May 15, 1941

LIB
NAT

Richard Burpee Hanson (Leader of the Official Opposition)

National Government

Mr. HANSON (York-Sunbury):

What is

the practice of the department in the application of the law? That would show what the intent was, to a degree at all events. The commissioner of income tax would know.

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LIB

James Lorimer Ilsley (Minister of Finance and Receiver General)

Liberal

Mr. ILSLEY:

The practice is to apply

the 7i per cent or the 9 per cent rate as it has been applied since last year. But it is the effect with which we are concerned- what it works out to. We are supposed to arrive at the non-resident rate. These are in effect non-residents. They are individuals. They may have been British who own shares all over the world, property and shares in India, south America, and many other places; they transferred these shares to a Canadian company which, in many instances, had its head office at Charlottetown, and the individual investors took in return the shares of that Canadian company. Then they received dividends on the shares of the company. But for the most part their property

Income War Tax Act

was abroad. They just put that in this for purposes which were advantageous to themselves.

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NAT

Richard Burpee Hanson (Leader of the Official Opposition)

National Government

Mr. HANSON (York-Sunbury):

Let me ask a plain question: did they come here to escape taxation in their own jurisdiction? Is that a true statement of affairs? If it is, of course they alienate a certain amount of sympathy which I might have for them.

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LIB
NAT

Richard Burpee Hanson (Leader of the Official Opposition)

National Government

Mr. HANSON (York-Sunbury):

The minister would not like to say that?

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LIB
NAT

Richard Burpee Hanson (Leader of the Official Opposition)

National Government

Mr. HANSON (York-Sunbury):

I quite appreciate that.

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LIB

James Lorimer Ilsley (Minister of Finance and Receiver General)

Liberal

Mr. ILSLEY:

I should like to ask the hon. member for St. Lawrence-St. George.

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LIB

Brooke Claxton

Liberal

Mr. CLAXTON:

I do not think anyone could give a categorical answer, because, as the minister has said, this has been an exceedingly complicated business. Each company is an individual entity of itself, set up for a special purpose, and usually having a trust behind it. But I would say that many of the companies that were created for the purpose of getting more advantageous taxes have ceased to exist since the change in the British finance act in 1936. For the most part these companies came to Canada to obtain, first, security, and, second, through domiciling themselves in Prince Edward Island they avoided any possibility of double succession duty- which was certainly a substantial advantage. There were, however, other purposes as well.

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LIB

Thomas Vien (Deputy Speaker and Chair of Committees of the Whole of the House of Commons)

Liberal

The CHAIRMAN:

Shall the item carry?

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NAT

Richard Burpee Hanson (Leader of the Official Opposition)

National Government

Mr. HANSON (York-Sunbury):

It is eleven o'clock. I think the minister had better sleep on it.

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LIB

James Lorimer Ilsley (Minister of Finance and Receiver General)

Liberal

Mr. ILSLEY:

Could I have resolution 8 carried?

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LIB

Thomas Vien (Deputy Speaker and Chair of Committees of the Whole of the House of Commons)

Liberal

The CHAIRMAN:

Shall resolution 8 carry? Some hon. MEMBERS: No.

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CCF
LIB

Thomas Vien (Deputy Speaker and Chair of Committees of the Whole of the House of Commons)

Liberal

The CHAIRMAN:

Shall resolution 9 carry? Mr. ILSLEY: Perhaps it had better stand.

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LIB

Thomas Vien (Deputy Speaker and Chair of Committees of the Whole of the House of Commons)

Liberal

The CHAIRMAN:

Shall resolution 10 carry? Resolutions 8, 9 and 10 carried.

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CCF

Alexander Malcolm Nicholson

Co-operative Commonwealth Federation (C.C.F.)

Mr. NICHOLSON:

I understood that we were discussing the entire group together.

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LIB

James Lorimer Ilsley (Minister of Finance and Receiver General)

Liberal

Mr. ILSLEY:

If the hon. gentleman raises that question, I shall have to ask that they all stand.

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LIB

Thomas Vien (Deputy Speaker and Chair of Committees of the Whole of the House of Commons)

Liberal

The CHAIRMAN:

Resolutions 8, 9 and 10 stand.

Progress reported.

It being five minutes after eleven o'clock, the house adjourned, without question put, pursuant to standing order.

Friday, May 16, 1941.

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May 15, 1941