Federal-Provincial Fiscal Arrangements Act

Marginal note:Computation of payments

10 The provincial personal income tax revenue guarantee 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) the amount equal to

  • (i) the product obtained by multiplying the total revenue that, in the opinion of the Minister, would have been derived in the province from a personal income tax on every individual

    • (A) who was resident in the province on the last day of the calendar year ending in the fiscal year, or

    • (B) who, not being resident in the province on the last day of the calendar year ending in the fiscal year, had income earned in that year in the province, as determined under the Income Tax Act,

    computed in accordance with the Income Tax Act, as it would have applied to the taxation year coinciding with the calendar year ending in the fiscal year, had the amendments referred to in section 9 not been made with respect to that year as if the personal income tax payable by every such individual were the “tax otherwise payable under this Part” within the meaning assigned to that expression by subsection 120(4) of the Income Tax Act for that taxation year, which total revenue is, in this Part, referred to as the “basic personal income tax revenue” that would have been derived in the province for the taxation year, by the provincial personal income tax rate applicable to that taxation year

  minus

  • (ii) the product obtained by multiplying the total revenue, as determined by the Minister, that would be derived in the province from a personal income tax on every individual described in clauses (i)(A) and (B) computed in accordance with the Income Tax Act, as it applied to that taxation year, as if the personal income tax payable by every such individual were the “tax otherwise payable under this Part” within the meaning assigned to that expression by subsection 120(4) of the Income Tax Act for that taxation year, by the provincial personal income tax rate applicable to that taxation year,

  exceeds

• (b) one per cent of the basic personal income tax revenue that would have been derived in the province for the taxation year.