(h) a disposition to which subsection 40(3.4) or 69(5) applies,
	and, for the purpose of this definition, a right to acquire a property (other than a right, as security only, derived from a mortgage, agreement for sale or similar obligation) is deemed to be a property that is identical to the property.
	(2) Subject to section 156, subsection (1) applies to dispositions of property that occur after April 26, 1995.
	26. (1) Paragraphs (a) and (b) of the definition ``permitted redemption'' in sub section 55(1) of the Act are replaced by the following:
	(a) a redemption or purchase for can cellation by the distributing corporation, as part of the reorganization in which the distribution was made, of all the shares of its capital stock that were owned, im mediately before the distribution , by a transferee corporation in relation to the distributing corporation,
	(b) a redemption or purchase for can cellation by a transferee corporation in relation to the distributing corporation, or by a corporation that, immediately after the redemption or purchase, was a sub sidiary wholly-owned corporation of the transferee corporation , as part of the reorganization in which the distribution was made, of all of the shares of the capital stock of the transferee corpora tion or the subsidiary wholly-owned corporation that were acquired by the distributing corporation in consideration for the transfer of property received by the transferee corporation on the distribu tion, and
	(2) Subsection 55(1) of the Act is amended by adding the following in alphabetical order:
``safe- income determination time'' « moment de détermina- tion du revenu protégé »	``safe-income determination time'' for a trans action or event or a series of transactions or events means the time that is the earlier of
	(a) the time that is immediately after the earliest disposition or increase in interest described in any of subparagraphs (3)(a)(i) to (v) that resulted from the transaction, event or series, and
	(b) the time that is immediately before the earliest time that a dividend is paid as part of the transaction, event or series;
	(3) The portion of subsection 55(2) of the Act before paragraph (a) is replaced by the following:
Deemed proceeds or capital gain	(2) Where a corporation resident in Canada has received a taxable dividend in respect of which it is entitled to a deduction under subsection 112(1) or (2) or 138(6) as part of a transaction or event or a series of transactions or events, one of the purposes of which (or, in the case of a dividend under subsection 84(3), one of the results of which) was to effect a significant reduction in the portion of the capital gain that, but for the dividend, would have been realized on a disposition at fair market value of any share of capital stock immediately before the dividend and that could reasonably be considered to be attribut able to anything other than income earned or realized by any corporation after 1971 and before the safe-income determination time for the transaction, event or series, notwithstand ing any other section of this Act, the amount of the dividend (other than the portion of it , if any, subject to tax under Part IV that is not refunded as a consequence of the payment of a dividend to a corporation where the payment is part of the series)
	(4) The portion of subsection 55(3) of the Act before paragraph (b) is replaced by the following:
Application	(3) Subsection (2) does not apply to any dividend received by a corporation (in this subsection and subsection (3.01) referred to as the ``dividend recipient'')
	(a) if, as part of a transaction or event or a series of transactions or events as a part of which the dividend was received, there was not at any particular time
	(i) a disposition of property, other than
	(A) money disposed of on the payment of a dividend or on a reduction of the paid-up capital of a share, and
	(B) property disposed of for proceeds that are not less than its fair market value,
	to a person or partnership who was an unrelated person immediately before the particular time,
	(ii) a significant increase (other than as a consequence of a disposition of shares of the capital stock of a corporation for proceeds of disposition that are not less than their fair market value) in the total direct interest in any corporation of one or more persons or partnerships who were unrelated persons immediately be fore the particular time,
	(iii) a disposition, to a person or partner ship who was an unrelated person im mediately before the particular time, of
	(A) shares of the capital stock of the corporation that paid the dividend (referred to in this paragraph and subsection (3.01) as the ``dividend payer''), or
	(B) property more than 10% of the fair market value of which was, at any time during the course of the series, derived from shares of the capital stock of the dividend payer,
	(iv) after the time the dividend was received, a disposition, to a person or partnership who was an unrelated person immediately before the particular time, of
	(A) shares of the capital stock of the dividend recipient, or
	(B) property more than 10% of the fair market value of which was, at any time during the course of the series, derived from shares of the capital stock of the dividend recipient, and
	(v) a significant increase in the total of all direct interests in the dividend payer of one or more persons or partnerships who were unrelated persons immediately be fore the particular time; or
	(5) Section 55 of the Act is amended by adding the following after subsection (3):
Interpreta- tion - for par. (3)(a)	(3.01) For the purposes of paragraph (3)(a),
	(a) an unrelated person means a person (other than the dividend recipient) to whom the dividend recipient is not related or a partnership any member of which (other than the dividend recipient) is not related to the dividend recipient;
	(b) a corporation that is formed by an amalgamation of 2 or more other corpora tions is deemed to be the same corporation as, and a continuation of, each of the other corporations;
	(c) where there has been a winding-up of a corporation to which subsection 88(1) ap plies, the parent is deemed to be the same corporation as, and a continuation of, the subsidiary;
	(d) proceeds of disposition shall be deter mined without reference to ``paragraph 55(2)(a) or'' in paragraph (j) of the defini tion ``proceeds of disposition'' in section 54; and
	(e) notwithstanding any other provision of this Act, where a non-resident person disposes of a property in a taxation year and the gain or loss from the disposition is not included in computing the person's taxable income earned in Canada for the year, the person is deemed to have disposed of the property for proceeds of disposition that are less than its fair market value unless, under the income tax laws of the country in which the person is resident, the gain or loss is computed as if the property were disposed of for proceeds of disposition that are not less than its fair market value and the gain or loss so computed is recognized for taxation in that country.
	(6) Clauses 55(3.1)(c)(ii)(B) and (C) of the Act are replaced by the following:
	(B) more than 10% of the fair market value of which was, at any time after the distribution and before the end of the series, attributable to property (other than money and indebtedness that is not convertible into other prop erty) described in clause (A) or (C) , or
	(C) to which, at any time during the course of the series, the fair market value of property described in clause (A) was wholly or partly attributable
	(7) Clauses 55(3.1)(d)(ii)(B) and (C) of the Act are replaced by the following:
	(B) more than 10% of the fair market value of which was, at any time after the distribution and before the end of the series , attributable to property (other than money and indebtedness that is not convertible into other prop erty) described in clause (A) or (C) , or
	(C) to which, at any time during the course of the series, the fair market value of property described in clause (A) was wholly or partly attributable
	(8) Subsection 55(3.2) of the Act is amended by striking out the word ``and'' at the end of paragraph (f), by adding the word ``and'' at the end of paragraph (g) and by adding the following after paragraph (g):
	(h) each corporation that is a shareholder and specified shareholder of a distributing corporation at any time during the course of a series of transactions or events, a part of which includes a distribution made by the distributing corporation, is deemed to be a transferee corporation in relation to the distributing corporation.
	(9) Paragraph 55(5)(a) of the Act is replaced by the following:
	(a) where a dividend referred to in subsec tion (2) was received by a corporation as part of a transaction or event or a series of transactions or events, the portion of a capital gain attributable to any income expected to be earned or realized by a corporation after the safe-income deter mination time for the transaction, event or series is deemed to be a portion of a capital gain attributable to anything other than income;
	(10) Paragraph 55(5)(c) of the Act is replaced by the following:
	(c) the income earned or realized by a corporation for a period throughout which it was a private corporation is deemed to be its income for the period otherwise deter mined on the assumption that no amounts were deductible by the corporation under section 37.1 of this Act, as that section applies for taxation years ending before 1995, or paragraph 20(1)(gg) of the Income Tax Act, chapter 148 of the Revised Statutes of Canada, 1952;
	(11) Subsection (1) applies to dividends received after February 21, 1994.
	(12) Subsections (2), (3) and (9) apply to dividends received after June 20, 1996.
	(13) Subsections (4) and (5) apply to dividends received by a corporation after February 21, 1994, except that
	(a) in respect of such dividends received before June 20, 1996, or received under an arrangement substantially advanced, as evidenced in writing, before June 20, 1996, subparagraphs 55(3)(a)(ii) and (v) of the Act, as enacted by subsection (4), shall, where paragraph (b) does not apply, be read as follows:
	(ii) a significant increase (other than as a consequence of a disposition of shares of the capital stock of a corporation for proceeds of disposition that are not less than their fair market value) in the interest in any corporation of one or more persons or partnerships who were unre lated persons immediately before the particular time,
	. . .
	(v) a significant increase in the interest in the dividend payer of one or more persons or partnerships who were unre lated persons immediately before the particular time; or
	and
	(b) in respect of such dividends, where they are received on shares issued before June 20, 1996, and the corporation so elects in writing before the end of the fourth month after the month in which this Act is assented to or in its return of income under Part I of the Act for the year in which it received the dividends, the Act shall be read without reference to subsection 55(3.01), as enacted by subsec tion (5), and paragraph 55(3)(a) of the Act, as enacted by subsection (4), shall be read as follows:
	(a) unless the dividend was received as part of a transaction or event or a series of transactions or events that resulted in
	(i) a disposition of any property to a person with whom the dividend recipient was dealing at arm's length, or
	(ii) a significant increase in the interest in any corporation of any person with whom the dividend recipient was dealing at arm's length; or
	(14) Where a corporation elects under paragraph (13)(b) in respect of dividends,
	(a) subsection 55(4) of the Act shall, in respect of those dividends, be read as follows:
	(4) Where it can reasonably be considered that the principal purpose of one or more transactions or events was to cause 2 or more persons to be related or to not deal with each other at arm's length, or to cause one corpora tion to control another corporation, so as to make subsection (2) inapplicable, for the purposes of this section, those persons are deemed not to be related or are deemed to deal with each other at arm's length, or the corporation is deemed not to control the other corporation, as the case may be.
	(b) paragraph 55(5)(e) of the Act shall, in respect of those dividends, be read as follows:
	(e) in determining whether 2 or more persons deal with each other at arm's length,
	(i) a person is deemed to deal with another person at arm's length and not to be related to the other person if the person is the brother or sister of the other person, and
	(ii) persons who are otherwise related to each other solely because of a right referred to in paragraph 251(5)(b) are deemed not to be related to each other; and
	(15) Subsections (6) and (7) apply to dividends received after April 26, 1995, except that, with respect to acquisitions of property that occur before June 20, 1996 or pursuant to a written agreement made before June 20, 1996,
	(a) clause 55(3.1)(c)(ii)(B) of the Act, as enacted by subsection (6), shall be read as follows:
	(B) more than 10% of the fair market value of which was, at any time after the distribution and before the end of the series, attributable to property (other than money and indebtedness that is not convertible into other prop erty) described in clause (A), or
	(b) clause 55(3.1)(d)(ii)(B) of the Act, as enacted by subsection (7), shall be read as follows:
	(B) more than 10% of the fair market value of which was, at any time after the distribution and before the end of the series, attributable to property (other than money and indebtedness that is not convertible into other prop erty) described in clause (A), or
	(16) Subsection (8) applies to dividends received after June 20, 1996 other than dividends received in the course of a reorga nization that is carried out pursuant to a series of transactions or events substantial ly advanced, as evidenced in writing, before June 21, 1996 or that was required on June 20, 1996 to be carried out pursuant to a written agreement made before June 21, 1996, and for the purpose of this subsection, a reorganization is deemed not to be re quired to be carried out where the parties to that agreement can be relieved of that requirement if there is a change to the Act.
	(17) Subsection (10) applies to the 1995 and subsequent taxation years.
	(18) Subsection (14) applies to dividends received after February 21, 1994.
	27. (1) Subparagraph 56(1)(a)(iv) of the Act is replaced by the following:
	(iv) a benefit under the Unemployment Insurance Act or the Employment Insur ance Act, other than a payment relating to the cost of a course or program designed to facilitate the re-entry into the labour force of a claimant under that Act,
	(2) Subparagraph 56(1)(l)(ii) of the Act is replaced by the following:
	(ii) reimbursement of costs incurred in relation to a decision of the Canada Employment and Immigration Commis sion , the Canada Employment and Insur ance Commission, a board of referees or an umpire under the Unemployment In surance Act or the Employment Insur ance Act, or
	(3) Subsection 56(1) of the Act is amended by adding the following after paragraph (q):
Earnings supplement	(r) amounts received by the taxpayer in the year as social assistance under a project, sponsored by the Government of Canada, under which the only benefits paid are intended to supplement individuals' in come from employment;
	(4) The portion of paragraph 56(1)(u) of the Act after subparagraph (ii) is replaced by the following:
	except to the extent that the payment is otherwise required to be included in com puting the income for a taxation year of the taxpayer or the taxpayer's spouse;
	(5) Subsections (1) and (2) are deemed to have come into force on June 30, 1996.
	(6) Subsections (3) and (4) apply to the 1993 and subsequent taxation years.
	27.1 (1) Paragraph 60(n) of the Act is amended by adding the word ``or'' at the end of subparagraph (ii.1) and by replacing the portion after that subparagraph with the following:
	(iii) any benefit under the Unemployment Insurance Act or the Employment Insur ance Act,