Federal-Provincial Fiscal Arrangements Act

Marginal note:Interpretation

• 3.5 (1) The following definitions apply in this section and in sections 3 to 3.4.

  average annual per capita national revenue to be equalized

  average annual per capita national revenue to be equalized means, for a fiscal year for a revenue source, the amount determined by the formula

  (A/2 + B/4 + C/4) / D

  where

  A

  is the national revenue to be equalized for that revenue source for the fiscal year that is two years prior to that fiscal year;

  B

  is the national revenue to be equalized for that revenue source for the fiscal year that is three years prior to that fiscal year;

  C

  is the national revenue to be equalized for that revenue source for the fiscal year that is four years prior to that fiscal year; and

  D

  is the aggregate of the average annual population of all provinces for that fiscal year. (revenu national annuel moyen sujet à péréquation par habitant)

  average annual per capita national yield

  average annual per capita national yield means, for a revenue source for a fiscal year, the amount determined by the formula

  (A/2 + B/4 + C/4) / D

  where

  A

  is the national yield for that revenue source for the fiscal year that is two years prior to that fiscal year;

  B

  is the national yield for that revenue source for the fiscal year that is three years prior to that fiscal year;

  C

  is the national yield for that revenue source for the fiscal year that is four years prior to that fiscal year; and

  D

  is the aggregate of the average annual population of all provinces for that fiscal year. (rendement national annuel moyen par habitant)

  average annual per capita revenue to be equalized

  average annual per capita revenue to be equalized means, in respect of a province for a revenue source for a fiscal year, the amount determined by the formula

  (A/2 + B/4 + C/4) / D

  where

  A

  is the revenue to be equalized for that revenue source for the fiscal year that is two years prior to that fiscal year;

  B

  is the revenue to be equalized for that revenue source for the fiscal year that is three years prior to that fiscal year;

  C

  is the revenue to be equalized for that revenue source for the fiscal year that is four years prior to that fiscal year; and

  D

  is the average annual population of that province for that fiscal year. (revenu annuel moyen sujet à péréquation par habitant)

  average annual per capita yield

  average annual per capita yield means, in respect of a province for a revenue source for a fiscal year, an amount determined by the formula

  (A/2 + B/4 + C/4) / D

  where

  A

  is the yield for that revenue source for the fiscal year that is two years prior to that fiscal year;

  B

  is the yield for that revenue source for the fiscal year that is three years prior to that fiscal year;

  C

  is the yield for that revenue source for the fiscal year that is four years prior to that fiscal year; and

  D

  is the average annual population of that province for that fiscal year. (rendement annuel moyen par habitant)

  average annual population

  average annual population means, in respect of a province for a fiscal year, the amount determined by the formula

  A/2 + B/4 + C/4

  where

  A

  is the population of that province for the fiscal year that is two years prior to that fiscal year;

  B

  is the population of that province for the fiscal year that is three years prior to that fiscal year; and

  C

  is the population of that province for the fiscal year that is four years prior to that fiscal year. (population annuelle moyenne)

  equalized fiscal capacity

  equalized fiscal capacity means, in respect of a province for a fiscal year, the product obtained by multiplying the per capita equalized fiscal capacity of that province for that fiscal year by the average annual population of that province for that fiscal year. (capacité fiscale après péréquation)

  national average rate of tax

  national average rate of tax means, in respect of a revenue source, the rate equal to the quotient obtained by dividing the aggregate of the revenue to be equalized for a revenue source for a fiscal year for all provinces by the revenue base in respect of that revenue source for that fiscal year for all provinces. (taux d’imposition national moyen)

  national revenue to be equalized

  national revenue to be equalized means, in respect of a revenue source for a fiscal year, the amount equal to the aggregate of the revenue to be equalized for that revenue source for that fiscal year for all provinces. (revenu national sujet à péréquation)

  national yield

  national yield means, for a revenue source for a fiscal year, the product obtained by multiplying the national average rate of tax for that revenue source for that fiscal year by the aggregate revenue base of all provinces in respect of that revenue source for that fiscal year.  (rendement national)

  per capita equalization payment

  per capita equalization payment means, in respect of a province for a fiscal year, the quotient obtained by dividing the fiscal equalization payment that would be paid to that province for that fiscal year, if the amount of that payment were determined under section 3.2 and subsections 3.4(1) to (4) as if that province had not made an election under subsection 3.2(2), by the average annual population of that province for that fiscal year. (paiement de péréquation par habitant)

  per capita equalized fiscal capacity

  per capita equalized fiscal capacity means, in respect of a province for a fiscal year, the amount determined by the formula

  A + B + (C / F)

  where

  A, B and F

  have the same meaning as the descriptions of A, B and F, respectively, in the definition total per capita fiscal capacity; and

  C

  is any fiscal equalization payment that may be paid to that province for that fiscal year if the amount of that payment were determined under paragraph 3.2(1)(a). (capacité fiscale par habitant après péréquation)

  per capita pre-adjustment equalized fiscal capacity

  per capita pre-adjustment equalized fiscal capacity means, in respect of a province for a fiscal year, the amount determined by the formula

  A + B + C + (E / F)

  where

  A, B, E and F

  have the same meaning as the descriptions of A, B, E and F, respectively, in the definition total per capita fiscal capacity; and

  C

  is the per capita equalization payment for that province for that fiscal year. (capacité fiscale par habitant après péréquation et avant rajustement)

  revenue base

  revenue base means, in respect of a revenue source for a province for a fiscal year, the measure of the relative capacity of that province to derive revenue from that revenue source for that fiscal year and may be defined more particularly by the regulations. (assiette)

  revenue source

  revenue source means any of the following sources from which provincial revenues are or may be derived:

  • (a) revenues relating to personal income;

  • (b) revenues relating to business income;

  • (c) revenues relating to consumption;

  • (d) revenues derived from property taxes; and

  • (e) revenues derived from natural resources. (source de revenu)

  revenue to be equalized

  revenue to be equalized means, in respect of a revenue source for a province for a fiscal year,  

  • (a) the revenue, as determined by the Minister, derived by that province for that fiscal year from that revenue source; and

  • (b) in the case of a revenue source other than a revenue source referred to in paragraph (e) of the definition revenue source, the product obtained by multiplying the sum of miscellaneous revenues derived by that province for the fiscal year by the quotient obtained by dividing the sum of revenues from that revenue source derived by all provinces for that fiscal year by the sum of all revenues derived by all provinces from the revenue sources referred to in paragraphs (a) to (d) of the definition revenue source for that fiscal year.

  It may be defined more particularly by the regulations. (revenu sujet à péréquation)

  total per capita fiscal capacity

  total per capita fiscal capacity means, in respect of a province for a fiscal year, the amount determined by the formula

  A + B + [(C + E) / F]

  where

  A

  is the aggregate of that province’s average annual per capita yield for each revenue source, except the one referred to in paragraph (e) of the definition revenue source, for that fiscal year;

  B

  is that province’s average annual per capita revenue to be equalized, for the revenue source referred to in paragraph (e) of the definition revenue source, for that fiscal year;

  C

  is any fiscal equalization payment that would be paid to that province for that fiscal year if the amount of that payment were determined in accordance with section 3.2 without regard to section 3.4;

  E

  is, with respect to Nova Scotia, any amount that may be paid to that province for that fiscal year in accordance with sections 7 and 8 and 10 to 14 of the Nova Scotia and Newfoundland and Labrador Additional Fiscal Equalization Offset Payments Act; and

  F

  is the average annual population of that province for that fiscal year. (capacité fiscale totale par habitant)

  yield

  yield means, in respect of a province for a revenue source for a fiscal year, an amount equal to the product obtained by multiplying the national average rate of tax for that revenue source for that fiscal year by that province’s revenue base for that revenue source for that fiscal year. (rendement)

• Marginal note:Deduction in computing revenue to be equalized

  (2) In computing the revenue to be equalized from the revenue source described in paragraph (a) of the definition revenue source in subsection (1) for all the provinces for a fiscal year, the Minister may deduct from the amount that, but for this subsection, would be the revenue to be equalized from that revenue source for all the provinces for that fiscal year, the amount, as estimated by the Minister, by which the revenues derived by Canada under the Income Tax Act from personal income taxes for the taxation year ending in that fiscal year are less than the revenues that would have been derived by Canada under that Act from those taxes if no special abatement of those taxes had been provided under subsection 120(2) of that Act or Part VI of this Act.

• Marginal note:Municipal revenues

  (3) For the purposes of this Part, the revenue derived by each municipality, board, commission or other local authority in a province that has power to derive those revenues for the financial year of each such local authority ending in that fiscal year is both deemed to be revenue derived by that province and

  • (a) in the case of local government property taxes, property taxes within the meaning of paragraph (d) of the definition revenue source in subsection (1); and

  • (b) in the case of other miscellaneous local government taxes and revenues, included in miscellaneous revenues for the purpose of the definition revenue to be equalized in subsection (1).