Good morning, members, Mr. Chair.
Thanks for your question, Ms. McLeod.
In the simplest of terms, it's possible to reduce Canadian tax by interposing a foreign intermediary between a source of income and a taxpayer. Since the 1970s, the Income Tax Act has contained rules that seek to respond to that to ensure that an appropriate amount of Canadian tax is paid.
Part 1 of Bill C-48 modifies those rules to ensure that they continue to apply appropriately, particularly in the context of circumstances involving a non-resident trust as the foreign intermediary.