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Federal-Provincial Fiscal Arrangements Regulations, 2007 (SOR/2007-303)

Regulations are current to 2024-05-01 and last amended on 2024-04-01. Previous Versions

PART 1Fiscal Equalization Payments (continued)

DIVISION 3General (continued)

Calculations and Estimates (continued)

  •  (1) For each fiscal year, the Minister shall, in December of the preceding fiscal year, make an estimate of the fiscal equalization amount to be calculated under section 3.72 of the Act using

    • (a) the information set out in the certificate that is submitted in the fiscal year preceding that for which the amount is estimated, and

    • (b) in the case of information that is not required to be set out in the certificate, the most recent data from the information source identified in these Regulations that is available as of December 1 of the fiscal year preceding that for which the amount is estimated.

  • (2) The Minister shall inform Nova Scotia’s Minister of Finance of the estimate referred to in subsection (1) on or before December 31 of the fiscal year preceding that for which the estimate is made.

  • SOR/2008-318, s. 12
  • SOR/2013-225, s. 14
  •  (1) When determining the revenue to be equalized from a revenue source for a fiscal year for the purpose of making a calculation or estimate referred to in section 13 or 14, the Minister may, if information that is necessary for that determination is incorrect, missing from the certificate or, in the case of information that is not required to be set out in the certificate, unavailable from the information source identified in these Regulations, estimate the revenue to be equalized on the basis of any information that is available to the Minister at the time of the calculation.

  • (2) When determining a revenue base for the purpose of making a calculation or estimate referred to in section 13 or 14, the Minister may, if information that is necessary for that determination is unavailable or incorrect, estimate the base using the following substitutions:

    • (a) if, when determining a revenue base referred to in paragraph 5(a) or 8(1)(a) for a fiscal year, information from T1 tax returns that are assessed or reassessed by the Canada Revenue Agency during the last three months of the calendar year that ends in the following fiscal year is not available for the purpose of calculating the simulated average revenue yield relating to personal income for the province for the taxation year that ends in the fiscal year, the Minister may use in place of that yield the product of

      • (i) the simulated average revenue yield relating to personal income for the province, calculated in accordance with the method set out in subsection 10(2) on the basis of the T1 tax returns assessed or reassessed during the first nine months of the calendar year that ends in the following fiscal year, and

      • (ii) the average, over the taxation years that end in the three fiscal years immediately preceding the fiscal year, of a fraction

        • (A) whose numerator is the total federal income tax as determined by the micro-simulation model that is assessed or reassessed for the taxation year for individuals, not including trusts, in the province during the calendar year following that taxation year, and

        • (B) whose denominator is the total federal income tax as determined by the micro-simulation model that is assessed or reassessed for the taxation year for individuals, not including trusts, in the province during the first nine months of the calendar year following that taxation year;

    • (b) if, when determining a revenue base referred to in paragraph 5(b) or 8(1)(b) for a fiscal year, information from corporation tax returns that are assessed or reassessed by the Canada Revenue Agency during the last two or three months of the calendar year that ends in the following fiscal year is not available for the purpose of calculating the allocated corporation taxable income attributable to the province for the fiscal year, the Minister may use in place of

      • (i) the corporations’ taxable income earned in the province for their taxation years ending in the calendar year that ends in the fiscal year in respect of which they are eligible for a deduction under subsection 125(1) of the Income Tax Act, the income in respect of which they are eligible for a deduction as assessed or reassessed by the Canada Revenue Agency during the first nine months of the calendar year that ends in the following fiscal year,

      • (ii) the corporations’ taxable income earned in the province for their taxation years ending in the calendar year that ends in the fiscal year, the income assessed or reassessed by the Canada Revenue Agency during the first 10 months of the calendar year that ends in the following fiscal year, and

      • (iii) the capital gains refunds payable to investment corporations and mutual fund corporations that constitute income earned in the province for their taxation years ending in the calendar year that ends in the fiscal year, those refunds that are assessed or reassessed by the Canada Revenue Agency during the first 10 months of the calendar year that ends in the following fiscal year;

    • (c) if, when determining a revenue base referred to in paragraph 5(c) for a fiscal year, information on taxes on products, other than federal and provincial general sales taxes, is not available from Statistics Canada for the purpose of netting those taxes from household final consumption expenditures, capital expenditures for intellectual property products, capital expenditures for machinery and equipment or capital expenditures for non-residential structures in a province, the Minister may use in place of that information

      • (i) in respect of household final consumption expenditures, the product, for each household final consumption expenditure category, of those expenditures in the province for the fiscal year, net of federal and provincial general sales taxes, and a fraction

        • (A) whose numerator is the amount of taxes on products, other than federal and provincial general sales taxes, paid in relation to those expenditures for that category in the province for the most recent fiscal year for which information on those taxes is available from Statistics Canada, and

        • (B) whose denominator is the expenditures for that category, net of federal and provincial general sales taxes, in the province for that most recent fiscal year, and

      • (ii) in respect of each type of capital expenditure, the product, for each public education or non-profit entity category, of those expenditures in the province for the fiscal year, net of federal and provincial general sales taxes, and a fraction

        • (A) whose numerator is the amount of taxes on products, other than federal and provincial general sales taxes, paid in relation to that type of capital expenditure by that category or sector in the province for the most recent fiscal year for which information on those taxes is available from Statistics Canada, and

        • (B) whose denominator is the capital expenditures of that type by that category or sector, net of federal and provincial general sales taxes, in the province for that most recent fiscal year;

    • (c.1) if, when determining a revenue base referred to in paragraph 5(c) for a fiscal year, the expenditure and tax information required to calculate C, D and I for a province for a calendar year is missing from the certificate, the Minister may use in place of C, D, and I, respectively,

      • (i) the product of C as calculated for that province for the most recent calendar year for which information is provided in the certificate and a fraction

        • (A) whose numerator is the C as calculated under these Regulations as they read on December 31, 2017 for the calendar year for which the information required to calculate C is missing from the certificate, and

        • (B) whose denominator is the C as calculated under these Regulations as they read on December 31, 2017 for the most recent calendar year for which the information required to calculate C is provided in the certificate,

      • (ii) the product of D as calculated for that province for the most recent calendar year for which information is provided in the certificate and a fraction

        • (A) whose numerator is the D as calculated under these Regulations as they read on December 31, 2017 for the calendar year for which the information required to calculate D is missing from the certificate, and

        • (B) whose denominator is the D as calculated under these Regulations as they read on December 31, 2017 for the most recent calendar year for which the information required to calculate D is provided in the certificate, and

      • (iii) the product of I as calculated for that province for the most recent calendar year for which information is provided in the certificate and a fraction

        • (A) whose numerator is the I as calculated under these Regulations as they read on December 31, 2017 for the calendar year for which the information required to calculate I is missing from the certificate, and

        • (B) whose denominator is the I as calculated under these Regulations as they read on December 31, 2017 for the most recent calendar year for which the information required to calculate I is provided in the certificate;

    • (c.2) if, when determining a revenue base referred to in paragraph 5(c) for a fiscal year, the expenditure and tax information required to calculate G for a province for a calendar year is missing from the certificate, the Minister may use in place of G

      • (i) for the earliest of the calendar years for which the information necessary to calculate G is missing from the certificate, the product of G as calculated for that province for the most recent calendar year for which information is provided in the certificate multiplied by one plus the average of the annual rates of growth of the provincial government’s current expenditures and non-profit institutions serving households’ final consumption expenditures, as determined by Statistics Canada for the purpose of its Provincial and Territorial Economic Accounts, for the calendar year for which the information required to calculate G is missing from the certificate, and

      • (ii) for any other calendar year for which the information required to calculate G is missing from the certificate, the result obtained under subparagraph (i) multiplied by one plus the sum of the annual averages of the annual rates of growth of the provincial government’s current expenditures and non-profit institutions serving households’ final consumption expenditures, as determined by Statistics Canada for the purpose of its Provincial and Territorial Economic Accounts, as determined for all calendar years for which the information required to calculate G is missing from the certificate;

    • (c.3) if, when determining a revenue base referred to in paragraph 5(c) for a fiscal year, the expenditure and tax information required to calculate H for a province for a calendar year is missing from the certificate, the Minister may use in place of H the product of H as calculated for that province for the most recent calendar year for which information is provided in the certificate and a fraction

      • (i) whose numerator is the current dollar provincial gross domestic product at market prices for that province, as determined by Statistics Canada for the purpose of its Provincial and Territorial Economic Accounts for the calendar year for which the information required to calculate H is missing from the certificate, and

      • (ii) whose denominator is the current dollar provincial gross domestic product at market prices for that province, as determined by Statistics Canada for the purpose of its Provincial and Territorial Economic Accounts for the most recent calendar year for which the information required to calculate H is provided in the certificate;

    • (d) if, when determining a revenue base referred to in paragraph 8(1)(d) for a fiscal year, the expenditure and tax information required to calculate G and H for a province for a calendar year is missing from the certificate, the Minister may use in place of G and H, respectively,

      • (i) the product of G as calculated for that province for the most recent calendar year for which information is provided in the certificate and a fraction

        • (A) whose numerator is the provincial government’s current expenditures, as determined by Statistics Canada for the purpose of its Provincial and Territorial Economic Accounts for the calendar year for which the information required to calculate G is missing from the certificate, and

        • (B) whose denominator is the provincial government’s current expenditures, as determined by Statistics Canada for the purpose of its Provincial and Territorial Economic Accounts for the most recent calendar year for which the information required to calculate G is provided in the certificate, and

      • (ii) the product of H as calculated for that province for the most recent calendar year for which information is provided in the certificate and a fraction

        • (A) whose numerator is the current dollar provincial gross domestic product at market prices for that province, as determined by Statistics Canada for the purpose of its Provincial and Territorial Economic Accounts for the calendar year for which the information required to calculate H is missing from the certificate, and

        • (B) whose denominator is the current dollar provincial gross domestic product at market prices for that province, as determined by Statistics Canada for the purpose of its Provincial and Territorial Economic Accounts for the most recent calendar year for which the information required to calculate H is provided in the certificate;

    • (e) if, when determining a revenue base referred to in paragraph 5(d) or 8(1)(z) for a fiscal year, information on the current dollar gross domestic product at factor cost attributable to the industries listed in the description of F in that paragraph in a province for the calendar year that ends in the preceding fiscal year is missing from the certificate, the Minister may use in place of that amount the product of the current dollar gross domestic product at factor cost attributable to those industries in the province for the most recent calendar year for which the information is provided in the certificate and a fraction

      • (i) whose numerator is the provincial government’s current expenditures, as determined by Statistics Canada for the purpose of its Provincial and Territorial Economic Accounts for the calendar year for which the information is missing from the certificate, and

      • (ii) whose denominator is the provincial government’s current expenditures, as determined by Statistics Canada for the purpose of its Provincial and Territorial Economic Accounts for the most recent calendar year for which the information is provided in the certificate;

    • (f) if information that is necessary for determining a revenue base referred to in paragraph 8(1)(f), (h), (j), (k), (z.1), (z.2) or (z.3) for a fiscal year is incorrect, missing from the certificate or, in the case of information that is not required to be set out in the certificate, unavailable from the information source identified in these Regulations, the Minister may replace the revenue base with the product of

      • (i) an estimate of the revenue base derived by substituting, in the calculation of the base, information for the most recent fiscal year or calendar year, as the case may be, for which the required information is set out in the certificate or is available from the identified information source, and

      • (ii) a fraction

        • (A) whose numerator is one plus a fraction whose numerator is the province’s percentage of the population of all provinces for the fiscal year for which the revenue base is being determined and whose denominator is that percentage for the fiscal year referred to in subparagraph (i) or, if that subparagraph refers to a calendar year, the fiscal year in which that calendar year ends, and

        • (B) whose denominator is two;

    • (g) if, when determining a revenue base referred to in paragraph 8(1)(y) for a fiscal year, information on the wages and salaries described in subparagraph (ii) of the description of A in that paragraph for the calendar year that ends in the fiscal year is missing from the certificate, the Minister may use in place of that information the product of the amount determined for that subparagraph for the most recent calendar year for which that information is provided in the certificate and a fraction

      • (i) whose numerator is the provincial government’s current expenditures, as determined by Statistics Canada for the purpose of its Provincial and Territorial Economic Accounts for the calendar year for which the wages and salaries information is missing from the certificate, and

      • (ii) whose denominator is the provincial government’s current expenditures, as determined by Statistics Canada for the purpose of its Provincial and Territorial Economic Accounts for the most recent calendar year for which the wages and salaries information is provided in the certificate; and

    • (h) if, in circumstances other than those described in paragraphs (a) to (g), information that is necessary for determining a revenue base for a fiscal year is incorrect, missing from the certificate or, in the case of information that is not required to be set out in the certificate, unavailable from the information source identified in these Regulations, the Minister may estimate the revenue base by substituting in the relevant calculations the information for the most recent fiscal, calendar or taxation year, as the case may be, that is available in a certificate or from the identified source.

  • (3) If a revenue base for a fiscal year is estimated in accordance with subsection (2), the Minister may further adjust that estimate to take into account factors or trends that could change the provincial share of that revenue base between the earlier fiscal year from which information was used to estimate the base for the fiscal year and the fiscal year for which the revenue base is estimated.

  • (4) If the Minister is unable to estimate a revenue base in accordance with subsection (2), the Minister shall make an estimate on the basis of any information that is available to the Minister.

  • (5) If an aggregate of the revenues of two or more revenue sources is provided in a certificate under paragraph 12(3)(c), the Minister shall determine the portion of the aggregate that is to apply to each of those revenue sources.

  • SOR/2008-318, s. 12
  • SOR/2013-225, s. 14
  • SOR/2018-131, s. 12

 [Repealed, SOR/2013-225, s. 14]

Elections

 An election made by a province under subsection 3.2(2) of the Act shall be communicated in writing to the Minister on or before March 1 preceding the fiscal year for which the election is being made.

  • SOR/2008-318, s. 12
  • SOR/2013-225, s. 14

Payments

 If the Minister determines under sections 3.2 and 3.4 of the Act that a fiscal equalization payment is to be made to a province for a fiscal year, the Minister shall make the payment to the province in 24 equal instalments, with an instalment being made on each of the first and third working days after the 15th calendar day of each month of the fiscal year.

  • SOR/2008-318, s. 12
  • SOR/2013-225, s. 14
 

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