Canadian Chamber of Commerce’s GAAR Submission on August 4, 2023 Draft Legislation

In August 2022, the Department of Finance (“Finance”) released a discussion paper (the “Discussion Paper”) on potential amendments to the general anti-avoidance rule (“GAAR”) in s. 245 of the Income Tax Act (Canada) (“ITA”), soliciting feedback on these possible changes.

The Chamber responded with a submission making various suggestions. This was followed by the federal budget of March 28, 2023 (the “March 2023 Budget”), which included specific proposals to amend s. 245 ITA (the “March 2023 Proposals”), and invited comment on them.

The Chamber provided a very detailed submission making numerous suggestions on these proposed amendments as well as further suggestions on the administration of GAAR, which was supplemented by a short further submission as a result of the Supreme Court of Canada’s decision on GAAR in Deans Knight Income Corporation v. The King.

This letter is written in response to the subsequent release of revised draft amendments to GAAR issued by Finance on August 4, 2023 (the “August 4 Amendments”), which solicited comment by no later than September 8, 2023.

Read the full submission here.