Letourneau
J.A.
(Robertson
J.A.
concurring):—
Facts
and
issues
This
is
yet
another
challenge
to
the
Income
Tax
Act,
R.S.C.
1952,
c.
148
(am.
S.C.
1970-71-72,
c.
63)
(the
"Act")
pursuant
to
section
15
of
the
Canadian
Charter
of
Rights
and
Freedoms
(the
"Charter").
In
the
present
applications
for
judicial
review,
section
122.5
of
the
Act,
which
provides
the
rules
for
determining
the
Goods
and
Services
Tax
credit
("GST
credit")
for
individuals,
is
attacked.
The
section
provides
a
refundable
tax
credit
of
$190
to
an
individual
who
is
resident
in
Canada
and
is
either
married,
a
parent
of
a
child
or
19
years
of
age
or
over.
The
applicants
request
a
review
of
the
decision
of
Judge
Margeson
of
the
Tax
Court
of
Canada,
delivered
on
November
12,
1992,
which
dismissed
their
appeals
launched
in
respect
of
the
1990
taxation
year.
At
the
outset
of
the
trial
before
the
Tax
Court,
it
was
agreed
that
the
evidence,
law
and
arguments
given
and
made
in
one
case
would
apply
equally
to
the
other.
The
applicants
who,
at
the
relevant
time,
were
13
and
18
years
of
age
respectively
and
lived
at
home
with
their
father
were
refused
the
GST
credit
on
account
of
their
age
and
the
fact
that
they
were
unmarried
or
had
no
children.
They
allege
that
section
122.5
violates,
both
in
its
purpose
and
effect,
their
equality
rights
under
section
15
of
the
Charter
on
the
basis
of
age.
More
precisely,
they
contend
that
children
under
the
age
of
19
are
discriminated
against
by
reason
of
age
because
it
is
their
parents
who
are
entitled
to
claim
the
tax
credit
on
their
behalf
while
children
aged
19
and
over
can
claim
the
refund
for
themselves.
Furthermore,
in
their
written
submissions,
they
alluded
to
the
fact
that
there
may
exist
potential
discrimination
on
the
basis
of
marital
or
family
status
as
children
under
the
age
of
19
who
are
married
are
eligible
for
the
rebate.
However,
as
that
ground
of
review
was
not
pursued
at
the
hearing,
I
shall
not
rule
on
it
although
my
reasoning
would
certainly
be
applicable
thereto.
For
the
1990
taxation
year,
both
applicants
reported
in
their
income
tax
returns
a
modest
income
from
various
sources.
In
the
Court
below
and
before
us,
they
were
represented
by
their
father
who
is
a
practising
lawyer
in
Edmonton,
Alberta.
The
applicants’
contention
as
to
the
unconstitutionality
of
section
122.5
did
not
find
favour
with
the
Tax
Court
of
Canada
and,
in
my
view,
rightly
so.
The
difference
between
the
American
and
the
Canadian
approach
to
discrimination
in
fiscal
matters
A
review
of
the
American
approach
to
alleged
discrimination
in
respect
of
Internal
Revenue
matters
is
instructive
to
the
extent
that
it
contrasts
sharply
with
the
Canadian
approach.
The
American
courts
have
widely
accepted
the
principle
of
indirect
or
disparate
impact
discrimination
in
the
enforcement
of
human
rights
legislation.
However,
they
have
refused
to
apply
this
latter
principle
to
constitutional
matters,
specifically
in
relation
to
the
guarantee
of
equality,
where
evidence
of
an
intent
to
discriminate
or
an
overt
differential
treatment
is
required.
In
an
article
entitled
“Equality
in
Context:
Judicial
Approaches
in
Canada
and
the
United
States”
(1990),
39
U.N.B.
L.J.
111
at
page
115,
the
author,
Colleen
Sheppard
writes:
The
first
area
where
we
can
see
the
paradigm
of
equality
as
sameness
of
treatment
running
into
difficulties
is
disparate
impact
discrimination.
The
essence
of
disparate
impact
discrimination
is
recognition
that
the
application
of
a
“facially
neutral”
law
or
policy,
or
sameness
of
treatment,
can
generate
unequal
results.
Some
laws
or
policies
ave
disproportionately
negative
effects
on
certain
groups,
depending
on
differences
in
social,
economic
or
cultural
realities.
And
this
can
occur
even
and
often
in
the
absence
of
any
intent
to
discriminate.
Although
this
type
of
discrimination
has
been
acknowledged
in
the
interpretation
of
human
rights
legislation
in
the
United
States,
it
has
been
rejected
by
the
courts
in
constitutional
cases.
A
majority
of
the
U.S.
Supreme
Court
has
held
consistently
that
there
must
be
overt
differential
treatment
or
evidence
of
an
intent
to
discriminate
for
there
to
be
a
violation
of
the
constitutional
guarantee
of
equality.
(See
e.g.,
Washington
v.
Davis,
426
U.S.
229
(1976);
Personnel
Administrator
of
Massachusetts
v.
Feeney,
442
U.S.
256
(1979);
McCleskey
v.
Kemp,
481
U.S.
279
(1987).)
[Emphasis
added.]
A
similar
conclusion
can
be
found
in
an
interesting
article
written
by
Ms.
Faye
Woodman.
The
following
comments
at
(1990),
22
Ott.
L.R.
625,
page
115,
are
noteworthy:
There
are
two
other
higher
levels
of
constitutional
review
which
theoretically
might
be
applied
to
some
of
the
distinctions
of
the
Internal
Revenue
Code.
The
''strict
scrutiny”
test
applies
to
legislation
that
classifies
on
the
basis
of
a
"suspect"
characteristic
(for
example,
race)
or
in
respect
of
a
“fundamental
interest"
(for
example,
mobility
rights).
Under
the
strict
scrutiny
test,
legislation,
including
tax
legislation,
would
be
declared
unconstitutional
unless
the
classification
can
be
shown
as
necessary
to
further
a
compelling
government
interest.
“Intermediate
level
scrutiny”
applies
to
"quasi-suspect"
characteristics
(for
example,
sex).
It
requires
that
the
classification
be
substantially
related
to
an
important
governmental
interest.
In
practice,
the
United
States
Internal
Revenue
Code
is
generally
not
subject
to
these
higher
levels
of
scrutiny
since
distinctions
drawn
in
the
American
income
tax
legislation,
as
in
its
Canadian
counterpart,
are
not
based
on
any
of
these
suspect
or
quasi-suspect
characteristics.
The
fact
that
the
classifications
may
have
a
disparate
and
adverse
impact
on
women
or
minorities
is
immaterial.
In
the
United
States,
unlike
Canada,
no
theory
of
general
application
has
been
developed
to
subject
legislation
to
constitutional
scrutiny
on
the
basis
of
its
effects
as
compared
to
its
purposes.
[Emphasis
added.]
Indeed,
as
early
as
1916,
the
Supreme
Court
of
the
United
States
validated
the
categories,
classifications
and
distinctions
made
and
used
in
Internal
Revenue
legislation
by
stating
that
"the
Constitution
does
not
conflict
with
itself
by
conferring,
upon
the
one
hand,
a
taxing
power,
and
taking
the
same
power
away,
on
the
other,
by
the
limitations
of
the
process
clause”
(Brushaber
v.
Union
Pacific
Rwy.
Co.,
240
U.S.
1,
at
page
24
(1916).
See
also
the
article
by
Faye
Woodman,
supra,
at
page
631).
The
Court
in
that
case,
however,
acknowledged
that
a
taxing
provision
could
be
so
arbitrary
and
unjust
as
to
amount
to
an
improper
confiscation
of
property
rather
than
to
a
proper
exercise
of
a
taxation
power.
The
reluctance
of
the
American
courts
to
introduce
the
concept
of
indirect
discrimination
in
the
field
of
taxation
and
more
broadly
in
economic
legislation
clearly
appears
in
the
following
comments
of
Mr.
Justice
White
in
Washington
v.
Davis,
426
U.S.
229
(1976)
at
page
248:
A
rule
that
a
statute
designed
to
serve
neutral
ends
is
nevertheless
invalid,
absent
compelling
justification,
if
in
practice
it
benefits
or
burdens
one
race
more
than
another
would
be
far
reaching
and
would
raise
serious
questions
about
and
perhaps
invalidate,
a
whole
range
of
tax,
welfare,
public
service,
regulatory,
and
licensing
statutes
that
may
be
more
burdensome
to
the
poor
and
the
average
black
than
to
the
affluent
white.
In
fact,
the
Supreme
Court
of
the
United
States
has
demonstrated
substantial
deference
to
legislatures
exercising
their
taxation
power
since
it
is
believed
that
this
realm
necessarily
involves
the
making
of
distinctions
and
classifications
which
will
normally
reflect
the
taxpayer's
ability
to
pay.
Accordingly,
the
American
courts
have
validated
such
differences
of
treatment
provided
they
bear
a
rational
relationship
to
a
legitimate
governmental
purpose.
In
this
latter
regard,
the
United
States
Supreme
Court,
in
a
case
involving
a
challenge
to
the
Internal
Revenue
Code
at
the
federal
level,
held
that
it
was
rational
for
Congress
to
agree
to
subsidize
lobbying
by
veteran
organizations
and
to
refuse
to
subsidize
substantial
lobbying
by
charities
generally.
Mr.
Justice
Rehnquist
wrote
in
Regan
v.
Taxation
with
Representation
of
Washington,
103
S.
Ct.
1997
(1987)
at
page
2002:
Legislatures
have
especially
broad
latitude
in
creating
classifications
and
distinctions
in
tax
statutes.
More
than
40
years
ago
we
addressed
these
comments
to
an
equal
protection
challenge
to
tax
legislation:
The
broad
discretion
as
to
classification
possessed
by
a
legislature
in
the
field
of
taxation
has
long
been
recognized.
.
.
.
[T]he
passage
of
time
has
only
served
to
underscore
the
wisdom
of
that
recognition
of
the
large
area
of
discretion
which
is
needed
by
a
legislature
in
formulating
sound
tax
policies.
Traditionally
classification
has
been
a
device
for
fitting
tax
programs
to
local
needs
and
usages
in
order
to
achieve
an
equitable
distribution
of
the
tax
burden.
It
has,
because
of
this,
been
pointed
out
that
in
taxation,
even
more
than
in
other
fields,
legislatures
possess
the
greatest
freedom
in
classification.
Since
the
members
of
a
legislature
necessarily
enjoy
a
familiarity
with
local
conditions
which
this
Court
cannot
have,
the
presumption
of
constitutionality
can
be
overcome
only
by
the
most
explicit
demonstration
that
a
classification
is
a
hostile
and
oppressive
discrimination
against
particular
persons
and
classes.
The
burden
is
on
the
one
attacking
the
legislative
arrangement
to
negative
every
conceivable
basis
which
might
support
it.
Madden
v.
Kentucky,
309
U.S.
83,
87-88,
60
S.
Ct.
406,
pages
407-08,
84
L.
Ed.
590
(1940).
It
would
be
fair
to
say
that
the
American
approach
has
so
far
been
cautious.
I
suppose
it
has
reflected
a
pragmatism
dictated
by
more
than
a
century
of
judicial
interpretation
of
constitutional
guarantees
within
the
economic
context.
The
Canadian
courts,
unlike
their
American
counterparts,
have
been
more
agressive
in
the
application
of
our
Charter
and
they
have
shown
a
willingness
to
be
less
deferential,
at
least
on
a
section
15
as
opposed
to
a
section
1
analysis,
to
challenges
to
legislative
provisions,
including
those
relating
to
economic
legislation.
Accordingly,
Mr.
Justice
lacobucci
stated
in
Symes
v.
Canada,
[1993]
4
S.C.R.
695,
[1994]
1
C.T.C.
40,
94
D.T.C.
6001,
at
753
(C.T.C.
67,
D.T.C.
6021):
[I]t
has
been
said
that
Courts
should
defer
to
legislatures
with
respect
to
difficult
economic
questions.
However,
support
for
this
proposition
is
said
to
come
from
cases
in
which
a
degree
of
deference
has
been
exhibited
as
part
of
a
section
1
Charter
analysis:
see,
e.g.,
PSAC
v.
Canada,
[1987]
1
S.C.R.
424,
38
D.L.R.
(4th)
249,
at
page
442
(D.L.R.
261).
Such
cases
do
not
advocate
a
deferential
approach
at
any
earlier
stage
of
Charter.
analysis.
The
courts,
in
interpreting
the
Charter
as
a
vigorous
and
meaningful
right
protecting
instrument
within
the
Constitution,
have
brought
on
the
constitutional
battlefield
the
notion
of
indirect
discrimination
(not
apparent
on
the
face
of
the
statute)
which
is
also
widely
recognized
in
their
interpretation
of
human
rights
legislation.
(See,
as
recent
examples,
the
cases
of
Symes,
supra,
and
Thibaudeau
v.
Canada,
[1994]
2
C.T.C.
4,
94
D.T.C.
6230.)
This
approach
has
not
gone
unnoticed
and
has
created
a
fair
degree
of
uncertainty
and
numerous
expectations.
The
present
case
is
yet
another
example
of
such
expectations
where
Charter
relief
is
sought
and
Charter
provisions
are
used.
The
purpose
and
requirements
of
section
15
A.
The
need
for
a
discriminatory
and
prejudicial
difference
of
treatment
In
my
opinion,
the
applicants’
contentions
fail
to
meet
the
test
enunciated
by
Chief
Justice
Lamer
in
R.
v.
Swain,
[1991]
1
S.C.R.
933,
63
C.C.C.
(3d)
481,
5
C.R.
(4th)
253,
where
he
properly
and
conveniently
summarized
the
purpose
and
requirements
of
subsection
15(1)
of
the
Charter
as
follows
(at
S.C.R.
page
992)(C.C.C.
520,
C.R.
297):
The
Court
must
first
determine
whether
the
claimant
has
shown
that
one
of
the
four
basic
equality
rights
has
been
denied
(i.e.,
equality
before
the
law,
equality
under
the
law,
equal
protection
of
the
law
and
equal
benefit
of
the
law).
This
inquiry
will
focus
largely
on
whether
the
law
has
drawn
a
distinction
(intentionally
or
otherwise)
between
the
claimant
and
others,
based
on
personal
characteristics.
Next,
the
court
must
determine
whether
the
denial
can
be
said
to
result
in
"discrimination".
This
second
inquiry
will
focus
largely
on
whether
the
differential
treatment
has
the
effect
of
imposing
a
burden,
obligation
or
disadvantage
not
imposed
upon
others
or
of
withholding
or
limiting
access
to
opportunities,
benefits
and
advantages
available
to
others.
Furthermore,
in
determining
whether
the
claimant's
subsection
15(1)
rights
have
been
infringed,
the
court
must
consider
whether
the
personal
characteristic
in
question
falls
within
the
grounds
enumerated
in
the
section
or
within
an
analogous
ground,
so
as
to
ensure
that
the
claim
fits
within
the
overall
purpose
of
section
15
—
namely,
to
remedy
or
prevent
discrimination
against
groups
subject
to
stereotyping,
historical
disadvantage
and
political
and
social
prejudice
in
Canadian
society.
[Emphasis
added.]
The
purpose
of
section
15
and
the
need
for
prejudice
and
stereotyping
were
acknowledged
and
affirmed
in
other
decisions
of
the
Supreme
Court.
In
Andrews
v.
Law
Society
of
B.C.,
[1989]
1
S.C.R.
143,
56
D.L.R.
(4th)
1,
[1989]
2
W.W.R.
289,
Wilson
J.
wrote
in
relation
to
the
standard
of
proof
under
section
1
at
S.C.R.
page
154
(D.L.R.
34,
W.W.R.
325):
This,
in
my
view,
remains
an
appropriate
standard
when
it
is
recognized
that
not
every
distinction
between
individuals
and
groups
will
violate
section
15.
If
every
distinction
between
individuals
and
groups
gave
rise
to
a
violation
of
section
15,
then
this
standard
might
well
be
too
stringent
for
application
in
all
cases
and
might
deny
the
community
at
large
the
benefits
associated
with
sound
and
desirable
social
and
economic
legislation.
This
is
not
a
concern,
however,
once
the
position
that
every
distinction
drawn
by
law
constitutes
discrimination
is
rejected
as
indeed
it
is
in
the
judgment
of
my
colleague,
McIntyre
J.
Given
that
section
15
is
designed
to
protect
those
groups
who
suffer
social,
political
and
legal
disadvantage
in
our
society,
the
burden
resting
on
government
to
justify
the
type
of
discrimination
against
such
groups
is
appropriately
an
onerous
one.
In
the
subsequent
decision
of
McKinney
v.
University
of
Guelph,
Madam
Justice
Wilson
reasserted
the
same
views
at
[1990]
3
S.C.R.
229,
76
D.L.R.
(4th)
545,
at
pages
386-87
(D.L.R.
604-05):
In
Andrews
it
was
acknowledged
that
the
key
to
section
15
is
the
word
"discrimination".
At
page
172
of
his
reasons
Mcintyre
J.
said:
The
right
to
equality
before
and
under
the
law,
and
the
rights
to
the
equal
protection
and
benefit
of
the
law
contained
in
section
15,
are
granted
with
the
direction
contained
in
section
15
itself
that
they
be
without
discrimination.
Discrimination
is
unacceptable
in
a
democratic
society
because
it
epitomizes
the
worst
effects
of
the
denial
of
equality,
and
discrimination
reinforced
by
law
is
particularly
repugnant.
The
worst
oppression
will
result
from
discriminatory
measures
having
the
force
of
law.
It
is
against
this
evil
that
section
15
provides
a
guarantee.
In
Reference
Re
Workers'
Compensation
Act,
1983
(Nfld.),
[1989]
1
S.C.R.
922,56
D.L.R.
(4th)
765;
R.
v.
Turpin,
[1989]
1
S.C.R.
1296,
48
C.C.C.
(3d)
8,
69
C.R.
(3d)
97;
Rudolf
Wolff
&
Co.
v.
Canada,
[1990]
1
S.C.R.
695,
69
D.L.R.
(4th)
392,
and
R.
v.
S.
(S.),
[1990]
2
S.C.R.
254,
57
C.C.C.
(3d)
115,
77
C.R.
(3d)
273,
this
Court
repeatedly
affirmed
that
in
order
to
establish
a
violation
of
subsection
15(1)
there
must
be
evidence
of
discrimination
in
stereotype
and
prejudice.
For
example,
quoting
from
Turpin
at
page
1333
(C.C.C.
35,
C.R.
127):
Differentiating
for
mode
of
trial
purposes
between
those
accused
of
section
427
offences
in
Alberta
and
those
accused
of
the
same
offences
elsewhere
in
Canada
would
not,
in
my
view,
advance
the
purposes
of
section
15
in
remedying
or
preventing
discrimination
against
groups
suffering
social,
political
and
legal
disadvantage
in
our
society.
A
search
for
indicia
of
discrimination
such
as
stereotyping,
historical
disadvantage
or
vulnerability
to
political
and
social
prejudice
would
be
fruitless
in
this
case.
.
.
.
It
is,
I
think,
now
clearly
established
that
what
lies
at
the
heart
of
subsection
15(1)
is
the
promise
of
equality
in
the
sense
of
freedom
from
the
burdens
of
stereotype
and
prejudice
in
all
their
subtle
and
ugly
manifestations.
[Emphasis
added.]
Words
of
caution
specifically
in
relation
to
economic
legislation
and
the
need
for
discrimination,
as
opposed
to
a
mere
difference
in
treatment,
can
also
be
found
in
the
reasons
of
La
Forest
J.
in
the
Andrews
case:
That
having
been
said,
I
am
convinced
that
it
was
never
intended
in
enacting
section
15
that
it
become
a
tool
for
the
wholesale
subjection
to
judicial
scrutiny
of
variegated
legislative
choices
in
no
way
infringing
on
values
fundamental
to
a
free
and
democratic
society.
Like
my
colleague,
I
am
not
prepared
to
accept
that
all
legislative
classifications
must
be
rationally
supportable
before
the
courts.
Much
economic
and
social
policy-
making
is
simply
beyond
the
institutional
competence
of
the
courts:
their
role
is
to
protect
against
incursions
on
fundamental
values,
not
to
second
guess
policy
decisions.
I
realize
that
it
is
no
easy
task
to
distinguish
between
what
is
fundamental
and
what
is
not
and
that
in
this
context
this
may
demand
consideration
of
abstruse
theories
of
equality.
For
example,
there
may
well
be
legislative
or
governmental
differentiation
between
individuals
or
groups
that
is
so
grossly
unfair
to
an
individual
or
group
and
so
devoid
of
any
rational
relationship
to
a
legitimate
state
purpose
as
to
offend
against
the
principle
of
equality
before
and
under
the
law
as
to
merit
intervention
pursuant
to
section
15.
For
these
reasons
I
would
think
it
better
at
this
stage
of
Charter
development
to
leave
the
question
open.
I
am
aware
that
in
the
United
States,
where
Holmes
J.
has
referred
to
the
equal
protection
clause
there
as
the
“last
resort
of
constitutional
arguments"
(Buck
v.
Bell,
274
U.S.
200
(1927),
at
p.
208),
the
courts
have
been
extremely
reluctant
to
interfere
with
legislative
judgment.
Still,
as
I
stated,
there
may
be
cases
where
it
is
indeed
the
last
constitutional
resort
to
protect
the
individual
from
fundamental
unfairness.
Assuming
there
is
room
under
section
15
for
judicial
intervention
beyond
the
traditionally
established
and
analogous
policies
against
discrimination
discussed
by
my
colleague,
it
bears
repeating
that
considerations
of
institutional
functions
and
resources
should
make
courts
extremely
wary
about
questioning
legislative
and
governmental
choices
in
such
areas.
[Emphasis
added.]
This
approach
of
the
Supreme
Court
is
consistent
with
the
view
it
expressed
that
a
disadvantage
under
section
15
may
have
to
be
found
outside
the
impugned
legislation
and,
therefore,
that
a
Court,
in
assessing
a
claim
of
discrimination
under
section
15,
has
to
look
not
only
at
the
impugned
legislation
which
is
said
to
violate
the
Charter,
but
also
at
the
larger
social,
political
and
legal
context
in
which
the
difference
of
treatment
arises.
In
R.
v.
Turpin,
Wilson
J.
wrote
at
[1989]
1
S.C.R.
1296,
correlative
cite,
at
pages
1331-32:
In
determining
whether
there
is
discrimination
on
grounds
relating
to
the
personal
characteristics
of
the
individual
or
group,
it
is
important
to
look
not
only
at
the
impugned
legislation
which
has
created
a
distinction
that
violates
the
right
to
equality
but
also
to
the
larger
social,
political
and
legal
context.
McIntyre
J.
emphasized
in
Andrews
(at
page
167):
For,
as
has
been
said,
a
bad
law
will
not
be
saved
merely
because
it
operates
equally
upon
those
to
whom
it
has
application.
Nor
will
a
law
necessarily
be
bad
because
it
makes
distinctions.
Accordingly,
it
is
only
by
examining
the
larger
context
that
a
court
can
determine
whether
differential
treatment
results
in
inequality
or
whether,
contrariwise,
it
would
be
identical
treatment
which
would
in
the
particular
context
result
in
inequality
or
foster
disadvantage.
A
finding
that
there
is
discrimination
will,
I
think,
in
most
but
perhaps
not
all
cases,
necessarily
entail
a
search
for
disadvantage
that
exists
apart
from
and
independent
of
the
particular
legal
distinction
being
challenged.
(See
also,
Symes,
supra,
at
pages
756-57.)
Applying
these
principles
to
the
case
at
bar,
I
cannot
say,
nor
is
there
for
that
matter
any
evidence
in
the
present
file
to
suggest,
that
unmarried
children
under
the
age
of
19
are
members
of
a
group
whose
“claim”,
to
paraphrase
the
very
words
of
Chief
Justice
Lamer
in
Swain,
"fits
within
the
overall
purpose
of
section
15—namely,
to
remedy
or
prevent
discrimination
against
groups
subject
to
stereotyping,
historical
disadvantage
and
political
and
social
prejudice
in
Canadian
society".
I
might
add
that
it
is
not
the
function
of
this
Court
to
speculate
on
the
issue
of
stereotyping,
historical
disadvantage
or
political
and
social
prejudice.
The
claimant
has,
under
section
15,
the
burden
of
introducing
the
necessary
evidence
to
prove
these
matters.
The
applicants’
failure
to
do
so
is
a
sufficient
ground
to
deny
their
claim.
As
Mr.
Justice
Cory
ruled
in
MacKay
v.
Manitoba
at
[1989]
2
S.C.R.
357,
61
D.L.R.
(4th)
385,
at
S.C.R.
page
366
(D.L.R.
391-92):
A
factual
foundation
is
of
fundamental
importance
on
this
appeal.
It
is
not
the
purpose
of
the
legislation
which
is
said
to
infringe
the
Charter
but
its
effects.
If
the
deleterious
effects
are
not
established
there
can
be
no
Charter
violation
and
no
case
has
been
made
out.
Thus
the
absence
of
a
factual
base
is
not
ust
a
technicality
that
could
be
overlooked,
but
rather
it
is
a
flaw
that
is
fatal
to
the
appellants’
position.
Furthermore,
when
one
looks
at
the
larger
context
to
determine
whether
the
differential
treatment
created
by
the
impugned
provision
amounts
to
discrimination
within
the
meaning
of
section
15,
one
finds
oneself
in
a
complex
social,
political,
legal,
fiscal
and
economic
environment
where
Parliament
is,
in
the
State’s
interest,
trying
to
raise
revenues
to
fund
the
government,
achieve
equity
among
taxpayers
in
so
doing
and
implement
fiscal
and
social
policies
unrelated
to
the
raising
of
revenue.
It
is
in
this
broader
context
that
the
impugned
provision
has
to
be
reviewed
in
order
to
determine
whether
the
differential
treatment
is
discriminatory
because
it
results
in
inequality
or
fosters
disadvantage.
The
evidence
before
the
Court
established
that
the
Goods
and
Services
Tax,
like
all
sales
taxes,
is
regressive
in
nature
in
that
the
amount
of
consumption
tax
paid
as
a
percentage
of
income
increases
as
income
declines.
All
major
government
studies
of
federal
consumption
taxes
have
noted
the
regressivity
of
such
taxes
and
the
need
to
develop
policies
and
programs
to
combat
such
an
effect.
In
the
government's
White
Paper
on
Sales
Tax
Reform
(Tax
Reform
1987,
Department
of
Finance,
June
18,
1987),
one
can
find
under
the
heading
"Fairness
to
Individuals
and
Families”
the
following
acknowledgment
at
page
43:
The
fundamental
argument
against
the
use
of
general
sales
taxes
as
a
major
revenue
instrument
has
always
been
their
disproportionate
burden
on
lower-income
consumers.
Two
options
are
available
to
offset
this
impact
in
the
context
of
the
multi-stage
sales
tax:
to
permit
the
tax-free
sale
of
certain
categories
of
goods
or
lower
the
rates
of
tax
applied
to
them;
or
to
provide
refundable
tax
credits
for
those
in
need.
Indeed,
as
early
as
the
time
of
the
Carter
Commission,
recommendations
were
made
for
tax
credits
that
could
be
offset
against
a
person's
tax
liability.
In
addition,
where
the
credit
exceeded
the
tax
liability
of
a
person,
it
provided
for
a
payment
from
the
taxing
authority
to
that
person.
The
logistics
of
establishing
such
a
refundable
tax
credit
ought
not
to
be
underestimated.
In
1978,
after
a
careful
review
of
the
possible
options,
the
Department
of
Finance
concluded
that
it
was
possible
to
define
an
income
tested
refundable
tax
credit
using
any
one
of
four
basic
recipient
units:
the
individual,
the
primary
earner
in
the
family,
the
primary
earner
plus
the
spouse
or
all
family
members.
It
also
concluded
that
the
appropriate
choice
would
depend
on
the
objectives
of
any
given
credit
and
the
trade-off
between
payments
to
inappropriate
recipient
groups
and
the
increased
complexity
both
for
the
lower-income
recipients
who
are
required
to
complete
tax
returns
as
well
as
those
administering
the
program.
The
following
extract
from
the
feasibility
study
highlights
the
options
and
their
respective
limits:
4,
INCOME-TESTED
REFUNDABLE
TAX
CREDITS
General
features
The
value
of
a
refundable
tax
credit
can
be
made
to
vary
with
the
income
of
an
individual
filing
unit
by
relating
the
credit
to
income
and
reducing
its
net
value
as
income
increases.
The
same
elements
must
be
defined
for
an
income-tested
refundable
tax
credit
as
for
a
simple
refundable
credit:
Eligibility
criteria,
filing
and
recipient
units,
benefit
structure,
frequency
of
assessment
and
frequency
and
method
of
payment
or
delivery.
Two
additional
elements
arise:
A
definition
of
income
and
the
problem
of
“stacking”
of
the
benefit
structure.
The
range
of
choices
with
respect
to
any
of
the
design,
assessment
and
delivery
elements
of
an
income-tested
credit
clearly
depends
on
how
these
elements
are
defined
in
the
tax
system.
The
closer
the
elements
of
the
credit
are
to
existing
tax
definitions
and
concepts,
the
fewer
the
additional
requirements
involved
in
administering
the
credit.
However,
it
may
be
that
administrative
simplicity
can
be
achieved
only
at
the
expense
of
sacrifices
to
the
achievement
of
the
objectives
of
an
income-tested
credit.
The
areas
in
which
these
sacrifices
may
be
particularly
significant
are:
The
filing
unit,
the
definition
of
income;
the
frequency
of
assessment;
and
the
benefit
schedule
and
stacking.
(1)
Filing
unit
There
are
four
main
alternatives
regarding
whose
income
is
to
be
taken
into
account
for
purposes
of
income-testing:
The
individual;
the
primary
earner
in
the
family
(spouse
with
the
higher
income);
the
primary
earner
plus
the
spouse;
and
all
family
members.
Individual:
The
simplest
unit
is
the
individual
because
this
is
the
nominal
filing
unit
for
the
present
income
tax
system.
For
example,
the
Ontario
sales
tax
credit
may
be
claimed
by
certain
individuals
who
are
16
years
or
older,
resident
in
Ontario
on
December
31
and
not
claimed
as
dependants
on
someone
else's
return.
Adopting
the
individual
filing
unit
would
achieve
maximum
compatibility
with
the
current
tax
system.
However,
for
those
programs
ideally
based
on
family
income,
use
of
the
individual
as
the
filing
unit
would
leaa
to
unintended
results
in
that
low-income
individuals
would
receive
benefits
even
though
total
family
income
was
quite
high
(e.g.,
the
millionaire’s
spouse).
Primary
earner
or
spouse
with
higher
income:
One
solution
to
the
problem
of
the
millionaire’s
spouse
is
to
allow
only
the
spouse
with
the
higher
income
(primary
earner)
to
file
for
the
credit.
This
approach
is
used
in
the
case
of
the
Ontario
property
tax
credit.
For
example,
one
could
define
a
family-based
refundable
tax
credit
where
the
gross
benefit
depended
only
on
family
size.
The
gross
credit
would
then
be
reduced
according
to
the
income
of
the
higher-income
spouse.
However,
this
type
of
income-testing
could
still
result
in
inequities
on
a
family
basis
as
two
families
with
the
same
total
income
could
end
up
with
different
credits
after
income-testing,
depending
upon
how
that
income
was
distributed
within
the
family.
A
similar
situation
exists
in
the
current
income
tax
system,
but
it
has
not
caused
serious
difficulties.
It
should
be
recognized
that
Revenue
Canada
will
not
be
able
to
identify
the
spouse
with
the
higher
income
unless
both
spouses
file
(or
are
required
to
file)
a
tax
return,
or
one
spouse
is
claimed
as
a
dependant
by
the
other,
and
the
definition
of
income
is
net
income.
The
extent
of
this
problem,
in
this
and
the
two
filing
units
discussed
later,
would
have
to
be
recognized
and
evaluated
in
any
specific
design
decision.
Primary
earner
plus
spouse:
In
this
approach
the
income
of
the
filing
unit
would
be
defined
as
the
sum
of
the
incomes
of
the
primary
earner
and
his
or
her
spouse.
Under
this
approach
unintended
payments
to
families
with
low-income
parents
and
high-
income
children
would
be
possible.
As
with
previous
alternatives,
if
the
information
is
present
to
determine
and
verify
which
spouse
had
the
higher
income,
little
additional
auditing
would
be
required
to
determine
the
sum
of
their
incomes
and
to
use
this
figure
for
income-testing.
However,
a
move
to
any
type
of
“joint
filing"
for
purposes
of
the
Income
Tax
Act
would
be
very
significant,
both
conceptually
and
in
terms
of
administrative
complexity.
Family.
The
final
filing
unit
is
the
family
itself,
including
the
incomes
of
children.
However,
there
is
a
range
of
possible
definitions
of
the
family.
One
possibility,
in
the
spirit
of
the
refundable
child
tax
credit,
would
be
to
include
only
children
18
or
under.
In
any
event,
the
main
issue
distinguishing
this
form
of
filing
unit
from
the
preceding
one
is
whether
the
reduction
in
unintended
payments
would
be
worth
the
increased
complexity
given
that
most
children
under
17
do
not
have
significant
incomes.
The
problem
remains,
however,
that
it
might
appear
somewhat
anomalous
for
a
“low-income”
family
to
be
receiving
a
credit
in
respect
of
a
child
who
has
enough
income
to
file
his
own
tax
return.
It
is
possible
to
define
an
income-tested
refundable
tax
credit
using
any
of
these
approaches.
The
choice
will
depend
on
the
particular
objectives
of
any
given
credit
and
the
trade-off
between
payments
to
inappropriate
recipient
groups
and
increased
filing
and
administrative
complexity.
[Emphasis
added.]
Prior
to
the
introduction
of
the
GST
credit,
Canada
adhered
to
a
system
of
refundable
tax
credits.
At
the
time
of
the
introduction
of
the
GST,
a
system
was
in
place
to
deliver
consumption
tax
credits
to
lower
and
middle-income
Canadians.
Evidence
tendered
at
trial
demonstrated
that
the
percentage
of
those
eligible
and
who
actually
applied
for
refundable
tax
credits
had
been
good
and
close
to
90
per
cent
in
such
cases
as
the
Child
Tax
credit.
Consequently,
by
utilizing
those
mechanisms
already
in
place
in
the
income
tax
reporting
system,
the
objective
of
the
GST
credit
was
to
identify
efficiently
and
to
redistribute
an
amount
in
the
order
of
$47.50
(the
basic
credit)
each
quarter
to
approximately
8.7
million
lower-income
Canadians.
B.
Age
as
a
personal
characteristic
The
Carter
Commission
recommended
in
1966
that
resident
children
form
part
of
the
family
unit
for
tax
purposes
and
that
an
age-based
definition
for
dependent
children
be
adopted.
It
proposed
the
age
of
21
as
the
cut-off
point.
In
unmistakable
terms
and
for
obvious
reasons
relating
to
the
effective
enforcement
of
the
law,
it
rejected
the
implementation
of
an
“actual
support"
test
for
determining
dependency
(Report
of
the
Royal
Commission
on
Taxation,
Taxation
of
Income,
vol.
3,
1966,
at
page
134):
We
suggest
that
in
no
circumstance
should
actual
support
be
the
test
of
dependency
for
purposes
of
inclusion
or
exclusion
of
a
child
from
the
family
unit.
[Emphasis
added.]
Indeed,
one
can
easily
envisage
the
substantial
costs
and
the
undesirable
intrusiveness
that
would
be
involved
in
measuring
in
each
case
the
level
of
actual
support
and
the
degree
of
dependency.
In
a
leading
article
on
taxation,
Professor
Boris
I.
Bittker
reasserts
the
need
to
define
clearly
the
group
whose
income
is
to
be
consolidated
and
warns
against
the
difficulty,
if
not
the
impossibility,
of
administering
a
taxation
statute
where
"squishy"
phrases,
categories
or
classifications
are
used.
In
this
respect
he
writes
(in
Federal
Income
Taxation
and
the
Family
(1975)
27
Stanford
Law
Review
1388,
at
page
1399):
The
most
objective
boundary
lines
are
those
based
on
legal
characteristics
such
as
marital
status,
obligation
to
support,
or
right
to
inherit.
Under
existing
law,
the
principal
determinant
of
the
tax
burden
is
marriage,
a
status
that
is
usually
unambiguous.
In
a
society
that
increasingly
questions
the
legitimacy
of
traditional
legal
distinctions,
however,
one
is
tempted
to
substitute
social
“realities”
in
defining
the
boundaries
of
the
group
whose
income
is
to
be
consolidated.
But
every
departure
from
readily
established
definitional
lines
increases
the
problem
of
enforcement.
If
the
tax
on
two
unmarried
persons
depends
on
whether
they
live
together,
for
example,
how
is
their
status
to
be
verified
by
the
Internal
Revenue
Service
without
an
intolerable
intrusion
into
their
private
lives?
The
attempt
of
social
workers
to
apply
the
“man
in
the
house”
rule
to
deny
welfare
payments
suggests
the
difficulties
that
would
be
encountered
by
the
Internal
Revenue
Service
in
auditing
claims
that
taxpayers
are,
or
are
not,
living
together.
If
the
assertions
of
status
on
tax
returns
were
taken
at
face
value
in
order
to
minimize
or
eliminate
costly
and
abrasive
investigations,
the
revenue
loss
resulting
from
improper
claims
might
be
very
large;
perhaps
more
important,
conscientious
taxpayers
would
be
offended
By
the
government's
refusal
to
enforce
its
own
rules
against
others.
For
these
reasons,
it
does
not
seem
feasible
to
consolidate
the
income
of
a
group
unless
its
boundaries
can
be
crisply
defined
and
readily
verified.
In
the
end,
facing
the
difficult
task
of
determining
the
parameters
of
dependency
of
children
in
the
family
unit,
Parliament
adopted
the
age-based
criterion
recommended
by
the
Carter
Commission,
but
lowered
the
age
to
19
so
as
to
adopt
an
objective
standard
which
is
closer
to
the
present
reality
in
Canada
with
regard
to
childhood
and
adulthood
and
which
is
also
consistent
with
the
community's
traditional
approach
to
rite
of
passage
issues
such
as
alcohol
consumption,
voting
and
driving.
Counsel
for
the
applicants
submits
that,
while
it
is
proper
to
use
the
age
criterion
in
relation
to
such
issues
as
voting,
driving
and
consumption
of
alcohol,
as
he
asserts
a
logical
connection
between
age
and
these
matters,
it
is
improper
to
do
so
in
relation
to
the
GST
refundable
credit
as
there
is
no
similar
connection
between
age
and
wealth/poverty
and
between
age
and
financial
status.
He
submits
that
the
credit
should
have
been
granted
on
the
basis
of
income
and
consumption,
and
not
age.
Section
15
of
the
Charter
recognizes
age
as
a
prohibited
ground
of
discrimination.
It
has
also
been
recognized,
however,
that
there
are
important
differences
between
age
discrimination
and
the
other
grounds
enumerated
in
subsection
15(1).
As
Mr.
Justice
La
Forest
stated
in
relation
to
age
and
the
allocation
of
benefits
(McKinney,
supra,
at
S.C.R.
page
297.
See
also
the
statement
of
Cory
J.
in
Dickason
v.
University
of
Alberta,
[1992]
2
S.C.R.
1103,
95
D.L.R.
(4th)
439,
at
S.C.R.
pages
1132-33
(D.L.R.
499)):
The
truth
is
that,
while
we
must
guard
against
laws
having
an
unnecessary
deleterious
impact
on
the
aged
based
on
inaccurate
assumptions
about
the
effects
of
age
on
ability,
there
are
often
solid
grounds
for
importing
benefits
on
one
age
group
over
another
in
the
development
of
broad
social
schemes
and
in
allocating
benefits.
In
the
present
case,
I
believe
the
applicants
misconstrued
the
nature
of
the
relationship
between
age
and
the
allocation
of
the
GST
credit.
Age
has
not
been
invoked
as
a
criterion
to
deny
a
benefit,
but
rather
is
being
used
to
determine
whether
a
child
is
likely
to
be
a
dependant
and,
therefore,
ought
to
be
included
in
or
excluded
from
the
family
unit
for
the
purpose
of
receiving
the
benefit.
It
was
linked
to
marital
and
parental
status
and
had
an
obvious
and
logical
connection
with
dependency.
In
turn,
family
status
was
linked
to
income
since
the
availability
and
amount
of
the
refundable
credit
depended
on
the
level
of
income
of
the
family
itself.
In
the
context
of
determining
whether
a
child
is
dependent
on
his
parents
or
not,
age
is
a
most
relevant
factor.
Barring
the
odd
exception,
it
is
the
factor
which
applies,
and
is
applied,
most
commonly,
conveniently
and
fairly
to
the
proper
determination
of
the
family
unit
for
benefit-allocation
purposes.
Although
it
is
true
that
age
has
been
associated
with
some
stereotypes
and
prejudices
in
the
context
of
employment
or
in
respect
of
the
elderly,
the
evidence
before
the
Tax
Court
of
Canada
and
before
this
Court
reveals
no
such
prejudice
in
relation
to
an
age-based
definition
of
dependency
in
the
family.
Whether
the
impugned
legislative
provision
is
discriminatory
in
its
purpose
As
the
learned
Tax
Court
judge
found
and
the
evidence
establishes,
the
GST
credit
is
not
a
taxing
program
but
rather
a
benefit
program.
The
purpose
of
section
122.5
of
the
Act
was
not
to
impose
a
burden
on
taxpayers
generally
and
discriminate
against
some
of
them.
On
the
contrary,
it
was
to
lessen
the
inevitable
and
adverse
effect
of
a
regressive
tax
such
as
the
Goods
and
Services
Tax
upon
lower-
income
Canadians.
Section
122.5
of
the
Act
is
corrective
in
nature
and
the
fact
that
the
applicants
do
not
find
it
sufficiently
remedial
to
their
liking
is
certainly
not
a
ground
to
declare
the
provision
unconstitutional
under
section
15
of
the
Charter.
Whether
the
impugned
legislative
provision
is
discriminatory
in
its
effects
In
assessing
the
applicants’
claim
of
discrimination,
I
have
reviewed
at
some
length
the
evidence
in
order
to
properly
place
the
impugned
provision
in
its
social,
political
and
legal
context
and
determine
whether
the
alleged
difference
of
treatment
resulted
in
an
inequality
or
fostered
a
disadvantage
contrary
to
section
15.
I
have
found
no
evidence
that
the
impugned
provision
reinforces
disadvantages
or
promotes
stereotyping.
The
purpose
of
section
122.5
of
the
Act
was
to
redress
the
inequity
generated
by
regressive
taxation,
which
necessarily
involved
an
assessment
by
Parliament
of
the
various
options
and
means
available
in
order
to
do
so.
At
the
end
of
the
day,
what
resulted
was
the
selection
of
a
system
that
would
best
achieve
the
desirable
equity,
bearing
in
mind
the
practical
constraints
associated
with
the
cost-effective
implementation
of
a
selected
measure
or
program.
Obviously,
this
selection
process
entailed
the
preference
of
one
approach
over
the
other
with
the
inevitable
result
that
some,
but
not
all,
taxpayers
would
have
been
better
off
with
a
different
option
than
the
one
selected
and
vice
versa.
There
was
nothing
wrong
for
Parliament,
in
its
search
for
an
equitable
solution
to
the
regressive
nature
of
the
GST
tax,
to
confer
benefits
upon
those
who
suffer
most
from
the
imposition
of
that
tax,
namely
lower-income
Canadians
and
their
families.
In
view
of
the
evidence
as
to
the
remedial
nature
of
the
impugned
provision,
the
larger
context
in
which
it
operates,
and
the
inherent
limits
in
the
implementation
of
such
a
benefit
program,
I
cannot
say
that
the
option
finally
selected
by
Parliament
creates,
in
its
effects,
a
discriminatory
and
prejudicial
difference
of
treatment
that
the
applicants
can
justifiably
complain
of.
It
does
cut
the
Gordian
knot
by
creating
distinctions
between
dependent
and
non-dependent
children,
the
former
being
included
in
the
family
unit
and
receiving
their
refundable
tax
credit
through
that
channel,
the
latter
being
considered,
as
any
other
unattached
individual,
a
tax
unit
on
its
own
and
receiving
the
tax
credit
personally.
In
my
view,
the
applicants
have
failed
to
establish
any
prejudice
or
stereotyping
in
these
circumstances.
Furthermore,
to
use
the
words
of
Mr.
Justice
La
Forest
in
the
Andrews
case
previously
quoted,
one
cannot
say
that
fundamental
unfairness
has
been
established
or
that
the
impugned
provision
is
so
grossly
unfair
to
the
applicants
or
their
group
or
so
devoid
of
any
rational
relationship
to
a
legitimate
state
purpose
as
to
offend
against
the
equality
principle
entrenched
in
the
Charter
and
thereby
warrant
our
intervention
under
section
15.
In
short,
section
122.5
of
the
Act
creates
a
distinction
but
one
which
is
not
discriminatory
within
the
meaning
of
section
15
of
the
Charter.
Consequently,
the
applications
for
judicial
review
should
be
dismissed.
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