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International companies using Canada as a base of operations – and this would include a stack of global mining companies – need to pay close attention to tax amendments announced in the last federal budget that might erode the benefits of doing business in Canada.
Finance Minister Jim Flaherty’s March 29 budget plan rolls out several changes that are supposed to close tax loopholes, among them a “targeted measure” to curtail the use of something called “foreign affiliate dumping transactions.”
The proposals have caught the attention of mining lawyers and other Canadian legal and tax advisors who work with multinational companies that have decided to manage their foreign assets out of Canada.
A joint committee on taxation made up of members of the Canadian Bar Association and the Canadian Institute of Chartered Accountants has filed a submission with the federal Department of Finance to point out some of their concerns with the proposals.