Taxpayers’ Fairness Act comes into force as province works to end CP Rail exemption

Saskatchewan’s Taxpayers’ Fairness (CPR) Act came into force Friday to help end what the provincial government calls an unfair tax exemption.

The act was passed unanimously during the Legislature’s spring session, and applies retroactively from Aug. 29, 1966.

The goal is to bring Canadian Pacific Railway in line with other companies when it comes to provincial tax rules.

CPR is currently suing Saskatchewan, aiming to get back $341 million in taxes paid by citing a clause which first appeared in an 1880 contract between Canada and the railway company’s predecessor. The contentious legal battle has been going on for some time.

The act states that “any taxes imposed on, collected from or paid by the CPR Company are conclusively deemed to have been validly imposed, collected or paid for all purposes.”

In a statement, Justice Minister Bronwyn Eyre said the act will help level the playing field for all companies that do business in Saskatchewan.

“We always want to ensure that the people of Saskatchewan receive their fair share from companies doing business in our province,” Eyre said.

“The argument that any company is exempt from taxation is unfair to taxpayers and other businesses that operate here.”

In addition to the lawsuit against the Saskatchewan government, CPR has also sued the federal government and the provincial governments of Alberta and Manitoba.

The lawsuit against Canada was dismissed by a federal court in September, the province noted, and the lawsuits against Alberta and Manitoba have not yet proceeded to trial.

The Taxpayers’ Fairness (CPR) Act is the third piece of legislation passed recently to try to address the exemption, following a constitutional amendment to the Saskatchewan Act passed by the Legislative Assembly as well as the House of Commons and Senate, and provisions in the federal Budget Implementation Act, passed in Ottawa last month.