Federal-Provincial Fiscal Arrangements Act

Marginal note:Computation of payments

• 6 (1) Subject to subsections (8) to (10), the fiscal stabilization payment that may be paid to a province for a fiscal year is the amount, if any, as determined by the Minister, by which

  • (a) ninety-five per cent of the revenue subject to stabilization of the province for the immediately preceding fiscal year

  exceeds

  • (b) the revenue subject to stabilization of the province for the fiscal year, adjusted in the prescribed manner to offset the amount, as determined by the Minister, of any change in the revenue subject to stabilization of the province for the fiscal year resulting from changes made by the province in the rates or in the structures of provincial taxes or other modes of raising the revenue of the province referred to in paragraphs (a) to (y) and (z.1) to (z.3) of the definition revenue source in subsection 4(2) of the former legislation, as revised or altered in accordance with section 5 of the Federal-Provincial Fiscal Arrangements Regulations, 1999, from the rates or structures in effect in the immediately preceding fiscal year.

• Marginal note:Interpretation

  (1.1) Where a province has entered into a tax collection agreement respecting either personal income tax or corporation income tax, a change to the Income Tax Act affecting, as the case may be, the amount defined as being tax otherwise payable under this Part, within the meaning assigned to that expression by subsection 120(4) of the Income Tax Act, or corporate taxable income within the meaning of that Act shall be deemed to be a change in the rates or in the structures of provincial taxes for the purposes of paragraph (1)(b).

• Marginal note:Definition of revenue subject to stabilization

  (2) With respect to a fiscal stabilization payment for a fiscal year that begins after March 31, 1987, in this section, revenue subject to stabilization of a province for a fiscal year means, in the case of the fiscal year beginning on April 1, 1986 and a fiscal year beginning on or after April 1, 1987, the aggregate of

  • (a) the total revenues, as determined by the Minister, derived by the province for the fiscal year from the revenue sources described in the definition revenue source in subsection 4(2) of the former legislation, as revised or altered in accordance with section 5 of the Federal-Provincial Fiscal Arrangements Regulations, 1999, other than the revenue sources described in paragraphs (z) and (z.4) of that definition, and

  • (b) the fiscal equalization payment to the province for the fiscal year under Part I.

  • (c) [Repealed, 1995, c. 17, s. 47]

• (2.1) [Repealed, 1999, c. 11, s. 3]

• Marginal note:Certain revenues excluded

  (2.2) For the purpose of determining the fiscal stabilization payment that may be paid to a province for a fiscal year that begins on or after April 1, 1996,

  • (a) revenue subject to stabilization of a province for the fiscal year and for the immediately preceding fiscal year does not include the amounts referred to in paragraph (2)(c), as it read on March 31, 1996; and

  • (b) notwithstanding subsection (3), the following amounts shall be deducted from the amount otherwise determined under this section:

    • (i) the total equalized tax transfer to the province in respect of the Canada Health and Social Transfer, as determined in accordance with subsection 16(1), and in respect of established programs, as determined in accordance with subsection 16(1), as it read on March 31, 1996, and

    • (ii) the value of the additional tax abatement units in respect of the Canada Health and Social Transfer, as determined in accordance with subsection 27(2), and in respect of established programs, as determined in accordance with subsection 28(1), as it read on March 31, 1996.

• Marginal note:Revenue subject to stabilization

  (3) For the purpose of determining pursuant to subsection (2) the revenue subject to stabilization of a province for a fiscal year, subsection 4(4) of the former legislation applies, with such modifications as the circumstances require, in determining the revenue derived by the province for the fiscal year from personal income taxes, described in paragraph (a) of the definition revenue source in subsection 4(2) of the former legislation, as revised or altered in accordance with section 5 of the Federal-Provincial Fiscal Arrangements Regulations, 1999, except that no deduction may be made in respect of the tax abatement units referred to in subsection 27(2).

• Marginal note:Revenues of a province

  (4) For the purposes of subsection (2), the revenue of a province for a fiscal year derived from the revenue source referred to in paragraph (a) of the definition revenue source in subsection 4(2) of the former legislation, as revised or altered in accordance with section 5 of the Federal-Provincial Fiscal Arrangements Regulations, 1999, shall be deemed to be

  • (a) the total amount, determined in prescribed manner, of the provincial personal income taxes assessed or reassessed, not later than twenty-four months after the end of the fiscal year, in respect of the taxation year ending in the fiscal year

  minus

  • (b) the total amount, determined in prescribed manner, of the tax credits and rebates claimed by taxpayers in the province against provincial personal income taxes for that taxation year that have been deducted from those assessed or reassessed provincial personal income taxes.

• Marginal note:Revenues of the province

  (5) For the purposes of subsection (2), the revenue of a province for a fiscal year derived from that part of the revenue source described in paragraph (b) of the definition revenue source in subsection 4(2) of the former legislation, as revised or altered in accordance with section 5 of the Federal-Provincial Fiscal Arrangements Regulations, 1999, that consists of corporation income taxes, shall be deemed to be

  • (a) the total amount, determined in prescribed manner, of the provincial corporation income taxes assessed or reassessed, not later than twenty-four months after the end of the fiscal year, in respect of the taxation year of corporations ending in the calendar year that ends in the fiscal year

  minus

  • (b) the total amount, determined in prescribed manner, of the tax credits and rebates claimed by taxpayers in the province against provincial corporation income taxes for that taxation year that have been deducted from those assessed or reassessed provincial corporation income taxes.

• Marginal note:Stabilization threshold re certain revenue sources

  (6) When, in computing the fiscal stabilization payment that may be paid to a province for a fiscal year pursuant to subsection (1), it is ascertained that

  • (a) the total revenues, as determined by the Minister, derived by the province for the immediately preceding fiscal year from the revenue sources described in paragraphs (l) to (w) of the definition revenue source in subsection 4(2) of the former legislation, as revised or altered in accordance with section 5 of the Federal-Provincial Fiscal Arrangements Regulations, 1999, and the part of the revenue source described in paragraph (z.5) of that definition that relates to natural resources

  exceed

  • (b) the total revenues, as determined by the Minister, derived by the province for the fiscal year from the revenue sources described in paragraph (a), as adjusted in the manner referred to in paragraph (1)(b),

  notwithstanding any other provision of this section, in applying subsections (1) and (2) to determine the fiscal stabilization payment that may be paid to the province for the fiscal year, no amount, other than any amount by which the difference between the amount determined under paragraph (a) and the amount determined under paragraph (b) exceeds one-half of the amount determined under paragraph (a), shall be included in respect of the difference between the amount determined under paragraph (a) and the amount determined under paragraph (b).

• Marginal note:Application by province for payment

  (7) A fiscal stabilization payment may be paid to a province for a fiscal year only on receipt by the Minister, not later than eighteen months after the end of the fiscal year, of an application by the province therefor containing such information as may be prescribed.

• Marginal note:Limit of $60 per capita

  (8) Subject to subsection (9), for each fiscal year that begins after March 31, 1987, the fiscal stabilization payment that may be paid to a province shall not exceed the amount obtained by multiplying $60 by the population of that province on June 1 of that year, based on the most recent information that has been prepared by Statistics Canada for that year in accordance with the regulations.

• Marginal note:Loan

  (9) If the amount of the fiscal stabilization payment of a province calculated pursuant to subsections (1) to (7) exceeds the amount calculated in respect of the province pursuant to subsection (8) any amount of the difference between those amounts may, at the discretion of the Minister, be lent to the province on the prescribed terms and conditions and in prescribed manner.

• Marginal note:Repayment

  (10) Any amount lent pursuant to subsection (9) does not bear interest and shall be repaid, in prescribed manner, by the province before the expiration of the period of five years following the date the amount is lent or shall be recovered, in prescribed manner, from any amount that may become payable to the province pursuant to this Act within that period.

• Marginal note:Definition of former legislation

  (11) In this section, former legislation means this Act as it read on May 13, 2004.