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Legislative and Regulatory Proposals Relating to the Excise Tax Act, the Air Travellers Security Charge Act, the Excise Act, 2001, the Greenhouse Gas Pollution Pricing Act, the Underused Housing Tax Act and Related Legislation

PART 1

Draft Amendments to the Excise Tax Act

1  (1)  Subsection 106.1(3.1) of the Excise Tax Act is replaced by the following:
Date electronic notice sent
(3.1)  For the purposes of this Act, if a notice or other communication in respect of a person, other than a notice or other communication that refers to the business number of a person, is made available in electronic format such that it can be read or perceived by a person or a computer system or other similar device, the notice or other communication is presumed to be sent to the person and received by the person on the date that an electronic message is sent, to the electronic address most recently provided before that date by the person to the Minister for the purposes of this subsection, informing the person that a notice or other communication requiring the person’s immediate attention is available in the person’s secure electronic account. A notice or other communication is considered to be made available if it is posted by the Minister in the person’s secure electronic account and the person has authorized that notices or other communications may be made available in this manner and has not before that date revoked that authorization in a manner specified by the Minister.
  
(2)  Section 106.1 of the Act is amended by adding the following after subsection (3.1):
Date electronic notice sent — business account
(3.2)  For the purposes of this Act, a notice or other communication in respect of a person that is made available in electronic format such that it can be read or perceived by a person or computer system or other similar device and that refers to the business number of a person is presumed to be sent to the person and received by the person on the date that it is posted by the Minister in the secure electronic account in respect of the business number of the person, unless the person has requested, at least 30 days before that date, in a manner specified by the Minister, that such notices or other communications be sent by mail.
  
2  (1)  The definition financial instrument in subsection 123(1) of the Act is amended by adding the following after paragraph (b):
(b.1)  a right (other than a right as a creditor), whether absolute or contingent, conferred by a corporation that does not have capital divided into shares to receive, either immediately or in the future, an amount that can reasonably be regarded as all or any part of the capital, revenue or income of the corporation,
(2)  Paragraph (h) of the definition financial instrument in subsection 123(1) of the Act is replaced by the following:
(h)  a guarantee, an acceptance or an indemnity in respect of anything described in any of paragraphs (a) to (b.1), (d), (e) and (g), or
(3)  Subsection 123(1) of the Act is amended by adding the following in alphabetical order:
Lloyd’s association means an association of persons formed on the plan known as Lloyd’s, whereby each member of the association participating in an insurance policy becomes liable for a stated, limited or proportionate part of the whole amount payable under the policy. (association Lloyd’s)
(4)  Subsections (1) to (3) are deemed to have come into force on the day after Announcement Date.
3  (1)  Subsection 149(4) of the Act is replaced by the following:
Exclusion of interest and dividend
(4)  In determining a total for a person under paragraph (1)(b) or (c), there shall not be included interest, or any dividend, from
(a)  if the person is a partnership, a corporation that is controlled by
(i)  the person,
(ii)  a corporation that is controlled by the person,
(iii)  a corporation that is related to a corporation described in subparagraph (ii), or
(iv)  a combination of persons described in subparagraphs (i) to (iii); or
(b)  in any other case, a corporation related to the person.
  
(2)  Subsection (1) applies to taxation years that begin after Announcement Date.
4  (1)  The Act is amended by adding the following after section 149:
Continuation of Lloyd’s association
149.1  (1)  For the purposes of this Part, if a Lloyd’s association that is registered under Subdivision D of Division V would, in the absence of this subsection, be regarded as having ceased to exist, the Lloyd’s association is deemed not to have ceased to exist until the registration of the Lloyd’s association is cancelled.
Continuation of Lloyd’s association
(2)  For the purposes of this Part, if the membership of a Lloyd’s association changes but the number that has been assigned to the Lloyd’s association by or under the authority of the council constituted by section 3 of the Lloyd’s Act 1982 (U.K.), 1982, c. 14 does not change as a result of that change in membership, the Lloyd’s association is deemed to continue as the same Lloyd’s association.
Policies issued by Lloyd’s association
(3)  For the purposes of this Part, if the members of a Lloyd’s association participate in an insurance policy such that each member becomes liable for a stated, limited or proportionate part of the whole amount payable under the policy, the Lloyd’s association is deemed to have issued the policy and to be insuring any risk that is insured under the policy.
Reinsurance
(4)  If, under the terms of a particular agreement entered into by the members of a particular Lloyd’s association (referred to in this subsection as the “reinsured members”) and either the members of another Lloyd’s association (referred to in this subsection as the “reinsuring members”) or another person that is a party to the particular agreement otherwise than as a member of a Lloyd’s association, the reinsuring members or the other person, as the case may be, agree to discharge, procure the discharge of or indemnify the reinsured members against the known and unknown liabilities of the reinsured members arising out of one or more insurance policies (referred to in this subsection as the “covered policies”), the following rules apply:
(a)  for the purposes of this Part and throughout the time the particular agreement is in effect, the other Lloyd’s association or the other person, as the case may be, is deemed to be an insurer, to have issued the covered policies and to be insuring any risk that is insured under the covered policies; and
(b)  the particular Lloyd’s association, the other Lloyd’s association and the reinsuring members or, as the case may be, the particular Lloyd’s association and the other person are jointly and severally, or solidarily, liable for
(i)  the payment of any amount of tax under Division II, III or IV.1, section 218 or subsection 218.1(1) that becomes payable by the particular Lloyd’s association, but only to the extent that the amount can reasonably be considered to relate to the covered policies,
(ii)  the remittance of any amount of net tax for any reporting period of the particular Lloyd’s association, but only to the extent that the amount can reasonably be considered to relate to the covered policies,
(iii)  the payment of any amount of tax under section 218.01 or subsection 218.1(1.2) that is determined for a specified year (as defined in section 217) of the particular Lloyd’s association, but only to the extent that the amount can reasonably be considered to relate to the covered policies, and
(iv)  the payment or remittance of any amount for which a third Lloyd’s association and the particular Lloyd’s association are jointly and severally, or solidarily, liable as a result of the application of this paragraph in respect of another agreement that was entered into by the members of the third Lloyd’s association and the members of the particular Lloyd’s association prior to the entering into of the particular agreement and that is in respect of one or more of the covered policies, but only to the extent that the amount can reasonably be considered to relate to those covered policies.
(2)  Subsection (1) is deemed to have come into force on the day after Announcement Date.
5  (1)  Paragraph 150(4)(c) of the Act is replaced by the following:
(c)  the day specified in the revocation of the election, which day is at least three hundred and sixty-five days after the day specified in the election.
(2)  Section 150 of the Act is amended by adding the following after subsection (4):
Form of revocation
(4.1)  A revocation of an election made under subsection (1) by a member of a closely related group and a corporation shall
(a)  be made jointly in prescribed form containing prescribed information by the member and the corporation;
(b)  specify the day on which the revocation is to become effective; and
(c)  be filed with the Minister in prescribed manner on or before
(i)  the particular day that is the earlier of
(A)  the day on or before which the member is required to file a return under Division V for the reporting period of the member that includes the day specified in the revocation, and
(B)  the day on or before which the corporation is required to file a return under Division V for the reporting period of the corporation that includes the day specified in the revocation, or
(ii)  any day after the particular day that the Minister may allow.
  
(3)  Subsections (1) and (2) are deemed to have come into force on the day after Announcement Date.
6  (1)  The definition Canadian partnership in subsection 156(1) of the Act is repealed.
(2)  Paragraph (b) of the definition qualifying group in subsection 156(1) of the Act is replaced by the following:
(b)  a group of specified partnerships, or of specified partnerships and corporations, each member of which is closely related, within the meaning of this section, to each other member of the group. (groupe admissible)
(3)  The portion of the definition qualifying member in subsection 156(1) of the Act before paragraph (a) is replaced by the following:
qualifying member of a qualifying group means a registrant that is a corporation resident in Canada or a specified partnership, each member of which is resident in Canada, and that meets the following conditions:
(4)  The portion of the definition temporary member in subsection 156(1) of the Act before paragraph (a) is replaced by the following:
temporary member of a qualifying group means a particular corporation
(5)  Paragraph (f) of the definition temporary member in subsection 156(1) of the Act is replaced by the following:
(f)  that receives a supply of property that meets the following conditions:
(i)  the supply is made by another corporation that is a qualifying member of the qualifying group and in contemplation of a distribution made in the course of a reorganization whereby the shares of the particular corporation are to be transferred upon the distribution to one or more corporations (referred to in this definition as the “transferee corporations”),
(ii)  the supplied property includes property that is neither a financial instrument nor property having a nominal value, and
(iii)  all or substantially all of the supplied property (other than financial instruments and property having a nominal value)
(A)  was last manufactured, produced, acquired or imported by the other corporation for consumption, use or supply exclusively in the course of the commercial activities of the other corporation,
(B)  is not consumed, used or supplied by the particular corporation otherwise than exclusively in the course of its commercial activities, and
(C)  may reasonably be expected to be consumed, used or supplied by the transferee corporations exclusively in the course of their commercial activities within 12 months from the time the supply is made;
(6)  Paragraph (h) of the definition temporary member in subsection 156(1) of the Act is replaced by the following:
(h)  the shares of which are transferred to the transferee corporations upon the distribution referred to in subparagraph (f)(i). (membre temporaire)
(7)  Subsection 156(1) of the Act is amended by adding the following in alphabetical order:
specified partnership means a partnership each member of which is a corporation or a partnership. (société de personnes déterminée)
(8)  The portion of subsection 156(1.1) of the Act before subparagraph (a)(i) is replaced by the following:
Closely related persons
(1.1)  For the purposes of this section, a particular specified partnership and another person that is a specified partnership or a corporation are closely related to each other at any time if, at that time,
(a)  in the case where the other person is a specified partnership,
  
(9)  Clause 156(1.1)(a)(i)(B) of the Act is replaced by the following:
(B)  a corporation, or a specified partnership, that is a member of a qualifying group of which the particular partnership is a member, or
(10)  Clause 156(1.1)(a)(ii)(B) of the Act is replaced by the following:
(B)  holds all or substantially all of the interest in a specified partnership that is a member of a qualifying group of which the other person is a member; and
(11)  Clause 156(1.1)(b)(i)(B) of the Act is replaced by the following:
(B)  a corporation, or a specified partnership, that is a member of a qualifying group of which the particular partnership is a member, or
(12)  Clause 156(1.1)(b)(iii)(B) of the Act is replaced by the following:
(B)  a corporation, or a specified partnership, that is a member of a qualifying group of which the other person is a member, or
(13)  Subparagraph 156(1.1)(b)(iv) of the Act is replaced by the following:
(iv)  all or substantially all of the interest in a specified partnership is held by
(A)  if the specified partnership is a member of a qualifying group of which the particular partnership is a member, the other person, and
(B)  if the specified partnership is a member of a qualifying group of which the other person is a member, the particular partnership.
(14)  Subsection 156(1.2) of the Act is replaced by the following:
Persons closely related to the same person
(1.2)  If, under subsection (1.1), two persons are closely related to the same corporation or specified partnership, the two persons are closely related to each other for the purposes of this section.
  
(15)  Paragraph 156(2.1)(c) of the Act is replaced by the following:
(c)  a supply that is not a supply of property that meets the conditions set out in paragraph (f) of the definition temporary member in subsection (1), if the recipient of the supply is a temporary member.
(16)  Subsections (1) to (3) and (7) to (14) are deemed to have come into force on the day after Announcement Date.
(17)  Subsections (4) to (6) are deemed to have come into force on Announcement Date.
(18)  Subsection (15) applies in respect of any supply made on or after Announcement Date.
7  (1)  Section 172.1 of the Act is amended by adding the following after subsection (8):
Later addition to net tax of employer
(8.01)  If, in making an assessment of the net tax for a reporting period of a person, the Minister determines that the tax in respect of a supply of all or part of a specified resource deemed to have been made by the person under paragraph (5)(a) or (5.1)(a) or in respect of a supply of an employer resource deemed to have been made by the person under any of paragraphs (6)(a), (6.1)(a), (7)(a) and (7.1)(a) is greater than the amount of tax that had been accounted for in respect of the supply prior to the Minister’s assessment of the net tax for the reporting period and if the person has paid or remitted all amounts owing to the Receiver General in respect of the net tax for the reporting period, if any, the following rules apply:
(a)  the person shall, in prescribed form and in a manner satisfactory to the Minister, provide prescribed information in respect of the supply to each pension entity that is deemed to have paid tax in respect of the specified resource or part or in respect of the employer resource, as the case may be, under whichever of paragraphs (5)(d), (5.1)(d), (6)(d), (6.1)(d), (7)(d) and (7.1)(d) is applicable (in this subsection referred to as the “applicable paragraph”) before the day that is one year after the later of
(i)  the day on which the Minister sends the notice of the assessment, and
(ii)  the first day on which all amounts owing to the Receiver General in respect of the net tax for the reporting period, if any, have been paid or remitted; and
(b)  if the person provides the prescribed information to a particular pension entity in accordance with paragraph (a) and if the prescribed information is received by the particular pension entity on a particular day that is after the end of the last claim period (as defined in subsection 259(1)) of the particular pension entity that ends within two years after the day on which the supply was deemed to have been made, for the purposes referred to in the applicable paragraph,
(i)  the particular pension entity is deemed to have paid on the particular day tax equal to the amount determined by the formula
A × (B/C)
where
A is the amount of tax in respect of the specified resource or part or in respect of the employer resource, as the case may be, that the particular pension entity is deemed to have paid under the applicable paragraph,
B is the difference between the tax in respect of the supply and the amount of tax that had been accounted for in respect of the supply prior to the Minister’s assessment of the net tax for the reporting period, and
C is the tax in respect of the supply, and
(ii)  if the applicable paragraph is paragraph (5)(d), (5.1)(d), (6)(d) or (6.1)(d), the tax that the particular pension entity is deemed to have paid under subparagraph (i) is deemed to be in respect of the supply of the specified resource or part or in respect of the supply of the employer resource, as the case may be, that the particular pension entity is deemed to have received under the applicable paragraph.
  
(2)  Subsection (1) applies in respect of any notice of assessment, reassessment or additional assessment sent to a person by the Minister of National Revenue except that, in respect of a notice of assessment, reassessment or additional assessment sent by the Minister of National Revenue on or before Announcement Date, paragraph 172.1(8.01)(a) of the Act, as enacted by subsection (1), is to be read as follows:
(a)  the person may, in prescribed form and in a manner satisfactory to the Minister, provide prescribed information in respect of the supply to each pension entity that is deemed to have paid tax in respect of the specified resource or part or in respect of the employer resource, as the case may be, under whichever of paragraphs (5)(d), (5.1)(d), (6)(d), (6.1)(d), (7)(d) and (7.1)(d) is applicable (in this subsection referred to as the “applicable paragraph”) before the day that is one year after the later of
(i)  the day on which the Act of Parliament that implements this subsection receives royal assent, and
(ii)  the first day on which all amounts owing to the Receiver General in respect of the net tax for the reporting period, if any, have been paid or remitted; and
8  (1)  The Act is amended by adding the following after section 172.1:
Pension entity — assessment of supplier
172.11  For the purposes of sections 225.2, 232.01, 232.02 and 261.01 and the Selected Listed Financial Institutions Attribution Method (GST/HST) Regulations, tax in respect of a supply of property or a service that became payable by a pension entity of a pension plan on a particular day is deemed to have become payable by the pension entity on the day on which the pension entity pays that tax and not to have become payable on the particular day if
(a)  the supplier did not, before the end of the last claim period (as defined in subsection 259(1)) of the pension entity that ends within two years after the end of the claim period of the pension entity that includes the particular day, charge that tax;
(b)  the supplier discloses in writing to the pension entity that the Minister has assessed the supplier for that tax;
(c)  the pension entity pays that tax after the end of that last claim period; and
(d)  that tax is not included in determining
(i)  a rebate under subsection 261.01(2) that is claimed by the pension entity for that last claim period or an earlier claim period of the pension entity, or
(ii)  an amount that a qualifying employer (as defined in subsection 261.01(1)) of the pension plan deducts in determining its net tax for a reporting period pursuant to a joint election made under any of subsections 261.01(5), (6) and (9) with the pension entity for that last claim period or an earlier claim period of the pension entity.
(2)  Subsection (1) applies in respect of tax that is paid by a pension entity in a claim period of the pension entity that ends after Announcement Date.
9  (1)  Paragraph (k) of the definition permitted deduction in section 217 of the Act is replaced by the following:
(k)  consideration (other than interest referred to in paragraph (g), dividends referred to in paragraph (h) or consideration referred to in paragraph (k.1) or (k.2)) for a specified non-arm’s length supply made to the qualifying taxpayer less the total of all amounts, each of which is a part of the value of the consideration and is loading;
(2)  The definition permitted deduction in section 217 of the Act is amended by adding the following after paragraph (k.1):
(k.2)  consideration (other than interest referred to in paragraph (g) or dividends referred to in paragraph (h)) for a supply that is deemed by subsection 150(1) to be a supply of a financial service and that is made to the qualifying taxpayer by another person, if the other person is a qualifying taxpayer throughout each specified year of the other person during which the other person makes an outlay, or incurs an expense, outside Canada for the purpose of making the supply;
(3)  Subsections (1) and (2) apply to any specified year of a person that ends after November 16, 2005, except that for the purposes of applying the definition permitted deduction in section 217 of the Act, as amended by subsections (1) and (2), in respect of an amount of consideration for a specified non-arm’s length supply that became due, or was paid without having become due, on or before that day, paragraph (k) of that definition is to be read without reference to the words “less the total of all amounts, each of which is a part of the value of the consideration and is loading”.
(4)  If, in assessing under section 296 of the Act tax payable by a person under Division IV of Part IX of the Act for a particular specified year of the person, an amount was taken into consideration as an external charge or as qualifying consideration for the particular specified year and as a result of the application of the definition permitted deduction in section 217 of the Act, as amended by subsections (1) and (2), the amount or part of the amount is neither qualifying consideration for any specified year of the person nor an external charge for any specified year of the person for which an election under subsection 217.2(1) of the Act is in effect, the person is entitled until the day that is one year after the day on which this Act receives royal assent to request in writing that the Minister of National Revenue make an assessment, reassessment or additional assessment for the purpose of taking into account that the amount or the part of the amount, as the case may be, is neither, if an election under subsection 217.2(1) of the Act is in effect for the particular specified year, an external charge for the particular specified year nor, in any other case, qualifying consideration for the particular specified year and, on receipt of the request, the Minister must with all due dispatch
(a)  consider the request; and
(b)  under section 296 of the Act, assess, reassess or make an additional assessment of the tax payable by the person under Division IV of Part IX of the Act for any specified year of the person and of any interest, penalty or other obligation of the person, solely for the purpose of taking into account that the amount or the part of the amount, as the case may be, is neither, if an election under subsection 217.2(1) of the Act is in effect for the particular specified year, an external charge for the particular specified year nor, in any other case, qualifying consideration for the particular specified year.
10  (1)  Paragraph 217.1(6)(a) of the Act is replaced by the following:
(a)  the whole or part of property (in this section referred to as “attributable property”) or of a qualifying service (in this section referred to as an “attributable service”) to which the qualifying expenditure is attributable is deemed to have been acquired by the qualifying taxpayer at the time at which the outlay was made or the expense was incurred;
(2)  Paragraph 217.1(7)(a) of the Act is replaced by the following:
(a)  the whole or part of property (in this section referred to as “internal property”) or of a qualifying service (in this section referred to as an “internal service”) to which the outlay or expense is attributable is deemed to have been supplied to the qualifying taxpayer at the time the outlay was made or the expense was incurred;
(3)  Section 217.1 of the Act is amended by adding the following after subsection (8):
Lloyd’s associations
(9)  For the purposes of this Division, the following rules apply in respect of a Lloyd’s association:
(a)  if the members of the Lloyd’s association are liable at any time in a specified year of the Lloyd’s association under an insurance policy that was issued by the Lloyd’s association and that insures a risk in respect of property ordinarily situated in Canada or in respect of a person resident in Canada, the Lloyd’s association is deemed to be a qualifying taxpayer throughout the specified year;
(b)  any activity of a member of the Lloyd’s association in respect of an insurance policy that was issued by the Lloyd’s association and that insures a risk in respect of property ordinarily situated in Canada or in respect of a person resident in Canada is deemed to be a Canadian activity of the Lloyd’s association;
(c)  if a member of the Lloyd’s association makes an outlay, or incurs an expense, outside Canada, if the outlay or expense may reasonably be regarded as being applicable to a Canadian activity of the Lloyd’s association and if a particular amount in respect of the outlay or expense would be qualifying consideration for a particular specified year of the member if the outlay or expense were applicable to a Canadian activity of the member and the member were a qualifying taxpayer throughout the particular specified year, the amount determined by the following formula is deemed to be qualifying consideration for the specified year of the Lloyd’s association in which the particular specified year ends:
A − B
where
A is the particular amount, and
B is the total of all amounts, each of which is an amount that is paid to the member as a reimbursement of the outlay or expense;
(d)  if a particular amount in respect of an outlay or expense is qualifying consideration for a specified year of the Lloyd’s association and another amount in respect of the same outlay or expense is qualifying consideration for a specified year of a member of the Lloyd’s association, the other amount of qualifying consideration is not to be included in determining tax under section 218.01 or subsection 218.1(1.2) for the specified year of the member;
(e)  if a member of the Lloyd’s association makes an outlay, or incurs an expense, outside Canada, if the outlay or expense may reasonably be regarded as being applicable to a Canadian activity of the Lloyd’s association and if a particular amount in respect of the outlay or expense would be an external charge for a particular specified year of the member if the outlay or expense were applicable to a Canadian activity of the member and the member were a qualifying taxpayer throughout the particular specified year, the amount determined by the following formula is deemed to be an external charge for the specified year of the Lloyd’s association in which the particular specified year ends:
A − B
where
A is the particular amount, and
B is the total of all amounts, each of which is an amount that is paid to the member as a reimbursement of the outlay or expense;
(f)  if an amount in respect of an outlay or expense is a particular external charge for a specified year of the Lloyd’s association and an amount in respect of the same outlay or expense is another external charge for a specified year of a member of the Lloyd’s association, the other external charge is not to be included in determining tax under section 218.01 or subsection 218.1(1.2) for the specified year of the member;
(g)  if a transaction or dealing between a particular qualifying establishment in Canada of a member of the Lloyd’s association and another qualifying establishment of the member in a country other than Canada may reasonably be regarded as being applicable to a Canadian activity of the Lloyd’s association and if a part of an amount in respect of the transaction or dealing would be an internal charge for a particular specified year of the member if the member were a qualifying taxpayer throughout the particular specified year,
(i)  the amount determined by the following formula is deemed to be an internal charge for the specified year of the Lloyd’s association in which the particular specified year ends:
A − B
where
A is the part of the amount in respect of the transaction or dealing, and
B is the total of all amounts, each of which is an amount that is paid to the member as a reimbursement of an outlay made, or expense incurred, outside Canada by the member that is included in the determination of the part of the amount in respect of the transaction or dealing, and
(ii)  for each outlay made, or expense incurred, outside Canada by the member that is included in the determination of the part of the amount in respect of the transaction or dealing, the outlay or expense is deemed not to have been made or incurred by the member and the amount determined by the following formula is deemed to be an outlay made, or expense incurred, outside Canada by the Lloyd’s association:
A − B
where
A is the amount of the outlay or expense, and
B is the total of all amounts, each of which is an amount that is paid to the member as a reimbursement of the outlay or expense;
(h)  if a part of an amount in respect of a transaction or dealing is a particular internal charge for a specified year of the Lloyd’s association and a part of the same amount is another internal charge for a specified year of a member of the Lloyd’s association, the other internal charge is not to be included in determining tax under section 218.01 or subsection 218.1(1.2) for the specified year of the member;
(i)  the Lloyd’s association is deemed not to deal at arm’s length with the following persons:
(i)  any other Lloyd’s association,
(ii)  the society incorporated by the Lloyd’s Act, 1871 (U.K.), 34 Vict., c. 21, by the name of Lloyd’s, and
(iii)  a person referred to in paragraph 14(2)(a) of the Lloyd’s Act 1982 (U.K.), 1982, c. 14, as amended from time to time; and
(j)  the members of the Lloyd’s association are deemed not to deal at arm’s length with the persons referred to in any of subparagraphs (i)(i) to (iii) in respect of any supply, transaction or series of transactions that may reasonably be regarded as being applicable to an activity of the Lloyd’s association.
  
Lloyd’s — credits and rebates
(10)  For the purposes of applying subsections (6) and (7) and determining an input tax credit under section 169 in respect of an amount of tax under section 218.01 or subsection 218.1(1.2) for a specified year of a Lloyd’s association, the following rules apply:
(a)  if the amount is in respect of qualifying consideration that is deemed to be qualifying consideration for the specified year under paragraph (9)(c) or an external charge that is deemed to be an external charge for the specified year under paragraph (9)(e), the attributable property or attributable service to which the qualifying consideration or external charge relates is deemed to have been acquired by the Lloyd’s association; or
(b)  if the amount is in respect of an internal charge that is deemed to be an internal charge for the specified year under paragraph (9)(g), the internal property or internal service to which the internal charge relates is deemed to have been acquired by the Lloyd’s association.
  
Lloyd’s — reinsurance
(11)  For the purposes of this Division, if an agreement entered into by the members of a particular Lloyd’s association and either the members of another Lloyd’s association or another person that is a party to the agreement otherwise than as a member of a Lloyd’s association is described in subsection 149.1(4) and applies in respect of one or more insurance policies (referred to in this subsection as the “Canadian covered policies”) that insure a risk in respect of property ordinarily situated in Canada or in respect of a person resident in Canada, the following rules apply:
(a)  the other Lloyd’s association or the other person, as the case may be, is deemed to be a qualifying taxpayer throughout every specified year of the other Lloyd’s association or of the other person that includes a time at which the agreement is in effect;
(b)  if the agreement is entered into by the members of another Lloyd’s association, the following activities are deemed to be Canadian activities of the other Lloyd’s association:
(i)  any activity of the other Lloyd’s association in respect of a Canadian covered policy, and
(ii)  any activity of a member of the other Lloyd’s association in respect of a Canadian covered policy; and
(c)  if paragraph (b) does not apply, any activity of the other person in respect of a Canadian covered policy is deemed to be a Canadian activity of the other person and the other person is deemed not to deal at arm’s length with the following persons:
(i)  any Lloyd’s association,
(ii)  the society incorporated by the Lloyd’s Act, 1871 (U.K.), 34 Vict., c. 21, by the name of Lloyd’s, and
(iii)  a person referred to in paragraph 14(2)(a) of the Lloyd’s Act 1982 (U.K.), 1982, c. 14, as amended from time to time.
  
Lloyd’s — members
(12)  Despite subsection (1), a person that is a member of a Lloyd’s association at any time in a specified year of the person and that is a person referred to in subparagraph 149(1)(a)(v) at any time in the specified year is not a qualifying taxpayer throughout the specified year if, throughout the specified year, the person
(a)  is not a person referred to in any of subparagraphs 149(1)(a)(i) to (iv) and (vi) to (xi);
(b)  is not a financial institution because of paragraph 149(1)(b) or (c); and
(c)  does not carry on an insurance business in Canada outside of any Lloyd’s association.
  
(4)  Subsections (1) and (2) are deemed to have come into force on the day after Announcement Date.
(5)  Subsection (3) applies in respect of any specified year of a person that ends after Announcement Date.
11  (1)  The portion of subsection 232.01(5) of the Act before paragraph (a) is replaced by the following:
Effect of tax adjustment note
(5)  If a person issues a tax adjustment note to a pension entity under subsection (3) in respect of all or part of a specified resource, a supply of the specified resource or part is deemed to have been received by the pension entity under subparagraph 172.1(5)(d)(i) or (5.1)(d)(i) and tax (in this subsection referred to as “deemed tax”) in respect of that supply is deemed to have been paid on a particular day under subparagraph 172.1(5)(d)(ii) or (5.1)(d)(ii) or paragraph (8.01)(b) by the pension entity, the following rules apply:
  
(2)  Subsection (1) is deemed to have come into force on the day after Announcement Date.
12  (1)  The portion of subsection 232.02(4) of the Act before paragraph (a) is replaced by the following:
Effect of tax adjustment note
(4)  If a person issues a tax adjustment note to a pension entity under subsection (2) in respect of particular employer resources consumed or used for the purpose of making an actual pension supply, a supply of each of those particular employer resources (each of which in this subsection is referred to as a “particular supply”) is deemed to have been received by the pension entity under subparagraph 172.1(6)(d)(i) or (6.1)(d)(i) and tax (in this subsection referred to as “deemed tax”) in respect of each of the particular supplies is deemed to have been paid under subparagraph 172.1(6)(d)(ii) or (6.1)(d)(ii) or paragraph (8.01)(b) by the pension entity, the following rules apply:
  
(2)  Subsection (1) is deemed to have come into force on the day after Announcement Date.
13  (1)  Subparagraph (i) of the description of H in the definition pension rebate amount in subsection 261.01(1) of the Act is replaced by the following:
(i)  if an application for a rebate under subsection (2) for the claim period is filed in accordance with subsection (3), the total of
(A)  the total amount indicated on the application under subsection (3.1), and
(B)  the total of all amounts, each of which is an eligible amount of the pension entity for the claim period that is described in paragraph (b) of the definition eligible amount and in respect of which a portion of the rebate is claimed by the pension entity in accordance with paragraph (3.2)(a),
(2)  The portion of subsection 261.01(3.1) of the Act before paragraph (a) is replaced by the following:
Application for rebate — pension rebate amount election
(3.1)  An application for a rebate under subsection (2) for a claim period of a pension entity shall indicate the total of all amounts, each of which is an eligible amount of the pension entity for the claim period (other than an eligible amount in respect of which a portion of the rebate is claimed by the pension entity in accordance with paragraph (3.2)(a))
  
(3)  Section 261.01 of the Act is amended by adding the following after subsection (3.1):
Separate claims for a claim period
(3.2)  If an eligible amount of a pension entity for a claim period of the pension entity is an amount of tax that is deemed to have been paid under subparagraph 172.1(8.01)(b)(i), or to have become payable under section 172.11, the following rules apply:
(a)  the portion of the rebate under subsection (2) for the claim period that is in respect of the excess pension rebate amount for the claim period in respect of the eligible amount may, despite subsection (4), be claimed in an application separate from the pension entity’s application for the portion of that rebate that is in respect of the remaining pension rebate amount for the claim period provided that the application for the portion of that rebate that is in respect of that excess pension rebate amount is filed by the pension entity after the beginning of the pension entity’s fiscal year that includes the claim period and not later than
(i)  if the pension entity is a registrant, the day on or before which the pension entity is required to file the return under Division V for the claim period, or
(ii)  in any other case, the last day of the claim period; and
(b)  a particular election under subsection (5) or (6) for the claim period that is in respect of the excess pension rebate amount for the claim period in respect of the eligible amount may be made separately from an election under subsection (5) or (6), as the case may be, that is in respect of the remaining pension rebate amount for the claim period provided that the portion of the rebate under subsection (2) for the claim period that is in respect of that excess pension rebate amount is claimed by the pension entity in a separate application that is filed in accordance with paragraph (a) and the particular election is filed at the same time that the application is filed.
  
Definitions
(3.3)  The following definitions apply in this subsection and subsection (3.2).
excess pension rebate amount for a claim period of a pension entity means, in respect of an amount of tax deemed to have been paid under subparagraph 172.1(8.01)(b)(i), or to have become payable under section 172.11, by the pension entity during the claim period, the amount that would be the pension rebate amount of the pension entity for the claim period if the amount of tax were the only eligible amount of the pension entity for the claim period. (excédent du montant de remboursement de pension)
remaining pension rebate amount for a claim period of a pension entity means the amount determined by the formula
A − B
where
A is the pension rebate amount of the pension entity for the claim period; and
B is the total of all amounts, each of which is an excess pension rebate amount for the claim period in respect of which a portion of the rebate under subsection (2) for the claim period is claimed by the pension entity in accordance with paragraph (3.2)(a). (solde du montant de remboursement de pension)
  
(4)  Subsections (1) to (3) are deemed to have come into force on the day after Announcement Date.
14  (1)  The formula in paragraph 273.2(2)(c) of the Act is replaced by the following:
$2,000,000 × A/365
(2)  Subsection (1) applies in respect of fiscal years of a person that end after Announcement Date.
15  (1)  Section 278 of the Act is amended by adding the following before subsection (1):
Meaning of electronic payment
278  (0.1)  In this section, electronic payment means any payment or remittance to the Receiver General that is made through electronic services offered by a person described in any of paragraphs (3)(a) to (d) or by any electronic means specified by the Minister.
(2)  The portion of subsection 278(3) of the Act before paragraph (a) is replaced by the following:
Electronic payment
(3)  Every person that is required under this Part to pay or remit an amount to the Receiver General shall, if the amount is $10,000 or more, make the payment or remittance by way of electronic payment, unless the person cannot reasonably remit or pay the amount in that manner, to the account of the Receiver General at or through
  
(3)  Subsections (1) and (2) apply in respect of payments and remittances made after 2023.
16  (1)  The Act is amended by adding the following after section 280.11:
Penalty — electronic payment
280.12  Every person that fails to comply with subsection 278(3) is liable to a penalty equal to $100 for each such failure.
(2)  Subsection (1) applies in respect of payments and remittances made after 2023.
17  (1)  The Act is amended by adding the following after section 285.02:
Definitions
285.03  (1)  The following definitions apply in this section.
gross entitlements of a person at any time, in respect of a planning activity of the person, means all amounts to which the person, or another person not dealing at arm’s length with the person, is entitled, either before or after that time and either absolutely or contingently, to receive or obtain in respect of the activity. (droits à paiement)
planning activity has the same meaning as in subsection 285.1(1). (activité de planification)
section 325 avoidance planning, by a person, means a planning activity in respect of a transaction or series of transactions that meets the following conditions:
(a)  the transaction or series of transactions is, or is part of, a section 325 avoidance transaction; and
(b)  the person knows, or would reasonably be expected to know but for circumstances amounting to gross negligence, that one of the purposes of the transaction or series of transactions is to
(i)  reduce a transferee’s joint and several, or solidary, liability under section 325 for an amount payable or remittable under this Part by a transferor or for an amount that would be payable or remittable by the transferor but for a transaction or series of transactions in which an amount, that is or may be relevant in determining any obligations or entitlements under this Part of a person that dealt at arm’s length with the transferor or transferee immediately before the transaction or series of transactions, is used directly or indirectly to provide a tax benefit for the transferor or transferee, or
(ii)  reduce the person or another person’s ability to pay any amount payable or remittable, or that may become payable or remittable, under this Part by the person or the other person. (planification d’évitement de l’article 325)
section 325 avoidance transaction means a transaction or series of transactions in respect of which
(a)  the conditions in paragraph 325(5)(a) or (b) are met; or
(b)  if subsection 325(5) applied to the transaction or series of transactions, the amount determined under subparagraph 325(5)(c)(ii) would exceed the amount determined under subparagraph 325(5)(c)(i). (transaction d’évitement de l’article 325)
tax benefit has the same meaning as in subsection 285.1(1). (avantage fiscal)
transaction includes an arrangement or event. (opération)
Penalty
(2)  Every person that engages in, participates in, assents to or acquiesces in a planning activity that they know is section 325 avoidance planning, or would reasonably be expected to know is section 325 avoidance planning, but for circumstances amounting to gross negligence, is liable to a penalty equal to the lesser of
(a)  50% of the amount payable or remittable under this Part in respect of which the joint and several, or solidary, liability was sought to be avoided through the planning, and
(b)  the total of $100,000 and the person’s gross entitlements in respect of the planning at the time at which the notice of assessment of the penalty is sent to the person in respect of the planning.
Clerical or secretarial services
(3)  Subsection (2) does not apply to a person solely because the person provided clerical services or secretarial services with respect to the planning.
(2)  Subsection (1) is deemed to have come into force on April 19, 2021.
18  Paragraph 298(1)(e) of the Act is replaced by the following:
(e)  in the case of any penalty payable by the person, other than a penalty under section 280.1, 285, 285.01, 285.02, 285.03 or 285.1, more than four years after the person became liable to pay the penalty;
19  (1)  Section 325 of the Act is amended by adding the following before subsection (1):
Definitions
325  (0.1)  The following definitions apply in this section.
property includes money. (bien)
transaction includes an arrangement or event. (opération)
(2)  Subsection 325(5) of the Act is replaced by the following:
Anti-avoidance rules
(5)  For the purposes of this section, if a person transfers property to another person as part of a transaction or series of transactions, the following rules apply:
(a)  the transferor is deemed to not be dealing at arm’s length with the transferee at the time of the transfer of the property if
(i)  the transferor and the transferee do not deal at arm’s length at any time during the period beginning immediately prior to the transaction or series of transactions and ending immediately after the transaction or series of transactions, and
(ii)  it is reasonable to conclude that one of the purposes of undertaking or arranging the transaction or series of transactions is to avoid joint and several, or solidary, liability of the transferee and the transferor under this section for an amount payable or remittable under this Part;
(b)  an amount that the transferor is liable to pay or remit under this Part (including, for greater certainty, an amount that the transferor is liable to pay under this section, regardless of whether the Minister has made an assessment under subsection (2) in respect of that amount) is deemed to have become payable or remittable, as the case may be, in the reporting period of the transferor in which the property was transferred, if it is reasonable to conclude that one of the purposes of the transfer of the property is to avoid the payment of a future amount payable under this Part by the transferor or transferee; and
(c)  the amount determined for A in paragraph (1)(d) is deemed to be the greater of
(i)  the amount otherwise determined for A in paragraph (1)(d) without reference to this paragraph, and
(ii)  the amount determined by the formula
A − B
where
A is the fair market value of the property at the time of the transfer, and
B is the fair market value, at its lowest at any time during the period beginning immediately prior to the transaction or series of transactions and ending immediately after the transaction or series of transactions, of the consideration given by the transferee for the transfer of the property (other than any part of the consideration that is in a form that is cancelled or extinguished during that period and for which no property that is neither cancelled nor extinguished during that period is substituted) provided that the consideration is held by the transferor at that time.
  
(3)  Subsections (1) and (2) are deemed to have come into force on April 19, 2021.
20  (1)  Subsection 335(10.1) of the Act is replaced by the following:
Date electronic notice sent
(10.1)  For the purposes of this Part, if a notice or other communication in respect of a person, other than a notice or other communication that refers to the business number of a person, is made available in electronic format such that it can be read or perceived by a person or a computer system or other similar device, the notice or other communication is presumed to be sent to the person and received by the person on the date that an electronic message is sent, to the electronic address most recently provided before that date by the person to the Minister for the purposes of this subsection, informing the person that a notice or other communication requiring the person’s immediate attention is available in the person’s secure electronic account. A notice or other communication is considered to be made available if it is posted by the Minister in the person’s secure electronic account and the person has authorized that notices or other communications may be made available in this manner and has not before that date revoked that authorization in a manner specified by the Minister.
  
(2)  Section 335 of the Act is amended by adding the following after subsection (10.1):
Date electronic notice sent — business account
(10.2)  For the purposes of this Part, a notice or other communication in respect of a person that is made available in electronic format such that it can be read or perceived by a person or computer system or other similar device and that refers to the business number of a person is presumed to be sent to the person and received by the person on the date that it is posted by the Minister in the secure electronic account in respect of the business number of the person, unless the person has requested, at least 30 days before that date, in a manner specified by the Minister, that such notices or other communications be sent by mail.
  
21  (1)  Subsection 1(1) of Part VII of Schedule VI to the Act is amended by adding the following in alphabetical order:
tangible personal property includes money;
(2)  Subsection (1) is deemed to come into force on the day after Announcement Date. It also applies in respect of a supply made on or before Announcement Date unless the supplier charged or collected, on or before Announcement Date, any amount as or on account of tax under Part IX of the Act in respect of the supply.

PART 2

Draft Amendments to the Air Travellers Security Charge Act

22  (1)  Section 20 of the Air Travellers Security Charge Act is replaced by the following:
Meaning of electronic payment
20  (1)  In this section, electronic payment means any payment to the Receiver General that is made through electronic services offered by a person described in any of paragraphs (2)(a) to (d) or by any electronic means specified by the Minister.
Electronic payment
(2)  Every person that is required under this Act to pay an amount to the Receiver General shall, if the amount is $10,000 or more, make the payment by way of electronic payment, unless the person cannot reasonably pay the amount in that manner, to the account of the Receiver General at or through
(a)  a bank;
(b)  a credit union;
(c)  a corporation authorized under the laws of Canada or a province to carry on the business of offering its services as a trustee to the public; or
(d)  a corporation authorized under the laws of Canada or a province to accept deposits from the public and that carries on the business of lending money on the security of real property or immovables or investing in mortgages on real property or hypothecs on immovables.
(2)  Subsection (1) applies in respect of payments made after 2023.
23  (1)  The Act is amended by adding the following after section 53:
Penalty — electronic payment
54  Every person that fails to comply with subsection 20(2) is liable to a penalty equal to $100 for each such failure.
(2)  Subsection (1) applies in respect of payments made after 2023.
24  (1)  Subsection 83(9.1) of the Act is replaced by the following:
Date electronic notice sent
(9.1)  For the purposes of this Act, if a notice or other communication in respect of a person, other than a notice or other communication that refers to the business number of a person, is made available in electronic format such that it can be read or perceived by a person or a computer system or other similar device, the notice or other communication is presumed to be sent to the person and received by the person on the date that an electronic message is sent, to the electronic address most recently provided before that date by the person to the Minister for the purposes of this subsection, informing the person that a notice or other communication requiring the person’s immediate attention is available in the person’s secure electronic account. A notice or other communication is considered to be made available if it is posted by the Minister in the person’s secure electronic account and the person has authorized that notices or other communications may be made available in this manner and has not before that date revoked that authorization in a manner specified by the Minister.
  
(2)  Section 83 of the Act is amended by adding the following after subsection (9.1):
Date electronic notice sent — business account
(9.2)  For the purposes of this Act, a notice or other communication in respect of a person that is made available in electronic format such that it can be read or perceived by a person or computer system or other similar device and that refers to the business number of a person is presumed to be sent to the person and received by the person on the date that it is posted by the Minister in the secure electronic account in respect of the business number of the person, unless the person has requested, at least 30 days before that date, in a manner specified by the Minister, that such notices or other communications be sent by mail.
  

PART 3

Draft Amendments to the Excise Act, 2001

25  (1)  Section 87 of the Excise Act, 2001 is amended by striking out “and” at the end of paragraph (a) and by adding the following after paragraph (a):
(a.1)  in the case of wine on which duty is not imposed because of paragraph 135(2)(a), before the wine is
(i)  removed from the licensee’s premises,
(ii)  consumed, or
(iii)  made available for sale on the premises; and
(2)  Subsection (1) is deemed to have come into force on June 30, 2022.
26  (1)  Paragraph 88(2)(i) of the Act is replaced by the following:
(i)  that is wine referred to in paragraph 135(2)(a) or (b) may be possessed by any person; and
(2)  Subsection (1) is deemed to have come into force on June 30, 2022, but does not apply to wine packaged before that day.
27  Section 158.01 of the Act is amended by striking out “or” at the end of paragraph (b), by adding “or” at the end of paragraph (c) and by adding the following after paragraph (c):
(d)  cannabis products that are in the possession of a holder of a licence referred to in paragraph 8(1)(e) or (f) of the Cannabis Regulations, but only to the extent that those cannabis products are used by the holder of the license in activities that are not prohibited for those cannabis products under the conditions of the license or the Cannabis Act.
28  Section 158.13 of the Act is replaced by the following:
Packaging and stamping of cannabis
158.13  A cannabis licensee shall not enter a cannabis product into the duty-paid market unless
(a)  the cannabis product has been packaged by
(i)  the licensee, or
(ii)  another cannabis licensee if prescribed conditions are met;
(b)  the package has printed on it prescribed information;
(c)  the cannabis product is stamped, to indicate that cannabis duty has been paid, by
(i)  the licensee, or
(ii)  another cannabis licensee if prescribed conditions are met; and
(d)  if the cannabis product is to be entered in the duty-paid market of a specified province, the cannabis product is stamped, to indicate that additional cannabis duty in respect of the specified province has been paid, by
(i)  the licensee, or
(ii)  another cannabis licensee if prescribed conditions are met.
29  Subsections 158.19(3) and (4) of the Act are replaced by the following:
Duty payable
(3)  The greater of the duty imposed under subsection (1) and the duty imposed under subsection (2) is payable at the time of delivery of the cannabis products to a purchaser by
(a)  if a person meets prescribed conditions in respect of the cannabis products, the person; and
(b)  in any other case, the cannabis licensee that packaged the cannabis products.
The cannabis products are relieved of the lesser of those duties.
  
Equal duties
(4)  If the amount of duty imposed under subsection (1) is equal to the amount of duty imposed under subsection (2), the duty imposed under subsection (1) is payable at the time of delivery of the cannabis products to a purchaser by
(a)  if a person meets prescribed conditions in respect of the cannabis products, the person; and
(b)  in any other case, the cannabis licensee that packaged the cannabis products.
The cannabis products are relieved of the duty imposed under subsection (2).
  
30  Subsection 158.2(2) of the Act is replaced by the following:
Duty payable
(2)  The duty imposed under subsection (1) is payable at the time of delivery of the cannabis products to a purchaser by
(a)  if a person meets prescribed conditions in respect of the cannabis products, the person; and
(b)  in any other case, the cannabis licensee that packaged the cannabis products.
  
31  (1)  Subsection 159.1(1) of the Act is replaced by the following:
Reporting period — general
159.1  (1)  Subject to this section and section 159.2, the reporting period of a person is a fiscal month.
(2)  Subsection (1) is deemed to have come into force on April 1, 2022.
32  (1)  The Act is amended by adding the following after section 159.1:
Definitions
159.2  (1)  The following definitions apply in this section.
calendar quarter means a period of three months beginning on the first day of January, April, July or October. (trimestre civil)
threshold amount of a cannabis licensee for a calendar quarter means the amount that is the total of all duties payable under Part 4.1 by the cannabis licensee, and any person associated with the cannabis licensee, in the immediately preceding four calendar quarters. (montant déterminant)
Reporting period — quarterly
(2)  On application by a cannabis licensee, the Minister may, in writing, authorize the reporting periods of the cannabis licensee to be calendar quarters, beginning on the first day of a particular calendar quarter, if the threshold amount of the cannabis licensee for the particular calendar quarter does not exceed $1,000,000.
Application — form and filing
(3)  An application made by a cannabis licensee under subsection (2) is to be
(a)  made in prescribed form containing prescribed information;
(b)  filed with the Minister in prescribed manner; and
(c)  filed within the first month of the calendar quarter in which the authorization is to take effect or before any later day that the Minister may allow.
Deemed revocation
(4)  An authorization under subsection (2) in respect of a cannabis licensee is deemed to be revoked at the beginning of a calendar quarter if the threshold amount of the cannabis licensee for the calendar quarter exceeds $1,000,000.
Revocation by Minister
(5)  The Minister may revoke an authorization under subsection (2) in respect of a cannabis licensee if
(a)  the cannabis licensee requests in writing that the Minister do so;
(b)  the cannabis licensee fails to comply with the Act; or
(c)  the Minister considers that the authorization is no longer required.
Notice of revocation
(6)  If the Minister revokes an authorization in respect of a cannabis licensee, the Minister shall send a notice in writing of the revocation to the cannabis licensee and shall specify in the notice the fiscal month of the cannabis licensee for which the revocation becomes effective.
Deemed reporting period on revocation
(7)  If a revocation under subsection (4) or (5) of an authorization under subsection (2) in respect of a cannabis licensee becomes effective before the last day of a calendar quarter, the period beginning on the first day of the calendar quarter and ending immediately before the first day of the fiscal month of the cannabis licensee for which the revocation becomes effective is deemed to be a reporting period of the cannabis licensee.
(2)  Subsection (1) is deemed to have come into force on April 1, 2022.
33  (1)  Section 163 of the Act is replaced by the following:
Meaning of electronic payment
163  (1)  In this section, electronic payment means any payment to the Receiver General that is made through electronic services offered by a person described in any of paragraphs (2)(a) to (e) or by any electronic means specified by the Minister.
Electronic payment
(2)  Every person that is required under this Act to pay any duty, interest or other amount to the Receiver General shall, if the amount is $10,000 or more, make the payment by way of electronic payment, unless the person cannot reasonably pay the amount in that manner, to the account of the Receiver General at or through
(a)  a bank;
(b)  an authorized foreign bank, as defined in section 2 of the Bank Act, that is not subject to the restrictions and requirements referred to in subsection 524(2) of that Act;
(c)  a credit union;
(d)  a corporation authorized under the laws of Canada or a province to carry on the business of offering its services as a trustee to the public; or
(e)  a corporation that is authorized under the laws of Canada or a province to accept deposits from the public and that carries on the business of lending money on the security of real property or immovables or investing in mortgages on real property or hypothecs on immovables.
(2)  Subsection (1) applies in respect of payments made after 2023.
34  The portion of section 234.1 of the Act before the formula is replaced by the following:
Contravention of section 158.02, 158.1, 158.11 or 158.12
234.1  Every person that contravenes section 158.02, 158.1, 158.11 or 158.12 is liable to a penalty equal to the amount determined by the formula
35  (1)  The Act is amended by adding the following after section 251.1:
Penalty — electronic payment
251.11  Every person that fails to comply with subsection 163(2) is liable to a penalty equal to $100 for each such failure.
(2)  Subsection (1) applies in respect of payments made after 2023.
36  (1)  Section 297 of the Act is amended by adding the following before subsection (1):
Definitions
297  (0.1)  The following definitions apply in this section.
common-law partner of an individual at any time means a person who is the common-law partner of the individual at that time for the purposes of the Income Tax Act. (conjoint de fait)
common-law partnership means the relationship between two persons who are common-law partners of each other. (union de fait)
transaction includes an arrangement or event. (opération)
(2)  Subsection 297(6) of the Act is replaced by the following:
Anti-avoidance rules
(6)  For the purposes of this section, if a person transfers property to another person as part of a transaction or series of transactions, the following rules apply:
(a)  the transferor is deemed to not be dealing at arm’s length with the transferee at the time of the transfer of the property if
(i)  the transferor and the transferee do not deal at arm’s length at any time during the period beginning immediately prior to the transaction or series of transactions and ending immediately after the transaction or series of transactions, and
(ii)  it is reasonable to conclude that one of the purposes of undertaking or arranging the transaction or series of transactions is to avoid joint and several, or solidary, liability of the transferee and the transferor under this section for an amount payable under this Act;
(b)  an amount that the transferor is liable to pay under this Act (including, for greater certainty, an amount that the transferor is liable to pay under this section, regardless of whether the Minister has made an assessment under subsection (3) in respect of that amount) is deemed to have become payable in the reporting period of the transferor in which the property was transferred, if it is reasonable to conclude that one of the purposes of the transfer of the property is to avoid the payment of a future amount payable under this Act by the transferor or transferee; and
(c)  the amount determined for A in paragraph (1)(d) is deemed to be the greater of
(i)  the amount otherwise determined for A in paragraph (1)(d) without reference to this paragraph, and
(ii)  the amount determined by the formula
A − B
where
A is the fair market value of the property at the time of the transfer, and
B is the fair market value, at its lowest at any time during the period beginning immediately prior to the transaction or series of transactions and ending immediately after the transaction or series of transactions, of the consideration given by the transferee for the transfer of the property (other than any part of the consideration that is in a form that is cancelled or extinguished during that period and for which no property that is neither cancelled nor extinguished during that period is substituted) provided that the consideration is held by the transferor at that time.
  
(3)  Subsections (1) and (2) are deemed to have come into force on April 19, 2021.
37  (1)  Subsection 301(9.1) of the Act is replaced by the following:
Date electronic notice sent
(9.1)  For the purposes of this Act, if a notice or other communication in respect of a person, other than a notice or other communication that refers to the business number of a person, is made available in electronic format such that it can be read or perceived by a person or a computer system or other similar device, the notice or other communication is presumed to be sent to the person and received by the person on the date that an electronic message is sent, to the electronic address most recently provided before that date by the person to the Minister for the purposes of this subsection, informing the person that a notice or other communication requiring the person’s immediate attention is available in the person’s secure electronic account. A notice or other communication is considered to be made available if it is posted by the Minister in the person’s secure electronic account and the person has authorized that notices or other communications may be made available in this manner and has not before that date revoked that authorization in a manner specified by the Minister.
  
(2)  Section 301 of the Act is amended by adding the following after subsection (9.1):
Date electronic notice sent — business account
(9.2)  For the purposes of this Act, a notice or other communication in respect of a person that is made available in electronic format such that it can be read or perceived by a person or computer system or other similar device and that refers to the business number of a person is presumed to be sent to the person and received by the person on the date that it is posted by the Minister in the secure electronic account in respect of the business number of the person, unless the person has requested, at least 30 days before that date, in a manner specified by the Minister, that such notices or other communications be sent by mail.
  
38  Section 304 of the Act is amended by adding the following after paragraph (n):
(n.1)  respecting the packaging or stamping, and entry into the duty-paid market, by a cannabis licensee of cannabis products that are owned or produced by another cannabis licensee, subject to an authorization of the Minister and any conditions that the Minister considers appropriate, and prescribing joint and several, or solidary, liability or penalties in respect of those cannabis products;

PART 4

Draft Amendments to the Greenhouse Gas Pollution Pricing Act

39  (1)  Section 86 of the Greenhouse Gas Pollution Pricing Act is replaced by the following:
Meaning of electronic payment
86  (1)  In this section, electronic payment means any payment to the Receiver General that is made through electronic services offered by a person described in any of paragraphs (2)(a) to (d) or by any electronic means specified by the Minister.
Electronic payment
(2)  Every person that is required under this Part to pay an amount to the Receiver General must, if the amount is $10,000 or more, make the payment by way of electronic payment, unless the person cannot reasonably pay the amount in that manner, to the account of the Receiver General at or through
(a)  a bank;
(b)  a credit union;
(c)  a corporation authorized under the laws of Canada or a province to carry on the business of offering its services as a trustee to the public; or
(d)  a corporation that is authorized under the laws of Canada or a province to accept deposits from the public and that carries on the business of lending money on the security of real property or immovables or investing in indebtedness on the security of mortgages on real property or hypothecs on immovables.
(2)  Subsection (1) applies in respect of payments made after 2023.
40  (1)  The Act is amended by adding the following after section 123:
Penalty — electronic payments
123.1  Every person that fails to comply with subsection 86(2) is liable to a penalty equal to $100 for each such failure.
(2)  Subsection (1) applies in respect of payments made after 2023.
41  (1)  Section 161 of the Act is amended by adding the following before subsection (1):
Meaning of transaction
161  (0.1)  In this section, transaction includes an arrangement or event.
(2)  Section 161 of the Act is amended by adding the following after subsection (5):
Anti-avoidance rules
(6)  For the purposes of this section, if a person transfers property to another person as part of a transaction or series of transactions, the following rules apply:
(a)  the transferor is deemed to not be dealing at arm’s length with the transferee at the time of the transfer of the property if
(i)  the transferor and the transferee do not deal at arm’s length at any time during the period beginning immediately prior to the transaction or series of transactions and ending immediately after the transaction or series of transactions, and
(ii)  it is reasonable to conclude that one of the purposes of undertaking or arranging the transaction or series of transactions is to avoid joint and several, or solidary, liability of the transferee and the transferor under this section for an amount payable under this Part;
(b)  an amount that the transferor is liable to pay under this Part (including, for greater certainty, an amount that the transferor is liable to pay under this section, regardless of whether the Minister has made an assessment under subsection (3) in respect of that amount) is deemed to have become payable in the reporting period of the transferor in which the property was transferred, if it is reasonable to conclude that one of the purposes of the transfer of the property is to avoid the payment of a future amount payable under this Part by the transferor or transferee; and
(c)  the amount determined for A in paragraph (1)(d) is deemed to be the greater of
(i)  the amount otherwise determined for A in paragraph (1)(d) without reference to this paragraph, and
(ii)  the amount determined by the formula
A − B
where
A is the fair market value of the property at the time of the transfer, and
B is the fair market value, at its lowest at any time during the period beginning immediately prior to the transaction or series of transactions and ending immediately after the transaction or series of transactions, of the consideration given by the transferee for the transfer of the property (other than any part of the consideration that is in a form that is cancelled or extinguished during that period and for which no property that is neither cancelled nor extinguished during that period is substituted) provided that the consideration is held by the transferor at that time.
  
(3)  Subsections (1) and (2) are deemed to have come into force on April 19, 2021.
42  (1)  Subsection 164(12) of the Act is replaced by the following:
Date electronic notice sent
(12)  For the purposes of this Part, if a notice or other communication in respect of a person, other than a notice or other communication that refers to the business number of a person, is made available in electronic format such that it can be read or perceived by a person or a computer system or other similar device, the notice or other communication is presumed to be sent to the person and received by the person on the date that an electronic message is sent, to the electronic address most recently provided before that date by the person to the Minister for the purposes of this subsection, informing the person that a notice or other communication requiring the person’s immediate attention is available in the person’s secure electronic account. A notice or other communication is considered to be made available if it is posted by the Minister in the person’s secure electronic account and the person has authorized that notices or other communications may be made available in this manner and has not before that date revoked that authorization in a manner specified by the Minister.
  
(2)  Section 164 of the Act is amended by adding the following after subsection (12):
Date electronic notice sent — business account
(12.1)  For the purposes of this Part, a notice or other communication in respect of a person that is made available in electronic format such that it can be read or perceived by a person or computer system or other similar device and that refers to the business number of a person is presumed to be sent to the person and received by the person on the date that it is posted by the Minister in the secure electronic account in respect of the business number of the person, unless the person has requested, at least 30 days before that date, in a manner specified by the Minister, that such notices or other communications be sent by mail.
  

PART 5

Draft Amendments to the Underused Housing Tax Act

43  (1)  Paragraph (a) of the definition specified Canadian partnership in section 2 of the Underused Housing Tax Act is replaced by the following:
(a)  a partnership, each member of which
(i)  is, on December 31 of the calendar year, an excluded owner or a specified Canadian corporation, or
(ii)  would be, on December 31 of the calendar year, an excluded owner if paragraph (b) of the definition excluded owner were read without reference to “or as a partner of a partnership”; or
(2)  Subsection (1) is deemed to have come into force on January 1, 2022.
44  (1)  Paragraph 6(7)(l) of the Act is replaced by the following:
(l)  the construction of the residential property is substantially completed in January, February or March of the calendar year, the residential property is offered for sale to the public during the calendar year and the residential property had never been occupied by an individual as a place of residence or lodging during the calendar year;
(2)  Subsection (1) is deemed to have come into force on January 1, 2022.
45  (1)  The portion of subsection 47(1) of the Act before paragraph (a) is replaced by the following:
Failure to file
47  (1)  Every person that fails to file a return as and when required under Part 4 is liable to a penalty equal to the greater of
(2)  Subsection (1) is deemed to have come into force on January 1, 2022.
Related Amendments
46  Section 116 of the Income Tax Act is amended by adding the following after subsection (7):
Exception – underused housing tax
(8)  If, in the absence of this subsection, the Minister would be required to issue a certificate under subsection (2), (4) or (5.2) in respect of a disposition, or a proposed disposition, of property that is residential property, as defined in section 2 of the Underused Housing Tax Act, the Minister may decline to issue the certificate if
(a)  the Minister is not satisfied that all returns that the non-resident person is required to file under section 7 of that Act in respect of the property have been filed;
(b)  the Minister is not satisfied that all taxes and other amounts payable under that Act by the non-resident person have been paid; or
(c)  the following conditions are met:
(i)  the Minister has reasonable grounds to believe that, for the calendar year immediately preceding the calendar year in which the property is or is expected to be disposed of, the non-resident person will be required to file a return under section 7 of that Act in respect of the property or will become liable to pay an amount of tax under subsection 6(3) of that Act in respect of the property, and
(ii)  the return has not been filed or the amount of tax has not been paid.
  

PART 6

Draft Amendments to the Budget Implementation Act, 2022, No. 1

47  (1)  The portion of subsection 128(3) of the Budget Implementation Act, 2022, No. 1 before paragraph (a) is replaced by the following:
(3)  Sections 158.42 to 158.47 and 158.49 and subsection 158.5(2) of the Excise Act, 2001, as enacted by section 59, subsection 63(1) and sections 107 to 109 come into force on October 1, 2022. However, those provisions of the Excise Act, 2001, subsection 63(1) and sections 107 to 109 do not apply before 2023 in respect of
  
(2)  Section 128 of the Act is amended by adding the following after subsection (3):
(3.1)  Sections 158.54 to 158.56, 158.6 and 158.61 of the Excise Act, 2001, as enacted by section 59, come into force on October 1, 2022. However, those sections of the Excise Act, 2001 do not apply in respect of
(a)  vaping products manufactured in Canada that are packaged before October 1, 2022 and that are not stamped; and
(b)  vaping products that are imported into Canada or released (as defined in subsection 2(1) of the Customs Act) before October 1, 2022 and that are not stamped.
  

PART 7

Draft Amendments to Various Regulations

DIVISION 1

Storage of Goods Regulations
48  Subsection 3(4) of the Storage of Goods Regulations is replaced by the following:
(4)  For the purposes of subsection 39.1(1) of the Act, firearms, prohibited ammunition, prohibited devices, prohibited or restricted weapons, tobacco products and vaping products are goods of a prescribed class that are forfeit if they are not removed from a customs office within 14 days after the day on which they were reported under section 12 of the Act.
  
49  Section 48 comes into force, or is deemed to have come into force, on October 1, 2022.

DIVISION 2

Joint Venture (GST/HST) Regulations
50  Subsection 3(1) of the Joint Venture (GST/HST) Regulations is amended by striking out “and” at the end of paragraph (o), by adding “and” at the end of paragraph (p) and by adding the following after paragraph (p):
(q)  the operation of a pipeline, rail terminal or truck terminal used for the transportation of oil, natural gas or related or ancillary products.
51  Section 50 is deemed to have come into force on January 1, 1991.

DIVISION 3

Selected Listed Financial Institutions Attribution Method (GST/HST) Regulations
52  (1)  The portion of paragraph 3(a) of the Selected Listed Financial Institutions Attribution Method (GST/HST) Regulations before subparagraph (i) is replaced by the following:
(a)  if a financial institution is a bank or a credit union and if, at any time in a taxation year of the financial institution, the financial institution maintains a deposit or other similar account that is in the name of a person resident in a province or, at any time in that year, a loan that was made by the financial institution is outstanding and is secured by real property situated in a province or, if not secured by real property, is owing by a person resident in a province, the following rules apply:
(2)  Clauses 3(a)(ii)(A) and (B) of the Regulations are replaced by the following:
(A)  outstanding loans secured by real property situated in the province,
(B)  outstanding loans, not secured by real property, owing by persons resident in the province, and
(3)  Paragraphs 3(b) and (c) of the Regulations are replaced by the following:
(b)  if a financial institution (other than a bank, credit union or investment plan) is an insurer that, at any time in a taxation year of the financial institution, is insuring a risk in respect of property ordinarily situated in a province or in respect of a person resident in a province, the financial institution is deemed to have a permanent establishment in the province throughout the taxation year;
(c)  if a financial institution (other than a bank, credit union, insurer or investment plan) is a trust and loan corporation, a trust corporation or a loan corporation and if, at any time in a taxation year of the financial institution, the financial institution conducts business (other than business in respect of loans) in a province or, at any time in that year, a loan that was made by the financial institution is outstanding and is secured by real property situated in a province or, if not secured by real property, is owing by a person resident in a province, the financial institution is deemed to have a permanent establishment in the province throughout the taxation year;
(4)  The portion of paragraph 3(e) of the Regulations before subparagraph (i) is replaced by the following:
(e)  if a financial institution is a distributed investment plan (other than a master pension entity or a segregated fund of an insurer), the financial institution is deemed to have a permanent establishment in a particular province throughout a taxation year of the financial institution if, at any time in the taxation year,
(5)  Section 3 of the Regulations is amended by striking out “and” at the end of paragraph (e), by adding “and” at the end of paragraph (f) and by adding the following after paragraph (f):
(g)  if a financial institution is a master pension entity, the financial institution is deemed to have a permanent establishment in a province throughout a taxation year of the financial institution if, at any time in the taxation year,
(i)  a pension entity, master pension entity or private investment plan holds one or more units of the financial institution and has a permanent establishment in the province, or
(ii)  a person (other than a pension entity, master pension entity or private investment plan) holds one or more units of the financial institution and is resident in the province.
53  (1)  Subsection 7(1) of the Regulations is replaced by the following:
Definitions
7  (1)  The following definitions apply in this section.
qualifying master pension entity means a master pension entity each unit of which is held by a pension entity, a private investment plan or another master pension entity that is a qualifying master pension entity. (entité de gestion principale admissible)
unrecoverable tax amount for a reporting period of a person means the amount determined by the formula
A − B
where
A is the total of all amounts, each of which is
(a)  an amount that would be included in the total for A in subsection 225.2(2) of the Act for the reporting period if that subsection were read without reference to any adaptation made to it under Part 5, if the person were a selected listed financial institution throughout the reporting period and if no election under subsection 55(1) were in effect throughout the reporting period,
(b)  an amount of tax that the person would be deemed to have paid under any of subsections 172.1(5) to (7.1) and subparagraph 172.1(8.01)(b)(i) of the Act during the reporting period, if the person were a selected listed financial institution throughout the reporting period, or
(c)  an amount that the person would be required by paragraph 232.01(5)(b) or 232.02(4)(b) of the Act to include in its determination of net tax for the reporting period if the person were a selected listed financial institution throughout the reporting period; and
B is the total of all amounts, each of which is
(a)  an amount that would be included in the total for B in subsection 225.2(2) of the Act for the reporting period if that subsection were read without reference to any adaptation made to it under Part 5, if the person were a selected listed financial institution throughout the reporting period and if no election under subsection 55(1) were in effect throughout the reporting period,
(b)  the federal component amount, within the meaning of section 232.01 of the Act, of a tax adjustment note issued under subsection 232.01(3) of the Act to the person during the reporting period, or
(c)  the federal component amount, within the meaning of section 232.02 of the Act, of a tax adjustment note issued under subsection 232.02(2) of the Act to the person during the reporting period. (montant de taxe non recouvrable)
(2)  The portion of subsection 7(2) of the Regulations before paragraph (a) is replaced by the following:
Qualifying small investment plan
(2)  For the purposes of this Part, an investment plan (other than a distributed investment plan) is a qualifying small investment plan for a particular fiscal year of the investment plan if the investment plan is not a qualifying private investment plan for the particular fiscal year and if
  
(3)  Section 7 of the Regulations is amended by adding the following after subsection (2):
Qualifying private investment plan
(3)  For the purposes of this Part, a financial institution is a qualifying private investment plan for a particular fiscal year that ends in a particular taxation year of the financial institution if it is a private investment plan, a pension entity of a pension plan or a master pension entity and if
(a)  in the case of a private investment plan or a pension entity,
(i)  if, in the absence of section 57, the particular fiscal year is the first fiscal year of the financial institution,
(A)  throughout the particular taxation year, less than 10% of the total number of plan members of the financial institution are resident in the participating provinces, and
(B)  throughout the particular fiscal year, the following amount is less than $100,000,000:
(I)  in the case of a pension entity of a pension plan, part of which is a defined contribution pension plan and the remaining part of which is a defined benefits pension plan, the amount determined by the formula
A + B
where
A is the total value of the assets of the defined contribution pension plan that are reasonably attributable to the plan members of the financial institution resident in the participating provinces, and
B is the total value of the actuarial liabilities of the defined benefits pension plan that are reasonably attributable to the plan members of the financial institution resident in the participating provinces,
(II)  in the case of a pension entity of a defined benefits pension plan, other than a pension entity described in subclause (I), the amount that is the total value of the actuarial liabilities of the pension plan that are reasonably attributable to the plan members of the financial institution resident in the participating provinces, and
(III)  in any other case, the amount that is the total value of the assets of the private investment plan or pension plan that are reasonably attributable to the plan members of the financial institution resident in the participating provinces, and
(ii)  in any other case,
(A)  throughout the taxation year of the financial institution that precedes the particular taxation year, less than 10% of the total number of plan members of the financial institution are resident in the participating provinces, and
(B)  throughout the fiscal year of the financial institution that precedes the particular fiscal year, the following amount is less than $100,000,000:
(I)  in the case of a pension entity of a pension plan, part of which is a defined contribution pension plan and the remaining part of which is a defined benefits pension plan, the amount determined by the formula
C + D
where
C is the total value of the assets of the defined contribution pension plan that are reasonably attributable to the plan members of the financial institution resident in the participating provinces, and
D is the total value of the actuarial liabilities of the defined benefits pension plan that are reasonably attributable to the plan members of the financial institution resident in the participating provinces,
(II)  in the case of a pension entity of a defined benefits pension plan, other than a pension entity described in subclause (I), the amount that is the total value of the actuarial liabilities of the pension plan that are reasonably attributable to the plan members of the financial institution resident in the participating provinces, and
(III)  in any other case, the amount that is the total value of the assets of the private investment plan or pension plan that are reasonably attributable to the plan members of the financial institution resident in the participating provinces; and
(b)  in the case of a master pension entity,
(i)  if, in the absence of section 57, the particular fiscal year is the first fiscal year of the financial institution, throughout the particular fiscal year
(A)  the financial institution is a qualifying master pension entity,
(B)  the total participating provinces unit value of the financial institution is less than $100,000,000, and
(C)  the participating provinces member percentage of the financial institution is less than 10%, and
(ii)  in any other case, throughout the fiscal year of the financial institution preceding the particular fiscal year
(A)  the financial institution is a qualifying master pension entity,
(B)  the total participating provinces unit value of the financial institution is less than $100,000,000, and
(C)  the participating provinces member percentage of the financial institution is less than 10%.
  
Total participating provinces unit value and percentage
(4)  For the purposes of paragraph (3)(b),
(a)  the total participating provinces unit value of a particular qualifying master pension entity at any time is equal to the total of all amounts, each of which is determined as follows for a pension entity of a pension plan, a private investment plan or another qualifying master pension entity that holds one or more units of the particular qualifying master pension entity:
(i)  in the case of a pension entity or a private investment plan, the amount determined by the formula
(A/B) × C
where
A is
(A)  in the case of a pension entity of a pension plan, part of which is a defined contribution pension plan and the remaining part of which is a defined benefits pension plan, the amount determined by the formula
D + E
where
D is the total value at that time of the assets of the defined contribution pension plan that are reasonably attributable to the plan members of the pension entity resident in the participating provinces, and
E is the total value at that time of the actuarial liabilities of the defined benefits pension plan that are reasonably attributable to the plan members of the pension entity resident in the participating provinces,
(B)  in the case of a pension entity of a defined benefits pension plan, other than a pension entity described in clause (A), the amount that is the total value at that time of the actuarial liabilities of the pension plan that are reasonably attributable to the plan members of the pension entity resident in the participating provinces, and
(C)  in any other case, the amount that is the total value at that time of the assets of the pension plan or private investment plan that are reasonably attributable to the plan members of the pension entity or private investment plan resident in the participating provinces,
B is
(A)  in the case of a pension entity of a pension plan, part of which is a defined contribution pension plan and the remaining part of which is a defined benefits pension plan, the amount determined by the formula
F + G
where
F is the total value at that time of the assets of the defined contribution pension plan, and
G is the total value at that time of the actuarial liabilities of the defined benefits pension plan,
(B)  in the case of a pension entity of a defined benefits pension plan, other than a pension entity described in clause (A), the amount that is the total value at that time of the actuarial liabilities of the pension plan, and
(C)  in any other case, the amount that is the total value at that time of the assets of the pension plan or private investment plan, and
C is the total value at that time of the units of the particular qualifying master pension entity that are held by the pension entity or private investment plan, and
(ii)  in the case of another qualifying master pension entity, the amount that is the total participating provinces unit value of the other qualifying master pension entity at that time, as determined in accordance with this paragraph; and
(b)  the participating provinces member percentage of a particular qualifying master pension entity at any time is equal to the amount, expressed as a percentage, determined by the formula
A/B
where
A is equal to the total of all amounts, each of which is determined for a pension entity, a private investment plan or another qualifying master pension entity that holds one or more units of the particular qualifying master pension entity by the formula
C × D
where
C is
(i)  in the case of a pension entity or private investment plan, the amount determined by the formula
E/F
where
E is the total number of plan members of the pension entity or private investment plan that are resident in the participating provinces at that time, and
F is the total number of plan members of the pension entity or private investment plan at that time, and
(ii)  in the case of another qualifying master pension entity, the participating provinces member percentage of the other qualifying master pension entity at that time as determined in accordance with this paragraph, and
D is the total value at that time of the units of the particular qualifying master pension entity that are held by the pension entity, private investment plan or other qualifying master pension entity, as the case may be, and
B is the total value at that time of the units of the particular qualifying master pension entity.
  
54  The portion of section 10 of the Regulations before paragraph (b) is replaced by the following:
Exception — qualifying investment plans
10  Section 9 does not apply in respect of a reporting period in a particular fiscal year of a financial institution that is a qualifying small investment plan or a qualifying private investment plan for the particular fiscal year if
(a)  the financial institution was a qualifying small investment plan or a qualifying private investment plan for the fiscal year of the financial institution that precedes the particular fiscal year and was not a selected listed financial institution throughout that preceding fiscal year;
55  Section 13 of the Regulations is repealed.
56  (1)  Subsection 14(1) of the Regulations is replaced by the following:
Election — prescribed financial institution
14  (1)  If an investment plan is, or reasonably expects to be, a qualifying small investment plan or a qualifying private investment plan for a fiscal year of the investment plan and if no application by the investment plan under subsection 15(1) in respect of the fiscal year has been approved by the Minister, the investment plan may make an election to be a prescribed financial institution for the purpose of paragraph 225.2(1)(b) of the Act that is effective from the first day of the fiscal year.
(2)  Subsection 14(6) of the Regulations is replaced by the following:
Effect of early revocation
(6)  If the Minister allows an investment plan to revoke an election made under subsection (1) on the first day of a fiscal year that begins less than three years after the election became effective and the investment plan is a qualifying small investment plan or a qualifying private investment plan for the fiscal year, section 9 does not apply in respect of any reporting period in the fiscal year.
  
57  Subsections 15(2) and (3) of the Regulations are replaced by the following:
Authorization
(2)  On receipt of an application made by an investment plan under subsection (1) in respect of a particular fiscal year of the investment plan and the fiscal year of the investment plan following the particular fiscal year, the Minister must, within 90 days of that receipt, consider the application and, if it is reasonable, based on the information in the possession of the Minister, to expect that the investment plan will be a qualifying small investment plan or a qualifying private investment plan for each of those two fiscal years, approve the application or, in any other case, refuse the application, and must, within that time limit, notify the investment plan in writing of the decision.
  
Effect of authorization
(3)  If the Minister approves an application made by an investment plan under subsection (1) in respect of a particular fiscal year of the investment plan and the fiscal year of the investment plan following the particular fiscal year,
(a)  if the investment plan is a qualifying small investment plan or a qualifying private investment plan for the particular fiscal year, section 9 does not apply in respect of any reporting period in the particular fiscal year; and
(b)  if the investment plan is a qualifying small investment plan or a qualifying private investment plan for the following fiscal year, section 9 does not apply in respect of any reporting period in the following fiscal year.
  
58  (1)  The portion of the definition plan merger in subsection 16(1) of the Regulations before paragraph (b) is replaced by the following:
plan merger means the merger or combination of two or more predecessors to form one continuing plan, which may or may not be a predecessor, in such a manner that
(a)  if none of the predecessors was, immediately before the merger or combination, a series of a distributed investment plan and the continuing plan is not, immediately after the merger or combination, a series of a distributed investment plan, the continuing plan is a predecessor;
(2)  Subsection 16(1) of the Regulations is amended by adding the following in alphabetical order:
continuing plan means, with respect to a merger or combination referred to in the definition plan merger,
(a)  a trust, corporation or partnership that results from the merger or combination and that is, immediately after the merger or combination, a distributed investment plan; or
(b)  a series of a stratified investment plan if the series results from the merger or combination and the investment plan does not result from the merger or combination. (régime continué)
predecessor means, with respect to a merger or combination referred to in the definition plan merger,
(a)  a trust, corporation or partnership that is participating in the merger or combination and that was, immediately before the merger or combination, a distributed investment plan; or
(b)  a series of a stratified investment plan if the series is participating in the merger or combination and the investment plan is not participating in the merger or combination. (régime remplacé)
59  The portion of subsection 24(2) of the Regulations before the formula is replaced by the following:
Determination of percentage
(2)  If a selected listed financial institution, other than a bank, credit union or investment plan, is an insurer, the financial institution’s percentage for a participating province and for a particular period in which it has a permanent establishment in that province is the amount, expressed as a percentage, determined by the formula
  
60  (1)  Subsection 26(1) of the Regulations is replaced by the following:
Determination of percentage
26  (1)  If a selected listed financial institution, other than a bank, credit union, insurer or investment plan, is a trust and loan corporation, a trust corporation or a loan corporation, the financial institution’s percentage for a particular period and for a participating province in which the financial institution has a permanent establishment is the percentage that the gross revenue for the particular period of its permanent establishments in the participating province is of the total gross revenue for the particular period of its permanent establishments in Canada.
(2)  Paragraphs 26(2)(a) and (b) of the Regulations are replaced by the following:
(a)  loans secured by real property situated in the participating province;
(b)  loans, not secured by real property, made to persons residing in the participating province;
(3)  The portion of paragraph 26(2)(c) of the Regulations before subparagraph (i) is replaced by the following:
(c)  loans, other than loans secured by real property situated in a country other than Canada in which the financial institution has a permanent establishment,
61  The Regulations are amended by adding the following after section 27:
Apportionment — Type of Business
Determination of percentage
27.1  If any one of subsections 24(2), 25(1) and 26(1) applies to a selected listed financial institution during a part of a particular period of the financial institution and if another of those subsections, or none of those subsections, applies to the financial institution during another part of the particular period, the financial institution’s percentage for the particular period and for a participating province is, despite sections 23 to 27, equal to the total of
(a)  the financial institution’s percentage for the particular period and for the participating province, as determined under section 24, multiplied by the amount determined by the formula
A/B
where
A is the number of days in the particular period during which subsection 24(2) applies to the financial institution, and
B is the number of days in the particular period;
(b)  the financial institution’s percentage for the particular period and for the participating province, as determined under section 25, multiplied by the amount determined by the formula
C/D
where
C is the number of days in the particular period during which subsection 25(1) applies to the financial institution, and
D is the number of days in the particular period;
(c)  the financial institution’s percentage for the particular period and for the participating province, as determined under section 26, multiplied by the amount determined by the formula
E/F
where
E is the number of days in the particular period during which subsection 26(1) applies to the financial institution, and
F is the number of days in the particular period; and
(d)  the financial institution’s percentage for the particular period and for the participating province, as determined under section 23 or 27, as applicable, multiplied by the amount determined by the formula
G/H
where
G is the number of days in the particular period during which none of subsections 24(2), 25(1) and 26(1) applies to the financial institution, and
H is the number of days in the particular period.
62  (1)  The portion of subsection 30(4) of the Regulations before paragraph (a) is replaced by the following:
Plan mergers
(4)  Despite subsection (1), if on a particular day a plan merger between two or more predecessors occurs to form a particular stratified investment plan that includes a particular series that is neither an exchange-traded series nor a provincial series or occurs to form a particular series of a particular stratified investment plan that is neither an exchange-traded series nor a provincial series, if the particular investment plan is a selected listed financial institution and if no election under section 49 or 64 is in effect in respect of the particular series throughout the fiscal year of the particular investment plan (in this subsection referred to as the “transitional fiscal year”) that includes the particular day, the following rules apply:
  
(2)  Subparagraphs (ii) and (iii) of the description of A in paragraph 30(4)(a) of the Regulations are replaced by the following:
(ii)  if the particular predecessor is a non-stratified investment plan,
(A)  if an election under section 49 or 61 is in effect in respect of the particular predecessor immediately before the plan merger, the particular predecessor’s percentage for the participating province as of the last day on which that percentage is required to be determined for the purposes of subsection 225.2(2) of the Act, as adapted by these Regulations, before the plan merger, and
(B)  in any other case, the particular predecessor’s percentage for the participating province and for the last particular period of the particular predecessor ending before the plan merger, and
(iii)  if the particular predecessor is a series of a stratified investment plan,
(A)  if an election under section 49 or 64 is in effect in respect of the particular predecessor immediately before the plan merger, the stratified investment plan’s percentage for the particular predecessor and for the participating province as of the last day on which that percentage is required to be determined for the purposes of subsection 225.2(2) of the Act, as adapted by these Regulations, before the plan merger, and
(B)  in any other case, the stratified investment plan’s percentage for the particular predecessor, for the participating province and for the last particular period of the stratified investment plan ending before the plan merger,
63  (1)  The portion of subsection 32(4) of the Regulations before paragraph (a) is replaced by the following:
Plan mergers
(4)  Despite subsection (1), if on a particular day a plan merger between two or more predecessors occurs to form a particular non-stratified investment plan, other than an exchange-traded fund, that is a selected listed financial institution and no election under section 49 or 61 is in effect in respect of the particular investment plan throughout the fiscal year of the particular investment plan (in this subsection referred to as the “transitional fiscal year”) that includes the particular day, the following rules apply:
  
(2)  The portion of subparagraph (i) of the description of A in paragraph 32(4)(a) of the Regulations before the formula is replaced by the following:
(i)  if the particular predecessor is a stratified investment plan, the total of all amounts, each of which is determined by the following formula for a series of the particular predecessor (in this subparagraph referred to as a “predecessor series”), units of which were converted, by any means, into units of the particular investment plan:
(3)  The descriptions of A2 and A3 in paragraph 32(4)(a) of the Regulations are replaced by the following:
A2 is the total value immediately before the plan merger of the units of the predecessor series that were converted, by any means, into units of the particular investment plan by virtue of the plan merger, and
A3 is the total of all amounts, each of which is the total value immediately before the plan merger of the units of a series of the particular predecessor (including the predecessor series) that were converted, by any means, into units of the particular investment plan by virtue of the plan merger,
(4)  Subparagraphs (ii) and (iii) of the description of A in paragraph 32(4)(a) of the Regulations are replaced by the following:
(ii)  if the particular predecessor is a non-stratified investment plan,
(A)  if an election under section 49 or 61 is in effect in respect of the particular predecessor immediately before the plan merger, the particular predecessor’s percentage for the participating province as of the last day on which that percentage is required to be determined for the purposes of subsection 225.2(2) of the Act, as adapted by these Regulations, before the plan merger, and
(B)  in any other case, the particular predecessor’s percentage for the participating province and for the last particular period of the particular predecessor ending before the plan merger, and
(iii)  if the particular predecessor is a series of a stratified investment plan,
(A)  if an election under section 49 or 64 is in effect in respect of the particular predecessor immediately before the plan merger, the stratified investment plan’s percentage for the particular predecessor and for the participating province as of the last day on which that percentage is required to be determined for the purposes of subsection 225.2(2) of the Act, as adapted by these Regulations, before the plan merger, and
(B)  in any other case, the stratified investment plan’s percentage for the particular predecessor, for the participating province and for the last particular period of the stratified investment plan ending before the plan merger,
64  (1)  The portion of subsection 33(3) of the Regulations before paragraph (a) is replaced by the following:
Plan mergers
(3)  Despite subsection (1), if on a particular day a plan merger between two or more predecessors occurs to form a particular stratified investment plan that includes a particular series, other than a provincial series, that is an exchange-traded series or occurs to form a particular series, other than a provincial series, of a particular stratified investment plan that is an exchange-traded series and if the particular investment plan is a selected listed financial institution, the following rules apply:
  
(2)  Subparagraphs (ii) and (iii) of the description of A in paragraph 33(3)(a) of the Regulations are replaced by the following:
(ii)  if the particular predecessor is a non-stratified investment plan,
(A)  if an election under section 49 or 61 is in effect in respect of the particular predecessor immediately before the plan merger, the particular predecessor’s percentage for the participating province as of the last day on which that percentage is required to be determined for the purposes of subsection 225.2(2) of the Act, as adapted by these Regulations, before the plan merger, and
(B)  in any other case, the particular predecessor’s percentage for the participating province and for the last particular period of the particular predecessor ending before the plan merger, and
(iii)  if the particular predecessor is a series of a stratified investment plan,
(A)  if an election under section 49 or 64 is in effect in respect of the particular predecessor immediately before the plan merger, the stratified investment plan’s percentage for the particular predecessor and for the participating province as of the last day on which that percentage is required to be determined for the purposes of subsection 225.2(2) of the Act, as adapted by these Regulations, before the plan merger, and
(B)  in any other case, the stratified investment plan’s percentage for the particular predecessor, for the participating province and for the last particular period of the stratified investment plan ending before the plan merger,
65  (1)  The portion of subsection 34(3) of the Regulations before paragraph (a) is replaced by the following:
Plan mergers
(3)  Despite subsection (1), if on a particular day a plan merger between two or more predecessors occurs to form a particular non-stratified investment plan that is an exchange-traded fund and a selected listed financial institution, the following rules apply:
  
(2)  The portion of subparagraph (i) of the description of A in paragraph 34(3)(a) of the Regulations before the formula is replaced by the following:
(i)  if the particular predecessor is a stratified investment plan, the total of all amounts, each of which is determined by the following formula for a series of the particular predecessor (in this subparagraph referred to as a “predecessor series”), units of which were converted, by any means, into units of the particular investment plan:
(3)  The descriptions of A2 and A3 in paragraph 34(3)(a) of the Regulations are replaced by the following:
A2 is the total value immediately before the plan merger of the units of the predecessor series that were converted, by any means, into units of the particular investment plan by virtue of the plan merger, and
A3 is the total of all amounts, each of which is the total value immediately before the plan merger of the units of a series of the particular predecessor (including the predecessor series) that were converted, by any means, into units of the particular investment plan by virtue of the plan merger,
(4)  Subparagraphs (ii) and (iii) of the description of A in paragraph 34(3)(a) of the Regulations are replaced by the following:
(ii)  if the particular predecessor is a non-stratified investment plan,
(A)  if an election under section 49 or 61 is in effect in respect of the particular predecessor immediately before the plan merger, the particular predecessor’s percentage for the participating province as of the last day on which that percentage is required to be determined for the purposes of subsection 225.2(2) of the Act, as adapted by these Regulations, before the plan merger, and
(B)  in any other case, the particular predecessor’s percentage for the participating province and for the last particular period of the particular predecessor ending before the plan merger, and
(iii)  if the particular predecessor is a series of a stratified investment plan,
(A)  if an election under section 49 or 64 is in effect in respect of the particular predecessor immediately before the plan merger, the stratified investment plan’s percentage for the particular predecessor and for the participating province as of the last day on which that percentage is required to be determined for the purposes of subsection 225.2(2) of the Act, as adapted by these Regulations, before the plan merger, and
(B)  in any other case, the stratified investment plan’s percentage for the particular predecessor, for the participating province and for the last particular period of the stratified investment plan ending before the plan merger,
66  (1)  Clauses (iii)(C) and (D) of the description of G3 in paragraph 46(a) of the Regulations is replaced by the following:
(C)  if a tax adjustment note is issued to the financial institution under subsection 232.01(3) of the Act in respect of all or part of a specified resource, if a supply of the specified resource or part is deemed for the purposes of section 232.01 of the Act to have been received by the financial institution under subparagraph 172.1(5)(d)(i) or (5.1)(d)(i) of the Act and if tax in respect of the supply is deemed for the purposes of section 232.01 of the Act to have been paid on a particular day under subparagraph 172.1(5)(d)(ii) or (5.1)(d)(ii) or paragraph 172.1(8.01)(b) of the Act by the financial institution, an amount that the financial institution would be required by paragraph 232.01(5)(c) of the Act to pay during the particular reporting period to the Receiver General as a result of the issuance of the tax adjustment note if the financial institution were a selected listed financial institution on the particular day, or
(D)  if a tax adjustment note is issued to the financial institution under subsection 232.02(2) of the Act in respect of employer resources, if particular supplies (as referred to in subsection 232.02(4) of the Act) of those employer resources are deemed for the purposes of section 232.02 of the Act to have been received by the financial institution under subparagraph 172.1(6)(d)(i) or (6.1)(d)(i) of the Act and if tax in respect of each of the particular supplies is deemed for the purposes of section 232.02 of the Act to have been paid under subparagraph 172.1(6)(d)(ii) or (6.1)(d)(ii) or paragraph 172.1(8.01)(b) of the Act by the financial institution, an amount that the financial institution would be required by paragraph 232.02(4)(c) of the Act to pay during the particular reporting period to the Receiver General as a result of the issuance of the tax adjustment note if the financial institution were a selected listed financial institution on the first day on which an amount of tax is deemed for the purposes of section 232.02 of the Act to have been paid in respect of the particular supplies,
(2)  Subparagraph (iv) of the description of G7 in paragraph 46(b) of the Regulations is replaced by the following:
(iv)  all amounts each of which is an amount of tax that the financial institution was deemed to have paid during the particular reporting period under any of subsections 172.1(5) to (7.1) and subparagraph 172.1(8.01)(b)(i) of the Act,
(3)  The description of G12 in paragraph 46(b) of the Regulations is amended by striking out “and” at the end of subparagraph (vi), by adding “and” at the end of subparagraph (vii) and by adding the following after subparagraph (vii):
(viii)  all amounts, each of which is determined by the following formula in respect of an amount of tax that the financial institution was deemed to have paid during the particular reporting period under subparagraph 172.1(8.01)(b)(i) of the Act and that is in respect of a supply that was deemed to have been made under any of subsections 172.1(5) to (7.1) of the Act:
A × (B/C)
where
A is the amount in respect of the supply that is used in determining B in the formula in paragraph 172.1(5)(c), (5.1)(c), (6)(c), (6.1)(c), (7)(c) or (7.1)(c) of the Act, as the case may be,
B is the amount determined for B in the formula in subparagraph 172.1(8.01)(b)(i) of the Act in determining the amount of tax, and
C is the amount determined for C in the formula in subparagraph 172.1(8.01)(b)(i) of the Act in determining the amount of tax;
67  Paragraph (a) of the definition qualifying investor in subsection 52(1) of the Regulations is replaced by the following:
(a)  is neither a qualifying small investment plan nor a qualifying private investment plan for the purposes of Part 1 for the fiscal year of the person that includes September 30 of the calendar year;
68  (1)  Subparagraph 58(1)(a)(ii) of the Regulations is replaced by the following:
(ii)  the day preceding the day on which a plan merger of the investment plan and one or more other investment plans or series of investment plans first occurs;
(2)  The portion of subsection 58(2) of the Regulations before paragraph (a) is replaced by the following:
New series — attribution point
(2)  Despite the meaning of attribution point as set out in subsections 16(1) and 18(3), if units of a series of an investment plan are issued, distributed or offered for sale in a particular fiscal year that ends in a particular taxation year of the investment plan and, immediately before the issuance, distribution or offering for sale, no units of the series are issued and outstanding, the following rules apply for the purposes of this Part and Part 2:
  
(3)  Subparagraph 58(2)(a)(ii) of the Regulations is replaced by the following:
(ii)  the day preceding the day on which a plan merger of either the investment plan or the series and one or more other investment plans or series of investment plans first occurs; and
69  Clause 59(a)(ii)(B) of the Regulations is replaced by the following:
(B)  the day preceding the day on which a plan merger of the investment plan and one or more other investment plans or series of investment plans first occurs;
70  Clause 62(a)(ii)(B) of the Regulations is replaced by the following:
(B)  the day preceding the day on which a plan merger of either the investment plan or the series and one or more other investment plans or series of investment plans first occurs;
71  (1)  Subsections 52(1) to (3) and sections 58 to 65 and 68 to 70 apply in respect of any reporting period of a person that begins after Announcement Date.
(2)  Subsections 52(4) and (5) and sections 53 to 57 and 67 apply in respect of any fiscal year of a person that ends after Announcement Date.
(3)  Section 66 applies in respect of any reporting period of a person that ends after Announcement Date.

DIVISION 4

Regulations Respecting Excise Licenses and Registrations
72  Subparagraph 2(2)(b)(i) of the Regulations Respecting Excise Licences and Registrations is replaced by the following:
(i)  failed to comply with any Act of Parliament, other than the Act, or of the legislature of a province respecting the taxation of or controls on alcohol, tobacco products, cannabis products or vaping products or any regulations made under it, or
73  Section 4 of the Regulations is replaced by the following:
4  A licence is valid for the period specified in the licence, which period
(a)  in the case of a cannabis license issued to a person, shall end on or before the date of expiry of the license or permit issued to the person under subsection 62(1) of the Cannabis Act and shall not exceed five years; or
(b)  in any other case, shall not exceed two years.
74  (1)  Paragraph 5(2)(a) of the Regulations is replaced by the following:
(a)  a bank draft;
(2)  Paragraph 5(2)(c) of the Regulations is replaced by the following:
(c)  a Canada Post money order; or
75  Subsection 10(1) of the Regulations is replaced by the following:
10  (1)  The grounds for the suspension of a licence or registration by the Minister are that the licensee or registrant
(a)  fails to meet any of the applicable requirements of section 2, 3, 6, 7 or 13;
(b)  fails to meet the conditions of the licence or registration;
(c)  is bankrupt;
(d)  ceases to carry on the business for which the license or registration was issued;
(e)  fails to comply with any Act of Parliament, other than the Act, or of the legislature of a province respecting the taxation of or controls of alcohol, tobacco products, cannabis products or vaping products, or any regulations made under it; or
(f)  acts to defraud Her Majesty.
76  Paragraph 12(1)(e) of the Regulations is replaced by the following:
(e)  fails to comply with any Act of Parliament, other than the Act, or of the legislature of a province respecting the taxation of or controls on alcohol, tobacco products, cannabis products or vaping products, or any regulations made under it; or

DIVISION 5

Stamping and Marking of Tobacco, Cannabis and Vaping Products Regulations
77  The definition case in section 1 of the Stamping and Marking of Tobacco, Cannabis and Vaping Products Regulations is replaced by the following:
case means a corrugated cardboard box in which packages or cartons of tobacco products, or packages of vaping products, are packed primarily for the purpose of transport and protection against damage. (caisse)
78  The Regulations are amended by adding the following after section 3.5:
3.6  For the purposes of paragraph 158.46(b) of the Act, the prescribed information is
(a)  the vaping product licensee’s name and address;
(b)  the vaping product licensee’s licence number; or
(c)  if the vaping product is packaged by the vaping product licensee for another person, the person’s name and the address of their principal place of business.
3.7  For the purposes of paragraph 158.47(1)(a) of the Act, the prescribed information is
(a)  the name and address of the manufacturer that packaged the vaping product;
(b)  if the vaping product was imported by a vaping product licensee, the licensee’s name and address or vaping product licence number; or
(c)  if the vaping product was imported by a person other than a vaping product licensee, the person’s name and address.
3.8  For the purposes of paragraphs 158.46(b) and 158.47(1)(a) of the Act, the following information is prescribed for cases of vaping products:
(a)  the number of packages in the case; and
(b)  the volume of the vaping substance in liquid form, and the weight of the vaping substance in solid form, contained in each package.
3.9  For the purposes of subsections 158.5(1) and (2) of the Act, the prescribed information is
(a)  for containers of vaping products manufactured in Canada, the information set out in section 3.6; and
(b)  for containers of imported vaping products, the information set out in section 3.7.
79  The Regulations are amended by adding the following after section 5:
Service Agreements in Respect of Cannabis Products
5.1  (1)  For the purposes of this section, service agreement means an agreement, containing prescribed information, between a particular cannabis licensee (other than a cannabis licensee that is a producer of cannabis products solely because of their packaging of cannabis products) and another cannabis licensee under which the other cannabis licensee is to package, or affix a cannabis excise stamp to, cannabis products for the particular cannabis licensee.
(2)  For the purposes of this section, a service agreement is an authorized service agreement from the effective date of its authorization under subsection (5) until the effective date of the revocation of the authorization of the service agreement under subsection (8).
(3)  A cannabis licensee that is a party to a service agreement may apply to the Minister to have the service agreement authorized by the Minister for the purposes of this section.
(4)  An application under subsection (3) in respect of a service agreement shall be made in the manner authorized by the Minister, include a copy of the service agreement and be filed with the Minister in prescribed manner.
(5)  If an application under subsection (3) in respect of a service agreement is filed with the Minister, the Minister shall with all due dispatch
(a)  consider the application and authorize or refuse to authorize the service agreement for the purposes of this section; and
(b)  notify the applicant in writing of the decision and, if authorized, the effective date of the authorization.
(6)  The Minister may, at any time, specify conditions that the Minister considers appropriate in respect of a service agreement authorized under subsection (5).
(7)  If an authorized service agreement is to be amended or is, or is to be, no longer in effect, a party to the authorized service agreement shall
(a)  without delay so notify the Minister in writing; and
(b)  if the authorized service agreement is to be amended, make an application under subsection (3) for the authorization of the amended service agreement.
(8)  If the Minister is of the opinion that a party to an authorized service agreement is in contravention of the authorized service agreement, that any condition specified by Minister under subsection (6) is not met or that the authorized service agreement is, or is to be, no longer in effect, the Minister
(a)  may revoke the authorization of the service agreement; and
(b)  shall, if the Minister revokes the authorization of the service agreement, issue a notice of revocation of the authorization of the service agreement to each party to the service agreement specifying the effective date of the revocation.
(9)  For the purposes of paragraph 158.05(2)(c) of the Act, a prescribed person is a cannabis licensee that is a party to an authorized service agreement and that has in their possession cannabis excise stamps that
(a)  are issued to the other cannabis licensee that is a party to the authorized service agreement; and
(b)  are to be affixed to a packaged cannabis product in accordance with the authorized service agreement.
(10)  For the purposes of subparagraph 158.13(a)(ii) of the Act, a prescribed condition is that the cannabis product has been packaged by the other cannabis licensee in accordance with an authorized service agreement.
(11)  For the purposes of subparagraphs 158.13(c)(ii) and (d)(ii) of the Act, a prescribed condition is that the cannabis product has been stamped by the other cannabis licensee in accordance with an authorized service agreement.
(12)  If duty imposed under section 158.19 or 158.2 of the Act on a cannabis product is payable by a cannabis licensee that is a producer of the cannabis product solely because of their packaging of the cannabis product in accordance with an authorized service agreement, the parties to the authorized service agreement are jointly and severally, or solidarily, liable for the payment of the duty and any interest or penalties in respect of that duty.
(13)  If duty imposed under section 158.25 or 158.26 of the Act is payable by a cannabis licensee in respect of a cannabis product that, under an authorized service agreement, was transferred to the other cannabis licensee that is a party to the authorized service agreement, the parties to the authorized service agreement are jointly and severally, or solidarily, liable for the payment of the duty and any interest or penalties in respect of that duty.
80  Sections 77 and 78 come into force, or are deemed to have come into force, on October 1, 2022.

DIVISION 6

Electronic Filing and Provision of Information (GST/HST) Regulations
81  Paragraph 2(a) of the Electronic Filing and Provision of Information (GST/HST) Regulations is replaced by the following:
(a)  the person is not a charity;
82  Section 81 applies in respect of reporting periods that begin after 2023.

DIVISION 7

Excise Duties on Cannabis Regulations
83  The Excise Duties on Cannabis Regulations are amended by adding the following after section 4:
Duty payable — prescribed conditions
4.1  For the purposes of subsections 158.19(3) and (4) and 158.2(2) of the Act, a person meets prescribed conditions in respect of cannabis products if the person is a party to an authorized service agreement, within the meaning of subsection 5.1(2) of the Stamping and Marking of Tobacco, Cannabis and Vaping Products Regulations, that transferred the cannabis products to the other party to the authorized service agreement for the purpose of packaging the cannabis products in accordance with the authorized service agreement.
84  Sections 8 and 9 of the Regulations are replaced by the following:
Prescribed provinces — offences
8  For the purposes of subparagraph (i) of the description of C in paragraph 218.1(2)(a) of the Act and subparagraph (i) of the description of C in paragraph 218.1(3)(a) of the Act, the following provinces are prescribed:
(a)  Ontario;
(b)  Saskatchewan;
(c)  Alberta; and
(d)  Nunavut.
Prescribed provinces — penalties
9  For the purposes of paragraph (a) of the description of C in section 233.1 of the Act, paragraph (a) of the description of C in section 234.1 of the Act and subparagraph 238.1(2)(b)(iii) of the Act, the following provinces are prescribed:
(a)  Ontario;
(b)  Saskatchewan;
(c)  Alberta; and
(d)  Nunavut.

DIVISION 8

Underused Housing Tax Regulations
85  The Underused Housing Tax Regulations are made as follows:
Underused Housing Tax Regulations
Interpretation
Meaning of Act
1  In these Regulations, Act means the Underused Housing Tax Act.
Prescribed Areas and Conditions
Definitions
2  (1)  The following definitions apply in this section.
census metropolitan area means a census metropolitan area within the meaning of the Statistics Canada document entitled Standard Geographical Classification (SGC) 2021. (région métropolitaine de recensement)
population centre means a population centre within the meaning of the Statistics Canada document entitled Standard Geographical Classification (SGC) 2021. (centre de population)
specified census agglomeration means a census agglomeration within the meaning of the Statistics Canada document entitled Standard Geographical Classification (SGC) 2021 that has a total population of at least 30,000. (agglomération de recensement désignée)
Paragraph 6(7)(m) of Act — prescribed areas
(2)  For the purposes of paragraph 6(7)(m) of the Act, each of the following areas is a prescribed area in respect of a calendar year:
(a)  an area that is, as determined in the last census published by Statistics Canada before the calendar year, neither within a census metropolitan area nor within a specified census agglomeration; and
(b)  an area that is, as determined in the last census published by Statistics Canada before the calendar year,
(i)  within a census metropolitan area or specified census agglomeration, and
(ii)  not within a population centre.
Paragraph 6(7)(m) of Act — prescribed condition
(3)  For the purposes of paragraph 6(7)(m) of the Act, a prescribed condition, for a calendar year and in respect of a person that is an owner of a residential property located in an area referred to in subsection (2), is that the residential property is used as a place of residence or lodging by the owner or the owner’s spouse or common-law partner for at least 28 days during the calendar year.
Returns
Social Insurance Number
3  The Minister may require an individual to provide their Social Insurance Number in a return filed under the Act.
86  (1)  Section 1, subsection 2(1) and section 3 of the Underused Housing Tax Regulations, as made by section 85, come into force, or are deemed to have come into force, on December 31, 2022.
(2)  Subsections 2(2) and (3) of the Underused Housing Tax Regulations, as made by section 85, apply to 2022 and subsequent calendar years.

DIVISION 9

Select Luxury Items Tax Regulations
87  The Select Luxury Items Tax Regulations are made as follows:
Select Luxury Items Tax Regulations
Interpretation
Definition of Act
1  In these Regulations, Act means the Select Luxury Items Tax Act.

PART 1

Subject Aircraft
Prescribed circumstances
2  (1)  For the purposes of subsection 36(3) of the Act, the circumstances set out in this section are prescribed circumstances.
Exemption certificate — exportation
(2)  Subject to subsection (3), an exemption certificate applies in respect of a sale of a subject aircraft by a vendor to a purchaser if
(a)  the vendor is a registered vendor in respect of subject aircraft at the particular time at which the sale is completed;
(b)  the certificate is made in prescribed form containing prescribed information;
(c)  the certificate includes
(i)  the identification number of the subject aircraft,
(ii)  a declaration by the purchaser that the subject aircraft
(A)  is to be exported as soon after the particular time as is reasonable having regard to the circumstances surrounding the exportation, the sale and, if applicable, the normal business practice of the purchaser and vendor,
(B)  is not to be used in Canada at any time before the exportation except to the extent reasonably necessary or incidental to its manufacture, offering for sale, transportation or exportation, and
(C)  is not to be registered with the Government of Canada or a province before the exportation except if the registration is done solely for a purpose incidental to its manufacture, offering for sale, transportation or exportation,
(iii)  a declaration by the purchaser that the purchaser is not a registered vendor in respect of subject aircraft at the particular time, and
(iv)  an acknowledgement by the purchaser that the purchaser is assuming liability to pay any amount of tax in respect of the subject aircraft that is or may become payable by the purchaser under this Act;
(d)  the purchaser provides, in a manner satisfactory to the Minister, the certificate in respect of the sale to the vendor; and
(e)  the vendor retains the certificate.
Exemption certificate — multiple purchasers
(3)  If a subject aircraft is sold by a vendor to more than one purchaser, this section applies in respect of the sale of the subject aircraft only if an exemption certificate would apply, in the absence of this subsection, in respect of each purchaser in accordance with subsection (2).

PART 2

Information Returns
Prescribed person
3  For the purposes of subsection 59(1) of the Act, a person is a prescribed person for a reporting period of the person if the person
(a)  is a registered vendor in respect of subject vehicles throughout the reporting period; and
(b)  is not otherwise registered, or required to be registered, under Division 5 of the Act at any time during the reporting period.

PART 3

Tax not Payable — Agreements Before 2022
Prescribed circumstances
4  (1)  For the purposes of section 33 of the Act, the circumstances set out in each of subsections (2) to (4) are prescribed circumstances.
Tax not payable on sale
(2)  Neither the tax under section 18 of the Act nor the tax under section 29 of the Act in respect of a subject item that is sold by a vendor to a purchaser is payable if the purchaser entered into an agreement in writing before 2022 with the vendor for the sale of the subject item in the course of the vendor’s business of offering for sale that type of subject item.
Tax not payable on import
(3)  The tax under section 20 of the Act in respect of a subject item that is imported is not payable if the importer entered into an agreement in writing before 2022 with a vendor for the sale of the subject item in the course of the vendor’s business of offering for sale that type of subject item.
Tax not payable on use
(4)  The tax under section 26 of the Act in respect of a subject item that is used in Canada at a particular time is not payable if a person entered into an agreement in writing before 2022 with a vendor for the sale of the subject item in the course of the vendor’s business of offering for sale that type of subject item and the person is an owner of the subject item at the particular time.
88  The Select Luxury Items Tax Regulations, as made by section 87, come into force on September 1, 2022.
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