Tax & Trade Blog

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JURISDICTION IN TAX DISPUTES TRICKY

INTERPRETATION OF APPEAL PROVISIONS CAN BE A COMPLICATED TASK!

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We have previously written about jurisdictional issues between the Tax Court of Canada (“TCC”) and Provincial Superior Courts here. A recent decision of the TCC – Desjardins v. the King, 2026 CCI 109 [Desjardins] – further illustrates the tricky nature of jurisdiction in tax disputes and that getting the forum correct is not a simple task.

In this update to our Tax Appeal Series on jurisdiction in tax disputes, we review the Desjardins decision with a view to highlighting the complicated task of statutory interpretation and its intersection with jurisdiction in tax disputes.

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DRAFT FORCED LABOUR BAN

CANADA TAKING STEPS TO APPEASE UNITED STATES & AVOID TARIFFS

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Our firm has recently written on Canada’s forced labour laws here and here. In a further update to Canada’s legislative regime designed to combat forced labour, Bill C-35 was introduced on June 12, 2026, with the aim of prohibiting the importation of goods produced by forced labour (the “Bill C-35”).

In this report, we review the political background that gave rise to this draft forced labour legislation and outline its contents.

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ALUMINUM SURTAX REPORT

MULTIPLE CANADIAN SURTAXES TARGET CHINESE ALUMINUM

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Like Canada’s steel surtax regime, which we have reported on here and here, Canada also implements a series of surtaxes aimed at imported aluminum goods. In particular, aluminum goods of Chinese origin are a primary target of certain surtaxes – and that might be expected given that China is among the world’s top aluminum manufacturers – and often referred to as the World’s center of gravity in aluminum (currently accounting for over 60% of overall production).

In this Customs & Trade Report, we review Canada’s surtax regime with respect to aluminum products, and some special Anti-Dumping & Countervailing duties (“ADCVD”) rules also impacting aluminum imports under Canada’s Special Import Measures Act (“SIMA”).

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STATUTE OF LIMITATIONS IN TAX AUDITS

WHEN THE FOUR-YEAR RULE DOES - AND DOES NOT - PROTECT YOU

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When it comes to Tax Audits, most Tax Auditors — whether from the federal Canada Revenue Agency (“CRA”) or provincial counterparts auditing for tobacco, fuel or other provincial compliance matters —operate within a four-year general limitation period.

In this Tax Audits Series Report, we review the general statute of limitations rules applicable to tax audits, as well as the key exceptions that allow Tax Auditors to reassess beyond that four-year period.

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CBSA: NO PROVISIONAL DUTIES ON AUSTRIAN OCTG

AN UNUSUAL NO-DUTY RESULT AFTER PRELIMINARY DUMPING DETERMINATION

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On May 4, 2026, the Canada Border Services Agency (“CBSA”) released a notice of its preliminary determination of dumping in respect of Oil and Gas Well Casing 6 originating in or exported from Austria (the “Subject Goods”).

Notably, despite determining an estimated margin of dumping of 22.6% for Voestalpine Tubulars GmbH & Co KG, the CBSA has decided NOT to impose provisional duties on imports of the Subject Goods at this stage of the investigation.

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STRICTER FORCED-LABOUR REGIME AHEAD?

CANADA TO STRENGTHEN FORCED LABOUR REGIME UNDER U.S. TARIFF PRESSURE

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Forced-labour compliance has been a growing issue for Canadian importers for several years.  While Canada already has import restrictions on forced-labour products in place, the federal government is now looking to strengthen that regime further — this time under U.S. tariff pressure.

On June 2, 2026, the United States Trade Representative (“USTR”) announced that Canada had failed to effectively enforce prohibitions on goods made with forced labour.  Accordingly, the USTR has proposed an additional 10% tariff on goods from Canada.

In response, Canada has indicated that new legislation will soon be introduced to make that regime even stronger.  For importers, this is a clear signal that the forced-labour rules may become stricter.

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TCC POWERLESS OVER CRA COLLECTIONS

CRA FREE TO GARNISH UNREMITTED GST/HST - EVEN WITH TCC APPEAL PENDING

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In the recent Tax Court of Canada (“TCC”) decision Harris v. The King, 2026 TCC 89 (“Harris”), a taxpayer assessed for unremitted GST/HST learned the hard way about the Canada Revenue Agency’s (“CRA”) extremely broad Collection Rights.

In this Tax Audits Series we review the Harris decision and the key differences it highlights between the CRA’s ability to collect GST/HST debts and Income Tax debts – and why it demonstrates that retaining Experienced Tax Counsel at the front-end of the audit process can help avoid harsh collections action later on.

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NEW CRA GUIDANCE ON PROVINCE OF SUPPLY

CRA’S POLICIES ON PROVINCE OF SUPPLY RULES NOW FOUND IN NEW D-MEMO SERIES

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Determining the province in which a supply occurs is a fundamental requirement for GST/HST compliance, because it dictates the applicable tax rate: 5% GST, 13% GST/HST in Ontario, 14% GST/HST in Nova Scotia, or 15% GST/HST in the remaining Atlantic provinces.

The rules for determining the provincial place of supply have not changed, but the Canada Revenue Agency (“CRA”) recently updated its applicable published guidance on these rules, meaning there are now new sources to be consulted when dealing with these issues.

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DIRECTORS’ LIABILITY FOR UNREMITTED GST/HST

RESIGNING AS DIRECTOR TO AVOID CORPORATE INDIRECT TAX LIABILITY A TRICKY TASK

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The GST/HST framework under the Excise Tax Act (“ETA”), as with other indirect tax regimes (like federal and provincial alcohol, tobacco and vaping taxes) includes “directors’ liability” provisions that are triggered when the corporation does not have the money to pay an assessed amount. Most of these systems have “statutory limitation rules” and “due diligence defences” which may limit liability, but these rules are extremely tricky to apply in practice.

We review these in a two-part series here, with reference to the helpful recent case Stevens v. The King, 2026 TCC 76 (“Stevens”), which revolves around this directors’ liability framework.

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THE DUE DILIGENCE DEFENCE & DIRECTORS’ LIABILITY

PROVING DUE DILIGENCE TO AVOID DIRECTORS’ GST/HST LIABILITY NO EASY FEAT!

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The GST/HST framework under the Excise Tax Act (“ETA”), as with other indirect tax regimes (like federal and provincial alcohol, tobacco and vaping taxes) includes “directors’ liability” provisions that are triggered when the corporation does not have the money to pay an assessed amount. Most of these systems have “due diligence defences” and “statutory limitation rules” which may limit a director’s liability, but these rules are tricky to apply in practice.

We review these rules in a two-part series, with reference to the recent case Stevens v. The King, 2026 TCC 76 (“Stevens”), which revolves around this directors’ liability framework.

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UNCLAIMED GST ITCs ALLOWED ON REASSESSMENT

TCC CONFIRMS CRA MUST ACCOUNT FOR UNCLAIMED CARRIED-FORWARD ITCs

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In a long-running GST/HST issue, the question has been whether the Minister’s obligation to “audit to net tax” requires CRA to take into account ALL unclaimed Input Tax Credits (“ITCs”) carried forward to a particular reporting period under audit. In the past, CRA maintained that its obligation under section 296(2) of the Excise Tax Act (“ETA”) only required it to allow unclaimed ITCs for the particular reporting period under audit and not any that may have then remained unclaimed from prior periods.

In a seismic decision of Justice Visser of the Tax Court of Canada ("TCC"), the TCC has now answered that question in favour of all Canadian GST registrants — a decision which we review below.

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SIMA 裁定：碳钢紧固件

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SIMA Ruling: Carbon Steel Fasteners

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2023年9月29日，加拿大边境服务署 (CBSA) 发布了一项 范围裁定， 认定 National Nail公司 的 隐藏式露台螺钉属于加拿大国际贸易法庭 (CITT) 发布的期终复审令所涵盖的货物范围。该复审令涉及来自中国及中国台北的某些碳钢紧固件的倾销，以及来自中国的某些碳钢紧固件的补贴。

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钢板桩用钢管反倾销措施期终复审！

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Steel Piling Pipe Expiry Review!

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2023年3月13日，加拿大国际贸易法庭（CITT）发布 通告，称其正对原产于或出口自中国的某些钢板桩管启动期终复审。任何希望参与该期终复审的人，必须在 2023年3月28日前提交参与通知！

国内生产商和出口商均应考虑参与该期终复审，因为对于未取得正常价值的货物，目前的反倾销税 (ADDs) 为 96.4%，反补贴税 (CVD) 为每公吨 641.35 元人民币！

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CANADA EXTENDING SURTAX REGIMES

DOF CONFIRMS EXTENSIONS INCOMING ON STEEL SURTAXES & RELATED RELIEF

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A recent Department of Finance Canada (“DOF”) news release has confirmed that Canada will be extending certain steel surtaxes and horizontal tariff relief for imported steel goods. The putative aim behind these extensions is to “defend steel workers and industry against steel trade diversion” and “provide producers and importers with greater business predictability and longer-term certainty”.

In this Steel Industry Report, we review which surtaxes and remission categories are set to be extended in the near future.

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WILFUL BLINDNESS: SAME AS ACTUAL KNOWLEDGE

TO TAXPAYER'S CHAGRIN, "SHOULD HAVE KNOWN" SAME AS KNOWLEDGE

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In over 35 years of tax practice, we have had more than a few inquiries from taxpayers facing CRA Audits and Assessments maintaining that they did not actually know they were non-compliant with their tax obligations. The doctrine of “wilful blindness” is something that these taxpayers would have benefitted from understanding: that is the ability that Canada Revenue Agency (“CRA”) and the Tax Court of Canada (“TCC”) have to equate “knowledge” with “information that the taxpayer should have known but was perhaps ‘wilfully blind’ to”.

In this Tax Audit Series Report, we discuss the doctrine of “wilful blindness” and a recent TCC decision that upheld some $1.3 million in penalties and interest, on the basis that the taxpayer was wilfully blind to his tax non-compliance.

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PROVISIONAL DUTIES ON FORGED GRINDING MEDIA

CBSA ISSUES PRELIMINARY DETERMINATION ON FORGED GRINDING MEDIA FROM CHINA

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On May 25, 2026, the Canada Border Services Agency (“CBSA”) released a notice of its preliminary determination of dumping and subsidizing in respect of forged grinding media originating in or exported from the People’s Republic of China (the “Subject Goods”). Provisional duties are now imposed on imports of the Subject Goods released from the CBSA on or after May 25, 2026.

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GST 201: BAD DEBT GST RECOVERY HAS STRICT RULES

SEVERAL CONDITIONS MUST BE MET TO RECOVER TAX PAID ON UNCOLLECTIBLE DEBT

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For businesses dealing with unpaid invoices, section 231 of the Excise Tax Act (ETA) offers a vital form of relief: the ability to recover GST/HST previously remitted on debts that have become uncollectible. However, as the recent Tax Court of Canada (TCC) decision Heydary Green Professional Corporation v. The King, 2026 TCC 69 (“Heydary”) demonstrates, this relief is only available to those who strictly adhere to the ETA’s technical requirements.

In this GST 201 Series blog, we review section 231 and the statutory rules for bad debts, as well as what Heydary shows about the process that must be followed to benefit from this section.

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CITT FINDING: DUMPING OF OCTG – AGAIN!

OCTG FROM MEXICO, THE PHILIPPINES, TÜRKIYE, SOUTH KOREA & USA

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On April 21, 2026, the Canadian International Trade Tribunal (the “CITT”) announced its Finding in Inquiry NQ-2025-007 (the “Finding”) reporting that the dumping of Oil Country Tubular Goods (“OCTG”) originating in or exported from the United Mexican States, Republic of the Philippines, and originating in the following countries (the “Subject Goods”):

• the Republic of Türkiye (by or on behalf of Borusan Mannesmann Boru Sanayi ve Ticaret A.Ş.);
• the Republic of Korea (by or on behalf of Hyundai Steel Company); and
• the United States of America (by or on behalf of Tenaris S.A).

New Anti-Dumping Duties (“ADDs”) now apply to the Subject Goods imported into Canada and released after April 21, 2026.

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AUDIT WAIVERS: GENERALLY A BAD IDEA?

AGREEING TO WAIVING AN AUDIT LIMITATION PERIOD COMES WITH SEVERAL RISKS

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When it comes to Tax Audits, most Tax Auditors — whether the federal Canada Revenue Agency (CRA) or its counterparts auditing for tobacco, fuel or other provincial compliance matters — are operating with one particular deadline in mind: a three or four-year limitation period governing what the Auditor can review and assess.

When Tax Audits are conducted late in that period, Tax Auditors will typically request Audit Waivers to provide themselves with additional time to complete their audits and issue assessments.

In this Tax Audits Series Report, we review what Audit Waivers are, how they operate, and why they can often be a very bad idea for the taxpayers and businesses agreeing to them.

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EMPLOYER HEALTH TAX: RELATED PARTY RULES

INCOME TAX RULES REIGN, BUT AS INTERPRETED BY ONTARIO?

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Ontario’s Employer Health Tax Act (the “Act” and the “EHT”) regime contains important associated-employer and related-party rules impacting things like EHT Exemptions and the calculation of payroll thresholds, as well as ultimate EHT liability. While the rules borrow heavily from Income Tax Act (“ITA”) definitions and concepts, the application of the rules in the EHT context is not always straight-forward and often influenced by administrative interpretation.

In this Indirect Tax Report, we review the EHT associated-employer variation of these rules and highlight practical difficulties arising when income tax concepts are applied for provincial purposes.