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Bill C-280

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Second Session, Forty-third Parliament,
69-70 Elizabeth II, 2020-2021
HOUSE OF COMMONS OF CANADA
BILL C-280
An Act to amend the Income Tax Act (residents of northern or intermediate zones)
FIRST READING, March 24, 2021
Mr. Bachrach
432008


SUMMARY

This enactment amends subsection 110.‍7(1) of the Income Tax Act to provide that Haida Gwaii is a northern zone for the purposes of section 110.‍7 of that Act.
Available on the House of Commons website at the following address:
www.ourcommons.ca


2nd Session, 43rd Parliament,
69-70 Elizabeth II, 2020-2021
HOUSE OF COMMONS OF CANADA
BILL C-280
An Act to amend the Income Tax Act (residents of northern or intermediate zones)

Preamble

Whereas residents of Haida Gwaii experience high costs of living that are due to the remote archipelago’s isolated geography;
Whereas the northern residents deduction was established to provide tax relief to residents of northern and isolated communities, thereby offsetting the higher cost of living and accessing services in these areas;
Whereas the northern residents deduction was also intended to help employers recruit and retain workers in northern and isolated areas, such as Haida Gwaii, where employment tends to be concentrated in resource sectors that are seasonal or subject to cyclical fluctuations;
Whereas Haida Gwaii is currently a prescribed intermediate zone for the purposes of the northern residents deduction, yet prior to regulatory amendments in 1993, Haida Gwaii residents were entitled to the full deduction, as it was then a prescribed northern zone;
Whereas the remote nature of Haida Gwaii is evidenced by the fact that employees of the Government of Canada and of Crown corporations who work there receive an isolation allowance;
Whereas, compared to larger metropolitan centres, many northern and rural communities face economic hardship, lack reliable access to services and struggle to attract and retain skilled workers;
Whereas the use of latitude to determine the prescribed northern zone is inherently arbitrary and fails to consider other factors that contribute to the cost of living, such as population size, accessibility and transportation options;
Whereas the particular remoteness of Haida Gwaii communities and the high cost of living faced by their residents illustrate the need to reform the northern residents deduction to reflect their lived experience;
Now, therefore, Her Majesty, by and with the advice and consent of the Senate and House of Commons of Canada, enacts as follows:

Short Title

Short title
1This Act may be cited as the Haida Gwaii Residents Tax Deduction Act.
R.‍S.‍, c. 1 (5th Supp.‍)

Income Tax Act

2(1)The portion of subsection 110.‍7(1) of the Income Tax Act before paragraph (a) is replaced by the following:
Residing in northern or intermediate zone
110.‍7(1)When, throughout a period (in this section referred to as the “qualifying period”) of not less than six consecutive months beginning or ending in a taxation year, a taxpayer who is an individual has resided in one or more particular areas each of which is a northern zone referred to in section 1 of Schedule 1 or an intermediate zone referred to in section 2 of that Schedule for the year and files for the year a claim in prescribed form, there may be deducted in computing the taxpayer’s taxable income for the year
(2)Paragraphs 110.‍7(2)‍(a) and (b) of the Act are replaced by the following:
(a)if the area is a northern zone referred to in section 1 of Schedule 1 for the year, 100%; and
(b)if the area is an intermediate zone referred to in section 2 of Schedule 1 for the year, 50%.
(3)Paragraph 110.‍7(4)‍(b) of the Act is replaced by the following:
(b)can reasonably be considered to be attributable to that portion of the qualifying period that is in the year and during which the taxpayer maintained a self-contained domestic establishment as the taxpayer’s principal place of residence in an area other than a northern zone referred to in section 1 of Schedule 1 or an intermediate zone referred to in section 2 of that Schedule for the year.
(4)Section 110.‍7 of the Act is amended by adding the following after subsection (5):
Order in Council
(6)The Governor in Council may, by order, amend Schedule 1 by adding, deleting or amending the name or the coordinates of an area.
3The reference to “schedule” in paragraph (g) of the definition financial institution in subsection 181(1) of the Act is replaced by a reference to “Schedule 2”.
4The schedule to the Act is renumbered as Schedule 2 and is repositioned accordingly.
5The Act is amended by adding, before Schedule 2, the Schedule 1 set out in the schedule to this Act.
6Sections 2 to 5 apply to the 2021 and subsequent taxation years.


Schedule

(Section 5)
Schedule 1
(Subsection 110.‍7(1), paragraphs 110.‍7(2)‍(a) and (b) and paragraph 110.‍7(4)‍(b))
1For the purposes of section 110.‍7, the northern zones are as follows:
(a)the Yukon Territory, the Northwest Territories or Nunavut;
(b)those parts of British Columbia, Alberta and Saskatchewan that lie north of 57°30′N latitude;
(c)that part of Manitoba that lies
(i)north of 56°20′N latitude, or
(ii)north of 52°30′N latitude and east of 95°25′W longitude;
(d)that part of Ontario that lies
(i)north of 52°30′N latitude, or
(ii)north of 51°05′N latitude and east of 89°10′W longitude;
(e)that part of Quebec that lies
(i)north of 51°05′N latitude, or
(ii)north of the Gulf of St. Lawrence and east of 63°00′W longitude;
(f)Labrador, including Belle Isle; or
(g)Haida Gwaii.
2For the purposes of section 110.‍7, the intermediate zones are Anticosti Island, the Magdalen Islands or Sable Island, or an area that is not a northern zone for the year and is:
(a)that part of British Columbia that lies
(i)north of 55°35′N latitude,
(ii)north of 55°00′N latitude and east of 122°00′W longitude, or
(iii)north of 55°13′N latitude and east of 123°16′W longitude;
(b)that part of Alberta that lies north of 55°00′N latitude;
(c)that part of Saskatchewan that lies
(i)north of 55°00′N latitude,
(ii)north of 54°15′N latitude and east of 107°00′W longitude, or
(iii)north of 53°20′N latitude and east of 103°00′W longitude;
(d)that part of Manitoba that lies
(i)north of 53°20′N latitude,
(ii)north of 52°10′N latitude and east of 97°40′W longitude, or
(iii)north of 51°30′N latitude and east of 96°00′W longitude;
(e)that part of Ontario that lies north of 50°35′N latitude; or
(f)that part of Quebec that lies
(i)north of 50°35′N latitude and west of 79°00′W longitude,
(ii)north of 49°00′N latitude, east of 79°00′W longitude and west of 74°00′W longitude,
(iii)north of 50°00′N latitude, east of 74°00′W longitude and west of 70°00′W longitude,
(iv)north of 50°45′N latitude, east of 70°00′W longitude and west of 65°30′W longitude, or
(v)north of the Gulf of St. Lawrence, east of 65°30′W longitude and west of 63°00′W longitude.

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