British Columbia--tax competitiveness.

June 13, 2012

On June 13, 2012, TEI submitted the following comments to the British Columbia Expert Panel on Business Taxation in response to an invitation for submissions to assist with developing recommendations "for a business tax system for British Columbia that balances the principles of competitiveness, fairness and simplicity." The comments were prepared under the aegis of TEI's Canadian Commodity Tax Committee, whose chair is Kim N. Berjian of the ConocoPhillips Canada. Contributing substantially to the development of TEI's comments were David A. Card of Spectra Energy Corporation, Brian A. Moul of British Columbia Hydro & Power Authority, and Michael J. Willis of Lafarge Canada Inc. Daniel B. De Jong of the Institute's legal staff coordinated the development of the Institute's comments.

Earlier this year, the Ministry of Finance appointed the Expert Panel on Business Taxation (Expert Panel) "to provide analysis and recommendations to the Province on business tax competitiveness and administrative improvements to streamline the Provincial Sales Tax." (1) The Expert Panel invited submissions from interested organizations to assist with developing recommendations "for a business tax system for British Columbia that balances the principles of competitiveness, fairness and simplicity." Tax Executives Institute is pleased to provide the following comments and suggestions to assist the Expert Panel in its efforts.

Tax Executives Institute (TEI or the Institute) is the preeminent association of in-house tax executives worldwide. The Institute's 7,000 professionals manage the tax affairs of 3,000 of the leading companies in Canada, the United States, Europe, and Asia. Canadians constitute 10 percent of TEI's membership, with our Canadian members belonging to chapters in Calgary, Montreal, Toronto, and Vancouver, which together make up one of our nine geographic regions, and must contend daily with the planning and compliance aspects of Canada's business tax laws. Many of our non-Canadian members including those in Europe and Asia work for companies with substantial activities in Canada. The comments set forth in this letter reflect the views of the Institute as a whole, but more specifically those of our B.C. and overall Canadian constituency.

For ease of reference, we have grouped our recommendations into four categories:

1. Income Tax

2. Carbon Tax and Motor Fuel Tax

3. Provincial Sales Tax

4. Reciprocal Taxation Agreement

   On November 15, 2011, in response to the Ministry of Finance's Action Plan to Re-implement Provincial Sales Tax, TEI provided a number of common sense administrative improvements to make the PST more efficient and administrable to the benefit of both taxpayers and the Province. A delegation of TEI representatives subsequently met with officials from the Ministry of Finance in Victoria on December 12, 2011, to discuss TEI's recommendations. Some of the simplification measures proposed in TEI's November 15 letter were adopted in the proposed Provincial Sales Tax Act that was tabled in the British Columbia legislature on May 14, 2012. A copy of our letter is attached for your reference.

   Enactment of the attached recommendations, which build upon our earlier comments, will improve the business climate in British Columbia, make the Province more competitive, and reduce the administrative complexity of complying with the Province's tax laws. The Institute would be pleased to meet with the Expert Panel to discuss our recommendations and other British Columbia taxation matters.

   The Expert Panel on Business Taxation (Expert Panel) has invited interested organizations...