This enactment amends the Income Tax Act in order to include, in the definition “taxable Canadian business”, any business that is entitled to a special tax benefit conferred by Barbados under the Canada-Barbados Income Tax Agreement Act, 1980.

R.‍S.‍, c. 1 (5th Supp.‍)

Her Majesty, by and with the advice and consent of the Senate and House of Commons of Canada, enacts as follows:

taxable Canadian business, at any time, of a foreign affiliate of a taxpayer resident in Canada or of a partnership of which a foreign affiliate of a taxpayer resident in Canada is a member (which foreign affiliate or partnership is referred to in this definition as the “operator”), means a business

• (a) the income from which

  • Insertion start (i) Insertion end  is, or would be if there were income from the business for the operator’s taxation year or fiscal period that includes that time, included in computing the foreign affiliate’s taxable income earned in Canada for a taxation year under subparagraph 115(1)‍(a)‍(ii), and

  • Insertion start (ii) Insertion end  is not, or would not be if there were income from the business for the operator’s taxation year or fiscal period that includes that time, exempt, because of a tax treaty with a country, from tax under this Part, or

• (b)  Insertion start that is entitled to a special tax benefit conferred by Barbados under the Canada-Barbados Income Tax Agreement Act, 1980; Insertion end (entreprise canadienne impo­sable)