In finding that the Ontario corporate minimum tax ("CMT") provided for in ss. 57.1 to 57.12 of the Corporations Tax Act was not deductible in computing income, the Directorate first noted that the “CMT is therefore a calculation of tax based on a corporation's income, with adjustments, appearing in its financial statements,” and after quoting the statement in Roenisch, 1 DTC 199, that “such payment of taxes … made to the province … is not so made to earn the income, it is paid because there is an income showing gain and profit,” the Directorate stated:
Since the CMT is a tax effectively calculated on income, it is therefore not deductible by virtue of paragraph 18(1)(a).