REASONS
FOR JUDGMENT
Paris J.
[1]
Mr. Leeper is appealing the denial of a portion
of the medical expense tax credit (“METC”) he
claimed in his 2011 taxation year. At issue are expenses incurred for the
purchase of natural health products including vitamins, minerals, herbs and naturopathic
supplements which were prescribed to Mr. Leeper’s spouse, Denise Leeper,
by a naturopathic physician to treat her cancer.
[2]
The Minister of National Revenue (the “Minister”) denied the METC on the basis that the
natural health products could lawfully be acquired for use by a patient without
a prescription, and that the purchase of the products was not recorded by a
pharmacist. The Minister determined that the cost of the products therefore did
not qualify as medical expenses because they did not fall within paragraph 118.2(2)(n)
of the Income Tax Act (the “Act”) The
relevant parts of that provision read as follows:
118.2(2) Medical expenses. For the purposes of subsection (1), a medical expense of an
individual is an amount paid
. . .
(n) for
(i) drugs, medicaments or other preparations or substances
. . .
(A) . . .
(B) that can lawfully be acquired for use by the patient only
if prescribed by a medical practioner or dentist, and
(C) the purchase of which is recorded by a pharmacist, . . .
Facts
[3]
The facts in this case are largely undisputed. As
part of Ms. Leeper’s integrated cancer treatment, she saw Dr. Neil McKinney, a
naturopathic physician in Victoria, B.C. Dr. McKinney prescribed natural health
products to Ms. Leeper, largely to treat the side effects of her
chemotherapy. Mr. Leeper testified that his spouse could not tolerate the
prescription drugs available to treat those side effects. Most of the
prescribed products were purchased by Mr. or Ms. Leeper directly from
Dr. McKinney while the remainder were purchased from a health food store.
[4]
One of the assumptions made by the Minister in
assessing was that the products in issue could be purchased “over the counter”
which I take to mean that the products could be acquired without a
prescription. This assumption was not refuted by Mr. Leeper. He testified that
most of the products could be purchased at a health food store, but that some
were only available at Dr. McKinney’s office.
[5]
Mr. Leeper produced a letter written by Dr. McKinney
in which the doctor described the substances he prescribed to Ms. Leeper.
He stated that “some are prescription drugs . . . dispensed by a pharmacist.” The
cost of those drugs was included in the METC that was allowed to Mr. Leeper.
Dr. McKinney also stated in his letter that “Other medications were
Chinese herbal formulations . . . only dispensed through licensed
practitioners” and “vitamins, restricted and general use botanicals, and other
naturopathic medicines.” Only those substances are in issue in this appeal, and
since Dr. McKinney distinguished between them and the prescription drugs
dispensed by a pharmacist referred to previously, I infer from this statement
that the herbal formulations, vitamins, botanicals and naturopathic medicines
were not prescription drugs dispensed by a pharmacist. In any event, there is
no evidence before me that would indicate that a prescription was required to
obtain those substances lawfully.
Appellant’s Position
[6]
Mr. Leeper submits that the definition of
“drugs” in paragraph 118.2(2)(n) of the Act should be interpreted
in a way that would include the natural health products prescribed by Dr.
McKinney.
[7]
First, he says that the condition set out in clause
118.2(2)(n)(B) (“clause (B)”) that the substance must be one “that can lawfully be acquired for use by the patient
only if prescribed by a medical practitioner or dentist”
simply requires that a medical practitioner be involved in the process by
which the patient acquires the substance. He submits that this reading of clause
(B) would exclude from METC eligibility any products purchased as a result of
self‑diagnosis. He says that a medical practitioner’s involvement would
ensure that the use of the substance by the patient would be medically
responsible and therefore “lawful”.
[8]
While I agree with Mr. Leeper that clause (B)
requires the intervention of a medical practitioner in the acquisition process,
clause (B) also requires that the prescribed substance only be legally obtainable
with a prescription. This in my view is the plain and ordinary meaning of the
wording of clause (B).
[9]
Parliament added the requirement found in clause
(B) to paragraph 118.2(2)(n) in 2008, in response to decisions of
this Court which allowed METC claims for the cost of substances which had been
prescribed by a doctor but which were legally obtainable without a prescription
(Breger v. The Queen, 2007 TCC 254 and Norton v. The Queen, 2008
TCC 29). Therefore, it is also clear that the intention of Parliament was to
limit the METC to medications lawfully obtainable only by prescription.
[10]
The evidence in this case supports the
Respondent’s position that the natural products prescribed by Dr. McKinney
could legally be obtained without a prescription, and I find that the
requirement in clause (B) has not been met.
[11]
In the absence of the Charter arguments
raised by Mr. Leeper, this finding would dispose of the appeal, and it is therefore
not necessary for me to consider his argument that the purchase of the natural
products was recorded by a pharmacist, since naturopathic physicians in B.C.
are granted certain powers to dispense prescription drugs to their patients
under the Health Professions Act of British Columbia, [RSBC 1996] c.
183, and since Dr. McKinney recorded the purchase of the natural health
products in issue. However, it appears to me that while a naturopathic
physician in B.C. may be granted certain powers of dispensing prescription
drugs, only a person who is registered as a member of the College of
Pharmacists of British Columbia falls within the definition of “pharmacist”
under section 25.8 of the Health Professions Act of B.C. There was no
evidence to show that Dr. McKinney was a member of the College of Pharmacists
of B.C., and I find that Mr. Leeper has not therefore shown that the purchase
of the natural health products were recorded by a pharmacist.
Charter
[12]
Mr. Leeper also argues that paragraph 118.2(3)(n)
of the Act violates his or his spouse’s rights under sections 7 and
15(1) of the Charter. Those provisions read as follows:
7. Everyone has the right to life, liberty and security of the person and
the right not to be deprived thereof except in accordance with the principles
of fundamental justice.
. . .
15(1) Every individual is equal before and
under the law and has the right to the equal protection and equal benefit of
the law without discrimination and, in particular, without discrimination based
on race, national or ethnic origin, colour, religion, sex, age or mental or
physical disability.
[13]
Mr. Leeper submitted that this case is
distinguishable from the case of Ali and Markel v. Canada, 2008 FCA 190,
in which the Federal Court of Appeal held that the requirement for exclusion of
off the shelf drugs from METC eligibility did not violate the taxpayer’s
section 7 or section 15 Charter rights.
[14]
In Ali and Markel, the
Federal Court of Appeal referred to the decision of the Supreme Court of Canada
in Auton (Guardian ad litem of) v. British Columbia (Attorney General),
[2004] 3 S.C.R. 657 and stated at paragraph 12 that:
In my view, this
is a case in which the subsection 15(1) issue can be addressed in a simpler
manner. In Auton, the Supreme Court of Canada held that subsection 15(1) of the
Charter will not be infringed where the benefit that is sought is not one that
is provided by the law that is being challenged. In the present case, the
benefit claimed by the appellants is the METC in respect of the cost of Dietary
Supplements that are purchased "off the shelf". That is what they
claimed in their tax returns and it is the entitlement to that claim that they
sought to establish in their notices of appeal to the Tax Court of Canada. In Ray, this Court confirmed that such a benefit is not one that is
provided by paragraph 118.2(2)(n) of the ITA. How then can
it be discriminatory to deny the appellants a benefit (the METC in respect of
the cost of "off the shelf" drugs) that no one gets?
[15]
The Federal Court of Appeal went on to hold that
paragraph 118.2(2)(n) was not discriminatory in purpose or effect in
respect of the Dietary Supplements in issue in that case:
15. With respect to the matter of direct
discrimination, the definition of medical expenses in subsection 118.2(2) of
the ITA does not explicitly exclude the cost of Dietary Supplements. Moreover,
nothing in the provisions of the ITA dealing with the METC points to the
express adoption by Parliament of a discriminatory policy with respect to the
non-availability of the METC in relation to the cost of Dietary Supplements.
Accordingly, I conclude that the legislative choice not to extend the METC to
include the cost of Dietary Supplements in the definition of medical expenses
in subsection 118.2(2) of the ITA does not constitute direct discrimination.
. . .
17. With respect to the legislative
scheme at issue in this case, the definition of "medical expense" in
subsection 118.2(2) of the ITA contains an enumeration of the specific types of
costs that are eligible for the METC. This indicates a legislative purpose of
limiting the availability of the METC to a specific list of items. Paragraph
118.2(2)(n) of the ITA exemplifies this purpose by drawing a line between items
that meet the "recorded by a pharmacist" requirement and those that
do not. Thus, paragraph 118.2(2)(n) of the ITA is fully consistent with the
purpose and scheme of the METC legislation which is to only provide the METC in
respect of specifically enumerated types of medical expenses and not with
respect to all types of medical expenses.
[16]
Mr. Leeper argues that in this case his spouse’s
cancer is a life-threatening disease, whereas the medical conditions of the
taxpayers in Ali and Markel (fibromyalgia and chronic
fatigue syndrome) were not. He referred to a Canada Revenue Agency
administrative publication entitled “List of Eligible Medical Expenses” which
included “cancer treatment” but which did not specifically include fibromyalgia
or chronic fatigue syndrome, and to other administrative and statutory
provisions dealing with serious or life-threatening medical conditions which
refer to cancer but not to fibromyalgia or chronic fatigue syndrome.
[17]
Mr. Leeper has not shown, though, how the
relative seriousness of a disease or condition would affect the subsection
15(1) analysis undertaken by the Federal Court of Appeal in Ali and
Markel, and in my view, the nature or seriousness of a taxpayer’s
condition or disease does not impact that analysis. Also, if Mr. Leeper’s
proposition were accepted, it would mean that a subsection 15(1) right to
equality would not apply equally to all persons suffering from a serious
disease, something that runs counter to the basic notion of equality rights.
[18]
I find that Mr. Leeper has not shown that his
case is distinguishable from the case of Ali and Markel and I conclude
that neither his nor his spouse’s section 15 Charter rights are
infringed by paragraph 118.2(2)(n).
[19]
The Federal Court of Appeal in Ali and
Markel also held that the taxpayers’ section 7 rights were not
infringed by paragraph 118.2(2)(n). In Ali and Markel,
the Court wrote:
22. In my
view, the ability to resist an income tax assessment on the basis of section 7
of the Charter has been sufficiently dealt with by Justice Rothstein at
paragraphs 29 and 30 of the decision of this Court in Mathew v. Canada, [2003] F.C.J. No. 1470, 2003 FCA 371, in which
he stated:
[29] I will accept that the power of reassessment of a
taxpayer implicates the administration of justice. However, I do not accept
that reassessments of taxpayers result in a deprivation of liberty or security
of the person.
[30] If
there is a right at issue in the case of reassessments in income tax, it is an
economic right. In Gosselin, [2002] 4 S.C.R. 429,
McLachlin C.J.C., for the majority, observed that in Irwin Toy Ltd. v.
Quebec (A.G.), [1989] 1 S.C.R. 927 at 1003,
Dickson C.J.C., for the majority, left open the question of whether section 7
could operate to protect "economic rights fundamental to human...survival".
However, there is no suggestion in Gosselin that section 7 is broad
enough to encompass economic rights generally or, in particular, in respect of
reassessments of income tax. I am, therefore, of the view that the
appellants have not demonstrated a deprivation of any right protected by
section 7 of the Charter.
[Emphasis added.]
[20]
Mr. L eeper relies on the decision of the
Supreme Court of Canada in Canada (Attorney General) v. Bedford, 2013
SCC 72 to ground his section 7 argument. In Bedford, the Supreme
Court held that certain sections of the Criminal Code relating to
prostitution infringed the section 7 Charter rights of prostitutes by
depriving them of security of the person. However, in Bedford, the
Supreme Court found that there was a “sufficient causal connection” between the
impugned Criminal Code provisions and the prostitutes’ security of the
person. The Court held that these provisions imposed dangerous conditions on
prostitution.
[21]
In the case before me, it has not been shown
that there is a sufficient causal connection between paragraph 118.2(2)(n)
of the Act and Ms. Leeper’s security of the person. While I have great
sympathy for Ms. Leeper’s situation, I do not accept that paragraph 118.2(2)(n)
imposes dangerous conditions upon her, since that provision does not prevent
her from obtaining the natural products that she requires. At most, it imposes,
indirectly, a higher cost to her of those substances and thereby creates an
economic barrier to that course of medical treatment. This engages economic
rights, which are not protected by section 7 of the Charter. This point
was made by the Federal Court of Appeal in Mathew v. Canada (2003 FCA 371)
at paragraphs 29 and 30:
I will accept that the power of reassessment of a taxpayer
implicates the administration of justice. However, I do not accept that
reassessments of taxpayers result in a deprivation of liberty or security of
the person.
If there is a right at issue in the case of reassessments in
income tax, it is an economic right. In Gosselin, McLachlin C.J.C., for the
majority, observed that in Irwin Toy Ltd. v. Quebec (A.G.), [1989] 1 S.C.R. 927 at 1003, Dickson C.J.C., for the majority, left open the
question of whether section 7 could operate to protect "economic rights
fundamental to human...survival". However, there is no suggestion in
Gosselin that section 7 is broad enough to encompass economic rights generally
or, in particular, in respect of reassessments of income tax. I am, therefore,
of the view that the appellants have not demonstrated a deprivation of any
right protected by section 7 of the Charter.
[22]
The cited paragraphs were relied upon by the
Court in Ali and Markel (supra, at para. 22). Leave to
appeal the Ali and Markel decision to the Supreme Court of Canada
was refused. These decisions are binding on this Court and I therefore conclude
that Mr. Leeper has not shown that paragraph 118.2(2)(n) infringes on
his spouse’s section 7 Charter rights.
[23]
For these reasons, the appeal is dismissed.
Signed at Vancouver,
British Columbia, this 16th day of April 2015.
“B.Paris”
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