Federal Court of Appeal opens door to renewed Treaty 8 tax immunity claim

Tuccaro v. Canada, 2014 FCA 184

On July 25, 2014, the Federal Court of Appeal ruled that prominent First Nation entrepreneur David Tuccaro could advance a claim that he is immune from taxation under the terms of Treaty 8. The decision overturns a decision of the Tax Court of Canada that would have prevented such a claim from being asserted, and opens the door to revisiting the decision of the Federal Court of Appeal in the 2003 Benoit case, which had ruled against such a treaty right.

The Federal Court of Appeal also dismissed cross-appeals by the Crown, including in relation to the Crown’s argument that the Canada Revenue Agency’s “Indian Act Employment Income Tax Exemption Guidelines” are not relevant to an appeal in the Tax Court of Canada.

The decision opens the door to the potential establishment, for the first time in Canada, of a treaty right to tax exemption. It also allows an argument to be advanced that the principle of the Honour of the Crown is relevant to how Canada determines the tax liability of First Nation citizens.

Gowlings acted for the appellant David Tuccaro in this matter. The appeal was argued by Max Faille, with assistance from Jaimie Lickers, Graham Ragan and Paul Seaman.

For a detailed case summary please click here.