscal year, as determined by the Minister based on relevant data, less the value of the sum of the parts of that marketable production described in paragraph (p) and subparagraph (r)(i), and

  • (ii) the adjustment factor for oil referred to in subsection (3);

• (p) in the case of mined oil revenues described in paragraph 7(1)(p), the total value of the marketable production of synthetic petroleum from hydrocarbon deposits in the province in the calendar year that ends in the fiscal year, as determined by Statistics Canada for the purpose of its publication entitled Oil and Gas Extraction;

• (q) in the case oil revenues referred to in paragraph 7(1)(q), the product of

  • (i) the total value of the marketable production of third tier oil from hydrocarbon deposits in the province in the calendar year that ends in the fiscal year, as determined by the Minister based on relevant data, less the value of the sum of the parts of that marketable production described in paragraph (p) and subparagraph (r)(i), and

  • (ii) the adjustment factor for oil referred to in subsection (3);

• (r) in the case of oil revenues described to in paragraph 7(1)(r), the product of

  • (i) the total value of the marketable production of third tier oil, having a density of 935 kg/m³ or greater, from hydrocarbon deposits in the province in the calendar year that ends in the fiscal year, as determined by the Minister based on relevant data, less the value of the part of that marketable production described in paragraph (p), and

  • (ii) the adjustment factor for oil referred to in subsection (3);

• (s) in the case of revenues from domestically sold natural gas and exported natural gas, described in paragraph 7(1)(s), the product of

  • (i) the total value of the marketable production of gas and gas by-products from hydrocarbon deposits in the province in the calendar year that ends in the fiscal year, as determined by Statistics Canada for the purpose of its publication entitled Oil and Gas Extraction, and

  • (ii) the adjustment factor for natural gas referred to in subsection (5);

• (t) in the case of sales of Crown leases and reservations on oil and natural gas lands, described in paragraph 7(1)(t),

  • (i) if the revenue to be equalized from those sales in the province for the fiscal year is greater than or equal to the aggregate, over the revenue sources set out in paragraphs (m), (o), (q), (r) and (s) of the definition revenue source in subsection 4(2) of the Act as it read on March 13, 2004, of the product of the revenue base for that revenue source in the province for the fiscal year and the national average rate of tax for that revenue source for the fiscal year, the revenue to be equalized from those sales in the province for the fiscal year, or

  • (ii) if the revenue to be equalized from those sales in the province for the fiscal year is less than that aggregate, that aggregate minus the lesser of

    • (A) the positive difference of that aggregate less that revenue, and

    • (B) any positive difference of

      • (I) the aggregate, over the preceding fiscal years beginning on or after April 1, 1987, of the amount by which the revenue to be equalized from those sales in the province for that fiscal year is greater than what the aggregate referred to in subparagraph (i) would be if it were, for each of those fiscal years, determined as if that subparagraph applied,

      less

      • (II) the aggregate, over all those preceding fiscal years, of the amount described in clause (A) or this clause, as the case may be, that is deducted under this subparagraph from the aggregate referred to in subparagraph (i);

• (u) in the case of oil and gas revenues described in paragraph 7(1)(u), the sum of

  • (i) the total volume of the marketable production of oil, synthetic petroleum and condensate from hydrocarbon deposits in the province in the calendar year that ends in the fiscal year, as classified and determined by Statistics Canada for the purpose of its publication entitled Oil and Gas Extraction, and

  • (ii) the product of 0.968 and the total volume of the net production of gas from hydrocarbon deposits in the province in the calendar year that ends in the fiscal year, as classified and determined by Statistics Canada for the purpose of its publication entitled Oil and Gas Extraction;

• (v) in the case of mining revenues described in paragraph 7(1)(v),

  • (i) in the case where the revenue to be equalized from mining revenues in the province for the fiscal year is greater than or equal to the calculated net profits, the revenue to be equalized from mining revenues in the province for the fiscal year, and

  • (ii) in the case where that revenue to be equalized is less than those calculated net profits, the calculated net profits less the aggregate, over the preceding fiscal years beginning with fiscal year 2000–2001, of the amounts previously subtracted from the calculated net profits under this subparagraph, but that result may not be less than the revenue to be equalized from mining revenues in the province for the fiscal year;

• (w) in the case of water power rentals described in paragraph 7(1)(w),

  • (i) for a province other than Quebec, British Columbia or Newfoundland and Labrador, the number of megawatt hours of electricity generated in the province by electric utilities and industrial establishments from hydro sources in the calendar year that ends in the fiscal year, as determined by Statistics Canada for the purpose of its publication entitled Electric Power Generation, Transmission and Distribution,

  • (ii) for Quebec or Newfoundland and Labrador, the product of the sum of the number of megawatt hours of electricity generated in both Quebec and Newfoundland and Labrador by electric utilities and industrial establishments from hydro sources in the calendar year that ends in the fiscal year, as determined by Statistics Canada for the purpose of its publication entitled Electric Power Generation, Transmission and Distribution, and a fraction

    • (A) whose numerator is the product of the total revenue from the sale of electricity that is generated from all sources in the province by electric utilities and industrial establishments in the calendar year that ends in the fiscal year, as determined by Statistics Canada for the purpose of its publication entitled Electric Power Generation, Transmission and Distribution, and another fraction whose numerator is the number that would be determined for that province under subparagraph (i) if that subparagraph applied to the province and whose denominator is the number of megawatt hours of electricity generated from all sources in the province by electric utilities and industrial establishments in the calendar year that ends in the fiscal year, as determined by Statistics Canada for the purpose of its publication entitled Electric Power Generation, Transmission and Distribution, and

    • (B) whose denominator is the sum of the numerators described in clause (A) for Quebec and Newfoundland and Labrador, and

  • (iii) for British Columbia, the sum of

    • (A) the number of megawatt hours of electricity generated in the province by electric utilities and industrial establishments from hydro sources in the calendar year that ends in the fiscal year, as determined by Statistics Canada for the purpose of its publication entitled Electric Power Generation, Transmission and Distribution, and

    • (B) the number of megawatt hours of electricity, in the calendar year that ends in the fiscal year, that constitutes the average annual usable hydroelectric energy portion of the downstream power benefits to which Canada is entitled in accordance with the Treaty Between the United States of America and Canada Relating to Cooperative Development of the Water Resources of the Columbia River Basin, and any protocols, amendments or addendums to that treaty;

• (x) in the case of insurance premium taxes described in paragraph 7(1)(x), the sum – as determined by the Minister based on information provided by the Office of the Superintendent of Financial Institutions and the provinces respecting the values referred to in subparagraph (i) and in clause (ii)(A) – for the province in the calendar year that ends in the fiscal year in relation to federally registered corporations and provincially licensed corporations, including a provincial government enterprise that carries on the business of insurance, of

  • (i) the amount by which the value of direct premiums written for property insurance is more than the value of direct premiums written for property marine insurance, and

  • (ii) the product of

    • (A) the amount by which the value of life, accident and sickness insurance premiums is more than the total value of dividends paid to policyholders under life insurance contracts, and

    • (B) a fraction

      • (I) whose numerator is the aggregate, over the 10 provinces, of the product of the provincial rate of the insurance premium tax that applies to life, accident and sickness insurance and another fraction whose numerator is the amount, for the province, referred to in clause (A) and whose denominator is the sum of those numerators for each of the 10 provinces, and

      • (II) whose denominator is the aggregate, over the 10 provinces, of the product of the provincial rate of the insurance premium tax that applies to property insurance and another fraction whose numerator is the amount, for the province, referred to in subparagraph (i) and whose denominator is the sum of those numerators for each of the 10 provinces;

• (y) in the case of payroll taxes described in paragraph 7(1)(y), the amount determined by the formula

  {A × [(W1 × P1) + (W2 × P2) + (W3 × P3) + (W4 × P4)] / (W × P)}+ M

  where

  A

  is total wages and salaries excluding supplementary labour income, as determined by Statistics Canada for the purpose of its System of National Accounts, paid in the province in the calendar year that ends in the fiscal year, other than the wages and salaries paid by

  • (i) the federal government sector to employees in the defence industry, and

  • (ii) the provincial and territorial government sector and the local government sector to employees in the provincial administration industry, the local government administration industry, the elementary and secondary education industry, the hospital services industry and the institutional health services industry,

  W

  is equal to the aggregate revenue derived from payroll taxes by all provinces that levy those taxes for the fiscal year, as computed by the Minister in accordance with subsections 9(5) and (6),

  W1,W2, W3 and W4

  are weightings whose value is equal to the revenue derived from payroll taxes for the fiscal year, as computed by the Minister in accordance with subsections 9(5) and (6), by

  • (i) Quebec, in the case of W1,

  • (ii) Newfoundland and Labrador, in the case of W2,

  • (iii) Ontario, in the case of W3, and

  • (iv) Manitoba, in the case of W4,

  P

  is the gross dollar value, before deductions, of the payrolls of all employers in the province for the calendar year that ends in the fiscal year, as determined by Statistics Canada based on its survey Employment, Payrolls and Hours, other than the payrolls of

  • (i) employers not included in that survey, and

  • (ii) employers in the provincial administration industry, the local administration industry, the elementary and secondary education industry, the hospital services industry and the institutional health services industry,

  P1, P2, P3 and P4

  are equal to the amount determined for P minus an amount that is the aggregate of the payrolls of all employers in the province whose payrolls are below a threshold dollar amount and minus an amount that is the product of the threshold dollar amount and the number of employers whose payrolls are above the threshold dollar amount, with the threshold dollar amount being the statutory amount of an employer’s payroll that is exempt from provincial payroll tax as of June 1 of the fiscal year

  • (i) in Quebec, in the case of P1,

  • (ii) in Newfoundland and Labrador, in the case of P2,

  • (iii) in Ontario, in the case of P3, and

  • (iv) in Manitoba, in the case of P4, and

  M

  is military pay and allowances, excluding supplementary labour income, paid in the province in the calendar year that ends in the fiscal year, as determined by Statistics Canada for the purpose of its System of National Accounts;

• (z) in the case of provincial and local government property taxes, described in paragraph 7(1)(z), the weighted sum of four sub-bases, determined by the formula

  (B1 × W1) + (B2 × W2) + (B3 × W3) + (B4 × W4)

  where

  B1

  is equal to the market value residential sub-base, determined by the formula

  {[(V × 1/V1) × Q] + [(P × 1/P1) × (1 - Q)]} × 1/R

  where

  V

  is equal to the assessed market value of residential property in the province for the calendar year that ends in the preceding fiscal year,

  V1

  is equal to the aggregate, over the 10 provinces, of the amount determined for V for each province,

  Q

  is equal to 0.5 for British Columbia and 0.7 for all other provinces,

  P

  is equal to the population of the province for the preceding fiscal year, as determined in accordance with section 11,

  P1

  is equal to the aggregate, over the 10 provinces, of the amount determined for P for each province,

  R

  is the aggregate, over the 10 provinces, of the amount determined for each province by the formula

  [(V × 1/V1) × Q] + [(P × 1/P1) × (1 - Q)]

  where

  V, V1, Q, P and P1

  have the meanings as set out above,

  B2

  is equal to the commercial-industrial sub-base as determined by the formula

  {[(F + G) × H] + I } × 1/ N2

  where

  F

  is equal to the difference between the aggregate current dollar gross domestic product at factor cost in the province for the calendar year that ends in the preceding fiscal year and the current dollar gross domestic product at factor cost attributable to the crop and animal production industry, the government elementary and secondary schools industry, the universities industry, the government community colleges and C.E.G.E.P.s industry, the other government education services industry, the hospitals and government nursing and residential care facilities industry, the other provincial and territorial government services industry and the other municipal government services industry, in the province for the calendar year that ends in the preceding fiscal year, as determined by Statistics Canada based on data from the Interprovincial Input-Output Accounts,

  G

  is equal to the product of

  • (i) the product of the population of the province for the preceding fiscal year and

    • (A) 1.694990, in the case of Ontario,

    • (B) 1.726083, in the case of Quebec,

    • (C) 0.704058, in the case of Nova Scotia,

    • (D) 0.533864, in the case of New Brunswick,

    • (E) 0.943687, in the case of Manitoba,

    • (F) 1.800304, in the case of British Columbia,

    • (G) 0.490192, in the case of Prince Edward Island,

    • (H) 0.698474, in the case of Saskatchewan,

    • (I) 1.015645, in the case of Alberta, and

    • (J) 0.623713, in the case of Newfoundland and Labrador, and

  • (ii) a fraction whose numerator is the aggregate, over the 10 provinces, of one third of the amount determined for F and whose denominator is the aggregate, over the 10 provinces, of the product determined in subparagraph (i),

  H

  is equal to a fraction whose numerator is the aggregate, over the 10 provinces, of the value determined for I multiplied by the fraction 20.945/79.055 and whose denominator is the aggregate, over the 10 provinces, of the sum of the amounts determined for F and G,

  I

  is equal to the value, measured in current dollars as of the end of the calendar year that ends in the preceding fiscal year, as determined by Statistics Canada for the purpose of its Fixed Capital Flows and Stocks data series, of the portion of the non–residential net capital stock in the province that consists of building construction in all industries, other than in the agriculture, forestry, fishing and hunting industry, the local, municipal and regional public administration industry, the provincial and territorial public administration industry, the primary and secondary education industry, the community colleges and C.E.G.E.P.s industry, the universities industry, the business schools and computer management training industry, the technical and trade schools industry, the other schools and instruction industry, the educational support services industry, the hospital services industry, the nursing and residential care facilities industry, the religious, grant-making, civic, and professional and similar organizations industry, and

  N2

  is equal to the aggregate, over the 10 provinces, of the amount determined for each province by the formula

  [(F + G) × H] + I

  where

  F, G, H and I

  have the meanings as set out above,

  B3

  is equal to the farm sub-base as determined by the formula

  [(K × L) +M] × 1/N3

  where

  K

  is equal to the value of farm land in the province, measured in current dollars as of the end of the calendar year that ends in the preceding fiscal year, as determined by Statistics Canada for the purpose of its publication entitled National Balance Sheet Accounts,

  L

  is equal to a fraction whose numerator is the aggregate, over the 10 provinces, of the amount determined for M multiplied by the fraction 84.078/15.922 and whose denominator is the aggregate, over the 10 provinces, of the value determined for K,

  M

  is equal to the value of farm net capital stock in the province that consists of building construction in the agricultural industry, measured in current dollars as of the end of the calendar year that ends in the preceding fiscal year, as determined by Statistics Canada for the purpose of its Fixed Capital Flows and Stocks data series, and

  N3

  is equal to the aggregate, over the 10 provinces, of the amount determined for each province by the formula

  (K × L) +M

  where

  K, L and M

  have the meanings as set out above,

  B4

  is equal to the multi-concept residential sub-base as determined by the formula

  {[(A + B + C) × D] + E} × 1/N4

  where

  A

  is equal to the value of personal disposable income for the calendar year that ends in the preceding fiscal year, less provincial and local indirect taxes for that year, other than provincial and local property taxes, non-profit taxes on corporations, motor vehicle licence and permit fees paid by businesses, miscellaneous taxes on natural resources and provincial and local taxes on the sale price and value of real or immovable property on its transfer in each province, as determined by Statistics Canada for the purpose of its Provincial Economic Accounts,

  B

  is equal to the product of

  • (i) the product of the population of the province for the preceding fiscal year and

    • (A) 1.694990, in the case of Ontario,

    • (B) 1.449733, in the case of Quebec,

    • (C) 0.704058, in the case of Nova Scotia,

    • (D) 0.533864, in the case of New Brunswick,

    • (E) 0.943687, in the case of Manitoba,

    • (F) 1.800304, in the case of British Columbia,

    • (G) 0.490192, in the case of Prince Edward Island,

    • (H) 0.698474, in the case of Saskatchewan,

    • (I) 1.015645, in the case of Alberta, and

    • (J) 0.623713, in the case of Newfoundland and Labrador, and

  • (ii) a fraction whose numerator is the aggregate, over the 10 provinces, of the amount determined for A and whose denominator is the aggregate, over the 10 provinces, of the product determined in subparagraph (i),

  C

  is equal to the product of

  • (i) the population of the province, including the estimated number of non-permanent residents, for the preceding fiscal year, less the population of the province, including the estimated number of non-permanent residents, for the fiscal year that was five years before that preceding fiscal year, and

  • (ii) a fraction whose numerator is the aggregate, over the 10 provinces, of the amount determined for A and whose denominator is the aggregate, over the 10 provinces, of the amount determined in subparagraph (i),

  D

  is equal to a fraction whose numerator is the product of the aggregate, over the 10 provinces, of the amount determined for E and 0.6056 and whose denominator is the aggregate, over the 10 provinces, of the sum of the amounts determined for A, B and C,

  E

  is equal to the residential net capital stock in the province, measured in current dollars, as of the end of the calendar year that ends in the preceding fiscal year, as determined by Statistics Canada for the purpose of its Fixed Capital Flows and Stocks data series,

  N4

  is the aggregate, over the 10 provinces, of the amount determined for each province by the formula

  [(A + B + C) × D] + E

  where

  A, B, C, D and E

  have the meanings as set out above,

  W1

  is equal to 0.576/2, being the weight for the market value residential sub-base,

  W2

  is equal to 0.406, being the weight for the commercial-industrial sub-base,

  W3

  is equal to 0.018, being the weight for the farm sub-base, and

  W4

  is equal to 0.576/2, being the weight for the multi-concept residential sub-base;

• (z.1) in the case of race track taxes described in paragraph 7(1)(z.1), the gross amount wagered in the province in the calendar year that ends in the fiscal year at pari-mutuel tracks on harness and running horse races, as determined by the Canadian Pari-Mutuel Agency;

• (z.2) in the case of revenues from lottery ticket sales, described in paragraph 7(1)(z.2), the product of 1,000,000 and the sum of

  • (i) the product of the net revenue after prize payouts from the sale of lottery tickets in the province for the fiscal year and a fraction whose numerator is 0.8 and whose denominator is the aggregate, over the 10 provinces, of that net revenue,

  • (ii) the product of personal disposable income in the province for the calendar year that ends in the fiscal year, as determined by Statistics Canada for the purpose of its Provincial Economic Accounts, and a fraction whose numerator is 0.1 and whose denominator is the aggregate, over the 10 provinces, of that personal disposable income, and

  • (iii) the product of the population of the province for the fiscal year and a fraction whose numerator is 0.1 and whose denominator is the population of all 10 provinces for that fiscal year;

• (z.3) in the case of revenues described in paragraph 7(1)(z.3), the product of 1,000,000 and the sum of

  • (i) the product of the net revenue after prize payouts from the sale of games of chance, other than net revenue from the sale of lottery tickets and from race track wagers, in the province for the fiscal year, and a fraction whose numerator is 0.2 and whose denominator is the aggregate, over the 10 provinces, of that net revenue,

  • (ii) the product of personal disposable income in the province for the calendar year that ends in the fiscal year, as determined by Statistics Canada for the purpose of its Provincial Economic Accounts, and a fraction whose numerator is 0.4 and whose denominator is the aggregate, over the 10 provinces, of that personal disposable income, and

  • (iii) the product of the population of the province for the fiscal year and a fraction whose numerator is 0.4 and whose denominator is the population of all 10 provinces for that fiscal year;

• (z.4) in the case of miscellaneous provincial taxes and revenues, provincial revenues from sales of goods and services, local government revenues from sales of goods and services, and miscellaneous local government taxes and revenues, described in paragraph 7(1)(z.4), the aggregate, over the revenue sources set out in paragraphs (a) to (k) and (x) to (z.3) of the definition revenue source in subsection 4(2) of the Act as it read on March 13, 2004 and the part of the revenue source set out in paragraph (z.5) of that definition that is not related to natural resources, of the products of

  • (i) the revenue base for each of those revenue sources for the province for the fiscal year, as determined under this section, paragraph 14(2)(b) and subsections 14(3) to (5), and

  • (ii) a fraction whose numerator is the aggregate, over the 10 provinces, of the revenue, determined under subsection 7(1) and paragraph 14(2)(a), for that revenue source and whose denominator is the aggregate, over the 10 provinces, of the revenue base for that revenue source, as determined under this section, paragraph 14(2)(b) and subsections 14(3) to (5); and

• (z.5) in the case of revenues of the Government of Canada from any of the sources referred to in the definition revenue source in subsection 4(2) of the Act as it read on March 13, 2004 that are shared by Canada with the provinces, described in paragraph 7(1)(z.5),

  • (i) for the revenue source that is revenue received from the Government of Canada under the Canada-Newfoundland Atlantic Accord Implementation Act, the revenue derived by the province from that revenue source, as determined by Statistics Canada,

  • (ii) for the revenue source that is revenue received from the Government of Canada under the Canada-Nova Scotia Offshore Petroleum Resources Accord Implementation Act, the revenue derived by the province from that revenue source, as determined by Statistics Canada, and

  • (iii) for the revenue source that is the province’s share of revenue from any revenue source referred to in that definition that is shared by Canada and the province, other than the revenue referred to subparagraph 7(1)(z.5)(i) or (ii), the province’s share of the revenue from that revenue source, as determined by Statistics Canada.

(2) For the purposes of paragraphs (1)(e) and (t), if a province has changed its method of accounting for a fiscal year so that the revenues referred to in those paragraphs are derived during a period that is other than 12 months, the Minister may adjust the amount of those revenues for that fiscal year to offset any effect of that change.

(3) For the purposes of paragraphs (1)(m) to (o), (q) and (r), the adjustment factor for oil is the amount determined by the following formula, which is equal to zero if the expression “(A + X)” is equal to zero:

(4) The following definitions apply in subsection (3).

revenue from oil

revenue from oil means the revenues referred to in paragraphs 7(1)(m) to (o), (q) and (r). (revenus tirés du pétrole)

value of oil

value of oil means the value of the marketable production of crude oil from hydrocarbon deposits in the province in a calendar year that ends in the fiscal year, as determined by Statistics Canada for the purpose of its publication entitled Oil and Gas Extraction. (valeur du pétrole)

(5) For the purpose of paragraph (1)(s), the adjustment factor for natural gas is the amount determined by the following formula, which is equal to zero if the expression “(A + X)” is equal to zero:

(6) The following definitions apply in subsection (5).

revenue from natural gas

revenue from natural gas means the revenues referred to in paragraph 7(1)(s). (revenus tirés du gaz naturel)

value of natural gas

value of natural gas means the value of the marketable production of gas and gas by-products from hydrocarbon deposits in the province in a calendar year that ends in the fiscal year, as determined by Statistics Canada for the purpose of its publication entitled Oil and Gas Extraction. (valeur du gaz naturel)

(7) For the purpose of paragraph (1)(x), moneys received by a provincial government enterprise from the provincial government consolidated revenue fund, or its equivalent, or from a specific tax, are deemed to be premiums of that enterprise.