Insights

Canada: Supreme Court Clarifies Federal Court's Role in Tax Disputes

Laurie Goldbach 12 Jul 2024

An overview by Borden Ladner Gervais, Taxand Canada

Laurie Goldbach and Laura Jochimski from Borden Ladner Gervais, Taxand Canada, have analysed two Supreme Court of Canada decisions that clarify when tax disputes should be handled by the Federal Court rather than the Tax Court of Canada.

The rulings state that if a case involves reviewing a decision made at the discretion of the Minister, it must go to the Federal Court, even if it’s related to tax assessments. This follows the review standards set by a previous case.

Key points include:

• The current jurisdictional boundary between the TCC and FC has been confirmed: tax disputes regarding discretionary matters, including the decision-making process itself, remain under the exclusive purview of the FC.
• Even though the TCC is a specialized court for tax matters, not all aspects of a tax dispute can be tried by the TCC. In particular, the TCC does not have the jurisdiction to review disputes involving a challenge to the exercise of ministerial discretion. Such challenges can only be made in the FC.
• The SCC judgments in Dow and Iris confirm the standard of review principles established in Vavilov apply in the context of tax disputes.

Read the full article here.

Article tags

Canada | Tax Law | Tax Policy