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Second Session, Thirty-Seventh Legislature

This version is based on the printed bill that was distributed in the Legislature after First Reading.
It is not the official version.   If accuracy is critical, you can obtain a copy of the printed bill from Statutory Publications.

Bill 47

THE BUDGET IMPLEMENTATION AND TAX STATUTES AMENDMENT ACT, 2001


Explanatory Note

(Assented to                                         )

HER MAJESTY, by and with the advice and consent of the Legislative Assembly of Manitoba, enacts as follows:

PART 1

THE CORPORATION CAPITAL TAX ACT

C.C.S.M. c. C226 amended

1           The Corporation Capital Tax Act is amended by this Part.

2           The following is added after subsection 22(3):

No interest on refund of instalments

22(4)       Despite subsection (3), no interest is payable on a refund of an amount paid or payable as an instalment of tax under this Act.

3           The following is added after subsection 33(1):

Corporation liable for costs

33(1.1)     If a corporation does not make its books and records available for inspection, examination and audit in Manitoba, it is liable for the expenses reasonably incurred by any officer appointed by the minister under this Act for the purpose of inspecting, examining or auditing the books and records at the place where they are kept.

PART 2

THE HEALTH AND POST SECONDARY EDUCATION TAX LEVY ACT

C.C.S.M. c. H24 amended

4           The Health and Post Secondary Education Tax Levy Act is amended by this Part.

5            The following is added after subsection 3(3.14):

Proration for part-year employers

3(3.15)     Despite any other provision of this section, if an employer does not have a permanent establishment in Manitoba throughout a year after 2001, the following rules apply in determining the tax payable by the employer for the year or a part of the year (the "relevant period"):

(a) the amount of the exemption (the "prorated amount") available to the employer under subsection (3.10) or (3.12), as the case may be, for the relevant period is the amount that bears the same proportion to the exemption otherwise available under that subsection to the employer for the relevant period that

(i) the number of days in the relevant period that the employer has a permanent establishment in Manitoba,

bears to

(ii) the total number of days in the relevant period;

(b) if the remuneration paid by the employer in the relevant period exceeds the prorated amount but is not more than twice that amount, the tax payable on that remuneration is 4.3% of the excess; and

(c) if the remuneration paid by the employer in the relevant period is more than twice the prorated amount, the tax payable on that remuneration is 2.15% of that remuneration.

For this purpose, "remuneration" means remuneration described in subsection (3.1.1).

6           The following is added after subsection 20(1):

Employer liable for costs

20(1.1)     An employer who does not make his, her or its books and records available for inspection, examination and audit in Manitoba is liable for the expenses reasonably incurred by an officer appointed by the minister under this Act for the purpose of inspecting, examining or auditing the books and records at the place where they are kept.

PART 3

THE HOMEOWNERS TAX AND   INSULATION ASSISTANCE ACT

C.C.S.M. c. H75 amended

7           The Homeowners Tax and Insulation Assistance Act is amended by this Part.

8           The title is amended by striking out "HOMEOWNERS" and substituting "PROPERTY".

9           The following is added after section 25:

PART V.1

ENVIRONMENTALLY SENSITIVE   AREAS TAX CREDIT

Regulatory scheme for environmentally sensitive areas tax credit

25.1(1)     The Lieutenant Governor in Council may make regulations establishing a scheme to provide a property tax reduction to the assessed owners or occupiers of lands on which prescribed conditions have been met in order to meet environmental objectives set out in the regulations.

Specific powers to make regulations

25.1(2)     Without limiting the generality of subsection (1), the Lieutenant Governor in Council may make regulations

(a) setting out environmental objectives of the tax reduction scheme, which may be different for different areas of the province;

(b) specifying the conditions that must be met in order for an assessed owner or occupier to be eligible for the tax reduction;

(c) specifying the amount of the tax reduction or the manner of calculating it;

(d) establishing an application process for the tax reduction;

(e) establishing methods for delivering the tax reduction to persons eligible for it, which may involve rebates of property taxes paid or reductions in the property taxes assessed, or a combination of rebates and reductions;

(f) respecting the reimbursement of municipalities and local government districts under subsection (3);

(g) establishing a process to deal with objections or complaints;

(h) providing authority to investigate, inspect or audit any matter pertaining to a person's claim for a property tax reduction under this Part;

(i) requiring persons to provide information necessary to support a claim for a property tax reduction under this Part;

(j) respecting any matter the Lieutenant Governor in Council considers necessary or advisable for the purposes of this Part.

Reimbursement of municipality

25.1(3)     The Minister of Finance for Manitoba shall ensure that each municipality and local government district is reimbursed out of the Consolidated Fund, in accordance with the regulations, for the property tax reductions made by it under this Part.

Payment of property tax reduction

25.1(4)     If a property tax reduction has been granted in respect of a property for a period during which the property was not eligible for it, the person who was the assessed owner or occupier during that period must pay to the Minister of Finance for Manitoba, in accordance with the regulations, the portion of the reduction that relates to that period.

Interest payable

25.1(5)     If a person fails to pay when it is due an amount payable under subsection (4), interest is payable by the person on the unpaid amount, at the rate prescribed under The Income Tax Act for the purpose of subsection 5.6(4) of that Act, from the date the municipal taxes levied in respect of the property for the year were due.

10          The following is added after section 26:

C.C.S.M. reference

27          This Act shall no longer be referred to as chapter H75 of the Continuing Consolidation of the Statutes of Manitoba but may be referred to as chapter P143 of the Continuing Consolidation of the Statutes of Manitoba.

PART 4

THE INCOME TAX ACT

C.C.S.M. c. I10 amended

11          The Income Tax Act is amended by this Part.

12          The definition "minister" in subsection 1(1) is replaced with the following:

"minister" means, except as otherwise provided,

(a) if no collection agreement is in effect, the Minister of Finance for Manitoba, and

(b) if a collection agreement is in effect, the Minister of National Revenue for Canada,

but in applying any provision of the federal Act for the purposes of this Act, a reference in such a provision to "minister" shall be read as a reference to the treasurer; (« ministre »)

13          Clause (b) of Rule 1 in subsection 4(1) is replaced with the following:

(b)  in any other case,

(i)  under subsection 4.1(1) for the 2001 taxation year,

(ii)  under subsection 4.1(2) for the 2002 taxation year, and

(iii) under subsection 4.1(2.1) for the 2003 and subsequent taxation years.

14(1)       The table in subsection 4.1(1) is amended by striking out "17.5%" and substituting "17.4%".

14(2)       Subsections 4.1(2) and (3) are replaced with the following:

Basic tax payable — 2002 taxation year

4.1(2)      An individual's basic tax payable for the 2002 taxation year is the amount determined according to the following table:

Taxable income (TI) Basic tax payable (BT)
$30,544. or less BT = 10.9% x TI
more than $30,544. but not more than $65,000. BT = $3,329. + 15.4% x (TI - $30,544.)
more than $65,000. BT = $8,635. + 17.4% x (TI - $65,000.)
 
Basic tax payable — 2003 and subsequent taxation years

4.1(2.1)    An individual's basic tax payable for the 2003 taxation year and for each subsequent taxation year is the amount determined according to the following table:

Taxable income (TI) Basic tax payable (BT)
$30,544. or less BT = 10.9% x TI
more than $30,544. but not more than $65,000. BT = $3,329. + 14.9% x (TI - $30,544.)
more than $65,000. BT = $8,463. + 17.4% x (TI - $65,000.)
 
Basic tax payable by inter vivos trust

4.1(3)      Despite subsections (1) to (2.1), the basic tax payable for a taxation year for an inter vivos trust to which subsection 122(1) of the federal Act applies is 17.4% of the trust's taxable income for the year.

15(1)       Subsection 4.2(3) is amended by adding "and" at the end of clause (b) and adding the following after clause (b):

(c) if the individual is a mutual fund trust, the amount, if any, included in the trust's Manitoba income for the year because of paragraph 82(1)(b) of the federal Act.

15(2)       Clause 4.2(6)(a) is amended by striking out "$2,500." and substituting "the total of $2,500. and the amount determined for that year for C in that formula".

16          Section 4.4 is amended by striking out "17.5%" and substituting "17.4%".

17(1)       Subclause 4.6(1)(b)(ii) is amended by striking out "17.5%" and substituting "17.4%".

17(2)       Subsection 4.6(2) of the French version is amended by renumbering the last clause as clause e).

17(3)       In the following subsections, each amount set out in the second column is replaced with the amount opposite in the third column:

Subsection Strike out Substitute
4.6(3) (Basic personal) $7,361. $7,412.
4.6(4) (Age) $3,595.
$26,757.
$3,619.
$26,941.
4.6(5) and (6) (Spouse,  Equivalent-to-spouse) $6,251.
$625.
$6,293.
$630.
4.6(7) (Infirm dependant) $2,429.
$4,932.
$3,500.
$4,966.
4.6(8) (Caregiver) $14,300.
$11,871.
$15,453.
$11,953.
4.6(11) (Disability) $4,370.
$2,994.
$2,036.
$6,000.
$3,500.
$2,050.
 
 
17(4) The formulas in subsection 4.6(13), (14), (15), (16) and (17) are amended by striking out ".17" and substituting ".16".

17(5)       Clause 4.6(18)(b) is amended by striking out "17.5%" and substituting "17.4%".

18(1)       Subsection 4.13(1) is amended in clause (b) of the description of D in the formula by striking out "17.5%" and substituting "17.4%".

18(2)       Subsection 4.13(2) is amended

(a) in the English version of the part before clause (a), by striking out "lesser" and substituting "least"; and

(b) by striking out "and" at the end of clause (a) and by replacing clause (b) with the following:

(b) the total of the trust's net income tax and net income surtax payable under subsections 4.2(3) and (4); and

(c) the tax payable by the trust under this Part for the year, net of any amount refundable to it for the year under subsection (1).

19          Subclause 5(1)(a)(i) is amended by adding "education" before "property tax credit".

20          The centred heading before section 5.3 is amended by adding "Education" before "Property".

21(1)       Subsection 5.4(1) is amended

(a) in the section heading, by adding "education" before "property"; and

(b) in the part before clause (a), by striking out "a property tax credit" and substituting "an education property tax credit".

21(2)       Subsection 5.4(2) is amended

(a) in the section heading, by adding "education" before "property"; and

(b) by striking out "a property tax credit" wherever it occurs in the subsection and substituting "an education property tax credit".

21(3)       Subsection 5.4(3) is amended

(a) in the section heading, by striking out "Property" and substituting "Education property";

(b) in the part of the subsection before the formula, by adding "education" before "property tax credit"; and

(c) in clause (b) of the description of A in the formula, by striking out "$600." and substituting "$675.".

21(4)       Subsection 5.4(4) is amended

(a) in the section heading, by striking out "Property" and substituting "Education property";

(b) in the subsection,

(i) by adding "education" before "property tax credit",

(ii) by striking out "$600." and substituting "$675.", and

(iii) by striking out "$700." and substituting "$775.".

22          Subsection 5.6(1) is amended by striking out "$325." and substituting "$400."

23          Clause 5.7(1)(d) and subsection 5.7(5) are amended by striking out "a property tax credit" and substituting "an education property tax credit".

24          Section 5.8 is amended by striking out "is the lesser of $700. and 7%" and substituting "after 2000 is 4%".

25(1)       Subsection 7(1) is replaced with the following:

Tax payable by corporation

7(1)        Subject to subsection (1.1), the tax payable by a corporation under section 3 for a taxation year is the following percentage of its taxable income earned in the year in Manitoba:

(a) for the 2001 and earlier calendar years, 17%;

(b) for the 2002 calendar year, 16.5%;

(c) for the 2003 calendar year, 16%;

(d) for the 2004 calendar year, 15.5%;

(e) for the 2005 and later calendar years, 15%.

Application of subsection (1)

7(1.1)      If a corporation's taxation year begins in one calendar year mentioned in subsection (1) and ends in the next, the tax payable by the corporation under section 3 for the taxation year shall be calculated in accordance with the following formula:

T = (P1 x I x A/C) + (P2 x I x B/C)

In this formula,

T   is the tax payable under section 3 by the corporation for the taxation year;

P1is the percentage specified in subsection (1) for the calendar year in which the taxation year begins;

P2is the percentage specified in subsection (1) for the next calendar year;

I   is the corporation's taxable income earned in Manitoba in the taxation year;

A   is the number of days of the corporation's taxation year within the calendar year in which the taxation year begins;

B   is the number of days of the corporation's taxation year within the next calendar year;

C   is the total number of days in the corporation's taxation year.

25(2)       Subsection 7(2) is replaced with the following:

Income eligible for small business deduction

7(2)        For the purpose of this section, the portion of a corporation's taxable income for a taxation year that is eligible for a small business deduction under this section is the amount determined by the following formula:

(A + B) x C/D

In this formula,

A   is the portion of the corporation's taxable income for the year on which a small business deduction is allowed under section 125 of the federal Act;

B   is the lesser of

(a) the proportion of 50% of the amount determined for A that the number of days in the corporation's taxation year that fall within a calendar year after 2001 is of the number of days in the taxation year, and

(b) the amount, if any, by which

(i) the amount that would, if the corporation's business limit under section 125 of the federal Act for the year were $300,000., be its taxable income for the year on which a small business deduction would be allowed under that section,

exceeds

(ii) the amount determined for A;

C   is the corporation's taxable income for the year earned in Manitoba;

D   is the corporation's taxable income for the year earned in Canada.

25(3)       Subsection 7(3) is amended by striking out "and" at the end of clause (f) and by replacing everything after clause (f) with the following:

(g) for the 2002 calendar year, 11.5%;

(h) for the 2003 calendar year, 11%;

(i) for the 2004 calendar year, 10.5%; and

(j) for the 2005 and later calendar years, 10%;

of the portion of the corporation's taxable income for the year that is eligible for the small business deduction under this section.

25(4)       The description of I in the formula in subsection 7(3.1) is replaced with the following:

I   is the portion of the corporation's taxable income for the year that is eligible for the small business deduction under this section.

26(1)       Subsection 7.5(1) is amended by repealing the definition "assets".

26(2)       Subsection 7.5(4) is amended by striking out "except for clause (c), and the corporation" and substituting "and".

27          Clauses 7.6(a) and (b) are amended by striking out "2002" and substituting "2005".

28          Clause 7.7(c) is repealed.

29          The following is added after subsection 11.6(8):

Stock savings plan

11.6(9)     The program of providing tax credits under this section in respect of the acquisition and ownership of eligible shares is deemed, for the purposes of the federal Act and the federal regulations, to be a stock savings plan, and an eligible share, while it is held by a person who by holding the share is entitled to a tax credit, is deemed to be held in the stock savings plan.

30          The following is added after section 27 and before the centred heading that follows that section:

Misrepresentation in tax planning arrangements

27.1(1)     Section 163.2 of the federal Act applies for the purposes of this Act.

Limitation

27.1(2)     Subsection (1) applies to a misrepresentation made before the day the Act that enacted this section received royal assent only if section 163.2 of the federal Act applies to the misrepresentation for the purposes of that Act.

31          The following is added after subsection 61(4):

Authority to collect taxes

61(5)       For greater certainty, if this Act is or has been amended, whether before or after this section comes into force, such that a collection agreement is no longer consistent with this Act, then despite the inconsistency,

(a) the collection agreement remains in effect for the purpose of applying the provisions of this Act that apply when a collection agreement is in effect; and

(b) the Government of Canada has the authority to collect on behalf of the Government of Manitoba all taxes payable under this Act;

until the collection agreement is terminated in accordance with its terms.

Minister of Finance may exercise powers of minister

61(6)       If while a collection agreement is in effect the minister or deputy head does not, for any reason, employ all the powers or perform all the duties that the Minister of Finance for Manitoba would have under this Act if no collection agreement were in effect, the Minister of Finance or Deputy Minister of Finance for Manitoba, or persons designated by the Minister of Finance for Manitoba for the purpose, may employ those powers or perform those duties.

PART 5

THE MOTIVE FUEL TAX ACT

C.C.S.M. c. M220 amended

32          Subsection 11(15) of The Motive Fuel Tax Act is amended in the English version by striking out "director," and substituting "director and every".

PART 6

THE RETAIL SALES TAX ACT

C.C.S.M. c. R130 amended

33          The Retail Sales Tax Act is amended by this Part.

34(1)       Subsection 2(9) is amended by adding "under this section" after "shall pay the tax".

34(2)       The following is added after subsection 2(9):

No credit for trade-in of interjurisdictional vehicle

2(9.1)      Subsection (9) does not apply where the property accepted by the vendor in trade is a motor vehicle that is or has been registered for interjurisdictional commercial purposes and on which tax has not been paid under this section by the purchaser.

35(1)       The definitions "vehicle registration year" and "vehicle taxable value" in subsection 2.3(1) are replaced with the following:

"vehicle registration year", in relation to the registration of a vehicle, means the period beginning on the effective date of the registration and ending on the expiry date of the registration as determined at the time of registration; (« année d'immatriculation du véhicule »)

"vehicle taxable value" of a vehicle means its fair market value on the acquisition date, or any greater amount that

(a) if the vehicle was purchased, was its purchase price, or

(b) if the vehicle is leased, is set out in the lease agreement as the purchase price,

and includes any capital expenditure made to the vehicle after the vehicle's acquisition date. (« valeur imposable du véhicule  »)

35(2)       Subsections 2.3(2.1) and (2.2) are amended by striking out everything after "in respect of a vehicle" and substituting "for its vehicle registration year that begins before March 2003, if the person has owned the vehicle continuously since March 1, 2001 and has paid tax on it under section 2 before that day."

35(3)       Subsection 2.3(10) is amended in the part before clause (a) by adding ", calculated in accordance with the regulations," after "shall provide a credit".

35(4)       Subsection 2.3(11) is repealed.

35(5)       Subsection 2.3(15) is replaced with the following:

Tax adjustment may be refunded or credited

2.3(15)     An amount required to be refunded under subsection (2.2) or (12) or credited under subsection (10) or (13) may be

(a) paid out of the Consolidated Fund as a refund; or

(b) applied as a credit against tax payable under this section.

Duty of Registrar of Motor Vehicles

2.3(16)     Despite The Highway Traffic Act and any other Act of the Legislature, the Registrar of Motor Vehicles under The Highway Traffic Act shall not permit any person to register a vehicle for interjurisdictional commercial purposes for a vehicle registration year unless the person produces evidence satisfactory to the registrar that the tax under this section for the vehicle registration year has been paid.

36(1)       Subsection 3(1) is amended

(a) by replacing clause (m) with the following:

(m) chemical products, as defined in the regulations, when purchased and used principally in farming;

(m.1) non-chemical products, as defined in the regulations, ordinarily used in agriculture or horticulture;

(b) in subclause (yy)(i), by striking out "2001" and substituting "July 2002".

36(2)       Subsection 3(11) is amended

(a) in the English version, by adding "or her" after "him"; and

(b) by adding "under section 2" after "paid the tax" and after "tax paid" wherever it occurs.

36(3)       The following is added after subsection 3(17):

Food and beverages on aircraft

3(17.1)     For greater certainty, food, beverages and non-reusable food and beverage containers purchased by a commercial air carrier for consumption by its passengers in an aircraft are deemed, for the purpose of clause (17)(b), to be purchased for resale whether or not the passengers are charged separately for those items.

36(4)       Subsection 3(18) is amended in the part after clause (b) by striking out "and retains" and substituting ", and retains for at least six months,".

36(5)       Clause 3(22)(b) is amended by striking out "and is continued to be used" and substituting ", and is continued to be used for at least six months,".

36(6)       Subsection 3(27.1) is amended, in the part before clause (a), by striking out "2001" and substituting "July, 2002".

37(1)       Subsection 8(1) is amended

(a) in the English version, by adding ", her or its" after "his"; and

(b) by striking out "taxes collected by that person" and substituting "amounts payable under this Act by that person".

37(2)       Subsection 8(3) is replaced with the following:

Responsibility of buyer on bulk sale

8(3)        A buyer who buys stock through a sale in bulk and fails to obtain from the seller of the stock the duplicate copy of a certificate furnished under subsection (1)

(a) is responsible for payment to the minister of all amounts payable under this Act by the seller in respect of transactions that occurred before the sale; and

(b) may recover, in a court of competent jurisdiction, from the seller any amount paid to the minister under this subsection.

37(3)       The English version of subsection 8(4) is amended

(a) in the definition "sale in bulk", by striking out "vendor" wherever it occurs and substituting "seller";

(b) by adding the following definition in alphabetical order:

"seller" includes a person who barters or exchanges stock in bulk with another person for other property, real or personal; (« vendeur »)

(c) by repealing the definition "vendor".

38          Subsections 13(7), (8), (9) and (10) are amended by striking out "sections 14 and 14.1" and substituting "section 14".

39          Sections 14 and 14.1 are replaced with the following:

Definitions

14(1)       In this section

"institution" means a bank, credit union, trust company or other similar person; (« établissement financier »)

"secured creditor" means a person who has a security interest in property of another person or who, in connection with such a security interest, acts for or on behalf of the person who has it, and includes a trustee appointed under a trust deed relating to a security interest, a receiver or receiver-manager appointed by a secured creditor or by a court on the application of a secured creditor, a sequestrator or any other person performing a similar function; (« créancier garanti »)

"security interest" means an interest in property that secures payment or performance of an obligation and includes an interest created by or arising out of a debenture, mortgage, lien, pledge, charge, deemed or actual trust, assignment or encumbrance of any kind whatever, however and whenever arising, created, deemed to arise or otherwise provided for; (« garantie »)

"tax debtor" means a vendor or purchaser who is indebted to Her Majesty in right of Manitoba in respect of tax collectable or repayable under this Act; (« débiteur fiscal »)

Demand re amounts required to be paid

14(2)       Where the minister knows or suspects that a person or partnership (referred to in this section as the "payor") is, or is about to become,

(a) indebted or liable to make a payment at any time to a tax debtor; or

(b) liable to make a payment at any time to a secured creditor who has a right to receive the payment that, but for a security interest in favour of the secured creditor, would be payable to the tax debtor;

the minister may, by registered mail or by a letter served personally, demand that the payor pay to the minister on account of the tax debtor's liability under this Act, forthwith if the moneys are payable immediately or on demand and, in any other case, as and when they become payable, the moneys otherwise payable to the tax debtor or the secured creditor.

Demand re amounts to be loaned, advanced, etc.

14(3)       Where the minister has knowledge or suspects that within 90 days

(a) an institution will lend or advance moneys to, or make a payment on behalf of, or make a payment in respect of a negotiable instrument issued by a tax debtor who is indebted to the institution and who has granted security in respect of the indebtedness; or

(b) a person or partnership, other than an institution, will lend or advance moneys to, or make a payment on behalf of, a tax debtor and the minister knows or suspects that

(i) the tax debtor is, was or will be within 90 days employed by, or engaged in providing property or services to, that person or partnership, or

(ii) except where that person is an individual, the tax debtor is not dealing at arm's length with that person or partnership;

the minister may, by registered mail or by a letter served personally, demand that the institution or the person or partnership pay in whole or in part to the minister on account of the tax debtor's liability under this Act the moneys that would otherwise be so lent, advanced or paid.

Periodic payments

14(4)       Where the minister has made a demand under subsection (2) for the payment of moneys otherwise payable as interest, rent, remuneration, a dividend, an annuity or other periodic payment, the demand

(a) applies to all such payments to be made by the payor to the tax debtor or secured creditor until the tax debtor's liability under this Act is satisfied; and

(b) operates to require the payor to pay to the minister, out of each such periodic payment, the amount stipulated by the minister in the demand.

Property of Her Majesty

14(5)       On receipt by a payor of a demand made under subsection (2), the moneys payable pursuant to the demand, despite any security interest in those moneys, become property of Her Majesty in right of Manitoba and shall be paid to the minister in priority to any security interest.

Service to business address

14(6)       A demand under subsection (2) or (3) to a person or institution that carries on business, otherwise than as a partner, may be addressed to the name of the person or institution or any other name under which the business is carried on.  If served personally, it is deemed to have been validly served when it has been left with an adult person employed at a place of business of the person or institution.

Service to partnership

14(7)       A demand under subsection (2) or (3) to a partnership may be addressed to one or more general partners of the partnership, to the partnership name or to any other name under which the partnership carries on business. If served personally, it is deemed to have been validly served when it has been left with a general partner of the partnership or with an adult person employed at a place of business of the partnership.

Failure to comply with subsection (2) demand

14(8)       Every payor who fails to comply with a demand made under subsection (2) is personally liable to pay to Her Majesty in right of Manitoba an amount equal to the amount demanded to be paid to the minister, and the amount is a debt due by the payor to Her Majesty in right of Manitoba and is recoverable as such in a court of competent jurisdiction.

Failure to comply with subsection (3) demand

14(9)       Every person, partnership or institution that fails to comply with a demand made under subsection (3) is liable to pay to Her Majesty in right of Manitoba an amount equal to the lesser of

(a) the amount demanded to be paid; and

(b) the total of the moneys lent, advanced or paid to or for the benefit of the tax debtor within 90 days after the demand was received by the person, partnership or institution;

and the amount is a debt due by the person, partnership or institution to Her Majesty in right of Manitoba and is recoverable as such in a court of competent jurisdiction.

Minister may assess amounts payable

14(10)      The minister may, within six years after mailing or serving a demand for payment under this section, assess the person, partnership or institution for any amount for which the person, partnership or institution becomes liable under subsection (8) or (9).

Minister's receipt discharges original liability

14(11)      The receipt of the minister for moneys paid as demanded or assessed under this section is a good and sufficient discharge of the original liability to the extent of the payment.

Deemed payment to or for debtor

14(12)      When an amount that would otherwise have been lent, advanced, paid or payable to or on behalf of a tax debtor is paid by a person, partnership or institution to the minister pursuant to a demand or assessment made under this section, the person, partnership or institution is deemed, for all purposes, to have lent, advanced or paid, as the case may be, the amount to or on behalf of the tax debtor.

40          Subsection 23(1) is amended in the part before clause (a) by adding ", other than for interjurisdictional commercial purposes," after "register a vehicle".

PART 7

THE TOBACCO TAX ACT

C.C.S.M. c. T80 amended

41          Subsection 2(1) of The Tobacco Tax Act is amended

(a) in clause (a), by striking out "8.6¢" and substituting "9.6¢";

(b) in clause (c), by striking out "$1.04" and substituting "$1.18";

(c) in clause (d), by striking out "7.3¢" and substituting "8.3¢";

(d) in subclause (e)(i), by striking out "85¢" and substituting "99¢"; and

(e) in subclause (e)(ii), by striking out "" and substituting "".

PART 8

THE WATER POWER ACT

C.C.S.M. c. W60 amended

42          The following is added after subsection 14(3) of The Water Power Act:

Rates may vary based on production or capacity

14(4)       The rental, royalties, fees, dues or other charges fixed by regulation under clause (1)(j) may vary based on the amount of water power being produced or capable of being produced by the holder of the lease, license, permit or other authorization.

Rates regulation may be made retroactive

14(5)       A regulation made under clause (1)(j), if it so provides, is effective with reference to a period before it is registered or is published as required by subsection (2), if that period begins no earlier than April 1 of the year in which the regulation is made.

PART 9

COMING INTO FORCE

Coming into force

43(1)       Except as otherwise provided in this section, this Act comes into force on the day it receives royal assent.

43(2)       Section 2 and clause 36(1)(a) are retroactive and are deemed to have come into force on May 1, 2001.

43(3)       Sections 14 and 16 to 24, except subsections 17(2) and 18(2), and clause 36(1)(b) and subsection 36(6) are retroactive and are deemed to have come into force on January 1, 2001.

43(4)       Section 15 and subsection 18(2) are retroactive and are deemed to have come into force on January 1, 2000.

43(5)       Sections 26 and 28 are retroactive and are deemed to have come into force on April 10, 2001 with respect to applications made under section 7.8 of The Income Tax Act on or after that day.

43(6)       Section 29 is retroactive and is deemed to have come into force on April 30, 1999.

43(7)       Section 30 is retroactive and is deemed to have come into force on June 30, 1999.

43(8)       Sections 34 and 35, subsection 36(2) and section 40 are retroactive and are deemed to have come into force on March 1, 2001.

43(9)       Section 37 is retroactive and is deemed to have come into force on June 1, 2001.

43(10)      Section 41 is retroactive and is deemed to have come into force on April 10, 2001.

43(11)      Section 42 is retroactive and is deemed to have come into force on April 1, 2001.

Explanatory Note

This Bill implements various measures announced in the 2001 budget.

Part 1 amends The Corporation Capital Tax Act to

  • clarify that no interest is payable on refunds of instalments; and
  • make a corporation liable for travel expenses incurred to audit its books and records if they are not kept in Manitoba.

Part 2 amends The Health and Post Secondary Education Tax Levy Act to

  • clarify the calculation of the levy for employers who have a permanent establishment in Manitoba for only part of a year; and
  • make an employer liable for travel expenses incurred to audit the employer's books and records if they are not kept in Manitoba.

Part 3 amends The Homeowners Tax and Insulation Assistance Act to

  • change the name of the Act to The Property Tax and Insulation Assistance Act; and
  • enable the government to establish a regulatory scheme for providing the environmentally sensitive areas tax credit announced in the 2001 budget.

Part 4 amends The Income Tax Act to

  • implement the income tax changes announced in the 2001 budget;
  • make the provisions of the federal Income Tax Act regarding misrepresentations in federal tax planning arrangements apply to misrepresentations made in Manitoba income tax planning arrangements;
  • clarify the authority for the collection of taxes under a tax collection agreement; and
  • make minor corrections.

Part 5 makes minor corrections to The Motive Fuel Tax Act.

Part 6 amends The Retail Sales Tax Act to

  • implement retail sales tax changes announced in the 2001 budget;
  • enhance the minister's collection powers in respect of amounts owing under the Act; and
  • make minor corrections.

Part 7 amends The Tobacco Tax Act to implement changes in the tobacco tax rates announced in the 2001 budget.

Part 8 amends The Water Power Act to enable water rates charged to Manitoba Hydro to be increased as announced in the 2001 budget.