Finance committee  It's a fairly complex determination. The rules in the Income Tax Act are actually not that long, but there's a tremendous amount of guidance done through the Organisation for Economic Co-operation and Development and transfer pricing guidelines put out by the Canada Revenue Agency.

Finance committee  No, I do not have that information with me. I will say that this is not intended as a tightening amendment in order to really change the outcomes of transfer pricing cases. Rather, it is intended as a clarifying amendment so that it's just much clearer how the transfer pricing rules interact with the other rules in the Income Tax Act.

Finance committee  Clause 53 amends section 212.3 of the act. That's the section that provides the foreign affiliate dumping rules. These rules essentially apply to prevent money from being extracted from Canada free of tax, avoiding the withholding tax rules that we just discussed. Currently, the rules apply when a non-resident corporation controls a corporation resident in Canada.

Finance committee  Sorry; I'm just scrolling.

Finance committee  Exactly. As I noted, this clause changes the rules so that it's not just non-resident corporations but corporations or trusts, so almost every measure in the foreign affiliate dumping rules had to be changed to say “corporation or trust”, which led to a lot of amendments in terms of pages for an insignificant change.

Finance committee  Clause 55 relates to the measure allowing for electronic delivery of requirements for information. Currently the Canada Revenue Agency can send to financial institutions requirements for information, but they have to be sent by registered mail. This measure would allow them to be sent electronically in order to improve the efficiency of the process.

Finance committee  Clause 56 is a consequential amendment on the measure that we just discussed. It is related to electronic deliveries of requirements for information.

Finance committee  Clause 57 is another consequential amendment related to electronic deliveries of requirements for information.

Finance committee  Clause 58 is one of the package of amendments with regard to the support for Canadian journalism that ensures that the rules work appropriately. In particular, it allows the Canada Revenue Agency to provide the names of organizations that are qualified for the digital news subscription tax credit, so if somebody wants to know if the periodical that they want to subscribe to qualifies for the credit, then the Canada Revenue Agency would be able to provide that information.

Finance committee  No. Again, I apologize. I saw the heading and was scrolling a bit too quickly. Clause 52 relates to a measure that prevents the avoidance of withholding tax in respect of securities lending arrangements. Securities lending arrangements are fairly common and provide liquidity in the securities markets.

Finance committee  Right, that's absolutely correct. As was noted earlier, many of these clauses have several components to them. The bulk of the securities lending rules are in clause 52, but the clause also contains a consequential amendment relating to the advanced life deferred annuity rules on payments to a non-resident in respect of an ALDA.

Finance committee  I don't want to characterize it as an anti-avoidance rule, because of course people might invest in an ALDA and then move south for the warmer climate or what have you. However, it ensures that when you have payments going to non-residents, they're not free from Canadian tax.

Finance committee  Well, part XIII withholding tax is technically an income tax imposed on a non-resident in respect of a payment. It's generally passive amounts. The 25% rate is the base rate, which can be reduced under tax treaties. Yes, obviously, if you don't report and pay your taxes, that can be tax evasion.

Finance committee  Clause 50 provides rules relating to the transition from the old health and welfare trust regime for providing benefits to employees to the new legislated employee life and health trust rules.

Finance committee  Clause 49 provides the rules for advanced life deferred annuities, which provide additional flexibility for savings in retirement.