REMISSION ORDERS

Remission orders are the means by which the government remits customs duties, income taxes and other taxes, penalties and any other debt. The remission may be in respect of amounts payable; a remission order does not necessarily imply disbursement of money by the government.

Most remission orders are made under the Financial Administration Act or the Customs Tariff.

1. Financial Administration Act

Subsection 23(2) of the Financial Administration Act authorizes the Governor in Council, on the recommendation of the appropriate minister, to "remit any tax or penalty, including any interest paid or payable thereon, where the Governor in Council considers that the collection of the tax or the enforcement of the penalty is unreasonable or unjust or that it is otherwise in the public interest to remit the tax or penalty."

Subsection 23(2.1) of that Act authorizes the Governor in Council, on the recommendation of the Treasury Board, to "remit any other debt, including any interest paid or payable thereon, where the Governor in Council considers that the collection of the other debt is unreasonable or unjust or that it is otherwise in the public interest to remit the other debt."

The terms "other debt", "penalty" and "tax" are defined as follows in subsection 23(1) of the Financial Administration Act:

"other debt" means any amount owing to Her Majesty, other than a tax or penalty or an amount in respect of which subsection 24.1(2) applies;

"penalty" includes any forfeiture or pecuniary penalty imposed or authorized to be imposed by any Act of Parliament for any contravention of the laws relating to the collection of the revenue, or to the management of any public work producing tolls or revenue, notwithstanding that part of such forfeiture or penalty is payable to the informer or prosecutor, or to any other person;

"tax" includes any tax, impost, duty or toll payable to Her Majesty, imposed or authorized to be imposed by any Act of Parliament.

Remission orders made under section 23 of the Financial Administration Act are not "regulations" within the meaning of the Statutory Instruments Act (see Definition "regulation", item 2.3 in Part 2). However, under paragraph 11(3)(d) of the Statutory Instruments Regulations, they must be published in the Canada Gazette, Part II, and are therefore examined by the appropriate regulations section (see EXAMINATION, item 4 in Part 2). These remission orders are designated "SI" and are accompanied by an explanatory note rather than a Regulatory Impact Analysis Statement (RIAS).

Unlike regulations, which generally come into force on the date of registration, remission orders made under the Financial Administration Act come into force on the date they are made.^[1] If a specific coming‑into‑force date is required, a coming-into-force provision is inserted at the end of the order (see coming-into-force provisions).

The format of these remission orders is flexible. In some cases, the remission is dealt with in the order in council itself, while in other cases it is dealt with in an annexed order, with or without schedules.

The reason for the remission is set out in the order in council, since a remission can be made only if the Governor in Council considers that the collection of the tax or other debt or the enforcement of the penalty is unreasonable or unjust or that it is otherwise in the public interest to remit the tax, penalty or other debt.

• Example 1: Remission in order in council (GST)

  Her Excellency the Governor General in Council, considering that it is in the public interest to do so, on the recommendation of the Minister of Finance, pursuant to subsection 23(2)^a of the Financial Administration Act^b, hereby remits to Albaraka Leasing Ltd. tax under Part IX of the Excise Tax Act^c in the amount of $32,503.56.

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  • ^a S.C. 1991, c. 24, s. 7(2)
  • ^b R.S., c. F-11
  • ^c R.S., c. E-15

  
  

• Example 2: Remission in order in council (penalty - ascertained forfeiture)

  Her Excellency the Governor General in Council, considering that the enforcement of the penalty is unjust, on the recommendation of the Minister of National Revenue, pursuant to subsection 23(2)^a of the Financial Administration Act^b, hereby remits the amount of $439,263.00, representing the ascertained forfeiture demanded from Provincial Airlines Ltd. on June 20, 1996 pursuant to paragraph 133(1)(c) of the Customs Act^c.

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  • ^a S.C. 1991, c. 24, s. 7(2)
  • ^b R.S., c. F-11
  • ^c R.S., c. 1 (2^nd supp.)

  
  

• Example 3: Order in council with attached order

  Her Excellency the Governor in Council, considering that it is in the public interest to do so, on the recommendation of the Minster of Finance, pursuant to subsection 23(2)^a of the Financial Administration Act^b, hereby makes the annexed Prescribed Areas Forward Averaging Remission Order.

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  • ^a S.C. 1991, c. 24, s. 7(2)
  • ^b R.S., c. F-11

PRESCRIBED AREAS FORWARD AVERAGING REMISSION ORDER

INTERPRETATION

• 1. The following definitions apply in this Order.

  "Act" means the Income Tax Act. (Loi)

  "averaging amount" has the meaning assigned by subsection 110.4(1) of the Act as that subsection applied to the 1987 taxation year. (montant d'étalement)

REMISSION

• 2. Remission is granted to a taxpayer in respect of the 1987 taxation year of an amount equal to the amount, if any, by which

  (a) the total of the taxes and penalties, and interest on that total, payable by the taxpayer for that year under the Act

  exceeds

  (b) the total of the taxes and penalties, and interest on that total, that would have been payable by the taxpayer for that year under the Act if the taxpayer's averaging amount for that year were reduced by the amount that the taxpayer was entitled to deduct under section 110.7 of the Act in computing the taxpayer's taxable income for that year by reason of having resided in an area prescribed by subsection 7303(5) or (6) of the Income Tax Regulations.

CONDITIONS

• 3. The remission is granted on condition that

  (a) the taxpayer makes an application for the remission in writing to the Minister of National Revenue on or before December 31, 1997; and

  (b) the amount of the reduction determined under paragraph 2(b) in the taxpayer's averaging amount for the 1987 taxation year is excluded in determining the taxpayer's accumulated averaging amount under paragraph 110.4(8)(a) of the Act after 1987.

2. Customs Tariff

Subsection 115(1) of the Customs Tariff authorizes the Governor in Council, on the recommendation of the Minister of Finance or the Minister of Public Safety and Emergency Preparedness, by order, to remit duties. The term "duties" is not defined as such in the Customs Tariff; however, under section 4 of that Act, the definition "duties" in subsection 2(1) of the Customs Act applies. That definition reads as follows:

"duties" means any duties or taxes levied or imposed on imported goods under the Customs Tariff, the Excise Act, 2001, the Excise Tax Act, the Special Import Measures Act or any other Act of Parliament, but, for the purposes of subsection 3(1), paragraphs 59(3)(b) and 65(1)(b), sections 69 and 73 and subsections 74(1), 75(2) and 76(1), does not include taxes imposed under Part IX of the Excise Tax Act;

Remission orders made under subsection 115(1) of the Customs Tariff are "regulations" within the meaning of the Statutory Instruments Act, even if they apply to one person only. They are therefore designated "SOR" and published with a RIAS. The format of these remission orders is the same as for any regulation; consequently, a coming-into-force provision must be included.

Note that, unlike remission orders under the Financial Administration Act, the Governor in Council is not subject to the unreasonableness or public interest test; the Governor in Council's power to remit is not limited to any specific criteria.

Example 1: Remission order with conditions

Her Excellency the Governor General in Council, on the recommendation of the Minister of Finance, pursuant to section 115^a of the Customs Tariff^b, hereby makes the annexed Order Remitting Customs Duties on Grinding Beads.

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• ^a S.C. 2005, c. 38, par. 142(e), 145(2)(j)
• ^b S.C. 1997, c. 36

 

ORDER REMITTING CUSTOMS DUTIES ON GRINDING BEADS

REMISSION 

1. Remission is granted of the customs duties paid or payable under the Customs Tariff on grinding beads produced by melting together the oxides of zirconium and silicon with lesser amounts of other oxides of tariff item No. 3823.90.90.

CONDITIONS

2. The remission is granted on the condition that

• (a) the grinding beads were imported into Canada during the period beginning on July 1, 1996, and ending on December 31, 1997;

• (b) the grinding beads are for use in the wet grinding of minerals; and

• (c) an application for remission is made to the Minister of National Revenue within three years after the date of importation of the grinding beads.

COMING INTO FORCE 

3. This Order comes into force on the day on which it is registered.

Example 2: Remission order containing a schedule

Her Excellency the Governor General in Council, on the recommendation of the Minister of Finance, pursuant to section 115^a of the Customs Tariff^b, hereby makes the annexed Order Remitting Customs Duties on Certain Fresh and Semi-processed Fruits and Vegetables Imported for Processing.

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• ^a S.C. 2005, c. 38, par. 142(e), 145(2)(j)
• ^b S.C. 1997, c. 36

 

ORDER REMITTING CUSTOMS DUTIES ON CERTAIN FRESH AND SEMI-PROCESSED FRUITS AND VEGETABLES IMPORTED FOR PROCESSING

REMISSION 

1. Remission is granted of the customs duties paid or payable under the Customs Tariff by or on behalf of the company listed in column 1 of the schedule up to the amount listed in column 4, in respect of the product listed in column 2, if the product was imported for processing during the year listed in column 3. 

CONDITION

2. The remission is granted on the condition that an application for remission is made to the Minister of National Revenue no later than December 31, 1998. 

COMING INTO FORCE

3. This Order comes into force on the day on which it is registered.

SCHEDULE

(Section 1)

	Column 1	Column 2	Column 3	Column 4
Item	Company	Product	Year	Amount ($)
1.	Carrière Foods Inc.	Asparagus	1995	67,583.24
2.	Fraser Valley Foods	Asparagus	1995	21,204.48
		Strawberries	1994	11,014.62
		Strawberries	1995	32,749.63
3.	Multifoods Inc.	Cucumbers (gherkins)	1994	53,289.13

Part 4 – Table of contents

Footnote

• ^[1] For additional information on the coming into force of statutory instruments, see COMING INTO FORCE, item 7 in Part 2.