OTTAWA — The government of Saskatchewan’s effort to remove a tax break for Canadian Pacific from the law that created the province has advanced at the federal level, with the amendment to the Constitution of Canada passing the House of Commons.
CTV News reports the legislation now moves to Senate, where it could be proclaimed to be in force by the Governor General and become law.
The effort to amend the Saskatchewan Act stems from a CP lawsuit seeking the refund of $341 million in back taxes, saying it is exempt under an 1880 agreement. The province has contended that exemption was rescinded as part of legislation in 1966 [see “Province seeks to amend constitution …,” Trains News Wire, Dec. 1, 2021].
The amendment, repealing Section 24 of the Saskatchewan Act, would be retroactive to 1966. Gordon Wyant, the province’s justice minister and attorney general, said in a press release the amendment will “ensure that all Saskatchewan taxpayers, both citizens and businesses alike, continue to be fairly treated and bear responsibility for provincial taxes which support our provincial infrastructure and economy.”
Saskatchewan collected the taxes. CP is suing to get a refund. CP says the 1880 legislation applies but Saskatchewan points to the 1966 law. Federal government action clarifies the validity of the Saskatchewan position. There is no retroactive action by government in this case.
The Canadian Senate is appointed by the government of the day. Senators stay until they turn 76. As vacancies come up the government in power fills the seats. The Senate role is to review legislation and recommend changes. The elected members of the House of Commons can reject the changes so the ultimate power is always with the elected representatives. The Supreme Court of Canada can find legislation unconstitutional but it happens as a challenge in a court case. The provincial and federal governments can include the ‘notwithstanding clause’ of the constitution in legislation which means the law cannot be challenged on a constitutional basis.
In the Canadian constitution there is no prohibition on retroactive measures.
Yesterday (Wednesday) the House of Commons voted unanimously to back the measure. The Senate (an unelected body in Canada – its complicated) will probably pass the legislation today (Thursday) or tomorrow and it will then receive Royal Assent (a formality) and become law.
Mr Shore – If you have knowledge, does Canada have judicial review of legislation comparable to the US Supreme Court’s power to find legislation to be unconstitutional and therefore void? (For many reasons, not only ex post facto. Due process comes to mind.)
It does. But this is a constitutional amendment (a less onerous process in Canada clearly). Seems to me this is simply clarifying how things have been operating since 1966.
I understand how you can repeal a tax exemption once granted, and thus collect tax going forward, but don’t understand how you can make it retroactive to 1966. Isn’t that ex post facto, prohibited by the US Constitution and presumably by the Constitution of Canada?
Le Canada, ce n’est pas les Etats Unis, eh? Au Canada, je dis M. le Prime Ministre dit la loi, ansi tous les citoyens doits suivre.
C’est dommage, my high school French was centuries ago and even back then I was terrible at it. Hope I got it half right. Toujours la feuille d’erable.
Got none of it right Charles, although sometimes it seems like it. Ha ha, have a good night,