Federal-Provincial Fiscal Arrangements Act (R.S.C., 1985, c. F-8)

Act current to 2017-10-13 and last amended on 2016-06-22. Previous Versions

Territorial Formula Financing Payments

Marginal note:Territorial formula financing payments
  •  (1) Subject to the other provisions of this Act, there may be paid to a territory a territorial formula financing payment not exceeding the amounts determined under this Part for each fiscal year in the period beginning on April 1, 2014 and ending on March 31, 2019.

  • (2) [Repealed, 2013, c. 33, s. 123]

  • Marginal note:Subsequent fiscal years

    (3) Subject to the other provisions of this Part, the territorial formula financing payment that may be paid to a territory for a fiscal year beginning after March 31, 2008 is equal to the amount, as determined by the Minister, by which

    • (a) the aggregate of the gross expenditure base and the superannuation adjustment for that territory for that fiscal year

    is greater than

    • (b) the eligible revenues for that territory for that fiscal year.

  • Marginal note:Adjusted gross expenditure base

    (4) For the purpose of paragraph (3)(a), for the fiscal year beginning on April 1, 2014, the gross expenditure base is equal to the amount determined by the formula

    A + 0.7 (B + C + D + E – F – G – H)

    where

    A
    is the gross expenditure base that would, in the absence of this subsection, be calculated for the fiscal year;
    B
    is equal to the average adjusted yield calculated for revenues relating to personal income;
    C
    is equal to the average yield calculated for revenues relating to corporate income and government business enterprises;
    D
    is equal to the average yield calculated for revenues derived from property taxes and miscellaneous revenues;
    E
    is equal to the average yield calculated for revenues relating to consumption taxes excluding revenues derived from excise taxes;
    F
    is $63,891,572 in respect of Yukon, $125,998,429 in respect of the Northwest Territories and $104,674,613 in respect of Nunavut;
    G
    is equal to the average yield calculated for revenues derived from personal income; and
    H
    is equal to the average yield calculated for revenues derived from corporate income and government business enterprises.
  • Marginal note:Definitions

    (5) The following definitions apply in this subsection and in subsection (4).

    average adjusted yield

    rendement rajusté moyen

    average adjusted yield means, in respect of revenues relating to personal income of a territory for the fiscal year beginning on April 1, 2014, the amount determined by the formula

    (A + B + C) / 3

    where

    A
    is the yield for that revenue source for the fiscal year beginning on April 1, 2012, calculated by adjusting the national average rate of tax for that fiscal year to exclude the revenues to be equalized adjustment for that fiscal year from the aggregate of the revenue to be equalized for that revenue source for the fiscal year for all provinces and territories;
    B
    is the yield for that revenue source for the fiscal year beginning on April 1, 2011, calculated by adjusting the national average rate of tax for that fiscal year to exclude the revenues to be equalized adjustment for that fiscal year from the aggregate of the revenue to be equalized for that revenue source for the fiscal year for all provinces and territories; and
    C
    is the yield for that revenue source for the fiscal year beginning on April 1, 2010, calculated by adjusting the national average rate of tax for that fiscal year to exclude the revenues to be equalized adjustment for that fiscal year from the aggregate of the revenue to be equalized for that revenue source for the fiscal year for all provinces and territories.

    average yield

    rendement moyen

    average yield means, in respect of a given revenue source of a territory for the fiscal year beginning on April 1, 2014, the amount determined by the formula

    (A + B + C) / 3

    where

    A
    is the yield for that revenue source for the fiscal year beginning on April 1, 2012, that yield being calculated, in respect of G and H of the formula provided for in subsection (4), in accordance with the provisions of this Act and the regulations as they read on December 17, 2012;
    B
    is the yield for that revenue source for the fiscal year beginning on April 1, 2011, that yield being calculated, in respect of G and H of the formula provided for in subsection (4), in accordance with the provisions of this Act and the regulations as they read on December 17, 2012; and
    C
    is the yield for that revenue source for the fiscal year beginning on April 1, 2010, that yield being calculated, in respect of G and H of the formula provided for in subsection (4), in accordance with the provisions of this Act and the regulations as they read on December 17, 2012.

    revenues to be equalized adjustment

    rajustement de revenus sujets à péréquation

    revenues to be equalized adjustment means the amount determined by the Minister for the fiscal year that corresponds to the amount, for all taxpayers, of any rebate, credit or reduction in relation to revenue relating to personal income that a territory, province or one of their local governments grant in favour of a taxpayer for the fiscal year, up to a maximum that reduces to zero the amount of the taxpayer’s tax that is included in that revenue source for that fiscal year. (rajustement de revenus sujets à péréquation)

  • 2004, c. 22, s. 4;
  • 2005, c. 7, s. 1;
  • 2006, c. 4, s. 183;
  • 2007, c. 29, s. 62;
  • 2013, c. 33, s. 123.
Marginal note:Additional payment for 2016-2017

 An amount may be paid to a territory equal to the difference between the amount determined by the Minister under paragraph (a) and the amount set out under paragraph (b) for that territory:

  • (a) the amount of the territorial formula financing payment that would have been paid to a territory for the fiscal year beginning on April 1, 2016, if that amount had been determined using the amount determined to be the gross expenditure base under subsection 4(2); and

  • (b) as the case may be,

    • (i) $878,040,329 in respect of Yukon,

    • (ii) $1,195,799,238 in respect of the Northwest Territories, and

    • (iii) $1,462,488,258 in respect of Nunavut.

  • 2016, c. 7, s. 181.

General

Marginal note:Powers of the Minister

 The Minister may determine, in respect of a territory for a fiscal year,

  • (a) the amount of the gross expenditure base adjustment, in order to reflect

    • (i) a transfer of responsibilities between Canada and the government of a territory or the government of a territory and an aboriginal government,

    • (ii) the signing of land claims, comprehensive land claims or self-government agreements with aboriginal governments, and

    • (iii) personal income tax room sharing agreements between the government of Yukon and an aboriginal government in Yukon; and

  • (b) the amount of the yield adjustment, in order to reflect

    • (i) personal income tax room sharing agreements between the government of Yukon and an aboriginal government in Yukon,

    • (ii) federal statutory limitations on territo-rial revenue raising capacity.

    • (iii) [Repealed, 2013, c. 33, s. 124]

  • 2004, c. 22, s. 4;
  • 2005, c. 7, s. 1;
  • 2007, c. 29, s. 62;
  • 2013, c. 33, s. 124.
Marginal note:Time of calculation

 The territorial formula financing payment payable to a territory for a fiscal year shall be calculated, at a time determined by the Minister, no later than three months before that fiscal year begins.

  • 2004, c. 22, s. 4;
  • 2005, c. 7, s. 1;
  • 2007, c. 29, s. 62.

 [Repealed, 2007, c. 29, s. 62]

Marginal note:Underpayment

 If the Minister determines that the Minister has underpaid any amounts payable to a territory under this Part, the Minister may, within the prescribed time and in the prescribed manner, pay that territory an amount equal to the underpayment.

  • 2005, c. 7, s. 1;
  • 2006, c. 4, s. 185;
  • 2007, c. 29, s. 62, c. 35, s. 167.
Marginal note:Overpayment

 If the Minister determines that the Minister has overpaid any amounts paid to a territory under this Part, the Minister may recover the amount of that overpayment

  • (a) within the prescribed time and in the prescribed manner, from any amount payable under this Act to that territory; or

  • (b) from that territory as a debt due to Her Majesty in right of Canada.

  • 2005, c. 7, s. 1;
  • 2007, c. 29, s. 62, c. 35, s. 167.
 
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