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Bill C-22

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	(i) in exchange for another security acquired before that time by the taxpayer, and
	(ii) in the course of
	(A) a corporate merger or reorganization of capital,
	(B) a transaction or series of transactions in which control of the corporation that issued the other security is acquired by a person or group of persons, or
	(C) a transaction or series of transactions in which all or substantially all of the issued and outstanding shares (other than shares held immediately before the transaction or the beginning of the series by a particular person or related group) of the corporation that issued the other security are acquired by the particular person or related group; or
	(b) a security acquired by a taxpayer from a corporation pursuant to a distribution with respect to another security that is an eligible distribution described in subsection 86.1(2).
	(4) Subsection 206(4) of the Act is replaced by the following:
Non-arm's length transactions	(4) For the purposes of this Part, where at any time a taxpayer acquires property, otherwise than pursuant to a transfer of property to which paragraph (f) or (g) of the definition ``disposition'' in subsection 248(1) applies, from a person with whom the taxpayer does not deal at arm's length for no consideration or for consideration less than the fair market value of the property at that time, the taxpayer is deemed to acquire the property at that fair market value, and for those purposes, a particular trust is deemed not to deal at arm's length with another trust if a person who is beneficially interested in the particular trust is at that time also beneficially interested in the other trust.
	(5) Subsection (1) applies after June 27, 1999.
	(6) Subsection (2) applies to months that end after February 2001.
	(7) Subsection (3) applies to months that end after 1997.
	(8) Subsection (4) applies in respect of property acquired after December 23, 1998.
	170. (1) Section 207.31 of the Act is replaced by the following:
Tax payable by recipient of an ecological gift	207.31 Any charity or municipality that at any time in a taxation year, without the authorization of the Minister of the Environment or a person designated by that Minister, disposes of or changes the use of a property described in paragraph 110.1(1)(d) or in the definition ``total ecological gifts'' in subsection 118.1(1) and given to the charity or municipality after February 27, 1995 shall, in respect of the year, pay a tax under this Part equal to 50% of the amount that would be determined for the purposes of section 110.1 or 118.1, if this Act were read without reference to subsections 110.1(3) and 118.1(6), to be the fair market value of the property if the property were given to the charity or municipality immediately before the disposition or change.
	(2) Subsection (1) applies in respect of dispositions or changes of use that occur after November 1999.
	171. (1) Paragraph 210.1(d) of the Act is replaced by the following:
	(d) a trust described in paragraph (a), (a.1) or (c) of the definition ``trust'' in subsection 108(1); or
	(2) Subsection (1) applies to the 1999 and subsequent taxation years.
	172. (1) Paragraph 210.2(2)(b) of the Act is replaced by the following:
	(b) the only taxable capital gains and allowable capital losses referred to in paragraph 3(b) were from dispositions of taxable Canadian property; and
	(2) Subsection (1) applies after October 1, 1996.
	173. (1) Subclause 212(1)(b)(ii)(C)(IV) of the Act is replaced by the following:
	(IV) of a corporation, commission or association to which any of paragraphs 149(1)(d) to (d.6) applies, or
	(2) Subparagraph 212(1)(c)(i) of the Act is replaced by the following:
	(i) is included in computing the income of the non-resident person under subsection 104(13), except to the extent that the amount is deemed by subsection 104(21) to be a taxable capital gain of the non-resident person, or
	(3) Section 212 of the Act is amended by adding the following after subsection 212(5):
Acting services	(5.1) Notwithstanding any regulation made under paragraph 214(13)(c), every person who is either a non-resident individual who is an actor or that is a corporation related to such an individual shall pay an income tax of 23% on every amount paid or credited, or provided as a benefit, to or on behalf of the person for the provision in Canada of the acting services of the actor in a film or video production.
Relief from double taxation	(5.2) Where a corporation is liable to tax under subsection (5.1) in respect of an amount for acting services of an actor (in this subsection referred to as the ``corporation payment'') and the corporation pays, credits or provides as a benefit to the actor an amount for those acting services (in this subsection referred to as the ``actor payment''), no tax is payable under subsection (5.1) with respect to the actor payment except to the extent that it exceeds the corporation payment.
Reduction of withholding	(5.3) If the Minister is satisfied that the deduction or withholding otherwise required by section 215 from an amount described in subsection (5.1), would cause undue hardship, the Minister may determine a lesser amount to be deducted or withheld and that lesser amount is deemed to be the amount so required to be deducted or withheld.
	(4) Subsection 212(13.1) of the Act is amended by striking out the word ``and'' at the end of paragraph (a) and by adding the following after paragraph (a):
	(a.1) where a partnership pays, credits or provides to a non-resident person an amount described in subsection (5.1), the partnership is deemed in respect of the amount to be a person; and
	(5) Section 212 of the Act is amended by adding the following after subsection (13.2):
Application of Part XIII to authorized foreign bank	(13.3) An authorized foreign bank is deemed to be resident in Canada for the purposes of
	(a) this Part, in respect of any amount paid or credited to or by the bank in respect of its Canadian banking business; and
	(b) the application in paragraph (13.1)(b) of the definition ``Canadian partnership'' in respect of a partnership interest held by the bank in the course of its Canadian banking business.
	(6) Subsection (1) applies to amounts paid or credited after 1998.
	(7) Subsection (2) applies to amounts paid or credited after December 17, 1999.
	(8) Subsections (3) and (4) apply to amounts paid, credited or provided after 2000.
	(9) Subsection (5) applies after June 27, 1999.
	174. (1) Subsection 215(1) of the Act is replaced by the following:
Withholding and remittance of tax	215. (1) When a person pays, credits or provides, or is deemed to have paid, credited or provided, an amount on which an income tax is payable under this Part, or would be so payable if this Part were read without reference to subsection 216.1(1), the person shall, notwithstanding any agreement or law to the contrary, deduct or withhold from it the amount of the tax and forthwith remit that amount to the Receiver General on behalf of the non-resident person on account of the tax and shall submit with the remittance a statement in prescribed form.
	(2) Subsection 215(5) of the Act is replaced by the following:
Regulations reducing deduction or withholding	(5) The Governor in Council may make regulations in respect of any non-resident person or class of non-resident persons to whom any amount is paid or credited as, on account of, in lieu of payment of or in satisfaction of, any amount described in any of paragraphs 212(1)(h), (j) to (m) and (q) reducing the amount otherwise required by any of subsections (1) to (3) to be deducted or withheld from the amount so paid or credited.
	(3) Subsection (1) applies to amounts paid, credited or provided after 2000.
	(4) Subsection (2) applies after April 1997.
	175. (1) The Act is amended by adding the following after section 216:
Alternative re: acting services	216.1 (1) No tax is payable under this Part on any amount described in subsection 212(5.1) that is paid, credited or provided to a non-resident person in a taxation year if the person
	(a) files with the Minister, on or before the person's filing-due date for the year, a return of income under Part I for the year; and
	(b) elects in the return to have this section apply for the year.
Deemed Part I payment	(2) If in respect of a particular amount paid, credited or provided in a taxation year, a non-resident person has complied with paragraphs (1)(a) and (b), any amount deducted or withheld and remitted to the Receiver General on behalf of the person on account of tax under subsection 212(5.1) in respect of the particular amount is deemed to have been paid on account of the person's tax under Part I.
Deemed election and restriction	(3) Where a corporation payment (within the meaning assigned by subsection 212(5.2)) has been made to a non-resident corporation in respect of an actor and at any time the corporation makes an actor payment (within the meaning assigned by subsection 212(5.2)) to or for the benefit of the actor, if the corporation makes an election under subsection (1) for the taxation year in which the corporation payment is made, the actor is deemed to make an election under subsection (1) for the taxation year of the actor in which the corporation makes the actor payment.
	(2) Subsection (1) applies to the 2001 and subsequent taxation years.
	176. (1) The Act is amended by adding the following after section 218.1:
	PART XIII.1
	ADDITIONAL TAX ON AUTHORIZED FOREIGN BANKS
Branch interest tax	218.2 (1) Every authorized foreign bank shall pay a tax under this Part for each taxation year equal to 25% of its taxable interest expense for the year.
Taxable interest expense	(2) The taxable interest expense of an authorized foreign bank for a taxation year is 15% of the amount, if any, by which
	(a) the total of all amounts on account of interest that are deducted under section 20.2 in computing the bank's income for the year from its Canadian banking business
	exceeds
	(b) the total of all amounts that are included in paragraph (a) and that are in respect of a liability of the bank to another person or partnership.
Where tax not payable	(3) No tax is payable under this Part for a taxation year by an authorized foreign bank if
	(a) the bank is resident in a country with which Canada has a tax treaty at the end of the year; and
	(b) no tax similar to the tax under this Part would be payable in that country for the year by a bank resident in Canada carrying on business in that country during the year.
Rate limitation	(4) Notwithstanding any other provision of this Act, the reference in subsection (1) to 25% shall, in respect of a taxation year of an authorized foreign bank that is resident in a country with which Canada has a tax treaty on the last day of the year, be read as a reference to,
	(a) if the treaty specifies the maximum rate of tax that Canada may impose under this Part for the year on residents of that country, that rate;
	(b) if the treaty does not specify a maximum rate as described in paragraph (a) but does specify the maximum rate of tax that Canada may impose on a payment of interest in the year by a person resident in Canada to a related person resident in that country, that rate; and
	(c) in any other case, 25%.
Provisions applicable to Part	(5) Sections 150 to 152, 158, 159, 160.1 and 161 to 167 and Division J of Part I apply to this Part with any modifications that the circumstances require.
	(2) Subsection (1) applies to taxation years that end after June 27, 1999.
	177. (1) Paragraph 219(1)(b) of the Act is replaced by the following:
	(b) the amount deducted because of section 112 and paragraph 115(1)(e) in computing the corporation's base amount,
	(2) Paragraph 219(1)(d) of the Act is amended by replacing the reference to the expression ``1/3 of the amount'' with a reference to the expression ``the amount''.
	(3) Subsection 219(1.1) of the Act is replaced by the following:
Excluded gains	(1.1) For the purpose of subsection (1), the definition ``taxable Canadian property'' in subsection 248(1) shall be read without reference to paragraphs (a) and (c) to (k) of that definition and as if the only interests or options referred to in paragraph (l) of that definition were those in respect of property described in paragraph (b) of that definition.
	(4) Paragraph 219(2)(a) of the Act is repealed.
	(5) Subsection (1) applies to the 1998 and subsequent taxation years.
	(6) Subsection (2) applies to taxation years that end after February 27, 2000 except that, for such taxation years that ended before October 18, 2000, the reference in paragraph 219(1)(d) of the Act, as enacted by subsection (2), to the expression ``the amount'' shall be read as a reference to the expression ``1/2 of the amount''.
	(7) Subsection (3) applies after October 1, 1996.
	(8) Subsection (4) applies to taxation years that end after June 27, 1999.
	178. (1) Section 220 of the Act is amended by adding the following after subsection (4.4):
Security for departure tax	(4.5) If an individual who is deemed by subsection 128.1(4) to have disposed of a property (other than a right to a benefit under, or an interest in a trust governed by, an employee benefit plan) at any particular time in a taxation year (in this section referred to as the individual's ``emigration year'') elects, in prescribed manner on or before the individual's balance-due day for the emigration year, that this subsection and subsections (4.51) to (4.54) apply in respect of the emigration year,
	(a) the Minister shall, until the individual's balance-due day for a particular taxation year that begins after the particular time, accept adequate security furnished by or on behalf of the individual on or before the individual's balance-due day for the emigration year for the lesser of
	(i) the amount determined by the formula
	A - B - [((A - B)/A) x C]
	where
	A is the total amount of taxes under Parts I and I.1 that would be payable by the individual for the emigration year if the exclusion or deduction of each amount referred to in paragraph 161(7)(a) were not taken into account,
	B is the total amount of taxes under those Parts that would have been so payable if each property (other than a right to a benefit under, or an interest in a trust governed by, an employee benefit plan) deemed by subsection 128.1(4) to have been disposed of at the particular time, and that has not been subsequently disposed of before the beginning of the particular year, were not deemed by subsection 128.1(4) to have been disposed of by the individual at the particular time, and
	C is the total of all amounts deemed under this or any other Act to have been paid on account of the individual's tax under this Part for the emigration year, and

Bill C-22

PART XIII.1

ADDITIONAL TAX ON AUTHORIZED FOREIGN BANKS