Tax Administration Agreement between the Government of Canada and the Matsqui First Nation

WHEREAS:

The Matsqui First Nation Goods and Services Tax Law, 2013 imposes a value-added tax within the lands described opposite the name of Matsqui in Schedule 1 to the First Nations Goods and Services Tax Act;

Section 5 of the Matsqui First Nation Goods and Services Tax Law, 2013 states that the Chief and Councillors of Matsqui, with the approval of the Governing Body, may enter, on behalf of Matsqui, into an administration agreement with Canada in relation to that tax;

The Chief and Councillors have the approval of the Governing Body to enter into this Agreement;

Subsection 5(2) of the First Nations Goods and Services Tax Act states that the Minister of Finance, with the approval of the Governor in Council, may enter into an administration agreement in respect of a value-added tax imposed under a first nation law; and

The Minister of Finance has the approval of the Governor in Council to enter into this Agreement;

NOW THEREFORE, the Parties agree as follows:

1. In this Agreement:

2. Words and expressions not specifically defined in this Agreement will, where they are defined in the Federal Act, have the meaning given to them therein or, if the words and expressions are not defined in the Federal Act, have the meaning assigned by subsection 123(1) of the Excise Tax Act.

3. The Interpretation Act, R.S.C. 1985, c. I-21 applies to this Agreement as if it were an enactment.

4. Where a reference is made in this Agreement to the First Nation Law or any other first nation law that meets the description set out in subsection 11(1) or 12(1) of the Federal Act, or regulations made under the First Nation Law or that other law, the reference shall be read as a reference to that First Nation Law, other law or those regulations, as amended from time to time.

5. Canada agrees that the tax power of Matsqui provided by subsection 4(1) of the Federal Act applies in respect of the FNGST and other amounts imposed under the First Nation Law while this Agreement is in effect and in respect of amounts, other than the FNGST, imposed under the First Nation Law after this Agreement ceases to have effect that relate to amounts imposed while this Agreement was in effect.

6. Canada shall act as the agent for Matsqui in respect of the administration and enforcement of the First Nation Law, and collect the FNGST and other amounts imposed under that law while this Agreement is in effect and amounts, other than the FNGST, imposed under that law after this Agreement ceases to have effect that relate to amounts imposed while this Agreement was in effect.

7. Canada shall account for the amounts collected under the First Nation Law on behalf of Matsqui by estimating the Tax Attributable and Net Tax Attributable to Matsqui and shall make and account for remittances to Matsqui in accordance with this Agreement.

8. Canada and its agents and subservient bodies shall comply with the obligations imposed on them under the First Nation Law, including the obligation to pay and account for the amounts imposed on them under the First Nation Law as if that law were applicable to Canada.

9. Matsqui agrees that the obligations, authorities, rights and privileges imposed upon or granted to a person under the First Nation Law shall not depend on whether that person is a Member, an Indian or another person.

10. Matsqui agrees that the First Nation Law shall be consistent with section 11 of the Federal Act. Matsqui shall ensure that the First Nation Law provides the Minister of National Revenue with sufficient authority to administer and enforce that law in accordance with this Agreement, including the authority to collect the FNGST and other amounts imposed under that law.

11. Matsqui shall provide the Minister in a timely manner with a certified true copy of:

12. Matsqui and its agents and subservient bodies shall comply with Part IX of the Excise Tax Act, the Federal Act, the First Nation Law and any other first nation law that meets the description set out in subsection 11(1) or 12(1) of the Federal Act.

13. The Matsqui and its agents and subservient bodies shall pay and account for the amounts imposed under Part IX of the Excise Tax Act, the Federal Act, the First Nation Law or any other first nation law that meets the description set out in subsection 11(1) or 12(1) of the Federal Act, except if the amounts are not payable by reason of a separate agreement given effect under an Act of Parliament.

14. The Parties agree to use data outlined in Annex A and Annex B in order to prepare the estimates and re-estimates described below. The Parties recognize, however, that the data available may not be optimal in all instances.

15. Prior to the beginning of each particular Entitlement Year, the Minister shall make, in accordance with the provisions in Annex A, an estimate for that Entitlement Year of the Tax Attributable to Matsqui.

16. The sharing, if any, between Matsqui and Canada of the amount estimated as Tax Attributable to Matsqui for an Entitlement Year will be calculated in accordance with the provisions in Annex B.

17. An estimate of Net Tax Attributable for each particular Entitlement Year shall be made by subtracting, from the estimate of the Tax Attributable to Matsqui determined under Annex A for the particular Entitlement Year, the estimate of Canada’s share, if any, determined under Annex B for that particular Entitlement Year.

18. Not later than the last day of February of the third and fifth calendar years following the particular Entitlement Year, or as soon thereafter as is practical, the Minister shall re-estimate, using the procedure set out in clause 17, the Net Tax Attributable to Matsqui for that particular Entitlement Year for the purpose of calculating in each of those years a Prior Estimate Adjustment for that particular Entitlement Year.

19. The Net Tax Attributable for a particular Entitlement Year shall be final and no further adjustments shall be made following the commencement of remittances incorporating the Prior Estimate Adjustment in respect of the second re-estimate for that year, subject to the Minister incorporating any adjustments that may be required to the second re-estimate as set out in the report prepared by the Auditor General that is referred to in clause 29.

20. The Minister shall remit to Matsqui on a monthly basis positive amounts in respect of a particular Entitlement Year determined by the formula:

[(A – B) / D] + [C / D]

  • where
    A is the amount estimated under clause 15 for that particular Entitlement Year;
    B is the amount of Canada’s share determined under clause 16 for that particular Entitlement Year;
    C is the sum of the current Prior Estimate Adjustments made in respect of any of the five Entitlement Years immediately preceding that particular Entitlement Year that are open for re-estimation and adjustment or, if there are fewer than five Entitlement Years preceding the particular Entitlement Year, in respect of all the Entitlement Years immediately preceding the particular Entitlement Year that are currently open for re-estimation and adjustment; and
    D is the number of months anticipated to be in that particular Entitlement Year.

21. If the result of the formula in clause 20 in respect of a particular Entitlement Year is negative, that amount multiplied by the number of months anticipated in the formula to be in that Entitlement Year is a debt due to Canada payable by Matsqui, subject to clause 22, within that Entitlement Year.

22. If the sum of the Prior Estimate Adjustments in the formula in clause 20 results in a reduction to the remittances in respect of a particular Entitlement Year that is equal to or greater than 20 percent of Net Tax Attributable to Matsqui for that year, Matsqui may defer the repayment of a portion, agreed to by the Parties (hereinafter referred to as the “Deferred Amount”), of the total of the Prior Estimate Adjustments and, unless otherwise agreed by the Parties, the Deferred Amount will be repaid to Canada by Matsqui during the two Entitlement Years following the particular Entitlement Year.

23. Canada shall retain as its property an amount imposed under the First Nation Law if that amount:
24. Prior to each particular Entitlement Year, or as soon thereafter as is practical, the Assistant Deputy Minister or any authorized officer or class of officer of the Tax Policy Branch of the Department of Finance shall provide Matsqui with a written statement for review concerning remittances in respect of that Entitlement Year that includes the following information:

25. The first remittance made to Matsqui in respect of a particular Entitlement Year shall be made on or before the last Working Day of the month following the first month of that particular Entitlement Year or as soon thereafter as is practical. Subsequent remittances in respect of the particular Entitlement Year shall be made on or before the last Working Day of each month thereafter, or as soon thereafter as is practical, for the number of months equal to one less than the number of months in that particular Entitlement Year.

26. The Parties agree that, in respect of FNGST that is imposed while this Agreement is in effect, the Minister may pay to a person any refund, rebate or other amount that is payable in accordance with the First Nation Law.

27. If no amount is held on behalf of Matsqui from which payment under clause 26 may be made in accordance with this tax administration agreement, or the amount of the payment exceeds the amount so held, Canada agrees to make the payment as a recoverable advance and Matsqui agrees that the advance shall be recovered against amounts of FNGST subsequently collected on behalf of Matsqui.

28. In the event that this Agreement is terminated, unless the Parties agree otherwise:

29. The Minister shall provide Matsqui with each report prepared by the Auditor General concerning the final determination, in accordance with clause 19, of Net Tax Attributable to Matsqui for each Entitlement Year and the remittances in respect of each Entitlement Year.

30. The statements provided under clause 24 and the reports provided under clause 29 shall be the only statements or reports provided to Matsqui by Canada in respect of amounts collected in accordance with this Agreement.

31. The procedures carried out to prepare the Auditor General’s reports will be determined by the Auditor General and will constitute the only procedures conducted by Canada with respect to the reporting obligations in connection with the determination of amounts as provided for in this Agreement. Matsqui agrees that it has no right to inspect the books and records of Canada in connection with this Agreement.

32. Unless the Parties agree otherwise, if a report prepared by the Auditor General in accordance with clause 29 indicates that the remittances for a particular Entitlement Year including the Prior Estimate Adjustments based on the re-estimates in respect of the particular Entitlement Year should be adjusted, the adjustment shall be incorporated as soon thereafter as is practical into the remittances in respect of an Entitlement Year that follows the particular Entitlement Year.

33. The Parties agree that the Minister of National Revenue shall have and may exercise all the powers of Matsqui relating to the administration and enforcement of the First Nation Law, including the collection of the FNGST and other amounts imposed under that law while this Agreement is in effect and the collection of amounts, other than the FNGST, imposed under that law after this Agreement ceases to have effect that relate to amounts imposed while this Agreement was in effect.

34. Matsqui agrees that the Minister of National Revenue shall be the administrative authority in respect of the FNGST, including all interpretations, Assessments, determinations, decisions, and any other matter related to administration, collection or enforcement.

35. Canada shall administer the First Nation Law free of charge for Matsqui and Canada shall pay the costs, charges or expenses (including amounts in respect of prosecutions or other legal proceedings, other than amounts referred to in clause 37) that are incurred by Canada in the administration and enforcement of the First Nation Law and the collection of the FNGST and other amounts imposed under that law.

36. Canada shall retain interest and penalties that are imposed under the First Nation Law and collected by the Minister of National Revenue.

37. Unless otherwise agreed by the Parties, Matsqui shall pay its own costs, charges and expenses incurred in relation to litigation to which Matsqui becomes a party, either voluntarily or because a party other than Canada requires it, relating to the validity of this Agreement, the Federal Act or the First Nation Law.

38. If this Agreement ceases at any time to have effect, the Minister of National Revenue shall continue after that time to assess, collect or pay, as the case requires, amounts payable under the First Nation Law in respect of the period in which this Agreement was in effect and amounts, other than the FNGST, imposed under that law after this Agreement ceases to have effect that relate to amounts imposed while this Agreement was in effect.

39. The Minister of National Revenue may provide to Matsqui information acquired in the administration and enforcement of the First Nation Law or, subject to section 295 of the Excise Tax Act, Part IX of the Excise Tax Act. Such information shall be provided free of charge.

40. Matsqui, subject to any applicable confidentiality or privacy obligations, shall provide to Canada, free of charge, information that it acquires that could assist in the administration and enforcement of the First Nation Law, the collection of amounts payable under that law, or the estimation of payments to be made under this Agreement. Canada agrees that any information made available by Matsqui will not be used for any purpose other than the purpose for which it was provided.

41. Except in its capacity as a registrant or a person required to pay or entitled to receive amounts under the First Nation Law, Matsqui shall accept as final and binding all interpretations, Assessments, determinations, decisions, and other actions made or taken by the Minister of National Revenue for the purposes of the First Nation Law.

42. For the purposes of section 8 of the Federal Act, the Parties agree that the authorized body, as defined in subsection 2(1) of the First Nation Law, is authorized to certify the First Nation Law to be a true copy and evidence that the law was duly enacted by the Governing Body.

43. Canada shall notify Matsqui in writing that the First Nation Law requires amendment, where, in the opinion of the Minister, the First Nation Law does not:

44. Upon receipt of the notice referred to in clause 43, the Chief of Matsqui agrees to propose forthwith to the Governing Body an amendment to the First Nation Law.

45. The Parties agree that if the First Nation Law is not amended to rectify the deficiencies identified in the notice referred to in clause 43, the Minister may terminate this Agreement:

46. Unless the Minister agrees otherwise, Matsqui shall provide the Minister with at least six months notice of the date on which it intends to repeal the First Nation Law, and shall provide the Minister with notice that the First Nation Law has been repealed within 10 days following the repeal.

47. In the event of a dispute between the Parties arising out of or in connection with this Agreement, other than disputes in respect of clause 9, 10, 41, 44, 45, 53 or 54, the Parties shall follow the procedure set out in subclauses (a) through (e) before pursuing other legal remedies.

48. The Parties agree that a decision arising from the dispute resolution process under clause 47 concerning a dispute in respect of the amount of money due to either Party for an Entitlement Year shall be implemented, notwithstanding clause 19, if written notice of the dispute is provided at any time during the period that begins at the beginning of the Entitlement Year and ends at the end of the sixth month in the fifth calendar year following the Entitlement Year.

49. The Parties may mutually determine time periods other than those referred to in clause 47.

50. Either Party may at any time request the other Party to review this Agreement and to consider amendments to this Agreement.

51. Subject to any applicable approvals, authorizations or legislative requirements, the Parties may, in writing, amend or vary this Agreement.

52. The Parties may mutually agree to terminate this Agreement at any time on such terms as may be agreed upon by the Parties.

53. Matsqui may terminate this Agreement by giving the Minister not less than six months written notice of its intention to terminate the Agreement, including the date upon which this Agreement shall end.

54. Except where clause 45 applies, the Minister may terminate this Agreement by giving Matsqui not less than six months written notice of the Minister’s intention to terminate the Agreement, including the date upon which this Agreement shall end.

55. This Agreement or the rights and obligations under this Agreement may not be assigned, either in whole or in part, by either Party.

56. Nothing in this Agreement shall limit or restrict, or be construed as limiting or restricting, Canada’s right to alter or vary, in such manner as Canada may determine, the Federal Act or Part IX of the Excise Tax Act.

57. Nothing in this Agreement shall constitute or be construed as constituting an undertaking by Canada to collect the FNGST or any other amount payable under the First Nation Law or to take any action with respect to the collection of those amounts where Canada has provided notice that, in the opinion of the Minister, a doubt exists that Matsqui has provided sufficient statutory or other authority for the imposition or collection of those amounts.

58. Where Canada does not collect the FNGST or any other amount payable under the First Nation Law by reason of there being, in the opinion of the Minister, doubtful authority to do so and notice has been served in accordance with clause 43, the amount that, in the opinion of the Minister, Canada has thereby failed to collect but that has been taken into account in determining a payment to Matsqui made under this Agreement may be recovered by Canada as a debt due to Canada by Matsqui, notwithstanding that such payment was made to Matsqui as if there were sufficient authority.

59. The effective date of this Agreement is the fourteenth day following the latter of the dates when it is signed by the Parties.

60. This Agreement shall end:

61. This Agreement may be executed in counterparts each of which so executed shall be deemed to be an original and such counterparts together shall constitute one and the same instrument and this Agreement shall be effective on the date set out in clause 59. Facsimile and scanned signatures shall be accepted the same as original signatures.

Signed on this 20th day of March, 2013, for Matsqui First Nation:

Originally signed by:

Chief Alice McKay

Councillor Brenda Morgan

Councillor Louis Julian

Signed on this 7th day of May, 2013, for the Government of Canada:

Originally signed by:

Minister of Finance James M. Flaherty

1. In this annex:

2. In this Agreement, Interim and Final Estimates of Tax Attributable to Matsqui for an Entitlement Year shall be determined as follows:

ETAMatsqui = NetGST * RELPOP * RELINC * (DEY / DCY)

3. Unless otherwise agreed by the Parties:
4. Unless otherwise agreed by the Parties:
5. Unless otherwise agreed by the Parties:
6. In deciding whether the use of data other than data mentioned in clause 4 or 5 would be more appropriate for estimating RELPOP or RELINC, consideration shall be given to:
1. In this annex:

2 * (AvNetGSTpC) * (PofR) * (DEY / DCY);

  • “Threshold 2” for an Entitlement Year is an amount equal to:

8 * (AvNetGSTpC) * (PofR) * (DEY / DCY).

2. For each estimate of Tax Attributable to Matsqui for an Entitlement Year, Canada’s share shall be determined as follows:

Canada’s share = [(0.00 * A) + (0.50 * B) + (0.95 * C)]

  • where
  • A is the lesser of Threshold 1 and the Estimate of Tax Attributable to Matsqui, for that Entitlement Year;
    B is
    • (a) the result obtained by subtracting Threshold 1 from Threshold 2, for that Entitlement Year, where the Estimate of Tax Attributable to Matsqui is greater than or equal to Threshold 2, for that Entitlement Year,
    • (b) the result obtained by subtracting Threshold 1 from the Estimate of Tax Attributable to Matsqui, for that Entitlement Year, where the Estimate of Tax Attributable to Matsqui is greater than Threshold 1 but less than Threshold 2, for that Entitlement Year, and
    • (c) nil in any other case; and
  • C is
    • (a) the result obtained by subtracting Threshold 2 from the Estimate of Tax Attributable to Matsqui, for that Entitlement Year, where the Estimate of Tax Attributable to Matsqui is greater than Threshold 2, for that Entitlement Year, and
    • (b) nil in any other case.

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