Government releases draft legislative proposals concerning income tax rules applicable to Canadian banks with foreign affiliates

The Minister of Finance, on 27 November 2012, released for consultation a package of draft legislative proposals relating to the Canadian Income Tax Act and Income Tax Regulations concerning the taxation of Canadian-based banks with foreign affiliates.

The package includes revision to the "base erosion" rules in the Income Tax Act's foreign accrual property income regime that were announced in Economic Action Plan 2012. The legislative proposals are intended to alleviate the ta…