Principal Issues: The Overseas Employment Tax Credit provides an economic advantage to only those employers carrying on the qualifying activities described in subparagraph 122.3(1)(b)(i), and the list of qualifying activities therein should be expanded to include all other trades, professions, suppliers and service providers.
Position: Referred to Department of Finance
Reasons: Matter of tax policy
XXXXXXXXXX
Dear XXXXXXXXXX :
Thank you for your correspondence received on December 15, 2010, with which you enclosed a letter from your constituent, XXXXXXXXXX , regarding activities that qualify for the overseas employment tax credit (OETC).
XXXXXXXXXX is concerned that the OETC provides an economic advantage to only those employers carrying on the qualifying activities contained in subparagraph 122.3(1)(b)(i) of the Income Tax Act and discussed in paragraphs 6 to 8 of Interpretation Bulletin IT-497R4, Overseas Employment Tax Credit. He suggests that, in the interest of fairness, the definition of a qualifying activity be expanded to include all other trades, professions, suppliers, and service providers.
The Canada Revenue Agency administers and enforces the Act as passed by Parliament. XXXXXXXXXX 's suggestion relates to tax policy, which is the responsibility of the Department of Finance Canada. Any changes to the Act would have to be proposed by the Minister of Finance and approved by Parliament. I am therefore forwarding a copy of our correspondence to the Honourable James M. Flaherty, Minister of Finance, for his consideration.
I trust that this referral is helpful.
Yours sincerely,
Keith Ashfield
c.c.: The Honourable James M. Flaherty, P.C., M.P.
Minister of Finance
House of Commons
Ottawa ON K1A 0A6
Paul Oatway CGA