Limiting retroactive legislation in Canada.

On February 16, 1995, Tax Executives Institute submitted the following comments to the Canadian Minister of Finance, Paul Martin, in respect of certain trends affecting the development and effective date of Canadian tax policy and legislation. The comments, which took the form of a letter from Institute President Jack R. Skinner, were prepared under the aegis of its Canadian Income Tax Committee, whose chair is J. A. (Drew) Glennie of Shell Canada Limited. Minister Martin's response is reprinted elsewhere in this issue.

On December 5, 1995, a delegation from Tax Executives Institute met with representatives from the Department of Finance to discuss a number of income tax issues. At the meeting, TEI expressed concern about certain trends in the development of Canadian income tax policy. Specifically, we commented on (i) the increasing tendency to introduce major policy changes in the guise of technical amendments bills, (ii) the introduction of legislative amendments retrospectively changing the tax treatment of completed transactions, and (iii) the use of hypertechnical changes to extend taxing jurisdiction to non-residents of Canada. We were invited to express our views and elaborate on our concerns through a separate submission.

1. Background

   Tax Executives Institute (TEI) is an international organization of approximately 5,000 professionals who are responsible - in an executive, administrative, or managerial capacity - for the tax affairs of the corporations and the other businesses by which they are employed. TEI's members represent more than 2,800 of the leading corporations in Canada and the United States.

   Canadians make up approximately 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. In addition, a substantial number of our U.S. members work for companies with significant Canadian operations. In sum, TEI's membership includes representatives from most major industries. The comments set forth in this submission reflect the views of the Institute as a whole, but more particularly those of our Canadian constituency.

   TEI has historically been concerned with issues of tax policy and administration and is dedicated to working with government agencies in Ottawa (and Washington), as well as in the provinces (and the states), to reduce the costs and burdens of tax compliance and administration to our common...