BILL 42

An Act to Amend the Financial Corporation Capital Tax Act

Her Majesty, by and with the advice and consent of the Legislative Assembly of New Brunswick, enacts as follows:

1 Section 2 of the Financial Corporation Capital Tax Act, chapter F-11.1 of the Acts of New Brunswick, 1987, is amended

(a)  by repealing subsection (1) and substituting the following:

Liability for tax and tax payable

2(1) A financial corporation that has a permanent establishment within the Province and whose fiscal year ends on or after April 1, 1987, shall pay to Her Majesty the Queen in right of the Province a tax

(a)  at the rate of 2% of the amount taxable of the financial corporation which rate applies from April 1, 1987, to March 31, 1988, both dates inclusive,

(b)  at the rate of 3% of the amount taxable of the financial corporation which rate applies from April 1, 1988, to March 31, 2012, both dates inclusive, and

(c)  at the rate of 4% of the amount taxable of the financial corporation which rate applies on or after April 1, 2012.

(b)  by repealing subsection (2);

(c)  by repealing subsection (3) and substituting the following:

2(3) If a financial corporation has a fiscal year beginning before April 1, 2012, and ending on or after April 1, 2012, the tax payable by the financial corporation for the fiscal year shall be calculated as follows:

(a)  by dividing the fiscal year into two notional fiscal years, the first ending on March 31, 2012, and the second beginning on April 1, 2012;

(b)  by apportioning the amount taxable between the two notional fiscal years proportionately according to the number of days in each;

(c)  by calculating

(i) tax for the first notional fiscal year in accordance with paragraph (1)(b), and

(ii) tax for the second notional fiscal year in accordance with paragraph (1)(c); and

(d)  by adding together the amounts determined under paragraph (c) and the total is the tax payable in respect of that fiscal year.

2 This Act shall be deemed to have come into force on April 1, 2012.