Bill 93, Good Financial Management Act, 1996

Good Financial Management Act, 1996

EXPLANATORY NOTES

PART I

AMENDMENTS TO THE FINANCIAL ADMINISTRATION ACT

The amendments to the Financial Administration Act have the following purposes:

1. The amendments to section 11 of the Act permit the Minister of Finance to authorize payment by cheque or other method from the Consolidated Revenue Fund by agency heads.

2. The re-enactment of section 12 allows the Minister of Finance to pay from the Consolidated Revenue Fund the Crown's guarantee or indemnity liability arising under any Act. The requirement to pay the liability in the manner specified in the Act authorizing it (e.g. using only appropriated funds) is removed.

3. The proposed Part II.1,

(a) authorizes the Minister of Finance to require ministries to pay into the Consolidated Revenue Fund surplus funds held by them outside the Consolidated Revenue Fund;

(b) authorizes ministries to deposit in Province of Ontario Savings Offices funds held outside the Consolidated Revenue Fund;

(c) provides for the investment by ministries of funds held by them outside the Consolidated Revenue Fund in Ontario securities and where authorized by the Minister, in other securities; and

(d) permits the Minister to authorize the Ontario Financing Authority to direct, control or carry out some or all of the financial activities that may be carried out by any minister or ministry designated by the Lieutenant Governor in Council.

4. Section 26 of the Act provides for the calculation of Canadian dollar equivalents of foreign currencies wherethe Bank of Canada provides a Canadian dollar noon spot exchange rate. The proposed amendment provides a method of determining Canadian dollar equivalents where there is no Canadian dollar noon spot exchange rate.

PART II

AMENDMENTS TO THE EMPLOYER HEALTH TAX ACT

The amendments to the Employer Health Tax Act,

(a) clarify the liability of employers, since the Act came into force, in respect of employer health tax on stock option benefits deemed, for income tax purposes, to be received by current employees from shares of the employer;

(b) impose employer health tax on stock option benefits deemed to be received after 1996 by a current or former employee from shares issued by a corporation not dealing at arm's length with the employer;

(c) provide that if a taxpayer is late in filing an annual tax return, no interest will accrue or be paid to the taxpayer on any overpayment of tax for that year for the period from the due date of the tax return to the date the tax return is filed by the taxpayer;

(d) clarify that interest payable by or to an employer is calculated on a year-by-year basis by reference to amounts payable for the particular year;

(e) clarify the effective date of penalties assessed under the Act for the purposes of determining the amount of any interest payable on a penalty;

(f) amend the amount of the administrative penalty for failure to file a tax return from 5 per cent of the amount of any unpaid tax for the year to 5 per cent of the balance owing of tax, interest and any previously assessed penalties in respect of the year that are unpaid as of the date the tax return for that year is due.

PART III

AMENDMENTS TO THE INCOME TAX ACT

The amendment to the definition of "individual" in subsection 8 (1) of the Act ensures that a co-operative education tax credit may be claimed even if the taxpayer has died before the end of the year.

The amendment to subsection 8 (8.1) provides that the co-operative education tax credit is claimed after any claim for the labour sponsored venture capital corporation tax credit.

The amendment to subsection 8 (15) of the Act moves back the commencement date for qualifying co-op work placements to ensure that all qualifying co-op work placements for the fall of 1996 will qualify for the co-operative education tax credit.

PART IV

AMENDMENTS TO THE LABOUR SPONSORED

VENTURE CAPITAL CORPORATIONS ACT, 1992

The amendments to the Labour Sponsored Venture Capital Corporations Act, 1992, refine and clarify the operation of the Act, to implement the 1996 Ontario Budget provisions. The amendments include provisions to:

(a) ensure that the investment maintenance requirements take into account capital returned to investors on redemptions;

(b) clarify that the Act applies to federally registered labour sponsored venture capital corporations only in respect of equity capital raised from shares issued to individuals who were residents of Ontario at the time the shares were issued;

(c) clarify the calculation of the amount of capital considered to have been invested in small businesses and public companies in the situation where a labour sponsored investment fund provides a guarantee in respect of a debt obligation of a small business or public company;

(d) clarify that labour sponsored investment funds must continue beyond the initial two year investment period to maintain at least 10 per cent of their capital in small businesses and not more than 15 per cent of their capital in public companies;

(e) clarify the date on which a labour sponsored investment fund will be considered not to comply with the investment maintenance requirements, the date tax credit certificates can no longer be issued and that the suspension of the issue of tax credit certificates for non-compliance with the Act will apply only in respect of shares issued after the failure of the labour sponsored investment fund to deliver the required information;

(f) revise the calculation of the penalty tax when a labour sponsored investment fund fails to meet or maintain the required level of eligible investments;

(g) apply the penalty tax when a labour sponsored investment fund fails to comply with the investment requirements in small businesses and public companies; and

(h) provide the Minister with the authority to extend the period within which a labour sponsored investment fund may earn a rebate of any penalty tax paid.

PART V

AMENDMENTS TO THE LAND TRANSFER TAX ACT

The amendments to the Land Transfer Tax Act are pursuant to the 1996 Budget proposal to make technical amendments to certain taxing statutes to improve administrative effectiveness and maintain the integrity of the tax system.

The amendment to the definition of "value of the consideration" permits land transfer tax to be imposed on the lower of the fair market value of the land and the amount due under the mortgage in the situation where the land owner is transferring the property to the mortgage holder in satisfaction of the unpaid debt owing under the mortgage.

The amendment to subsection 1 (5) of the Act prevents a non-resident individual from avoiding the requirement of having to be physically in Canada for a substantial period of time during the previous two years in order to be considered to be ordinarily resident in Canada and eligible to pay the "resident" rate of land transfer tax on the acquisition of agricultural or recreational land.

The proposed subsection 2 (4.1) of the Act is an anti-avoidance provision to prevent non-resident purchasers from avoiding land transfer tax at the "non-resident" rate on the acquisition of agricultural land.

Under section 2 of the Act, land transfer tax is payable on the registration of a conveyance of land. Section 2.2 will ensure that the purchaser of the land is liable for the land transfer tax even if the conveyance is registered by another person. The amendment to subsection 12 (1) of the Act ensures that the purchaser may be assessed the tax.

Land transfer tax is imposed at graduated rates on the value of the consideration set out in the particular conveyance. Section 2.3 will prevent taxpayers from avoiding tax by acquiring a property through a series of conveyances or dispositions, eachfor a fractional interest in the property that, when added together, gives the transferee the intended degree of ownership.

The amendment to subsection 3 (14) of the Act ensures that corporations will be treated as affiliates if they are controlled by the same person or persons.

The amendments to section 5 simplify the provisions relating to the affidavit of residency and value of the consideration by,

(a) dispensing with the affidavit if the only transferee is the Crown;

(b) providing that the value of the consideration need not be disclosed in the affidavit if the conveyance is tax exempt under subsection 1 (6) of the Act which exempts any lease having a term that together with all renewals is less than fifty years;

(c) permitting the transferor instead of the transferee to make the affidavit in certain circumstances.

The proposed subsection 18 (12) of the Act ensures that the tax deferral provisions available to non-resident purchasers will apply in respect of conveyances submitted electronically for registration under Part III of the Land Registration Reform Act.

PART VI

AMENDMENTS TO THE RETAIL SALES TAX ACT

The amendments to the Retail Sales Tax Act have the following purposes:

1. The Act is amended to clarify that the tax payable in respect of admissions is to be remitted to the Minister of Finance at the time of purchase and not at the time of the events for which the tickets were sold.

2. The amendment to subsection 2 (11.1) corrects a cross reference.

3. The re-enactment of subsection 2 (13) of the Act will clarify that the refund for overpayments payable to a third party only relates to real property contracts.

4. The proposed clause 2 (16) (c) of the Act broadens the circumstances where a vendor can refund tax previously collected from a purchaser to include any transaction where the price originally paid is subsequently reduced and the amount refunded or credited to the purchaser.

5. The amendment to subsection 4.2 (3) of the Act reflects a change made to the definition of "used motor vehicle" by the Ministry of Transportation by referring to a vehicle's empty weight, rather than its "gross weight".

6. The re-enactment of paragraph 22 of subsection 7 (1) of the Act eliminates references to obsolete federal legislation.

7. The proposed paragraph 34.1 provides an exemption for animals trained to assist the disabled.

8. The proposed amendment to subsection 9 (2) of the Act clarifies that the exemption from tax on admissions to musical or dramatic performances applies where at least 90 per cent of the performers are Canadian citizens who are resident in Canada, as well as landed immigrants.

9. Under the proposed subsection 13 (3) of the Act any person, whether a vendor or not, who has collected any tax will be required to remit it to the Minister in the same manner as is required from vendors.

10. The proposed amendment to subsection 18 (3) of the Act will extend the time for assessing tax payable by manufacturing contractor to four years from the end of the contractor's fiscal year to permit determination of overhead and other costs.

11. The amendments to subsection 19 (1) of the Act deletes a cross reference.

PART VII

AMENDMENTS TO THE TOBACCO TAX ACT

The amendments have the following purposes:

1. Change a reference to the former Ministry of Revenue to read as a reference to the Ministry of Finance.

2. Interest on refunds will be computed and compounded daily.

PART VIII

AMENDMENTS TO THE MINING TAX ACT

The amendments to the Mining Tax Act will establish the effective dates for administrative penalties and will come into force on proclamation together with the related interest and penalty provisions enacted in the Revenue and Liquor Licence Statute Law Amendment Act, 1994.

PART IX

AMENDMENTS TO THE CORPORATIONS TAX ACT

AND THE CORPORATIONS TAX AMENDMENT ACT, 1994

The amendments to the Corporations Tax Act and the Corporations Tax Amendment Act, 1994 implement the 1996 Ontario Budget proposal to improve administrative effectiveness and efficiency of the Act and include,

(a) amendments to the Co-operative Education Tax Credit to ensure that all qualifying co-op work placements for the 1996 fall term will qualify, to provide the Minister of Finance with the authority to impose sanctions against educational institutions that contravene the Act and to simplify the certification process for educational institutions;

(b) technical amendments to facilitate the making of regulations relating to the bank small business tax credit;

(c) extension of the statute-barred period to ensure that Ontario corporate taxes can be reassessed if consequential changes are necessary as a result of tax reassessments made under the federal Act or by the other provinces;

(d) changes in statutory references to the federal Income Tax Act to correspond with section numbering changes made in the federal Act on consolidation in the Revised Statutes of Canada, 1985 (5th Supplement);

(e) technical amendments to the interest and penalty provisions and to the mining reclamation trust tax credit;

(f) adoption of federal income tax changes applicable to corporations, announced in the 1992 to 1994 federal budgets;

(g) adoption of federal income tax changes made in federal technical amending bills.

PART X

AMENDMENTS TO THE MPPs PENSION ACT, 1996

The amendments to the formulas in subsection 10 (1) allow past service prior to 1992 to be taken into account in determining the pension of a person who was not a member of the Assembly on January 1, 1992 and who later became a member of the Assembly.

The proposed section 10.1 ensures that a member's pension under the registered plan will not exceed 75 per cent of his or her 36 highest months of remuneration as a member of the Assembly.

The proposed section 48.1 added to the Act authorizes payment from the Consolidated Revenue Fund,

(a) to purchase annuity contracts to provide pension benefits under the Act and the Legislative Assembly Retirement Allowances Act; and

(b) to transfer the balance of plan accounts to a third party outside the Consolidated Revenue Fund if an arrangement for the custody and management of those accounts outside the Consolidated Revenue Fund is made by the Speaker with the approval of the Minister of Finance.

Bill 931996

An Act to amend certain statutes administered

by the Minister of Finance to promote

good management of the Province's finances,

to implement certain provisions of the 1996

Budget and to implement other aspects of the

Government's agenda and to amend the

MPPs Pension Act, 1996

CONTENTS

PartSections

I Amendments to the Financial Administration

Act1-4

II Amendments to the Employer Health Tax Act5-8

III Amendments to the Income Tax Act9

IV Amendments to the Labour Sponsored Venture

Capital Corporations Act, 199210-15

V Amendments to the Land Transfer Tax Act16-22

VI Amendments to the Retail Sales Tax Act23-31

VII Amendments to the Tobacco Tax Act32-34

VIII Amendments to the Mining Tax Act35

IX Amendments to the Corporations Tax Act

and the Corporations Tax Amendment Act, 199436-65

X Amendments to the MPPs Pension Act, 199666-69

XI Commencement, Short Title70-71

Her Majesty, by and with the advice and consent of the Legislative Assembly of the Province of Ontario, enacts as follows:

PART I

AMENDMENTS TO THE FINANCIAL ADMINISTRATION ACT

1. Section 11 of the Financial Administration Act, as amended by the Statutes of Ontario, 1991, chapter 55, section 4, 1994, chapter 17, section 62 and 1996, and chapter 24, section 36, is further amended,

(a) by inserting "or an agency head" after "minister" in the first line of clause (1.2)(a);

(b) by inserting "or by that agency head" after "minister" in the second line of clause (1.2)(b); and

(c) by adding the following subsection:

Definition

(1.2.1) In subsection (1.2),

"agency head" means the chair or similar presiding officer of a board, commission, authority, corporation or other agency of the Government of Ontario. ("chef d'organisme")

2. Section 12 of the Act, as re-enacted by the Statutes of Ontario, 1991, chapter 55, section 5, is repealed and the following substituted:

Payment of guarantee or indemnity

12. Any amount required to be paid by or on behalf of the Crown by the terms of a guarantee or indemnity given pursuant to this or any other Act may be paid by the Minister of Finance from the Consolidated Revenue Fund.

3. The Act is amended by adding after section 16.2 the following Part:

PART II.1

FINANCIAL MANAGEMENT AND CONTROL

Definition

16.3 In this part,

"ministry" includes the Accountant of the Ontario Court.

Surplus funds not in the consolidated revenue fund

16.4 (1) Despite any other Act or regulation, a ministry may pay into the Consolidated Revenue Fund at any time any amount of its funds held outside the Consolidated Revenue Fund that it determines to be surplus to its current needs.

Same

(2) Despite any other Act or regulation, a ministry shall pay into the Consolidated Revenue Fund, when ordered to do so by the Minister of Finance, any amount of its funds held outside the Consolidated Revenue Fund that is determined by the Minister of Finance to be surplus to the current needs of the ministry.

Application of subsection (2)

(3) Subsection (2) applies whether or not a payment is or has been made under subsection (1).

Reserves

(4) In determining an amount payable under subsection (2), the Minister of Finance may allow such amount to be retained for the future needs of the ministry making the payment as the Minister of Finance considers appropriate.

Obligation not impaired

(5) The Minister of Finance shall make such arrangements as he or she considers necessary to provide that a payment ordered under subsection (2) will not impair the ability of the ministry making the payment to meet its financial liabilities or obligations as they come due or to fulfil its contractual commitments.

Credit facility authorized

(6) An arrangement under subsection (5) may include the provision to a ministry by Ontario, the Ontario Financing Authority, a bank or a financial institution of a credit facility sufficient to allow the ministry to meet its financial liabilities and obligations or to fulfil its contractual commitments.

Deposits in Province of Ontario Savings Offices

16.5 (1) Despite any Act or regulation, every ministry may deposit in any Province of Ontario Savings Office money held outside the Consolidated Revenue Fund and belonging to it or held by it in trust for the Crown.

Investment in Ontario securities

(2) Despite any Act or regulation, every ministry may invest money held outside the Consolidated Revenue Fund and belonging to it or held by it in trust for the Crown in the purchase, acquisition or holding of,

(a) notes, bonds, debentures, deposit receipts, short term securities or other evidences of indebtedness issued or guaranteed as to principal and interest by Ontario;

(b) an interest in any investment pool that is established or administered by the Ontario Financing Authority for the purpose only of buying, selling, holding and dealing in securities mentioned in clause (a) and that receives and manages funds invested only by public bodies within the meaning of subsection 29(1) of the Capital Investment Plan Act, 1993 and by ministries; or

(c) any security, financial agreement or evidence of indebtedness, or class of securities, financial agreements or evidences of indebtedness, authorized in writing by the Minister of Finance for the investment by the ministry named in the authorization of funds from time to time held by that ministry outside the Consolidated Revenue Fund.

Minister of Finance may issue and sell securities

(3) In addition to the issue and sale of securities authorized under any other Act or under any other provision of this Act, the Minister of Finance may issue and sell on behalf of Ontario inaccordance with this section notes, bonds, debentures, deposit receipts, short term securities and other evidences of indebtedness to any ministry for the purposes of an investment that the ministry is authorized to make under clause (2)(a) or (c) or for the purpose of an investment pool described in clause (2)(b).

Same

(4) For any note, bond, debenture, deposit receipt, short term security or other evidence of indebtedness issued and sold by the Minister of Finance under subsection (3), the Minister of Finance may determine the date of issue and maturity, the rate or rates and the date or dates of the payment of interest, if any, the price or prices for which any of them may be sold, and subject to subsection (5), such other conditions as the Minister of Finance considers appropriate.

Same

(5) A note, bond, debenture, deposit receipt, short term security or other evidence of indebtedness issued and sold under subsection (3),

(a) shall state on its face that it is issued under this section;

(b) shall not be paid, renewed, repaid or replaced under section 21;

(c) may provide that it shall not be assigned or pledged as security by the holder thereof and may be sold only to Ontario or the Ontario Financing Authority; and

(d) shall be deemed not to be a loan for the purpose of section 18.

Authorized investments

(6) An investment pursuant to this section or section 16.6 by, or on behalf of, a ministry of all or any part of the assets belonging to it or held by it in trust for the Crown shall not be deemed to be contrary to or prevented by any rule of law or enactment.

Definitions

16.6 (1) In this section,

"designated minister or ministry" means a minister or ministry that has been designated for the purpose of this section by order of the Lieutenant Governor in Council; ("ministre ou ministère désigné")

"financial activities" includes borrowing, leasing, investing and banking and the management of cash, financial assets, financial risks and financial liabilities. ("activités financières")

Control of financial activities

(2) Despite any other Act or the regulations under any other Act, the Minister of Finance may authorize the Ontario Financing Authority to direct, control or carry out some or all of the financial activities that any designated minister or ministry is authorized by any Act, regulation or agreement to undertake or carry out.

Authorization

(3) An authorization under subsection (2),

(a) shall be in writing;

(b) shall state the minister or ministry to which it applies and specify the order of the Lieutenant Governor in Council designating that minister or ministry;

(c) shall indicate the financial activities that the Ontario Financing Authority is authorized to direct, control or carry out; and

(d) shall set out such other terms and conditions as the Minister of Finance considers appropriate for the purpose of the authorization.

Same

(4) The Minister of Finance, from time to time in writing, may vary the provisions of an authorization, as he or she considers appropriate, and may rescind any authorization at any time.

Power of Ontario Financing Authority

(5) For the purpose of directing, controlling or carrying out any financial activities mentioned in an authorization under subsection (2), the Ontario Financing Authority may in the name of and on behalf of the minister or ministry to which the authorization applies,

(a) negotiate, enter into, carry out or perform any agreement concerning financial activities that it is authorized under subsection (2) to direct, control or carry out;

(b) exercise the rights and discharge the obligations of the minister or ministry to which the authorization applies under any agreement to which that ministry or minister or the Crown is a party; and

(c) execute all documents and do such other acts and things as the Ontario Financing Authority considers necessary or desirable to direct, control or carry out the financial activities authorized under subsection (2).

Investment in market securities

(6) Unless otherwise agreed by a minister or a ministry, securities issued by Ontario and purchased as an investment by or on behalf of the minister or ministry pursuant to an authorization under subsection (2) shall be purchased at prices, and bear interest, if any, comparable to the prices and rates of interest for similar securities issued and sold by Ontario in the public capital markets of Canada.

No action to be commenced

(7) Subject to subsection (8), no action or proceeding of any kind shall be commenced against the Ontario Financing Authority, a minister or ministry, or against an employee, officer, director or agent of the Ontario Financing Authority, a minister or ministry, for any act, omission, neglect or default in good faith done or omitted to be done in connection with implementing or complying with an authorization under subsection (2).

Agreements not affected

(8) Subsection (7) shall not be construed to limit the validity or enforceability of any agreement made or purporting to be made pursuant to an authorization under subsection (2).

4. (1) Section 26 of the Act, as re-enacted by the Statutes of Ontario 1991, chapter 55, section 12 and amended by 1994, chapter 17, section 62 and 1996, chapter 24, section 38, is further amended by adding the following subsection:

Bank of Canada rate not available

(5) If, in respect of a foreign currency to be converted to Canadian dollars in accordance with subsection (2) or (4), the Bank of Canada has not quoted a Canadian dollar noon spot exchange rate in the 10 days immediately preceding the day described in clause (2)(b), subclause (4)(a)(ii) or subclause (4)(b)(ii), as the case requires, the conversion shall be at the Canadian dollar exchange rate for that currency quoted on a day and by a financial service or financial institution acceptable to the Minister of Finance.

Commencement

(2) Subsection (1) shall be deemed to have come into force on October 31, 1996.

PART II

AMENDMENTS TO THE EMPLOYER HEALTH TAX ACT

5. Subsection 2 (3.1) of the Employer Health Tax Act, as enacted by the Statutes of Ontario, 1996, chapter 24, section 2, is repealed and the following substituted:

Stock option benefits

(3.1) If an employer has agreed to sell or issue to an employee shares of the capital stock of the employer, the amount of any benefit deemed to be received in a year by the employee under section 7 of the Income Tax Act (Canada) in respect of the shares shall be deemed to be remuneration paid to the employee by the employer in the same year.

Stock option benefits, connected corporation

(3.2) If an employer or a corporation connected to the employer has agreed to sell or issue to an employee of the employer shares of the capital stock of a corporation connected to the employer, the amount of any benefit deemed to be received by the employee under section 7 of the Income Tax Act (Canada) in respect of those shares shall be deemed to be remuneration paid to the employee by the employer in the same year, if the year in which the benefit is deemed to be received is after 1996.

Stock option benefits, former employee

(3.3) Despite subsection (3.1) and (3.2), if an employer or a corporation connected to the employer has agreed to sell or issue to an employee of the employer shares of the capital stock of the employer or of a corporation connected to the employer, the amount of any benefit with respect to those shares that is deemed to be received by the employee under section 7 of the Income Tax Act (Canada) after the employee has ceased to be employed by the employer shall be deemed to be remuneration paid to the employee by the employer in the same year, if the year in which the benefit is deemed to be received is after 1996.

Connected corporation

(3.4) For the purposes of subsections (3.2) and (3.3), a corporation is connected to an employer if the employer and the corporation do not deal at arm's length with each other within the meaning of section 251 of the Income Tax Act (Canada).

6. (1) Subsections 7 (1) and (2) of the Act are repealed and the following substituted:

Interest charged, employer

(1) Where, on a particular date, the debt payable by a taxpayer as an employer under this Act in respect of a particular year and all amounts in respect of that year which were at any time before that date either refunded to the taxpayer or applied under this Act exceed the aggregate of all payments previouslymade in respect of the year by the taxpayer as an employer, the taxpayer shall be charged interest payable to the Minister at the prescribed rate and calculated in the prescribed manner on the excess amount from that date to the date payment of the excess amount is received by the Minister.

Interest paid, employer

(2) Where, on a particular date, the aggregate of all payments previously made by a taxpayer as an employer under this Act in respect of a particular year exceeds the debt payable in respect of the year under this Act as of that date by the taxpayer as an employer and all amounts in respect of that year which were at any time before that date either refunded to the taxpayer or applied under this Act, the Minister shall pay, credit or apply under this Act interest at the prescribed rate and calculated in the prescribed manner on the excess amount from that date to the date the amount of the excess is refunded to the taxpayer or applied in accordance with this Act.

(2) Subsection 7 (4) of the Act is repealed and the following substituted:

Amount of debt, employer

(4) In this section, the amount of the debt payable under this Act as of a particular date by a taxpayer as an employer in respect of a particular year is the amount, if any, by which,

(a) the aggregate of,

(i) any instalment of tax under this Act in respect of the particular year payable before the particular date by the taxpayer as an employer,

(ii) the amount by which the amount of tax for the year, if any, payable under this Act before the particular date by the taxpayer as an employer exceeds all instalments of tax in respect of the year payable by the taxpayer as an employer,

(iii) all penalties having an effective date on or before the particular date that have been assessed under this Act in respect of the year against the taxpayer as an employer,

(iv) the total of all amounts each of which is an amount of interest in respect of the year charged under this section before the particular date to the taxpayer as an employer, and

(v) all other amounts in respect of the year that on or before the particular day became payable under this Act in respect of the taxpayer as anemployer, or became collectible and enforceable as if they were tax payable under this Act by the taxpayer as an employer,

exceeds,

(b) the aggregate of,

(i) the amount, if any, by which all instalments of tax in respect of the year payable before the particular date by the taxpayer as an employer exceeds the amount of tax payable for the year under this Act by the taxpayer as an employer, and

(ii) all amounts each of which is an amount of interest in respect of the year credited under this section before the particular date to the taxpayer as an employer.

(3) Subclauses 7 (5) (a) (iii) and (iv) of the Act, as re-enacted by the Statutes of Ontario, 1994, chapter 8, section 7, are repealed and the following substituted:

(iii) all penalties having an effective date on or before the particular date that have been assessed under this Act in respect of the year against the taxpayer as a self-employed individual,

(iv) the total of all amounts each of which is an amount of interest in respect of the year charged under this section before the particular date to the taxpayer as a self-employed individual, and

(v) all other amounts in respect of the year that on or before the particular day became payable under this Act in respect of the taxpayer as a self-employed individual, or became collectible and enforceable as if they were tax payable under this Act by the taxpayer as a self-employed individual.

(4) Section 7 of the Act, as amended by the Statutes of Ontario, 1994, chapter 8, section 7, is further amended,

(a) by adding the following subsection:

Effective date of penalties

(6) For the purposes of this section, the effective date of a penalty assessed under this Act is as follows:

1. If the penalty is assessed under section 30, the effective date of the penalty is the date that the person is required under this Act to deliver the return, statement or other document to which the penalty relates.

2. If the penalty is assessed under any other section of this Act, the effective date of the penalty is the date the penalty is assessed.

(b) by adding the following subsection:

No interest until return delivered

(7) Despite subsections (2) and (2.2), if a return for a year is delivered after the day on or before which it is required to be delivered under section 5, no interest shall be paid, credited or applied under this Act for the period of time from the day on or before which the return was required to be delivered to the Minister to the day after the day the return is delivered to the Minister.

Application

(5) Subsection 7 (7) of the Act, as enacted by clause 6 (4) (b), applies in respect of returns required to be delivered under the Act after December 31, 1996.

7. (1) Subsection 30 (1) of the Act, as re-enacted by the Statutes of Ontario, 1994, chapter 8, section 29, is repealed and the following substituted:

Penalties, failure to deliver return

(1) Every person who fails to deliver a return in respect of a particular year at the time and in the manner required by this Act or the regulations shall pay a penalty when assessed therefor equal to 5 per cent of the amount that is determined under subsection 7 (1) or (2.1) to be the excess amount in respect of the year as of the date the return was required to be delivered, if the excess amount as of that date is at least $1,000.

(2) Subsection 30 (1) of the Act, as re-enacted by the Statutes of Ontario, 1994, chapter 8, section 29, applies in respect of returns required to be delivered under the Act after December 31, 1996.

Commencement

8. (1) Section 5 shall be deemed to have come into force on January 1, 1990.

Same

(2) Clause 6 (4) (b), subsection 6 (5) and section 7 come into force on January 1, 1997.

PART III

AMENDMENTS TO THE INCOME TAX ACT

9. (1) Clause (c) of the definition of "individual" in subsection 8 (1) of the Income Tax Act, as amended by the Statutes of Ontario, 1992, chapter 18, section 55, 1993, chapter 29, section 6 and 1996, chapter 1, Schedule C, section 8, is further amended by striking out "subsection (8.1), (8.3), (8.4) and (9)" in the amendment of 1996 and substituting "subsections (8.1), (8.3), (8.4), (9) and (15)".

(2) Subsection 8 (8.1) of the Act, as enacted by the Statutes of Ontario, 1992, chapter 18, section 55 and amended by 1994, chapter 17, section 99 and 1996, chapter 24, section 13 is further amended by striking out "under subsection (3), (3.1), (4) or (9)" in the eighth line and substituting "under subsection (3), (3.1), (4), (9) or (15)".

(3) Subsection 8 (15) of the Act, as enacted by the Statutes of Ontario, 1996, chapter 24, section 13, is amended by striking out "August 31, 1996" in the fifth and sixth lines and inserting "July 31, 1996".

Commencement

(4) This Part shall be deemed to have come into force on January 1, 1996.

PART IV

AMENDMENTS TO THE LABOUR SPONSORED

VENTURE CAPITAL CORPORATIONS ACT, 1992

10. (1) Subsection 17(2) of the Labour Sponsored Venture Capital Corporations Act, 1992, as re-enacted by the Statutes of Ontario, 1996, chapter 24, section 5, is repealed and the following substituted:

Requirement to maintain eligible investments

(2) A labour sponsored investment fund corporation shall keep invested in eligible investments an amount not less than the amount determined by the following formula:

A = B - 0.7(C - D)

where,

"A" is the amount required to be invested in eligible investments under this subsection;

"B" is the aggregate of all amounts required to be invested by subsections (1) and (1.1);

"C" is the aggregate amount paid as a return of capital of Class A shares; and

"D" is the aggregate of all amounts paid as a return of capital of Class A shares and deducted in calculating an amount under subsection (1) or (1.1).

(2) Clause 17 (4) (a) of the Act, as re-enacted by the Statutes of Ontario, 1996, chapter 24, section 5, is repealed and the following substituted:

(a) equity capital received on the issue of Class A shares to shareholders of the corporation who were ordinarily resident in Ontario at the time the shares were issued; and

. . . . .

11. (1) Subsection 18 (8) of the Act, as enacted by the Statutes of Ontario, 1994, chapter 17, section 85, is amended by striking out "For the purposes of clauses 18 (1) (e) and 20 (2) (b)" in the first and second lines and substituting "For the purposes of section 17, clause 18 (1) (e), section 18.1, clause 20 (2) (b) and subsection 28 (3)".

(2) Section 18 of the Act, as amended by the Statutes of Ontario, 1994, chapter 17, section 85, is further amended by adding the following subsection:

Deemed cost

(8.1) For the purposes of subsection 28 (3), the cost at any time to a labour sponsored investment fund corporation of eligible investments that are guarantees shall be deemed to be 25 per cent of the aggregate amount at that time of the debt obligations in respect of which the guarantees were provided.

12. Section 18.1 of the Act, as re-enacted by the Statutes of Ontario, 1996, chapter 24, section 6, is amended by adding the following subsections:

Same

(2.1) Not more than 15 per cent of the amount of equity capital received on the issue of Class A shares after May 6, 1996 that is required to be maintained in eligible investments by a labour sponsored investment fund corporation under subsection 17(2) shall be invested in eligible businesses that were reporting issuers under the Securities Act at the time that a particular investment was made.

. . . . .

Same

(4.1) A labour sponsored investment fund corporation shall maintain in investments in businesses that are small businesses at the time the particular investment is made an amount equal to 10 per cent, or the prescribed percentage where another percentage has been prescribed under subsection (3), of the amount of equity capital received on the issue of Class A shares after May 6, 1996 that is required to be maintained in eligible investments under subsection 17 (2) by the corporation.

13. (1) Clauses 25.1 (3) (a) and (b) of the Act, as enacted by the Statutes of Ontario, 1996, chapter 24, section 8, are repealed and the following substituted:

(a) the corporation shall be considered not to be in compliance with sections 17 and 18.1 as of the date of the failure to deliver the certificate, information or documentation; and

(b) no further tax credit certificates shall be issued under section 25 in respect of Class A shares issued after the date of the failure to deliver the certificate, information or documentation until the corporation delivers the certificate or provides the information or documentation.

(2) Subsection 25.1 (4) of the Act, as enacted by the Statutes of Ontario, 1996, chapter 24, section 8, is repealed and the following substituted:

Order to stop issuing certificates

(4) If the Minister is of the opinion that a labour sponsored investment fund corporation is not in compliance with section 17 or 18.1 at any particular time, the Minister may stop issuing tax credit certificates in respect of Class A shares of the corporation issued after that particular time or, if the corporation issues tax credit certificates under an arrangement referred to in subsection 25 (9), order the corporation to stop issuing tax credit certificates in respect of Class A shares issued by the corporation after the date of the order until the corporation provides proof to the satisfaction of the Minister that the corporation is in compliance with sections 17 and 18.1.

(3) Subsection 25.1 (6) of the Act, as enacted by the Statutes of Ontario, 1996, chapter 24, section 8, is repealed and the following substituted:

Same

(6) If a labour sponsored investment fund corporation has delivered a certificate referred to in subsection (1) but was not in compliance with section 17 or 18.1 as of the date specified in the certificate or at any time afterwards, the corporation shall pay to the Minister a penalty equal to twice the total amount of all labour sponsored venture capital corporation tax credits in respect of Class A shares issued at a time when the corporation was not in compliance with section 17 or 18.1 and for which tax credit certificates were issued.

14. (1) Subsection 28 (1) of the Act, as amended by the Statutes of Ontario, 1996, chapter 24, section 9, is repealed and the following substituted:

Investment level tax

(1) A labour sponsored venture capital corporation that fails to meet or maintain the level of eligible investments required by this Act to be held by the corporation at the end of a particular fiscal year shall pay a tax for the year equal to the amount determined by the following formula:

T = (A x 20/100) - B

where,

"T" is the tax payable under this section;

"A" is the amount by which the amount of the corporation's equity capital received on the issue of its Class A shares that is required by this Act to be maintained in eligible investments as of the end of the fiscal year exceeds the total of all amounts, each of which is the cost to the corporation of an eligible investment held by the corporation at the end of the fiscal year; and

"B" is the amount of any tax paid by the corporation under this subsection in respect of any preceding year that has not been rebated to the corporation under subsection (2).

(2) Subsection 28 (1) of the Act, as re-enacted by subsection (1), is repealed and the following substituted:

Investment level tax, employee ownership labour sponsored venture capital corporation

(1) An employee ownership labour sponsored venture capital corporation that fails to meet or maintain the level of eligible investments required by section 9 to be held by the corporation at the end of a particular fiscal year shall pay a tax for the year equal to the amount determined by the following formula:

T = (A x 20/100) - B

where,

"T" is the tax payable under this subsection;

"A" is the amount by which the amount of the corporation's equity capital received on the issue of its Class A shares that is required by this Act to be maintained in eligible investments as of the end of the fiscal year exceeds the total of all amounts, each of which is the cost to the corporation of an eligible investment held by the corporation at the end of the fiscal year; and

"B" is the amount of any tax paid by the corporation under this subsection in respect of any preceding year that has not been rebated to the corporation under subsection (2).

(3) Subsections 28 (3) and (4) of the Act, as enacted by the Statutes of Ontario, 1996, chapter 24, section 9 are repealed.

(4) Section 28 of the Act, as amended by the Statutes of Ontario, 1996, chapter 24, section 9 and subsections (1), (2) and (3) of this section, is further amended by adding the following subsections:

Investment level tax, labour sponsored investment fund corporation

(3) A labour sponsored investment fund corporation that fails to meet or maintain the level of eligible investments required by section 17 to be held by the corporation at the end of a particular calendar year, holds investments at the end of a particular calendar year in eligible businesses that are reporting issuers under the Securities Act in excess of the level permitted by section 18.1, or fails to meet or maintain the level of investments in eligible businesses that are small businesses required by section 18.1 to be held by the corporation at the endof a particular calendar year, shall pay a tax for the year equal to the amount by which the greater of,

(a) 15 per cent of the amount by which the amount of the corporation's equity capital received on the issue of its Class A shares that is required by this Act to be maintained in eligible investments as of the end of the calendar year exceeds the total of all amounts, each of which is the cost to the corporation of an eligible investment held by the corporation at the end of the calendar year; and

(b) the aggregate of,

(i) 15 per cent of the amount by which the amount of the corporation's equity capital received on the issue of Class A shares after May 6, 1996 that is invested at the end of the calendar year in eligible businesses that were reporting issuers under the Securities Act at the time the investment was made exceeds 15 per cent of the amounts of equity capital received on the issue of Class A shares after May 6, 1996 required to be maintained in eligible investments under subsection 17 (2) by the corporation at the end of the calendar year, and

(ii) 15 per cent of the amount by which the amount of the corporation's equity capital received on the issue of Class A shares after May 6, 1996 that is required by subsection 18.1 to be invested at the end of the calendar year in eligible businesses that are small businesses exceeds the total of all amounts, each of which is a cost to the corporation of an eligible investment in an eligible business that is a small business held by the corporation at the end of the calendar year,

exceeds,

(c) the amount of any tax paid by the corporation under this subsection in respect of any preceding year that has not been rebated to the corporation under subsection (4).

Rebate

(4) Upon receipt of an application from a labour sponsored investment fund corporation that has paid a tax under subsection (3) with respect to a calendar year, the Minister may rebate the tax without interest to the corporation if,

(a) the application is received within three years after the end of the calendar year with respect to which the tax was imposed; and

(b) the Minister is satisfied that as of a date that is no later than the end of the second calendar year ending after the calendar year in respect of which the tax was imposed, or at the end of such later period as is approved by the Minister, the labour sponsored investment fund corporation,

(i) maintained throughout a full calendar year and continues to maintain the level of eligible investments it is required by this Act to maintain,

(ii) did not hold eligible investments in eligible businesses that are reporting issuers under the Securities Act in excess of the level permitted by section 18.1 throughout a full calendar year and continues not to hold such investments in excess of this level, and

(iii) maintained throughout a full calendar year and continues to maintain the level of eligible investments in eligible businesses that are small businesses that it is required by section 18.1 to maintain.

Commencement

15. (1) This Part, except subsections 14 (2) and (4) shall be deemed to have come into force on May 7, 1996.

Same

(2) Subsections 14 (2)and (4) come into force on December 31, 1997.

PART V

AMENDMENTS TO THE LAND TRANSFER TAX ACT

16. (1) The definition of "value of the consideration" in subsection 1 (1) of the Land Transfer Tax Act, as amended by the Statutes of Ontario, 1996, chapter 18, section 7, is further amended by adding the following clause:

(b.1) in the case of a conveyance of land to the mortgagee or chargee under a mortgage or charge affecting the land when the conveyance is given in satisfaction of the amount owed under the mortgage or charge, the lesser of,

(i) the value of the consideration determined under clause (a) plus the amount owed under the mortgage or charge at the time the conveyance is made, including principal, interest and all other costs or expenses other than municipal taxes, secured by the mortgage or charge and owing at the time plus the amount owing similarly calculated under any other mortgage or charge that is subsequent in priority to the mortgage or charge in respect of which the conveyance is made, if that mortgage or charge is held by the mortgagee or chargee to whom the conveyance is made, or

(ii) an amount established to the satisfaction of the Minister to be equal to the fair market value of the land that is subject to the conveyance.

(2) Clause 1 (5) (a) of the Act is repealed and the following substituted:

(a) he or she has been physically present in Canada for at least 366 days in the previous twenty-four months.

17. (1) Subsection 2(4) of the Act is amended by striking out "Treasurer" in the eighteenth line and substituting "Minister".

(2) Section 2 of the Act, as amended by the Statutes of Ontario, 1994, chapter 18, section 4, is further amended by adding the following subsection:

Tax anti-avoidance

(4.1) If subsection (4) would have applied on a disposition of agricultural land within the meaning of clause (6) (a) or (b) if the corporation that owns the land had not become a non-resident corporation before the disposition, the corporation shall bedeemed for the purposes of subsection (4) to have become a non-resident corporation as a result of the disposition if the Minister is of the opinion that one of the reasons the corporation became a non-resident corporation before the disposition was to avoid the imposition of tax under subsection (4).

18. The Act is amended by adding the following sections:

Person liable for the tax

2.2 Every person who immediately after the registration of a conveyance has a beneficial interest in the land that was acquired or increased as a result of a conveyance or as part of an arrangement relating to the conveyance is liable for the payment of the tax required to be paid on registration of the conveyance under section 2 or 2.1, unless the person has previously paid tax on the acquisition of or increase in beneficial interest.

Multiple conveyances

2.3 (1) Where land is conveyed by more than one conveyance and the Minister is of the opinion that one of the reasons for conveying the land by more than one conveyance is to reduce the total amount of tax payable under this Act in respect of the conveyances of the land to an amount less than the amount of tax that would have been payable if the land had been conveyed by one conveyance, the total amount of tax payable under this Act in respect of the conveyances shall not be less than the amount of tax that would have been payable if the land had been conveyed by one conveyance.

Multiple dispositions of beneficial interest

(2) Where a disposition of a beneficial interest in land occurs by means of more than one disposition of a beneficial interest in the land and the Minister is of the opinion that one of the reasons for disposing of the beneficial interest by more than one disposition is to reduce the total amount of tax payable under this Act in respect of the dispositions to an amount less than the amount of tax that would have been payable if the beneficial interest in the land had been disposed of in one disposition, the total amount of tax payable under this Act in respect of the dispositions shall not be less than the amount of tax that would have been payable if the beneficial interest had been disposed of by one disposition.

19. Subsection 3 (14) of the Act is repealed and the following substituted:

Interpretation, affiliate

(14) For the purposes of this section,

(a) a corporation shall be deemed to be an affiliate of another corporation if one of them is the subsidiary of the other or if both are subsidiaries of the same corporation or if each of them is controlled by the same person or persons;

(b) a corporation shall be deemed to be a subsidiary of another corporation if it would be a subsidiary of that corporation for the purposes of the Securities Act; and

(c) subsections 1 (3) to (6) of the Securities Act apply in determining if a corporation is an affiliate of another corporation.

20. (1) Section 5 of the Act, as amended by the Statutes of Ontario, 1994, chapter 18, section 4 and 1996, chapter 18, section 10 is further amended by adding the following subsection:

Affidavit of transferor

(2.1) Despite subsection (2), upon application by a transferor named in a conveyance to the Minister, the Minister or a person authorized by the Minister may consent to the transferor making the affidavit required by subsection (1), and the transferor may make the affidavit if,

(a) the transferor is tendering or submitting the conveyance for registration;

(b) no tax is payable under this Act in respect of the conveyance; and

(c) the transferor satisfies the Minister that the transferor has sufficient information to enable the transferor to make the affidavit.

(2) Subsection 5 (5) of the Act is repealed and the following substituted:

Affidavit not required

(5) Despite subsection (1), no affidavit is required under that subsection on the tender for registration of a conveyance,

(a) if the only transferee named in the conveyance is Her Majesty in right of Ontario, Her Majesty in right of Canada or a Crown agency within the meaning of the Crown Agency Act, and if no tax is payable under this Act by any person in respect of the conveyance; or

(b) if the conveyance expressly states that it is in trust for only Her Majesty in right of Ontario, Her Majesty in right of Canada or a Crown agency within the meaning of the Crown Agency Act.

Affidavit, certain leases

(5.1) If no tax is payable on the tender or submission for registration of a conveyance of land by reason of subsection 1 (6), the affidavit required under subsection (1) does not need to contain the information otherwise required under clauses (1) (a), (b), (c) and (e).

21. Subsection 12 (1) of the Act is repealed and the following substituted:

Assessment

(1) If a person responsible for the payment of tax fails to pay it as required under this Act or if a person is liable to pay tax or a penalty imposed by this Act, the Minister may make an assessment of the amount of the tax or penalty, together with any interest imposed thereon under this Act.

22. Section 18 of the Act is amended by adding the following subsection:

Deferral of tax under s. 2.1

(12) Subsections (1) to (10) apply with such modifications as are necessary in respect of tax payable by a non-resident person under section 2.1.

PART VI

AMENDMENTS TO THE RETAIL SALES TAX ACT

23. Clause (a.1) of the definition of "sale" in subsection 1 (1) of the Retail Sales Tax Act, as enacted by the Statutes of Ontario, 1994, chapter 13, section 1, is repealed and the following substituted:

(a.1) the provision of any charge or billing, including periodic payments,

(i) upon rendering or providing or upon any undertaking to render or provide to another person a taxable service, or

(ii) for or on account of a price of admission, including any admission sold on a subscription or season ticket basis.

24. (1) Subsection 2 (6) of the Act is amended by striking out "or at the time of the payment of a price of admission" in the second and third lines.

(2) Subsection 2 (11.1) of the Act, as enacted by the Statutes of Ontario, 1994, chapter 13, section 2, is amended by striking out "(11)" in the first line and substituting "(10)".

(3) Subsection 2 (13) of the Act is repealed and the following substituted:

Refund to contracting party

(13) If the amount that is the subject of an application under subsection (11) was paid in the course of performing a contract for the construction of any building or structure or other improvement which on completion will be real property and was repaid by another party to the contract, the amount may be refunded to the other party.

(4) Clause 2 (16) (c) of the Act, as amended by the Statutes of Ontario, 1992, chapter 13, section 1 and 1994, chapter 13, section 2, is repealed and the following substituted:

(c) the price paid for the tangible personal property, taxable service or as the price of admission is subsequently reduced and the amount of the reduction refunded or credited to the purchaser.

25. The definition of "motor vehicle" in subsection 4.2 (3) of the Act, as enacted by the Statutes of Ontario, 1993, chapter 12, section 5, is amended by striking out "a gross weight of not more than 3,000 kilograms" in the third and fourth lines andsubstituting "an empty vehicle weight of not more than 2,200 kilograms".

26. (1) Paragraph 22 of subsection 7 (1) of the Act is repealed and the following substituted:

22. State and commercial aircraft, as defined by the Minister, including parts, equipment and repairs to such aircraft.

(2) Subsection 7 (1) of the Act, as amended by the Statutes of Ontario, 1992, chapter 13, section 4, 1994, chapter 13, section 9 and 1996, chapter 18, section 17, is further amended by adding the following paragraph:

34.1 Animals, as defined by the Minister, specifically trained to assist and for the sole benefit of persons who are chronic invalids or who have a physical disability, and harnesses for such animals.

27. Subsection 9 (2) of the Act, as amended by the Statutes of Ontario, 1992, chapter 13, section 5, is further amended by adding after "persons" in the thirteenth line "who are Canadian citizens resident in Canada or".

28. Section 12 of the Act, as amended by the Statutes of Ontario, 1994, chapter 13, section 8, is further amended by striking out "or at the time of the payment of a price of admission" wherever it occurs.

29. Section 13 of the Act, as re-enacted by the Statutes of Ontario, 1994, chapter 13, section 10, is amended by adding the following subsection:

Deemed vendor

(3) Any person who collects any amount as or on account of tax shall be deemed to be a vendor for the purposes of subsection (1) and for the purposes of assessment, collection and enforcement of this Act.

30. Subsection 18 (3) of the Act is amended by inserting after "payable" in the fourth line "or, in the case of a manufacturing contractor, within four years from the end of the person's fiscal year during which the tax became payable".

31. On a day to be named by proclamation of the Lieutenant Governor, subsection 19 (1) of the Act, as re-enacted by the Statutes of Ontario, 1992, chapter 13, section 6 and amended by Statutes of Ontario, 1994, chapter 13, section 14, is further amended by striking out "or (2)" wherever it occurs.

PART VII

AMENDMENTS TO THE TOBACCO TAX ACT

32. Subsection 25 (3) of the Act is amended by striking out "Revenue" in the last line and substituting "Finance".

33. Subsection 38 (4) of the Act is amended by inserting after "regulations" in the fourth line "computed and compounded daily".

Commencement

34. Section 33 shall be deemed to have come into force on July 1, 1993.

PART VIII

AMENDMENTS TO THE MINING TAX ACT

35. (1) Section 8 of the Mining Tax Act, as amended by the Statutes of Ontario, 1994, chapter 18, section 6, is further amended,

(a) by repealing clause 8 (6) (d);

(b) by adding the following subsection:

Effective date of penalties

(6.2) The effective date of a penalty assessed under this Act shall be determined in accordance with the following rules:

1. If the penalty is under subsection 15 (1) in respect of a return, the effective date is the date on or before which the operator was required to deliver the return.

2. If the penalty is under subsection 15 (4) in respect of tax payable for a taxation year, the effective date is the date the balance of tax payable, if any, for that taxation year is required to be paid by the operator under subsection 2 (2).

3. In any other case, the effective date is the date the penalty is assessed by the Minister.

Commencement

(2) This Part comes into force on the day that subsection 6 (8) of the Revenue and Liquor Licence Statute Law Amendment Act, 1994 comes into force.

PART IX

AMENDMENTS TO THE CORPORATIONS TAX ACT

AND THE CORPORATIONS TAX AMENDMENT ACT, 1994

CORPORATIONS TAX ACT

36. (1) Clause 1 (1) (b) of the Corporations Tax Act is repealed.

(2) The definition of "paid-up capital" in clause 1 (1) (d) of the Act is amended by striking out "paragraph 89 (1) (c)" in the third line and substituting "subsection 89 (1)".

(3) Sub-subclause 1 (3) (d) (iv) (A) of the Act is amended by striking out "subsections 127.2 (8) and 127.3 (6)" in the twenty-first and twenty-second lines and substituting "subsections 127.2 (8), 127.3 (6) and 128.1 (2)".

37. (1) Clause 11 (3) (a) of the Act is amended by striking out "subparagraph 13 (21) (f) (vi)" in the first and second lines and substituting "element H in the formula in the definition of "undepreciated capital cost" in subsection 13 (21)".

(2) Subsection 11 (14) of the Act is repealed.

(3) Subsection 11 (20) of the Act is repealed.

(4) Subsection 11 (22) of the Act is amended by inserting after "chapter 55" in the fourth line "as amended by subsection 132 (1) of the Statutes of Canada, 1994, chapter 21,".

(5) Section 11 of the Act, as amended by the Statutes of Ontario, 1992, chapter 3, section 2 and 1994, chapter 14, section 4, is further amended by adding the following subsection:

Interpretation

(25) In the application of subsection 12 (2.2) of the Income Tax Act (Canada) for the purposes of this Act, a reference in that subsection to an assessment or reassessment of tax, interest or penalties under section 152 of that Act shall be read as a reference to an assessment or reassessment under Part V of this Act.

(6) Despite subsection (2), subsection 11 (14) of the Act continues to apply in respect of taxation years ending before February 23, 1994.

(7) Despite subsection (3), subsection 11 (20) of the Act continues to apply in respect of taxation years commencing before February 26, 1986.

(8) Subsection 11 (25) of the Act, as enacted by subsection (5), applies in respect of amounts received after January 31, 1990.

38. (1) The definitions in subsection 12 (1) of the Act are amended as follows:

1. Subclause (c) (ii) of the definition of "expenditure base" is amended by striking out "subparagraph 13 (21) (f) (vii)" in the tenth and eleventh lines and substituting "element I in the formula in the definition of "undepreciated capital cost" in subsection 13 (21)".

2. The definition of "qualified expenditure" is amended by striking out "subparagraph 37 (7) (f) (i), (ii) or (iii)" in the last two lines and substituting "subparagraph 37 (8) (d) (i), (ii) or (iii)".

3. The definition of "scientific research and experimental development" is amended by striking out "paragraph 37 (7) (b)" in the fourth and fifth lines and substituting "the definition of that term in subsection 37 (7)".

(2) The definition of "scientific research and experimental development" in subsection 12 (1) of the Act, as amended by paragraph 3 of subsection (1), is repealed.

(3) Despite subsection (2), the definition of "scientific research and experimental development" in subsection 12 (1) of the Act, as amended by paragraph 3 of subsection (1), continues to apply in respect of work performed before February 28, 1995.

39. (1) The definitions in subsection 13 (1) of the Act are amended as follows:

1. Clause (c) of the definition of "eligible asset pool" is amended by striking out "subparagraph 13 (21) (f) (ii.1)" in the third and fourth lines and substituting "element C in the formula in the definition of "undepreciated capital cost" in subsection 13 (21)".

2. Subclause (d) (i) of the definition of "eligible asset pool" is amended by striking out "subparagraph 13 (21) (f) (vii) or (viii)" in the third and fourth lines and substituting "element I or J in the formula in the definition of "undepreciated capital cost" in subsection 13 (21)".

3. The definition of "eligible assets of the corporation for the taxation year" is amended by striking out "subparagraph 13 (21) (f) (i)" in the third and fourthlines of clause (a) and in the second line of clause (b) and substituting in each case "element A in the formula in the definition of "undepreciated capital cost" in subsection 13 (21)".

(2) Subsection 13 (7) of the Act, as enacted by the Statutes of Ontario, 1992, chapter 3, section 4, is amended by striking out "subparagraph 13 (21) (f) (i)" in the first and second lines and substituting "element A in the formula in the definition of "undepreciated capital cost" in subsection 13 (21)".

40. (1) Subsection 14 (3) of the Act is amended by striking out "and paragraph 48 (1) (c)" in the first and second lines.

(2) Clause 14 (5) (d) of the Act is repealed and the following substituted:

(d) where the property is a foreign resource property, there shall be deducted in respect of the property,

(i) any amount that has become receivable by the corporation at a particular time in a taxation year as the result of a transaction that occurred after May 6, 1974 in which the consideration given by the corporation for the amount was property or services the original cost of which may reasonably be regarded as having been foreign exploration and development expenses, and

(ii) any amount required by subsection 80 (9) of the Income Tax Act (Canada) to be applied to reduce the adjusted cost base of the property at or before the end of the taxation year.

(3) The definition of "foreign resource property" in subsection 14 (6) of the Act is amended by striking out "paragraph 66 (15) (c) of the Income Tax Act (Canada) if that paragraph" in the fourth, fifth and sixth lines and substituting "subsection 66 (15) of the Income Tax Act (Canada) if the definition of "Canadian resource property"".

(4) Clause 14 (5) (d) of the Act, as amended by subsection (2), applies in respect of taxation years of corporations ending after February 21, 1994.

41. (1) The Act is amended by adding the following section:

Application of Income Tax Act (Canada), ss. 61.3, 61.4

16.1 Sections 61.3 and 61.4 of the Income Tax Act (Canada) apply for the purposes of this Act in so far as those sections apply to corporations.

(2) Section 16.1 of the Act, as enacted by subsection (1), applies in respect of taxation years of corporations ending after February 21, 1994.

42. The definitions in subsection 18 (15) of the Act are amended as follows:

1. The definition of "agreed portion" is amended by striking out "paragraph 66 (15) (a)" in the second line and substituting "subsection 66 (15)".

2. The definition of "assistance" is amended by striking out "paragraph 66 (15) (a.1)" in the second line and substituting "subsection 66 (15)".

3. The definition of "drilling or exploration expense" is amended by striking out "paragraph 66 (15) (d)" in the fourth and fifth lines and substituting "subsection 66 (15)".

4. The definition of "flow-through share" is amended by striking out "paragraph 66 (15) (d.1)" in the second and third lines and substituting "subsection 66 (15)".

5. The definition of "joint exploration corporation" is amended by striking out "paragraph 66 (15) (g)" in the second and third lines and substituting "subsection 66 (15)".

6. The definition of "original owner" is amended by striking out "paragraph 66 (15) (g.11) of the Income Tax Act (Canada) if that paragraph" in the fourth and fifth lines and substituting "subsection 66 (15) of the Income Tax Act (Canada) if the definition of "original owner" in that subsection".

7. The definition of ""outlay" or "expense"" is amended by striking out "paragraphs 66 (15) (g.2) and (g.3)" in the second and third lines and substituting "subsection 66 (15)".

8. The definition of "predecessor owner" is amended by striking out "paragraph 66 (15) (g.4) of the Income Tax Act (Canada) if that paragraph" in the fourth and fifth lines and substituting "subsection 66 (15) of the Income Tax Act (Canada) if the definition of "predecessor owner" in that subsection".

9. The definition of "principal-business corporation" is amended by striking out "paragraph 66 (15) (h)" in the second and third lines and substituting "subsection 66 (15)".

10. The definition of "production" is amended by striking out "paragraph 66 (15) (h.01)" in the third line and substituting "subsection 66 (15)".

11. The definition of "reserve amount" is amended by striking out "paragraph 66 (15) (h.02) in the second line and substituting "subsection 66 (15)".

12. The definition of "selling instrument" is amended by striking out "paragraph 66 (15) (h.1)" in the second and third lines and substituting "subsection 66 (15)".

13. The definition of "shareholder corporation" is amended by striking out "paragraph 66 (15) (i)" in the third line and substituting "subsection 66 (15)".

43. (1) Section 20 of the Act, as amended by the Statutes of Ontario, 1994, chapter 14, section 7, is further amended by striking out the portion before clause (b) and substituting the following:

Application of Income Tax Act (Canada), s. 66, part

20. Subsections 66 (12.6) to (12.741), (16), (17), (18) and (19) of the Income Tax Act (Canada) are applicable for the purposes of this Act in so far as they apply to corporations, except that in the application of these subsections,

(a) references to the "Minister" in subsections 66 (12.68), (12.69), (12.691), (12.7), (12.701), (12.73), (12.74) and (12.741) of that Act shall be read as references to the Minister of National Revenue;

. . . . .

(2) Section 20 of the Act, as amended by subsection (1), applies in respect of renunciations purported to be made after February 28, 1993.

44. (1) Subsection 26 (5) of the Act, as enacted by the Statutes of Ontario, 1994, chapter 14, section 9, is repealed and the following substituted:

Reduction of resource expenditures

(5) Subsection 80 (8) of the Income Tax Act (Canada) shall be read as if paragraph (e) of that subsection had not been enacted.

(2) Subsection 26 (5) of the Act, as enacted by subsection (1), applies in respect of taxation years of corporations ending after February 21, 1994.

45. Subsection 34 (7) of the Act is repealed and the following substituted:

Same

(7) In the application of section 110.5 of the Income Tax Act (Canada) and in the application of the definition of "non-capital loss" in subsection 111 (8) of that Act for the purposes of this Act, the amount determined under section 110.5 that is added for the purposes of that Act to the taxable income of the corporation for the taxation year and to the non-capital loss of the corporation for the taxation year under element B of the formula in the definition of "non-capital loss" in subsection 111 (8) shall be the amount added to the taxable income and included in the non-capital loss of the corporation for the taxation year for the purposes of this Act.

46. Subsection 37(4) of the Act is repealed and the following substituted:

Competent authority agreements

(4) Section 115.1 of the Income Tax Act (Canada) applies for the purposes of this Act in respect of an agreement made under the provisions of a tax treaty, convention or agreement if a regulation has been made under subsection 1(8) to modify the provisions of this Act for the purpose of giving effect to a provision of the treaty, convention or agreement.

Same

(5) If a regulation has not been made under subsection 1(8) in respect of a particular treaty, convention or agreement, section 115.1 of the Income Tax Act (Canada) is applicable for the purposes of this Act in respect of an agreement referred to in section 115.1 of that Act that was made under that treaty, convention or agreement only to the extent that,

(a) the agreement deals with a provision of that Act,

(i) that applies for the purposes of this Act,

(ii) that has not been replaced for the purposes of this Act by a provision of this Act, and

(iii) in respect of which this Act does not contain provisions that are to apply in addition to the provision; or

(b) the agreement does not deal with a disposition of taxable Canadian property to a non-resident individual or a non-resident partnership.

47. (1) Subsections 43.2 (1) and (2) of the Act, as enacted by the Statutes of Ontario, 1996, chapter 1, Schedule B, section 6, are repealed.

(2) Subsection 43.2 (4) of the Act, as enacted by the Statutes of Ontario, 1996, chapter 1, Schedule B, section 6 is repealed and the following substituted:

Deemed tax payment

(4) A corporation, other than a corporation that is exempt from tax under this Act by virtue of section 57, shall be deemed to pay on account of its tax payable under this Act for a taxation year an amount claimed by the corporation that does not exceed its mining reclamation trust tax credit for the taxation year.

(3) Subsection 43.2 (6) of the Act, as enacted by the Statutes of Ontario, 1996, chapter 1, Schedule B, section 6, is repealed.

(4) Subsections (1) to (3) apply in respect of taxation years ending after February 22, 1994.

48. Subsection 43.3 (1) of the Act, as enacted by the Statutes of Ontario, 1996, chapter 1, Schedule B, section 7, is amended by striking out "sections 39, 40, 41, 43 and 43.2" in the fifth and sixth lines and substituting "sections 39, 40, 41 and 43".

49. (1) Subsection 43.4 (1) of the Act, as enacted by the Statutes of Ontario, 1996, chapter 24, section 27, is amended by striking out "43.2" in the sixth line.

(2) Subsection 43.4 (3) of the Act, as enacted by the Statutes of Ontario, 1996, chapter 24, section 27, is amended by striking out "August 31, 1996" in the fifth line and substituting "July 31, 1996".

(3) Subsections 43.4 (4) and (5) of the Act, as enacted by the Statutes of Ontario, 1996, chapter 24, section 27, are repealed and the following substituted:

Certification of qualifying co-op work placement

(4) Every eligible educational institution in Ontario that has a co-operative education program that has qualifying co-op work placements shall certify in a manner or form approved by the Minister to every corporation providing a qualifying co-op work placement that the placement is a qualifying co-op work placement for the purposes of this section, and the certification shall contain the name of the student in the placement and any additional information required by the Minister.

Part of records and books of account

(5) Unless otherwise directed by the Minister, the certification provided by an eligible educational institution under subsection (4) in respect of a qualifying co-op work placement shall form part of the records and books of accountrequired to be kept under section 94 by the corporation providing the qualifying co-op work placement.

Minister's direction and order

(5.1) If incorrect certifications have been given under subsection (4) or an eligible educational institution has certified a work placement to be a qualifying co-op work placement when it was not, the Minister may direct the educational institution to cease certifying work placements and may order that all or certain of the work placements of the institution be deemed not to be qualifying co-op work placements for the purposes of this section until the Minister revokes the direction and order.

Resumption of certification

(5.2) If the Minister is satisfied that the educational institution will comply with the Minister's directions with respect to the accuracy, form and content of certifications to be given under subsection (4), the Minister, subject to any conditions the Minister considers reasonable, may revoke the direction and order given under subsection (5.1), and all work placements that would have otherwise been qualifying co-op work placements while the Minister's direction and order were in effect shall, to the extent approved by the Minister, be considered to be qualifying co-op work placements for the purposes of this section and may be so certified by the educational institution.

50. Subsection 43.5 (1) of the Act, as enacted by the Statutes of Ontario, 1996, chapter 24, section 27, is amended by striking out "43.2" in the seventh line.

51. (1) Subsection 44.1 (2) of the Act, as enacted by the Statutes of Ontario, 1996, chapter 24, section 27, is amended by striking out "other than a mining reclamation trust tax credit under section 43.2," in the fourth, fifth and sixth lines.

(2) Paragraph 1 of subsection 44.1 (4) of the Act, as enacted by the Statutes of Ontario, 1996, chapter 24, section 27, is repealed.

52. The Act is amended by adding the following section:

Application of Income Tax Act (Canada), ss. 128.1, 128.2

45.1 Sections 128.1 and 128.2 of the Income Tax Act (Canada), in so far as they apply to corporations, are applicable for the purposes of this Act.

53. Subsections 48 (4), (5) and (6) of the Act are repealed and the following substituted:

Same

(4) In the application of the definitions of "capital gains dividend account" and "capital gains redemptions" in subsection 131 (6) of the Income Tax Act (Canada) for taxation years ending after December 31, 1989, the multiplication factor of "100/21 of" wherever it appears in those definitions shall be read as "8 56/93 times".

Same

(5) The following rules apply in the application for the purposes of this Act of the definition of "refundable capital gains tax on hand" in subsection 131 (6) of the Income Tax Act (Canada):

1. The percentage referred to in paragraphs (a) and (b) in the calculation of the amount designated as "A" in the formula in the definition shall be read as "15.5 per cent".

2. The reference to "this Part" in paragraph (c) in the calculation of the amount designated as "A" in the formula in the definition shall be read as a reference to Part II of this Act.

3. Paragraph (c) in the calculation of the amount designated as "A" in the formula in the definition shall be read without reference to the words "determined without reference to section 123.2".

Apportionment of capital gains refund

(6) If a corporation had a permanent establishment in a jurisdiction outside Ontario during a taxation year and this section applies in respect of that year, the "taxable income" and "taxed capital gains" determined for the purposes of the application of the definition of "refundable capital gains tax on hand" in subsection 131 (6) of the Income Tax Act (Canada), as that definition applies for the purposes of this Act, shall each be reduced by that proportion thereof that,

(a) the taxable income of the corporation that is deemed to have been earned in jurisdictions other than Ontario for the taxation year for the purposes of section 39;

is of,

(b) the corporation's total taxable income for the year.

54. (1) The Act is amended by adding the following section:

Application of Income Tax Act (Canada), s. 132.2

48.1 Section 132.2 of the Income Tax Act (Canada) applies for the purposes of this Act in so far as that section applies tocorporations and, in the application of that section, the reference in paragraph 132.2 (1) (o) to "Part I.3" shall be read as a reference to Part III of this Act and the reference to "this Part" shall be read as a reference to Part II of this Act.

(2) Section 48.1 of the Act, as enacted by subsection (1), applies after June 30, 1994, except that an election referred to in paragraph (c) of the definition of "qualifying exchange" in subsection 132.2 of the Income Tax Act (Canada) as it applies for the purposes of this Act shall be considered to have been made in a timely manner if it is made before December 31, 1995.

55. The Act is amended by adding the following section:

Application of Income Tax Act (Canada), ss. 142.2 to 142.6

55.1 Sections 142.2 to 142.6 of the Income Tax Act (Canada) apply for the purposes of this Act in the same manner and subject to the same exceptions as those sections apply for the purposes of that Act.

56. Subsection 57.12 (1) of the French version of the Act, as enacted by the Statutes of Ontario, 1994, chapter 14, section 21, is amended by striking out "le calcul de ce montant" in the tenth line and substituting "le calcul du montant déterminé".

57. Subsection 66.1 (15) of the Act, as enacted by the Statutes of Ontario, 1996, chapter 18, section 20, is amended by striking out "and" at the end of clause (c), inserting "and" at the end of clause (d) and by adding the following clause:

(e) otherwise providing for the application of the provisions of this section where a bank or specified corporation has made an eligible investment that satisfies the conditions prescribed under clause (b).

58. Subsection 69 (2) of the Act, as amended by the Statutes of Ontario, 1994, chapter 14, section 30, is further amended by striking out "subsections 73 (1) and (2)" in the second and third lines and substituting "subsections 71 (1) and (2)".

59. (1) Subsection 78 (6) of the Act, as re-enacted and amended by the Statutes of Ontario, 1996, chapter 1, Schedule B, section 11 and 1996, chapter 24, section 29, is amended by repealing clauses (a) and (b) and substituting the following:

(a) the tax payable by the corporation for the taxation year is less than $2,000 after deducting the amount, if any, deemed under section 43.2 to be a payment on account of its tax payable for the taxation year and the amount, if any, of its capital gains refund as determined under section 48 for the taxation year; or

(b) the tax payable by the corporation for the immediately preceding taxation year is less than $2,000 after deducting,

(i) the amount, if any, of its capital gains refund as determined under section 48 for that taxation year, and

(ii) the amount, if any, deemed under section 43.2 to be a payment on account of its tax payable for that taxation year.

(2) Clause 78 (6) (a) of the Act, as re-enacted by subsection (1) is amended by striking out "section 43.2" in the third line and substituting "sections 43.2 or 43.3".

(3) Clause 78 (6) (a) of the Act, as re-enacted by subsection (1) and amended by subsection (2), is further amended by striking out "sections 43.2 or 43.3" in the third line and substituting "sections 43.2, 43.3, 43.4 or 43.5".

(4) Clauses 78 (6) (a) and (b) of the Act, as re-enacted by subsection (1) apply to taxation years of corporations ending after February 22, 1994.

(5) Clause 78 (6) (a) of the Act, as re-enacted by subsection (1) and amended by subsection (2), applies to taxation years of corporations ending after December 31, 1994.

(6) Clause 78 (6) (a) of the Act, as re-enacted by subsection (1) and amended by subsection (3), applies to taxation years of corporations ending after May 7, 1996.

60. (1) The Act is amended by adding the following section:

Liability in respect of transfer by insolvent corporation

78.1 Section 160.4 of the Income Tax Act (Canada) applies for the purposes of this Act and, in the application of that section,

(a) references in subsections 160.4 (1) and (2) to "this Part" shall be read as references to Part II of this Act; and

(b) the reference in subsection 160.4 (3) to "this Division" shall be read as a reference to Part V of this Act.

(2) Section 78.1 of the Act, as enacted by subsection (1), applies to transfers made after December 20, 1994.

61. (1) Clause 79 (3) (b) of the Act, as enacted by the Statutes of Ontario, 1994, chapter 14, section 37, is repealed and the following substituted:

(b) the effective date of a refund to which a corporation is entitled under section 46 or 48 is the date the balance of tax payable, if any, for the taxation year is required to be paid by the corporation under clause 78 (2) (b).

(2) Subsection 79 (3) of the Act, as re-enacted by the Statutes of Ontario 1994, chapter 14, section 37, is amended by adding "and" at the end of clause (c), by striking out "and" at the end of clause (d), and by striking out clause (e).

(3) Section 79 of the Act, as amended by the Statutes of Ontario, 1994, chapter 14, section 37, is further amended by adding the following subsection:

Effective date of penalties

(3.2) The effective date of a penalty assessed under this Act shall be determined under the following rules:

1. If the penalty is under subsection 76(1) in respect of a return, the effective date of the penalty is the date on or before which the corporation was required to deliver the return.

2. If the penalty is under subsection 76(6)or (9) in respect of a taxation year, the effective date of the penalty is the date the balance of tax payable, if any, for that taxation year is required to be paid by the corporation under clause 78 (2) (b).

3. In any other case, the effective date of the penalty is the date the penalty is assessed by the Minister.

(4) Subsection 79 (7) of the Act, as re-enacted by the Statutes of Ontario, 1994, chapter 14, section 37, is amended by striking out the portion before clause (a) and substituting the following:

Effect of loss carried back

(7) For the purposes of calculating interest payable or allowed under this section or section 82 or 83 in respect of a particular taxation year, and for the purpose of determining the amount of a penalty, if any, to be assessed under subsection 76(1) and the amount of tax payable under subsections 78(4) and (6),

. . . . .

62. (1) Section 80 of the Act, as amended by the Statutes of Ontario, 1992, chapter 3, section 16, 1994, chapter 14, section 38 and 1996, chapter 1, Schedule B, section 13, is further amended by adding the following subsections:

Exception, reassessment

(25) Despite subsections (11), (12) and (15), the Minister may reassess and make additional assessments or assess tax, interest or penalties in respect of any item that affects a corporation's liability or potential liability under this Act and which can be reasonably regarded as relating to an assessment action carried out by a taxing authority in respect of the corporation, if the reassessment, additional assessment or assessment is made by the Minister on or before the day that is the later of,

(a) the latest day on which a reassessment, additional assessment or assessment may be made under clause (11) (b) or (c); or

(b) unless a waiver has been filed under subsection (26), the day that is 365 days after the date of notification of the assessment action carried out by the taxing authority.

Waiver

(26) A corporation may,

(a) file a waiver with the Minister, in a form approved by the Minister, permitting the Minister to assess, reassess or make additional assessments under subsection (25) after the last date on which the Minister could otherwise assess, reassess or make additional assessments under that subsection; and

(b) file with the Minister, in a form approved by the Minister, a revocation of a waiver previously filed under clause (a).

Same

(27) If a corporation has filed a revocation of a waiver under subsection (26), the Minister may not issue a notice of assessment or reassessment later than one year after the date on which the corporation filed the revocation of the waiver.

Interpretation

(28) For the purposes of subsection (25),

(a) an assessment action carried out by a taxing authority means one or more of the following actions carried out by the Minister of National Revenue under the Income Tax Act (Canada) or by the appropriate statutory authority under a statute of a province or territory ofCanada that imposes a tax similar to a tax imposed under this Act,

(i) an assessment, reassessment or additional assessment of tax, interest or penalties,

(ii) a determination or redetermination of a loss,

(iii) the confirmation of an assessment, reassessment or additional assessment of tax, interest or penalties or of a determination or redetermination of a loss,

(iv) a determination of the corporation's entitlement to a refundable tax credit or other refund;

(b) the date of notification of an assessment action carried out by a taxing authority is the day that is the later of,

(i) the day that the Minister receives notification from the corporation of all items that affect the corporation's liability or potential liability under this Act which can reasonably be regarded as relating to the assessment action, or if the Minister does not receive notification from the corporation, the day that the Minister receives notification of the assessment action from the taxing authority, and

(ii) the ninetieth day after the day of mailing of a notice of the assessment action by the taxing authority to the corporation.

(2) Subsections 80 (25) to (28), as enacted by subsection (1), apply in respect of assessment actions in respect of corporations carried out by taxing authorities for which notices are mailed or otherwise issued and sent by the taxing authorities to the corporations after the day this Act receives Royal Assent.

CORPORATIONS TAX AMENDMENT ACT, 1994

63. Subsection 41 (4) of the Corporations Tax Amendment Act, 1994 is repealed and the following substituted:

(4) Despite subsection (2), subsection 83 (4) of the Act continues in force and to apply before the day clause 79 (7) (a) of the Act, as enacted by subsection 37 (3) of this Act, comes into force, in determining,

(a) the amount of interest allowed under subsection 83 (1) of the Act for taxation years commencing before January 1, 1994; and

(b) the amount of interest allowed under subsection 83 (1) of the Act in respect of changes in the amount of tax payable resulting from the deduction of an amount under subsection 111 (1) of the Income Tax Act (Canada), as made applicable by section 34 of the Act.

64. Subsection 44 (3) of the French version of the Act is amended by striking out "le jour" in the second line and substituting "la veille du jour".

COMMENCEMENT

Commencement

65. (1) Section 46 shall be deemed to have come into force on January 1, 1985.

Same

(2) Subsections 37 (3) and (7) shall be deemed to have come into force on February 25, 1986.

Same

(3) Subsection 37 (4) shall be deemed to have come into force on September 13, 1988.

Same

(4) Subsections 37 (5) and (8) shall be deemed to have come into force on February 1, 1990.

Same

(5) Section 58 shall be deemed to have come into force on December 31, 1991.

Same

(6) Subsections 36 (3) and 40 (1) and section 52 shall be deemed to have come into force on January 1, 1993.

Same

(7) Section 43 shall be deemed to have come into force on March 1, 1993.

Same

(8) Section 56 shall be deemed to have come into force on January 1, 1994.

Same

(9) Subsections 40 (2) and (4) and sections 41 and 44 shall be deemed to have come into force on February 22, 1994.

Same

(10) Subsections 37 (2) and (6), sections 47 and 55 and subsections 59 (1) and (4) shall be deemed to have come into force on February 23, 1994.

Same

(11) Subsections 36 (1) and (2), 37 (1), 38 (1) and 40 (3) and sections 39, 42, 45 and 53 shall be deemed to have come into force on March 1, 1994.

Same

(12) Sections 63 and 64 shall be deemed to have come into force on June 23, 1994.

Same

(13) Section 54 shall be deemed to have come into force on July 1, 1994.

Same

(14) Section 60 shall be deemed to have come into force on December 21, 1994.

Same

(15) Section 48 and subsections 59 (2) and (5) shall be deemed to have come into force on January 1, 1995.

Same

(16) Subsections 38 (2) and (3) shall be deemed to have come into force on February 28, 1995.

Same

(17) Section 61 shall be deemed to have come into force on August 1, 1995.

Same

(18) Sections 49, 50, 51 and 57 and subsections 59 (3) and (6) shall be deemed to have come into force on May 8, 1996.

PART X

AMENDMENTS TO THE MPPs PENSION ACT, 1996

66. (1) Clause (a) of variable D in the formula set out in subsection 10 (1) of the MPPs Pension Act, 1996, is amended by inserting "or before" after "on" in the second line.

(2) Clause (a) of variable H in the formula set out in subsection 10 (2) of the Act is amended by inserting "or before" after "on" in the second line.

67. The Act is further amended by adding the following section:

Overall limit

10.1 (1) Despite any other provision of this Part, the aggregate annual allowance payable under this Part to a member of the registered plan shall not exceed,

(a) for the calendar year in which the allowance begins, 5 per cent of the member's average annual remuneration multiplied by the member's years of service as a member of the Assembly before June 8, 1995, up to a maximum amount equal to 75 per cent of the member's average annual remuneration; and

(b) for any subsequent calendar year, the amount referred to in clause (a) increased in the manner described in subsection 30 (6).

Average annual remuneration

(2) For the purposes of subsection (1), an individual's average annual remuneration is his or her average annual remuneration during any 36 months of service as a member of the Assembly, which months need not be consecutive, during which his or her remuneration was highest.

68. The Act is further amended by adding the following section:

Payment to purchase annuity contracts

48.1 (1) The Minister of Finance may pay from the Consolidated Revenue Fund the amount required to purchase annuity contracts under section 48 of this Act or section 25.2 of the Legislative Assembly Retirement Allowances Act, and the amount standing to the credit of accounts maintained in the Consolidated Revenue Fund in connection with benefits under those Acts shall be reduced by the amount by which a person's entitlement to benefits under those Acts is reduced by the purchase of the annuity contracts.

Accounts held outside the Consolidated Revenue Fund

(2) If the Speaker, with the approval of the Minister of Finance, enters into an arrangement under which registered plan accounts or supplementary plan accounts or both are held under this Act outside the Consolidated Revenue Fund, the Minister of Finance shall pay from the Consolidated Revenue Fund to the person by whom the accounts are held the amount standing to the credit of the accounts.

Commencement

69. Sections 67 and 68 shall be deemed to have come into force on January 1, 1992.

PART XI

COMMENCEMENT, SHORT TITLE

Commencement

70. Except as otherwise provided, this Act comes into force on the day it receives Royal Assent.

Short title

71. The short title of this Act is the Good Financial Management Act, 1996.