Simon's Megalomaniacal Legal Resources

Federal Tax - Excise Tax Act (ETA)

. Johnson v. Canada

In Johnson v. Canada (Fed CA, 2023) the Federal Court of Appeal considers the Excise Tax Act (ETA) appeal jurisdiction of the Tax Court:

B. Appeals to the Tax Court under Sections 302 and 306 of the ETA

[31] Sections 302 and 306 of the ETA provide for appeals to the Tax Court:

302 Where a person files a notice of objection to an assessment and the Minister sends to the person a notice of a reassessment or an additional assessment, in respect of any matter dealt with in the notice of objection, the person may, within ninety days after the day the notice of reassessment or additional assessment was sent by the Minister,

302 La personne, ayant présenté un avis d’opposition à une cotisation, à qui le ministre a envoyé un avis de nouvelle cotisation ou de cotisation supplémentaire concernant l’objet de l’avis d’opposition peut, dans les 90 jours suivant cet envoi :

(a) appeal therefrom to the Tax Court; or

(a) interjeter appel devant la Cour canadienne de l’impôt;

(b) where an appeal has already been instituted in respect of the matter, amend the appeal by joining thereto an appeal in respect of the reassessment or additional assessment in such manner and on such terms as the Tax Court directs.

(b) si un appel a déjà été interjeté, modifier cet appel en y joignant un appel concernant la nouvelle cotisation ou la cotisation supplémentaire, en la forme et selon les modalités fixées par cette cour.

...

306 A person who has filed a notice of objection to an assessment under this Subdivision may appeal to the Tax Court to have the assessment vacated or a reassessment made after either

306 La personne qui a produit un avis d’opposition à une cotisation aux termes de la présente sous-section peut interjeter appel à la Cour canadienne de l’impôt pour faire annuler la cotisation ou en faire établir une nouvelle lorsque, selon le cas :

(a) the Minister has confirmed the assessment or has reassessed, or

(a) la cotisation est confirmée par le ministre ou une nouvelle cotisation est établie;

(b) one hundred and eighty days have elapsed after the filing of the notice of objection and the Minister has not notified the person that the Minister has vacated or confirmed the assessment or has reassessed,

(b) un délai de 180 jours suivant la production de l’avis est expiré sans que le ministre n’ait notifié la personne du fait qu’il a annulé ou confirmé la cotisation ou procédé à une nouvelle cotisation.

but no appeal under this section may be instituted after the expiration of ninety days after the day notice is sent to the person under section 301 that the Minister has confirmed the assessment or has reassessed.

Toutefois, nul appel ne peut être interjeté après l’expiration d’un délai de 90 jours suivant l’envoi à la personne, aux termes de l’article 301, d’un avis portant que le ministre a confirmé la cotisation ou procédé à une nouvelle cotisation.

[32] Filing a notice of objection to an assessment is a condition precedent to filing an appeal to the Tax Court under either section 302 or section 306 of the ETA (Li v. Canada, 2011 TCC 416, at paras. 3-4). Section 302 also has the additional requirement that after filing the notice of objection, the Minister of National Revenue (Minister) must have sent “to the person a notice of a reassessment or an additional assessment, in respect of any matter dealt with in the notice of objection”.

....

E. Appeals to the Tax Court under section 216 of the ETA

[49] Subsection 216(5) of the ETA contemplates a right of appeal to the Tax Court from a decision of the President of the CBSA:

216(5) The provisions of this Part and of the Tax Court of Canada Act that apply to an appeal taken under section 302 apply, with any modifications that the circumstances require, to an appeal taken under subsection 67(1) of the Customs Act from a decision of the President of the Canada Border Services Agency made under section 60 or 61 of that Act in a determination of the tax status of goods as if the decision of the President were a confirmation of an assessment or a reassessment made by the Minister under subsection 301(3) or (4) as a consequence of a notice of objection filed under subsection 301(1.1) by the person to whom the President is required to give notice under section 60 or 61 of the Customs Act, as the case may be, of the decision.

216(5) Les dispositions de la présente partie et de la Loi sur la Cour canadienne de l’impôt concernant les appels interjetés en vertu de l’article 302 s’appliquent, avec les adaptations nécessaires, aux appels interjetés en vertu du paragraphe 67(1) de la Loi sur les douanes d’une décision du président de l’Agence des services frontaliers du Canada rendue conformément aux articles 60 ou 61 de cette loi quant au classement de produits, comme si cette décision était la confirmation d’une cotisation ou d’une nouvelle cotisation établie par le ministre en application des paragraphes 301(3) ou (4) par suite d’un avis d’opposition présenté aux termes du paragraphe 301(1.1) par la personne que le président est tenu d’aviser de la décision selon les articles 60 ou 61 de la Loi sur les douanes.

[50] This subsection only applies if there is “a decision of the President of the Canada Border Services Agency made under section 60 or 61 of that Act in a determination of the tax status of goods”. The expression “determination of the tax status of goods” is defined in subsection 216(1) of the ETA:

216 (1) In this section, determination of the tax status of goods means a determination, re-determination or further re-determination that the goods are, or are not, included in Schedule VII.

216 (1) Au présent article, classement s’entend du classement tarifaire de produits, de la révision de ce classement ou du réexamen de cette révision, effectué en vue d’établir si les produits sont inclus ou non à l’annexe VII.

[51] Therefore, the right to appeal to the Tax Court is limited to a determination (or re-determination) that particular goods are, or are not, included in Schedule VII to the ETA. It is not a general determination of the tax status of any particular goods nor is it a determination of whether a particular person is exempt from taxation.

[52] Various goods are described in the paragraphs of Schedule VII to the ETA. Paragraph 1 of Schedule VII refers to goods classified under certain listed headings or subheadings of Chapter 98 of Schedule I to the Customs Tariff, S.C. 1997, c. 36. Chapter 98 of this schedule is identified as “Special classification provisions - non-commercial”.

[53] It should be noted that if the President of the CBSA makes a decision as contemplated by subsection 216(5) of the ETA, it would be deemed to be “a confirmation of an assessment or a reassessment made by the Minister under subsection 301(3) or (4) as a consequence of a notice of objection filed under subsection 301(1.1)”. Subsection 216(5) of the ETA provides that the appeal provisions of section 302 of the ETA are applicable. Section 302 sets out a limitation period of 90 days to file an appeal to the Tax Court. It should also be noted that section 305 of the ETA (which grants a person the right to apply for an extension of time to file an appeal) only refers to a failure to file an appeal under section 306 of the ETA.