Submission to Deputy Prime Minister Chrystia Freeland Regarding Post-Budget Comments on the General Anti-Avoidance Rule (GAAR)

The Canadian Chamber of Commerce is pleased to share post-budget comments on the general anti-avoidance rule (GAAR). Written by Steve Suarez, co-chair of the Canadian Chamber’s Economics and Taxation Committee and a partner in the Toronto office of Borden Ladner Gervais LLP, our submission:

• Proposes steps to achieve the GAAR that Parliament wants, which would produce “’reasonably predictable result[s]’ so that taxpayers can comply with the rule, and the administration and the courts can easily apply it”.
• Highlights the practical reality that virtually any commercial transaction done in something other than the least tax-efficient manner possible will come within the definition of GAAR, which contravenes Parliament’s original intention.
• Discusses suggestions for better targeting GAAR on those cases of abusive tax avoidance which GAAR is meant to address while minimizing the potential for administrative over-reach, reducing the number of GAAR disputes before the courts, and minimizing the cost and complexity of resolving those that remain.

Ultimately, the business community and the government have a shared interest in ensuring that GAAR is robust, effective, and focused exclusively and successfully on those few who engage in abusive tax avoidance.

Read the full submission here.

Read supplemental letter to our prior submission here.