2 November 1989 Income Tax Severed Letter AC00288 - CCA Class 28 - Major Mine Expansion

Mr. Ron Sully
Assistant Deputy Minister
Mineral Policy                               0-0288
Energy, Mines and Resources, Canada          Allan B. Nelson
Room 701                                     957-8984
580 Booth Street
Ottawa, Ontario
K1A 0E4

Attention:  Mr. Donald G. Schell
            Director
            Mining Tax Legislation Interpretation Division

Dear Mr. Sully:

Re: Class 28 - Major Expansion

We are writing to request your opinion concerning subparagraph (a)(ii) of the Class 28 of Schedule II of the Regulations to the Act ("Class 28(a)(ii)").

Background

We have been asked to opine that a major expansion has taken
place, for the purposes of Class 28(a)(ii), in the following
instance:
                  24(1)

Analysis

Class 28(a)(ii) includes assets situated in Canada that would otherwise be included in another class that were "acquired by the taxpayer principally for the purpose of ... and each of which ... was the subject of a major expansion after November 7, 1969 whereby the greatest designed capacity, measured in tons of input of ore, of the mill that processed the ore from the mine was not less than 25 per cent greater in the year immediately following the expansion than it was in the year immediately preceeding the expansion".

In the present instance it is our view that there has been an

                    24(1)

Department of Finance's Comments

We referred this issue to Finance and received their comments as follows:

                   21(1)(b)

Queries

      24(1)            21(1)(b)

If you require further information please contact the writer.

Director General Rulings Directorate Legislative and Intergovernmental Affairs Branch