(3) Subsection (1) applies to individuals who cease to be resident in Canada after October 1, 1996.
	(4) Subsection (2) applies to the 2000 and subsequent taxation years.
	155. (1) Paragraph 161(7)(a) of the Act is amended by adding the following before subparagraph (ii):
	(i) any amount deducted under section 119 in respect of a disposition in a subsequent taxation year ,
	(2) Subparagraph 161(7)(a)(iv.1) of the Act is replaced by the following:
	(iv.1) any amount deducted under subsection 126(2) in respect of an unused foreign tax credit (within the meaning assigned by subsection 126(7)), or under subsection 126(2.21) or (2.22) in respect of foreign taxes paid , for a subsequent taxation year,
	(3) Paragraph 161(7)(a) of the Act is amended by striking out the word ``and'' at the end of subparagraph (ix) and by adding the following after subparagraph (x):
	(xi) any amount deducted under any of subsections 128.1(6) to (8) from the taxpayer's proceeds of disposition of a property because of an election made in a return of income for a subsequent taxation year ; and
	(4) Subsections (1) to (3) apply to taxation years that end after October 1, 1996.
	156. (1) Paragraphs 164(1)(a) and (b) of the Act are replaced by the following:
	(a) may,
	(i) before mailing the notice of assessment for the year, where the taxpayer is a qualifying corporation (as defined in subsection 127.1(2)) and claims in its return of income for the year to have paid an amount on account of its tax payable under this Part for the year because of subsection 127.1(1) in respect of its refundable investment tax credit (as defined in subsection 127.1(2)), refund all or part of any amount claimed in the return as an overpayment for the year, not exceeding the amount by which the total determined under paragraph (f) of the definition ``refundable investment tax credit'' in subsection 127.1(2) in respect of the taxpayer for the year exceeds the total determined under paragraph (g) of that definition in respect of the taxpayer for the year,
	(ii) before mailing the notice of assessment for the year, where the taxpayer is a qualified corporation (as defined in subsection 125.4(1)) or an eligible production corporation (as defined in subsection 125.5(1)) and an amount is deemed under subsection 125.4(3) or 125.5(3) to have been paid on account of its tax payable under this Part for the year, refund all or part of any amount claimed in the return as an overpayment for the year, not exceeding the total of those amounts so deemed to have been paid, and
	(iii) on or after mailing the notice of assessment for the year, refund any overpayment for the year, to the extent that the overpayment was not refunded pursuant to subparagraph (i) or (ii) ; and
	(b) shall, with all due dispatch, make the refund referred to in subparagraph (a)(iii) after mailing the notice of assessment if application for it is made in writing by the taxpayer within the period within which the Minister would be allowed under subsection 152(4) to assess tax payable under this Part by the taxpayer for the year if that subsection were read without reference to paragraph 152(4)(a).
	(2) Subsection 164(5) of the Act is amended by adding the following after paragraph (a):
	(a.1) any amount deducted under section 119 in respect of the disposition of a taxable Canadian property in a subsequent taxation year ,
	(3) Paragraph 164(5)(e) of the Act is replaced by the following:
	(e) the deduction of an amount under subsection 126(2) in respect of an unused foreign tax credit (within the meaning assigned by subsection 126(7)), or under subsection 126(2.21) or (2.22) in respect of foreign taxes paid , for a subsequent taxation year,
	(4) Subsection 164(5) of the Act is amended by adding the following after paragraph (h.01):
	(h.02) the deduction under any of subsections 128.1(6) to (8) of an amount from the taxpayer's proceeds of disposition of a property, because of an election made in a return of income for a subsequent taxation year ,
	(5) Subsection 164(5.1) of the Act is replaced by the following:
Interest - disputed amounts	(5.1) Where a portion of a repayment made under subsection (1.1) or (4.1), or an amount applied under subsection (2) in respect of a repayment, can reasonably be regarded as being in respect of a claim made by the taxpayer in an objection to or appeal from an assessment of tax for a taxation year for a deduction or exclusion described in subsection (5) in respect of a subsequent taxation year, interest shall not be paid or applied on the portion for any part of a period that is before the latest of the dates described in paragraphs (5)(i) to (l).
	(6) Subparagraph 164(6.1)(a)(iii) of the Act is amended by replacing the reference to the fraction ``1/4'' with a reference to the fraction ``1/2''.
	(7) Subsection (1) applies to the 1999 and subsequent taxation years.
	(8) Subsections (2) to (5) apply to taxation years that end after October 1, 1996.
	(9) Subsection (6) applies to deaths that occur after February 27, 2000 except that, for deaths that occurred after February 27, 2000 and before October 18, 2000, the reference to the fraction ``1/2'' in subparagraph 164(6.1)(a)(iii) of the Act, as enacted by subsection (6), shall be read as a reference to the fraction ``1/3''.
	157. (1) Subsection 165(2.1) of the Act is replaced by the following:
Application	(2.1) Notwithstanding any other provision of this Act, paragraph (1)(a) shall apply only in respect of assessments, determinations and redeterminations under this Part and Part I.2.
	(2) Subsection (1) applies to the 2001 and subsequent taxation years.
	158. (1) Section 169 of the Act is amended by adding the following after subsection (1):
Ecological gifts	(1.1) Where at any particular time a taxpayer has disposed of a property, the fair market value of which has been confirmed or redetermined by the Minister of the Environment under subsection 118.1(10.4), the taxpayer may, within 90 days after the day on which that Minister has issued a certificate under subsection 118.1(10.5), appeal the confirmation or redetermination to the Tax Court of Canada.
	(2) Subsection (1) applies in respect of gifts made after February 27, 2000 except that, where a certificate has been issued under subsection 118.1(10.5) of the Act, as enacted by subsection 94(7), before this Act receives royal assent, subsection 169(1.1) of the Act, as enacted by subsection (1), shall be read as follows:
	(1.1) Where at any particular time a taxpayer has disposed of a property, the fair market value of which has been confirmed or redetermined by the Minister of the Environment under subsection 118.1(10.4), the taxpayer may, within 90 days after the day on which the Income Tax Amendments Act, 2000 receives royal assent, appeal the confirmation or redetermination to the Tax Court of Canada.
	159. (1) Section 171 of the Act is amended by adding the following after subsection (1):
Ecological gifts	(1.1) On an appeal under subsection 169(1.1), the Tax Court of Canada may confirm or vary the amount determined to be the fair market value of a property and the value determined by the Court is deemed to be the fair market value of the property determined by the Minister of the Environment.
	(2) Subsection (1) applies in respect of gifts made after February 27, 2000.
	160. (1) Subsection 180.1(1) of the Act is replaced by the following:
Individual surtax	180.1 (1) Every individual shall pay a tax under this Part for each taxation year equal to 5% of the amount, if any, by which the tax payable under Part I by the individual for the year exceeds $15,500 .
	(2) Subsection 180.1(2) of the Act is replaced by the following:
Former resident credit for tax paid	(1.4) There may be deducted from the tax otherwise payable under this Part by an individual for a taxation year (computed without reference to subsections (1.1) and (1.2)) the amount, if any, by which
	(a) the amount that would be deductible under section 119 in computing the individual's tax payable under Part I for the year if, in applying for that purpose paragraph (a) of the definition ``tax for the year otherwise payable under this Part'' in subsection 126(7), the reference in that paragraph to ``tax payable under this Part for the year'' were read as a reference to ``the total of taxes that, but for subsections 180.1(1.1), (1.2) and (1.4), would be payable under this Part and Part I.1 for the year''
	exceeds
	(b) the amount deductible under section 119 in computing the individual's tax payable under Part I for the year.
Meaning of tax payable under Part I	(2) For the purposes of subsection (1), the tax payable under Part I by an individual for a taxation year is the amount, if any, by which
	(a) the amount that would be the individual's tax payable under that Part for the year if that Part were read without reference to section 119 , subsection 120(1) and sections 122.3, 126, 127, 127.4 and 127.54
	exceeds
	(b) if the individual was throughout the year a mutual fund trust, the least of the amounts determined under paragraphs (a), (b) and (c) of the description of A in the definition ``refundable capital gains tax on hand'' in subsection 132(4) in respect of the trust for the year, and
	(c) in any other case, nil.
	(3) Subsection (1) applies to the 2000 taxation year.
	(4) Subsection (2) applies after October 1, 1996.
	161. (1) Part I.1 of the Act is repealed.
	(2) Subsection (1) applies to the 2001 and subsequent taxation years.
	162. (1) The formula in subparagraph 180.2(4)(a)(ii) of the Act is replaced by the following:
	(0.0125A - $665 )(1 - B)
	(2) Subsection (1) applies to amounts paid after November 1999.
	163. (1) The portion of paragraph 181.3(3)(a) of the Act before subparagraph (i) is replaced by the following:
	(a) in the case of a financial institution, other than an authorized foreign bank or an insurance corporation, the amount, if any, by which the total at the end of the year of
	(2) Subsection 181.3(3) of the Act is amended by striking out the word ``and'' at the end of paragraph (c), by adding the word ``and'' at the end of paragraph (d) and by adding the following after paragraph (d):
	(e) in the case of an authorized foreign bank, the total of
	(i) 10% of the total of all amounts, each of which is the risk-weighted amount at the end of the year of an on-balance sheet asset or an off-balance sheet exposure of the bank in respect of its Canadian banking business that the bank would be required to report under the OSFI risk-weighting guidelines if those guidelines applied and required a report at that time, and
	(ii) the total of all amounts, each of which is an amount at the end of the year in respect of the bank's Canadian banking business that
	(A) if the bank were a bank listed in Schedule II to the Bank Act, would be required under the risk-based capital adequacy guidelines issued by the Superintendent of Financial Institutions and applicable at that time to be deducted from the bank's capital in determining the amount of capital available to satisfy the Superintendent's requirement that capital equal a particular proportion of risk-weighted assets and exposures, and
	(B) is not an amount in respect of a loss protection facility required to be deducted from capital under the Superintendent's guidelines respecting asset securitization applicable at that time.
	(3) Subsection 181.3(4) of the Act is replaced by the following:
Investment allowance of financial institution	(4) The investment allowance for a taxation year of a corporation that is a financial institution is
	(a) in the case of a corporation that was resident in Canada at any time in the year, the total of all amounts each of which is the carrying value at the end of the year of an eligible investment of the corporation ;
	(b) in the case of an insurance corporation that was throughout the year not resident in Canada, the total of all amounts each of which is the carrying value at the end of the year of an eligible investment of the corporation that was used or held by it in the year in the course of carrying on an insurance business in Canada;
	(c) in the case of an authorized foreign bank, the total of all amounts each of which is the amount at the end of the year, before the application of risk weights, that the bank would be required to report under the OSFI risk-weighting guidelines if those guidelines applied and required a report at that time, of an eligible investment used or held by the bank in the year in the course of carrying on its Canadian banking business; and
	(d) in any other case, nil.
Interpreta- tion	(5) For the purpose of subsection (4),
	(a) an eligible investment of a corporation is a share of the capital stock or long-term debt (and, where the corporation is an insurance corporation, is non-segregated property within the meaning assigned by subsection 138(12)) of a financial institution that at the end of the year
	(i) is related to the corporation,
	(ii) is not exempt from tax under this Part, and
	(iii) is resident in Canada or can reasonably be regarded as using the proceeds of the share or debt in a business carried on by the institution through a permanent establishment (as defined by regulation) in Canada; and
	(b) a credit union and another credit union of which the credit union is a shareholder or member are deemed to be related to each other.
	(4) Subsections (1) to (3) apply after June 27, 1999, except that in its application to taxpayers other than authorized foreign banks for taxation years that end before 2002, paragraph 181.3(5)(a) of the Act, as enacted by subsection (3), shall be read without reference to subparagraph (iii).
	164. (1) Section 186 of the Act is amended to add the following after subsection (6):
Interpreta- tion	(7) For greater certainty, where a provision of this Act or the regulations indicates that the term ``connected'' has the meaning assigned by subsection 186(4), that meaning shall be determined by taking into account the application of subsection 186(2) unless the provision expressly provides otherwise.
	(2) Subject to subsection (3), subsection (1) applies on and after March 16, 2001.
	(3) Subsection (1) does not apply for the purposes of applying the Act on and after March 16, 2001 with respect to actions or transactions of a taxpayer required to be carried out under an agreement in writing made by the taxpayer before March 16, 2001 if the taxpayer elects in writing that this subsection apply by filing the election including a copy of the agreement with the Minister of National Revenue before the day that is 60 days after the day on which this Act receives royal assent.
	165. (1) The description of C in subsection 190.1(1.1) of the Act is replaced by the following:
	C is the number of days in the year that are after February 25, 1992 and before 2001 .
	(2) Subsection (1) applies to taxation years that end after 1998.
	166. (1) The portion of paragraph 190.13(a) of the Act before subparagraph (i) is replaced by the following:
	(a) in the case of a financial institution, other than an authorized foreign bank or a life insurance corporation, the amount, if any, by which the total at the end of the year of
	(2) Section 190.13 of the Act is amended by striking out the word ``and'' at the end of paragraph (b), by adding the word ``and'' at the end of paragraph (c) and by adding the following after paragraph (c):