Pending Canadian excise tax issues.

On December 8, 1993, Tax Executives Institute held its annual liaison meeting with officials of the Canadian Department of Finance on Excise and Goods and Services Tax issues. In connection with the meeting, the Institute submitted the following comments, which were prepared under the aegis of the Institute's Canadian Commodity Tax Committee, whose chair is Paul J. deWinter of Imperial Oil Limited. Also participating in the liaison meeting was Hugh D. Berwick of Alcan Aluminium Limited, the Institute's Vice President-Region 1, and other members of the Canadian Commodity Tax Committee. A report on the liaison meeting will be included in a future issue of The Tax Executive. (A separate liaison meeting was held with the Department on pending income tax issues.)

Tax Executives Institute welcomes the opportunity to present the following comments and questions on several pending commodity and excise tax issues, which will be discussed with representatives of the Department of Finance during TEI's December 8, 1993, liaison meeting. In the meantime, if you have any questions about these comments, please do not hesitate to call either Hugh D. Berwick, TEI's Vice President for Canadian Affairs, at (514) 848-8235 or Paul J. DeWinter, Chair of the Institute's Canadian Commodity Tax Committee, at (416) 968-4506.

1. Background

   Tax Executives Institute is an international organization of approximately 4,800 professionals who are responsible--in an executive, administrative, or managerial capacity--for the tax affairs of the corporations and other businesses by which they are employed. TEI's members represent more than 2,400 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, including manufacturing, distributing, wholesaling, and retailing; real estate; transportation; financial services; and natural resources (including timber and integrated oil companies). The comments set forth in this submission reflect the views of the Institute as a whole, but more particularly those of our Canadian constituency.

2. Section 141: Use in Commercial Activities

   The eligibility of certain costs for input tax credits is a paramount concern for businesses subject to Canada's Goods...