Section 87 Indian Act
The Indian Act in Canada, is the principal statute dealing with status Indians, their bands and the system of Indian reserves. The Act is wide raning in scope including resource development, governance, fiscal management and many other major policies. It is still regarded as one of the primary documents which rules how the Government of Canada interacts with first nations and their members. Section 87 is one of the most important policies enacted via the Indian Act regarding tax exemption.
Under an appropriate connecting factors test and a further principled approach to Section 87 of the Indian Act, Indians’ property can be exempt from taxation. Currently, the statutory tax exemption for Indians are determined in respect
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(2)No Indian or band is subject to taxation in respect of the ownership, occupation, possession or use of any property mentioned in paragraph (1)(a) or (b) or is otherwise subject to taxation in respect of any such property.
(3) No succession duty, inheritance tax or estate duty is payable on the death of any Indian in respect of any property mentioned in paragraphs (1)(a) or (b) or the succession thereto if the property passes to an Indian, nor shall any such property be taken into account in determining the duty payable under the Dominion Succession Duty Act, chapter 89 of the Revised Statutes of Canada, 1952, or the tax payable under the Estate Tax Act, chapter E-9 of the Revised Statutes of Canada, 1970, on or in respect of other property passing to an Indian.
2. Practical Effects on Income
Under section 87, income earned on a reserve is tax exempt1. Although on its face it seems like unambiguous provision in practice the application can be quite complex. This section applies to all sources of income as stated in the Income Tax Act. There are many outside factors to consider when deciding if income was earned on a reserve2. Common law precedents, and Canada Revenue Agency (CRA) guidelines have defined application of this section the following
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Furthermore, there are many First Nations who have lost this eligilbility through negotiated self-government treaties.
3.1 Revenue Canada’s New Policy
The new policy introduced by Revenue Canada says that that those working for an on-reserve employer is no longer except from income tax. * The policy, introduced in 1995 as an amendment, at the time has affected over 3000 aboriginal citizens and faced much resistance and protest. There were no more modifications on this aspect since. 3.2 Misconceptions
Contrary to common belief, First Nation members are not exempt from taxes, but depending on what kind of business it is, who the employer is, and where it is situated, they may be eligible for some exceptions. There is a widespread misunderstanding because the Canadian government’s takeover of land, that First Nations community is exempt from provincial taxes because they are at a disadvantaged position. However, there is much to be investigated than making general
The Indian Act is a combination of multiple legislations regarding the Aboriginal people who reside across Canada, such as the Gradual Civilization Act of 1857 and the Gradual Enfranchisement Act of 1869 (Hanson, n.p.). The Gradual Civilization Act was the Canadian government's attempt to assimilate the aboriginals into the Canadian society in a passive manner, through a method they encouraged called Enfranchisement. Enfranchisement is basically a legal process that allows aboriginals to give up their aboriginal status and accept a Canadian status (Crey, n.p.). This process, while under the Gradual Civilization Act, was still voluntary, but became a forced process when the Indian Act was consolidated in 1876 (Hanson, n.p.). The Gradual Enfranchisement Act introduced in 1869 was a major legislation that intruded with the private lives of the aboriginals. First, it established the “elective band council system” (Hanson, n.p.) that grants th...
The failure of the Bureau of Indian Affairs to manage this trust fund properly led to legislation and lawsuits in the 1990s and early 2000s to force the government to properly account for the revenues collected. The aim of the act was to encourage American Indians to take up agriculture and adopt the habits of civilized life and ultimately.... ... middle of paper ... ...upon the survey of the lands so as to conform thereto; and patents. shall be issued to them for such lands in the manner and with the restrictions as provided herein.
Members of the Canadian government and the Indigenous people signed Treaty 6 in 1876. Treaty 6 was “a formal and binding contract between two nations” that would help deal with important matters. Treaty negotiations included land, education, healthcare, government funding, and more. The treaty was created to help benefit both parties – the Canadian government, and the Indigenous people. However, the Canadian government broke this treaty many times. In the mid 1880’s there w...
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After several generations of Indian people being subjected to discrimination, abuse, and neglect by government authorities. It is hard to deny that in many ways the government policies set in place generations ago to eliminate Canada of Indian culture, have been successful.
Our Indian legislation generally rests on the principle, that the aborigines are to be kept in a condition of tutelage and treated as wards or children of the State. …the true interests of the aborigines and of the State alike require...
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Fleras, Augie. “Aboriginal Peoples in Canada: Repairing the Relationship.” Chapter 7 of Unequal Relations: An Introduction to Race, Ethnic and Aboriginal Dynamics in Canada. 6th ed. Toronto: Pearson, 2010. 162-210. Print.
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