TITLE:

The Income Tax Act, the Excise Tax Act and the Term Interest: An Interesting Case for Harmonization

AUTHOR(S): 

Lamoureux, Martin

EDITOR:

This research report inspired an article that was published in:

• Lamoureux, Martin, “The Income Tax Act, The Excise Tax Act and the Term Interest:  An Interesting Case for Harmonization”, The Harmonization of Federal Legislation with Quebec Civil Law and Canadian Bijuralism – Collection of Studies in Tax Law, Montreal, Association de planification fiscale et financière, 2002, pp. 7 :1-38.

PAGE(S):

SERIE(S):

The Harmonization of Federal Legislation with Quebec Civil Law and Canadian Bijuralism – Collection of Studies in Tax Law

SUBJECT(S):

Canadian Bijuralism
Tax law

ABSTRACT:

The abstract is inspired, in part, from the one found in The Harmonization of Federal Legislation with Quebec Civil Law and Canadian Bijuralism – Collection of Studies in Tax Law.

The purpose of this study is to find a French equivalent of the term “interest” as it is used under British common law, to harmonize it with the civil law legal system and finally, to propose a French equivalent for the term “interest” for the common law audience.  To harmonize the term “interest” with the civil law, one must obviously find its civil law equivalent.  As a prerequisite, we must define the term “interest” in its technical sense at common law and superimpose such a definition over its closest Quebec civil law equivalent.  This would put us in a position to suggest an equivalent term that is not only respectful of the federal Parliament’s intent, but that also reflects the spirit of the law of each Canadian province. 

TABLE OF CONTENTS:

INTRODUCTION

1. THE TECHNICAL MEANING OF THE TERM “INTEREST”: SIGNIFICANT NOTABLE DISTINCTIONS

1.1 THE INFLUENCE AND IMPORTANCE OF THE CONTEST USED TO LIMIT THE NOTION OF INTEREST

1.2 THE Common law AND THE SCOPE OF THE TERM “INTEREST” (INTÉRêT)

1.2.1 The general meaning of “interest” (intérêt)

1.2.2 The technical meaning of “interest” (intérêt)

1.3 ITA AND ETA PROVISIONS INCORPORATING THE TERM “INTEREST” (INTÉRêT) WHICH ARE NOT PROBLEMATIC, BUT WHICH MUST BE DISTINGUISHED

1.3.1 Interest in a business

1.3.2 Interest in a life insurance policy

1.3.3 Interest in an obligation

2. PART ONE:  HARMONIZATION OF THE TERM “INTEREST” WITH THE TERMINOLOGY OF THE COMMON LAW IN FRENCH

2.1 The general meaning of the term “right” (droit)

2.2 THE TECHNICAL MEANING OF THE WORD “RIGHT” (DROIT)

2.3 LICENCE – AN EXAMPLE IN WHICH THE TERM “DROIT” HAS A BROADER SCOPE THAN THE TERM “INTEREST”

2.4 RECOMMENDATION CONCERNING THE TRANSLATION OF THE TERM “INTEREST” TO HARMONIZE IT WITH COMMON LAW IN FRENCH

3. PART TWO:  IDENTIFICATION OF PROBLEM PROVISIONS IN THE ITA AND ETA

4. PART THREE:  THE QUEBEC CIVIL LAW EQUIVALENT OF THE TERM "INTÉRêT": "REAL RIGHT"

4.1 OBJECTIVES OF THE HARMONIZATION OF THE TERM "INTEREST" (INTÉRêT) TO MAKE IT ACCESSIBLE TO THE FRENCH AND ENGLISH LANGUAGE AUDIENCES OF THE PROVINCE OF QUEBEC

4.2 THE NOTION OF "INTEREST" (INTÉRêT) IN THE QUEBEC CIVIL LAW TRADITION

4.3 THE BASIC CHARACTERISITCS OF THE RIGHT OF OWNERSHIP IN CIVIL LAW

4.4 THE RIGHT OF OWNERSHIP AND THE NOTION OF REAL RIGHT

4.4.1 definition of a real right

4.4.2 Dismemberments of the right of ownership in civil law in Quebec civil law

4.4.3 The right of ownership, Quebec civil law and the common law: comparing basic concepts

4.4.4 Tax problems arising from the conceptual differences between a trust, a usufruct and a substitution

4.4.5 Parliament's solution to these problems

4.5 REAL RIGHT: OUR PROPOSED SOLUTION FOR THE HARMONIZATION OF THE TERM "INTEREST" (INTÉRêT)

5. PART FOUR:  CONCEPTUAL SIMILARITIES AND DIFFERENCES BETWEEN THE NOTIONS OF "INTEREST" (INTÉRêT) AND "REAL RIGHT" (DROIT RÉEL)

6. PART FIVE: DEFINITION OF THE TERMS "INTEREST" AND "REAL RIGHT" IN THE ITA AND ETA

6.1 RECOMMENDATIONS RELATING TO THE DEFINITIONS OF THE TERMS "INTEREST" (INTÉRêT) AND "REAL RIGHT" (DROIT RÉEL) IN THE ITA AND ETA

6.2 A DEFINITION WHICH SETS THE PARAMETERS FOR THE APPLICATION OF THE NOTION OF "INTEREST" (INTÉRêT)

6.3 ADOPTING THE COMMON LAW DEFINITION OF "INTEREST" (INTÉRêT)

6.4 ADOPTING THE CIVIL LAW DEFINITION OF "REAL RIGHT" (DROIT RÉEL)

CONCLUSION

SCHEDULE 1

BIBLIOGRAPHY