MAY 27 1986
SMALL BUSINESS AND GENERAL DIVISION M. Evans (613) 957-2136
RE: Transport Employee's Expenses Paragraph 8(1)(g) Subsection 8(4)
This is in reply to your memorandum dated March 18, 1986.
We confirm that, in determining whether or not the principal business of an employer is passenger, goods, or passenger and goods transport for the purposes of paragraph 8(1)(g), the Department is relying on the Creamer decision at the Federal Court-Trial Division ( 76 DTC 6422) and not on the Anderson decision at the Tax Appeal Board ( 69 DTC 636). In this regard, we also refer you to the case of Raymond R. Roy v. M.N.R. ( 81 DTC 238) in which it was found that the appellant, who worked on a ferry under the jurisdiction of the Ministry of Highways and Public Works Act, was employed by Her Majesty the Queen in the right of the Province of British Columbia in the Department of Highways and was therefore not employed by a person whose principal business was transportation of goods and passengers. Although the Creamer case was not referred to in the Roy case, the findings in the Roy case appear to support your interpretation of the Creamer case.
We wish to point out that in the Anderson case reference was made on page 639 to one group of workers on ferries which falls under the administration of a Crown Corporation which is a government agency; this group of employees was entitled to deduct the cost of their noon meal. As a precaution, you might wish to assure yourself that the Air Services Branch of the Ministry of Transportation and Highways is not a Crown Corporation. We mention this since the index of services provided by the Minister of Transportation and Highways in British Columbia, other than referring to "air space parcels", does not mention an Air Service Branch.
We trust this information will be of assistance.
ORIGINAL SIGNED BY ORIGINAL SIGNÉ PAR
P.D. FUOCO for Director Small Business and General Division Specialty Rulings Directorate Legislative and Intergovernmental Affairs Branch