Sample Laws under the First Nations Fiscal Management Act

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___________________________ FIRST NATION PROPERTY TAXATION LAW, 20__ (QUEBEC) TABLE OF CONTENTS PART I Citation ........................................................................................................................ PART II Definitions and References ......................................................................................... PART III Administration ............................................................................................................ PART IV Liability for Taxation .................................................................................................. PART V Exemptions from Taxation.......................................................................................... PART VI Grants .......................................................................................................................... PART VII Levy of Tax ................................................................................................................. PART VIII Tax Roll and Tax Notice ............................................................................................. PART IX Payment Receipts and Tax Certificates ...................................................................... PART X Penalties and Interest .................................................................................................. PART XI Revenues and Expenditures ........................................................................................ PART XII Collection and Enforcement........................................................................................ PART XIII Seizure and Sale of Personal Property ........................................................................ PART XIV Seizure and Assignment of Taxable Property ............................................................. PART XV Discontinuance of Services ......................................................................................... PART XVI General Provisions ...................................................................................................... SCHEDULES I Request for Information by Tax Administrator II Tax Notice III Costs Payable by Debtor Arising from the Collection and Enforcement of Unpaid Taxes IV Tax Certificate V Tax Arrears Certificate VI Notice of Seizure and Sale of Personal Property VII Notice of Sale of Seized Personal Property VIII Notice of Seizure and Assignment of Taxable Property IX Notice of Sale of a Right to Assignment of Taxable Property X Notice of Discontinuance of Services

WHEREAS: A. Pursuant to section 5 of the First Nations Fiscal Management Act, the council of a first nation may make laws respecting taxation for local purposes of reserve lands and rights in reserve lands;

B. The Council of the _____________________ First Nation deems it to be in the best interests of the First Nation to make a law for such purposes; and

C. The Council of the ___________________ First Nation has given notice of this law and has considered any representations received by the Council, in accordance with the requirements of the First Nations Fiscal Management Act;

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NOW THEREFORE the Council of the _____________________ First Nation duly enacts as follows: PART I CITATION Citation 1. This Law may be cited as the ____________ First Nation Property Taxation Law, 20___ . PART II DEFINITIONS AND REFERENCES Definitions and References 2.(1) In this Law: “Act” means the First Nations Fiscal Management Act, S.C. 2005, c. 9, and the regulations enacted under that Act;

“adjusted assessed value” has the meaning given to that term in the Assessment Law; “assessed value” has the meaning given to that term in the Assessment Law; “Assessment Law” means the ______ First Nation Property Assessment Law, 20___ ; “Assessment Review Board” means the assessment review board established under the Assessment Law; “assessment roll” has the meaning given to that term in the Assessment Law; “assessor” means a person appointed to that position under the Assessment Law; “child” includes a child for whom a person stands in the place of a parent; “Council” has the meaning given to that term in the Act; “debtor” means a person liable for unpaid taxes imposed under this Law; “expenditure law” means an expenditure law enacted under paragraph 5(1)(b) of the Act; “First Nation” means the ___________ First Nation, being a band named in the schedule to the Act; “First Nation Entity” means (a) a corporation in which the First Nation beneficially holds, directly or indirectly, shares (i) having not less than fifty percent (50%) of the votes that could be cast at an annual meeting of the shareholders of the corporation, or

(ii) having not less than fifty percent (50%) of the fair market value of all of the issued shares of the capital stock of the corporation; or

(b) a partnership in which the First Nation beneficially owns, directly or indirectly, (i) not less than fifty percent (50%) of all voting rights of the partnership, or (ii) interests in the partnership having not less than fifty percent (50%) of the fair market value of all of the interests in the partnership;

“holder”, in relation to a right in reserve lands, means a person (a) in possession of the right, (b) entitled through a lease, licence or other legal or contractual means to the right, (c) in de facto occupation of reserve lands, or any other immovable situated on reserve lands, or (d) who is a trustee of the right;  

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“immovable” means (a) an immovable within the meaning of article 900 of the Civil Code of Québec, and (b) a movable that is permanently attached to an immovable referred to in paragraph (a), and includes a building or structure that is erected or placed in, on, over or under land; “improvement” means any thing, other than land, that is included in the definition of “immovable”; “local revenue account” means the local revenue account referred to in section 13 of the Act; “locatee” means a person who is in lawful possession of reserve lands under subsections 20(1) and (2) of the Indian Act;

“movable” means a movable within the meaning of the Civil Code of Québec; “Notice of Discontinuance of Services” means a notice containing the information set out in Schedule X; “Notice of Sale of a Right to Assignment of Taxable Property” means a notice containing the information set out in Schedule IX;

“Notice of Sale of Seized Personal Property” means a notice containing the information set out in Schedule VII;

“Notice of Seizure and Assignment of Taxable Property” means a notice containing the information set out in Schedule VIII;

“Notice of Seizure and Sale” means a notice containing the information set out in Schedule VI; “person” means any person, and any group of persons or assets, such as a partnership, association or trust; “personal property” has the same meaning as a movable; “property class” has the meaning given to that term in the Assessment Law; “Province” means the province of Quebec; “registry” means any land registry in which rights in reserve lands are registered; “related individual” means, in respect of a member of the First Nation, (a) that member’s spouse, child, grandchild, great-grandchild, parent, grandparent, great-grandparent or guardian,

(b) the spouse of that member’s parent, grandparent, great-grandparent, child, grandchild or great-grandchild, or

(c) the child, grandchild, great-grandchild, parent, grandparent or great-grandparent of that member’s spouse;

“reserve” means a reserve of the First Nation within the meaning of the Indian Act; “resolution” means a motion passed and approved by a majority of Council present at a duly convened meeting;

“right”, in relation to reserve lands, means any right of any nature in or to the lands, including any right to occupy, possess or use the lands and any right of a lessee, but does not include title to the lands that is held by her Majesty;

“spouse” includes a common law partner within the meaning of the Indian Act; “tax administrator” means a person appointed by Council under subsection 3(1) to administer this Law; “Tax Arrears Certificate” means a certificate containing the information set out in Schedule V; “Tax Certificate” means a certificate containing the information set out in Schedule IV;

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“Tax Notice” means a notice containing the information set out in Schedule II; “tax roll” means a list prepared pursuant to this Law of persons liable to pay tax on taxable property; “taxable property” means a right in reserve lands that is subject to taxation under this Law; “taxation year” means the calendar year to which an assessment roll applies for the purposes of taxation; “taxes” include (a) all taxes imposed, levied, assessed or assessable under this Law, and all penalties, interest and costs added to taxes under this Law, and

(b) for the purposes of collection and enforcement, all taxes imposed, levied, assessed or assessable under any other local revenue law of the First Nation, and all penalties, interest and costs added to taxes under such a law; and

“taxpayer” means a person liable for taxes in respect of taxable property. (2) For greater certainty, a right, in relation to reserve lands, includes improvements. (3) In this Law, references to a Part (e.g. Part I), section (e.g. section 1), subsection (e.g. subsection 2(1)), paragraph (e.g. paragraph 3(4)(a)) or Schedule (e.g. Schedule I) is a reference to the specified Part, section, subsection, paragraph or Schedule of this Law, except where otherwise stated.

PART III ADMINISTRATION Tax Administrator 3.(1) Council must, by resolution, appoint a tax administrator to administer this Law on the terms and conditions set out in the resolution.

(2) The tax administrator must fulfill the responsibilities given to the tax administrator under this Law and the Assessment Law.

(3) The tax administrator may, with the consent of [insert title], assign the performance of any duties of the tax administrator to any officer, employee, contractor or agent of the First Nation.

(4) The tax administrator’s responsibilities include (a) the collection of taxes and the enforcement of payment under this Law; and (b) the day-to-day management of the First Nation’s local revenue account. PART IV LIABILITY FOR TAXATION Application of Law 4. This Law applies to all rights in reserve lands. Tax Liability 5.(1) Except as provided in Part V, all rights in reserve lands are subject to taxation under this Law. (2) Taxes levied under this Law are a debt owed to the First Nation, recoverable by the First Nation in any manner provided for in this Law.

(3) Taxes are due and payable under this Law notwithstanding any proceeding initiated or remedy sought by a taxpayer respecting his or her liability to taxation under this Law.

(4) Any person who is a holder of taxable property in any taxation year is liable to the First Nation for all taxes imposed on that taxable property under this Law during the taxation year and for all unpaid taxes imposed in a previous taxation year, including, for greater certainty, interest, penalties and costs as provided

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in this Law. Tax Refunds 6.(1) Where a person is taxed in excess of the proper amount in a taxation year, the tax administrator must refund to that person any excess taxes paid by that person.

(2) Where a person is entitled to a refund of taxes, Council may direct the tax administrator to refund the amount in whole or in part by applying it as a credit on account of taxes or other unpaid amounts that are due or accruing due to the First Nation in respect of taxable property held by that person.

(3) Where a person is entitled to be refunded an amount of taxes paid under this Law, the tax administrator must pay the person interest as follows:

(a) interest accrues from the date that the taxes were originally paid to the First Nation; (b) the interest rate during each successive three (3) month period beginning on January 1, April 1, July 1 and October 1 in every year, is two percent (2%) below the prime lending rate of the principal banker to the First Nation on the 15th day of the month immediately preceding that three (3) month period;

(c) interest will not be compounded; and (d) interest stops running on the day payment of the money owed is delivered or mailed to the person to whom it is owed, or is actually paid.

PART V EXEMPTIONS FROM TAXATION Exemptions [Note to First Nation: The First Nation should determine what, if any, exemptions it wishes to provide in its Law. Refer to the Taxation Law Standards for further information and limitations on the types of exemptions that may be included. The following are examples of exemptions a First Nation may wish to consider in its Law.

7.(1) The following rights in reserve lands are exempt from taxation under this Law to the extent indicated:

(a) subject to subsections (2) and (3), a right held or occupied by the First Nation, a First Nation Entity, or a member of the First Nation;

(b) a right occupied as a residence by one (1) or more members of the First Nation and related individuals of those members and by no other persons;

(c) a right held by a school board, a general or vocational college, or a university establishment; (d) a right held by an episcopal corporation, a religious institution or a church and principally used for public worship;

(e) a right held by a public institution for the provision of health services or social services; (f) a right held by a cooperative or a non-profit organization that is used primarily as a childcare centre, daycare centre or coordinating office; and

(g) a right held by a non-profit corporation and used as a private educational institution; and (h) a right used as a cemetery, not operated for profit. (2) Where a right in reserve lands is held by the First Nation, a First Nation Entity or a member of the First Nation, as the case may be, and is wholly occupied by a person who is not the First Nation, a First Nation Entity or a member of the First Nation,

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(a) the exemption in paragraph (1)(a) does not apply to the person who is not the First Nation, a First Nation Entity or a member of the First Nation;

(b) that person is responsible for the taxes levied in respect of the right; and (c) the taxes are a liability only on that person. (3) Where a right in reserve lands is occupied by the First Nation, a First Nation Entity or a member of the First Nation and is also occupied by a person who is not the First Nation, a First Nation Entity or a member of the First Nation,

(a) the exemption in paragraph (1)(a) does not apply to that person; (b) taxes under this Law must be levied in respect of that person’s proportionate occupation of the right; and

(c) the taxes are a liability only on that person. (4) An exemption in paragraph (1)(c) to (h) applies only to that portion of the right that is used for the purposes for which the exemption is given.

(5) Where subsection (4) applies to a right that is a portion of a building, the exemption also applies to a proportionate part of the land on which the building stands.

[Note to First Nation: Subsection (4) may be added on its own; however, subsection (5) can only be added if subsection (4) has been added.]]

PART VI GRANTS [Note to First Nation: The First Nation should consider what, if any, grants it wishes to provide in its law. The qualifying requirements for grants must be set out in this Law, with the amounts to be determined each year in an expenditure law. The following are examples of possible grants.

Annual Grants 8.(1) Council may provide for a grant to a holder of taxable property (a) where the holder is a charitable, philanthropic or other not-for-profit corporation, and Council considers that the property is used for a purpose that is directly related to the purposes of the corporation; and

(b) [set out qualifying criteria for other grant programs]. (2) Grants provided under subsection (1) (a) may be given only to a holder of taxable property that is taxable in the current taxation year; (b) must be in an amount equal to or less than the taxes payable on the taxable property in the current taxation year, less any other grants; and

(c) must be used only for the purposes of paying the taxes owing on the taxable property in the current taxation year.

(3) Council may provide for a grant to holders of entirely residential rights in reserve lands who would be entitled to a grant under Division I.1 of Chapter XVIII of the Act Respecting Municipal Taxation (Quebec) if the holder’s taxable property were located off the reserve.

(4) A grant under subsection (3) must be in an amount that is not more than the amount to which a person would be entitled under the Act Respecting Municipal Taxation (Quebec) if the holder’s taxable property was subject to property taxation by the Province.

(5) Council will in each taxation year determine all grants that will be given under this Part and

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will authorize those grants in an expenditure law. PART VII LEVY OF TAX Tax Levy 9.(1) On or before __________ in each taxation year, Council must adopt a law setting the rate of tax to be applied to each property class. [Note to First Nation: Please insert a fixed date by which your rates law will be made each year. Local governments in Quebec generally set rates between November 15 and March 1.]

(2) A law setting the rate of tax may establish different tax rates for each property class. (3) Taxes must be levied by applying the rate of tax against each one hundred dollars ($100) of assessed value or adjusted assessed value of the right in reserve lands, as applicable, in accordance with the Assessment Law.

(4) Taxes levied under this Law are deemed to be imposed on January 1 of the taxation year in which the levy is first made.

(5) Notwithstanding subsection (3), Council may establish, in its annual law setting the rate of tax, a minimum tax payable in respect of a taxable property.

(6) A minimum tax established under the authority of subsection (5) may be established in respect of one or more property classes.

Tax Payments [Note to First Nation: In Quebec, a municipality must allow for taxes to be paid by installment where those taxes are greater than three hundred dollars ($300). The First Nation may choose to provide for payment by installments, in which case these tax payment provisions must be altered.]

10.(1) Taxes are due and payable on or before __________ of the taxation year in which they are levied. [Note to First Nation: Please insert a fixed date by which taxes are due. There must be at least thirty (30) days between giving the tax notice and the tax due date.]

(2) Taxes must be paid at the office of the First Nation during normal business hours, by cheque, money order or cash.

(3) Payment of taxes made by cheque or money order must be made payable to the ________ First Nation.

PART VIII TAX ROLL AND TAX NOTICE Tax Roll 11.(1) On or before _________ in each taxation year, the tax administrator must create a tax roll for that taxation year. [Note to First Nation: Please insert a fixed date by which your tax roll will be completed in each year.]

(2) The tax roll must be in paper or electronic form and must contain the following information in respect of each right in reserve lands:

(a) a description of the right as it appears on the assessment roll; (b) the name and address of the holder entered on the assessment roll with respect to the right, or the word “unknown” if the holder is unknown;

(c) the name and address of every person entered on the assessment roll with respect to the right;

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(d) the assessed value by classification of the land and the improvements comprising the right as it appears in the assessment roll, exclusive of exemptions, if any;

(e) the adjusted assessed value of the right for the current taxation year, if different from the assessed value;

(f) the amount of taxes levied on the right in the current taxation year under this Law; and (g) the amount of any unpaid taxes from previous taxation years. (3) The tax administrator may use the certified assessment roll as the tax roll by adding the following information to the assessment roll:

(a) the amount of taxes levied on the right in the current taxation year under this Law; and (b) the amount of any unpaid taxes from previous taxation years. Annual Tax Notices 12.(1) On or before March 1 in each taxation year, the tax administrator must mail a Tax Notice to (a) subject to subsection (4), each holder of taxable property under this Law, and (b) each person whose name appears on the tax roll in respect of the taxable property, to the address of the person as shown on the tax roll. (2) The tax administrator must enter on the tax roll the date of mailing a Tax Notice. (3) The mailing of the Tax Notice by the tax administrator constitutes a statement of and demand for payment of the taxes.

(4) Where more than one (1) holder is entered on the tax roll in respect of a taxable property, the tax administrator may mail the Tax Notice to only one of them, indicating that it is intended for the addressee and for the other holders.

(5) If a number of taxable properties are assessed in the name of the same holder, any number of those taxable properties may be included in one Tax Notice.

(6) Where the holder of a charge on a right gives notice to the assessor of the charge under the Assessment Law and the assessor enters the holder’s name on the assessment roll, the tax administrator must mail a copy of all tax notices issued in respect of the right to the holder of the charge during the duration of the charge.

(7) The Tax Notice and the Assessment Notice required under the Assessment Law relating to the same right may be mailed together or may be combined into one notice.

Amendments to Tax Roll and Tax Notices 13.(1) Where the assessment roll has been amended in accordance with the Assessment Law, or where the assessment roll has come into force under the Assessment Law, the tax administrator must amend the tax roll or create a new tax roll, as necessary, and mail an amended Tax Notice to every person affected by the amendment or new tax roll.

(2) Where an amended Tax Notice indicates a reduction in the amount of taxes owing, the tax administrator must forthwith refund any excess taxes that have been paid, in accordance with section 6.

(3) Where an amended Tax Notice indicates an increase in the amount of taxes owing, the taxes are due and payable on the date of mailing of the amended Tax Notice; however, the taxpayer must be given thirty (30) days to pay those taxes and a penalty and interest must not be added in that period.

Requests for Information 14.(1) The tax administrator may deliver a Request for Information containing the information set out

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in Schedule I to a holder or a person who has disposed of a right in reserve lands, and that person must provide to the tax administrator, within fourteen (14) days or a longer period as specified in the notice, information for any purpose related to the administration of this Law.

(2) The tax administrator is not bound by the information provided under subsection (1). PART IX PAYMENT RECEIPTS AND TAX CERTIFICATES Receipts for Payments 15. On receipt of a payment of taxes, the tax administrator must issue a receipt to the taxpayer and must enter the receipt number on the tax roll opposite the right in reserve lands for which the taxes are paid.