I am writing in response to your letter of November 30, 1990, concerning the taxation of international shipping organizations.
The confidentiality provisions of the Income Tax Act do not permit me to disclose information concerning the affairs of taxpayers, including the details of advance rulings or other requests made by taxpayers, without written permission. However, I can confirm that the Department of National Revenue has been involved in considering this matter, as indicated by the Honourable Micheal Wilson, Minister of Finance, in his letter to you of October 3, 1990.
The Department has determined that, under the present law, income from international shipping activities which is earned by a corporation incorporated outside of Canada may, under certain circumstances, be subject to Canadian income tax. The Department of Finance has been advised of this determination. I understand that Finance officials are continuing to consider the tax policy issues involved in submissions requesting amendments of the law to exempt such income from tax.
I trust my comments will assist you in replying to your constituent.
Yours sincerely,
G. Arsenault/ssd 957-2126)December 17, 1990
MD/mf (90338015)January 11, 1991D.M.'s Office