Citation: 2005TCC175
Date: 20050303
Docket: 2004-2759(IT)I
BETWEEN:
FRANK GIORNO,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
REASONS FOR JUDGMENT
Rip J.
[1] Frank Giorno has appealed his
income tax assessment for the 2000, 2001 and 2002 taxation years
on the presumption that subsection 118(5) of the Income Tax Act ("Act") infringes on his
equality rights under section 15 of the Canadian Charter of Rights and
Freedoms ("Charter"). The respondent made a
preliminary objection to quash the respected appeals for 2000 and 2001 since
Mr. Giorno did not file a Notice of Objection in respect of those years as
required by section 165 of the Act. Based on the material before
me I quashed the appeals for 2000 and 2001. I was advised that Mr. Giorno is well
within time to apply for extension of time to object to the 2000 and 2001 assessments
in accordance with section 166.1 of the Act and I informed him to do so
without delay.
[2] Mr. Giorno and his former spouse entered into
Separation Agreement on January 10, 1995. The Appellant states that the
Agreement was only an interim agreement intended to be a "guideline"
and a "reference point" for discussions and not a legally binding
agreement. This is not what the Agreement states; there is no suggestion in the
Agreement that it is a guideline or reference point. There are handwritten
references on the copy filed at trial that it is an interim agreement but these
references are not initialed or otherwise indicate that the appellant’s former
spouse agrees with the handwritten notes or that the Agreement is an interim agreement,
as claimed by the appellant. The Agreement does contemplate the parties
developing a “parenting plan”. I find the Agreement to be what it purports to
be, among other things, an agreement for the care and support of the children
of the marriage.
[3] Under the Agreement, the parents agreed to have
joint custody of their two children. Mr. Giorno testified that the
children reside with him for 182½ days a year and with their mother 182½ days a
year. Mr. Giorno agreed that he would pay child support of $400 for each child
per month until one of the following occurred:
a)
The child
reached age 18 years and stopped attending school;
b)
The child
reached 21 years;
c)
The child
maintained a separate residence;
d)
The child
married.
[4] At the time the Agreement was
signed by Mr. Giorno and his spouse on January 10, 1995, paragraph 60(b) of the
Act permitted him to deduct from his income, and required his spouse to
include in her income, the amounts he paid to her on a periodic basis for the
maintenance of the children. In 1997 the provisions of paragraph 60(b) and section
56.1 were amended so that a payment for child support made after the "commencement
date" of an agreement would not be deductible by the payer. An agreement
made before May 1997 does not have a "commencement date". However,
where an agreement is made before August 1997 it may have a "commencement
date" after 1997. In such case the "commencement date" would be
the earliest of:
a)
The date specified as a "commencement date" of the agreement in
a joint election filed with the Minister in prescribed form 2;
b)
The agreement was varied after April 1997 to change the amounts of child
support, the date of the first payment of the varied amount;
c)
Where subsequent agreement was made after April 1997 to change total child
support payments, the date of the first subsequent payment;
d)
The day specified in the agreement, or any variation thereof, as a "commencement
date" of the agreement for purposes of the Act.
[5] On the facts at bar, there was
no amendment or variation of the Agreement of January 10, 1995, there was no
subsequent agreement, no "commencement date" was specified in
any agreement and no order of the Court was issued varying, amending or
replacing the original agreement between Mr. Giorno and his wife at the
time.
Mr. Giorno was entitled to deduct from income in 2000 the amount he paid his
wife on a periodic basic for support of the children and she was required to
include the amount she so received in her income for 2000.
[6] The respondent alleges,
however, that in electronically filing his 2000 tax return, Mr. Giorno deducted
no amount as support payments and in computing taxes for the year, he deducted
a non‑refundable tax credit for an equivalent to spouse amount. The
Minister originally allowed the deduction of the non‑refundable tax
credit in respect of an equivalent to spouse amount as claimed but later, by reassessment,
disallowed the tax credit. The reason for disallowing the equivalent to spouse credit was
that the appellant was required to pay child support to his former spouse.
[7] Mr. Giorno took comfort in the fact that the
Minister allowed him the equivalent to spouse credit in 1995 and insisted the
practice continue. Each taxation year stands on its own and how the fisc considered
a claim in one year is not a binding precedent for other years. The Minister
says that he allowed the claim in 1995 because he was not aware that Mr. Giorno
was required to make child support payments in 1995.
[8] In any event, the appellant’s position at trial
was that
subsection 118(5), which disallows a taxpayer from claiming the equivalent to
spouse credit when that taxpayer is required to pay a support amount, violates
section 15 of the Charter, at least in the circumstances where a joint
custody parent who pays support would otherwise be entitled to the credit.
[9] Subsection 118(5) provides that:
|
No amount may be deducted under subsection (1) in
computing an individual's tax payable under this Part for a taxation year in
respect of a person where the individual is required to pay a support amount
(within the meaning assigned by subsection 56.1(4)) to the individual's spouse
or common-law partner or former spouse or common-law partner in respect of
the person and the individual
(a) lives separate and apart from the spouse or
common-law partner or former spouse or common-law partner throughout the year
because of the breakdown of their marriage or common-law partnership; or
(b) claims a deduction for the year because of
section 60 in respect of a support amount paid to the spouse or common-law
partner or former spouse or common-law partner.
|
|
Aucun montant n'est déductible en application du
paragraphe (1) relativement à une personne dans le calcul de l'impôt payable
par un particulier en vertu de la présente partie pour une année d'imposition
si le particulier, d'une part, est tenu de payer une pension alimentaire au
sens du paragraphe 56.1(4) à son époux ou conjoint de fait ou ex-époux ou
ancien conjoint de fait pour la personne et, d'autre part, selon le
cas :
a) vit séparé de son époux ou conjoint de fait ou
ex-époux ou ancien conjoint de fait tout au long de l'année pour cause
d'échec de leur mariage ou de leur union de fait;
b) demande une déduction pour l'année par l'effet
de l'article 60 au titre de la pension alimentaire versée à son époux ou
conjoint de fait ou ex‑époux ou ancien conjoint de fait.
|
[10] "Support amount" is
defined in the Act as follows:
|
means an amount payable or receivable as an
allowance on a periodic basis for the maintenance of the recipient, children
of the recipient or both the recipient and children of the recipient, if the
recipient has discretion as to the use of the amount, and
(a) the recipient is the spouse or common-law
partner or former spouse or common-law partner of the payer, the recipient
and payer are living separate and apart because of the breakdown of their
marriage or common-law partnership and the amount is receivable under an
order of a competent tribunal or under a written agreement; or
(b) the payer is a natural parent of a child of
the recipient and the amount is receivable under an order made by a competent
tribunal in accordance with the laws of a province.
|
|
Montant payable ou à recevoir à titre d'allocation
périodique pour subvenir aux besoins du bénéficiaire, d'enfants de celui-ci
ou à la fois du bénéficiaire et de ces enfants, si le bénéficiaire peut
utiliser le montant à sa discrétion et, selon le cas :
a) *le bénéficiaire est l'époux ou le conjoint de
fait ou l'ex-époux ou l'ancien conjoint de fait du payeur et vit séparé de
celui-ci pour cause d'échec de leur mariage ou union de fait et le montant
est à recevoir aux termes de l'ordonnance d'un tribunal compétent ou d'un
accord écrit;
b) le payeur est le père naturel ou la mère
naturelle d'un enfant du bénéficiaire et le montant est à recevoir aux termes
de l'ordonnance d'un tribunal compétent rendue en conformité avec les lois
d'une province.
|
[11] Section 15(1) of the Charter
states that:
|
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.
|
|
La loi ne fait acception de personne et s'applique
également à tous, et tous ont droit à la même protection et au même bénéfice
de la loi, indépendamment de toute discrimination, notamment des
discriminations fondées sur la race, l'origine nationale ou ethnique, la
couleur, la religion, le sexe, l'âge ou les déficiences mentales ou
physiques.
|
[12] Mr. Giorno's argument that subsection 118(5) infringes section 15 of
the Charter is summarized in his written submissions as follows:
The issue boils
down to this: If you are a joint custody dad and you earn slightly more than
your ex partner and if you have an agreement (informal or court ordered) to pay
support to your ex you cannot claim a $6,000 deduction known as the
"spousal equivalent". But your ex partner can.
[13] In Law v. Canada, the Supreme Court
of Canada articulated the following three stage analysis for the purpose of
determining whether a legislative provision infringed of section 15 of the Charter;
A. Does the impugned law
(a) draw a formal distinction between the claimant and others on the basis of
one or more personal characteristics, or (b) fail to take into account the
claimant's already disadvantaged position within Canadian society resulting in
substantively differential treatment between the claimant and others on the
basis of one or more personal characteristics?
B. Is the claimant subject
to differential treatment based on one or more enumerated and analogous
grounds? and
C. Does the differential
treatment discriminate, by imposing a burden upon or withholding a benefit from
the claimant in a manner which reflects the stereotypical application of
presumed group or personal characteristics, or which otherwise has the effect
of perpetuating or promoting the view that the individual is less capable or
worthy of recognition or value as a human being or as a member of Canadian
society, equally deserving of concern, respect, and consideration?
[14] The appellant argued that the subsequent
decision in B v. Ontario (Human Rights Commission), ("Mr. B")
stands for the proposition that a person does not have to belong to an
identifiable group for the court to make a finding of discrimination. That case
involved a complaint heard by a Board of Inquiry appointed pursuant to the Ontario Human Rights Code. Although it is not a Charter
case, it is still instructive as the Supreme Court has often held that
human rights legislation is quasi-constitutional in nature. Specifically, Mr. A
alleged that he was discriminated against on the ground of marital or family
status.
[15] In Mr. B, Mr. A was dismissed from his
employment with D Ltd., of which Mr. B was the manager. The event that led to
the termination was that Mr. A accused Mr. B of sexually molesting his
daughter. The
Ontario Court of Appeal held that Mr. A's dismissal was based on his
presumed inability, as husband and father, to be a good employee given the
accusations of his wife and daughter. The dismissal was not based on merit or
conduct, and constituted discrimination, the prohibited enumerated grounds
under the Code being marital and family status. The Supreme Court of
Canada unanimously dismissed the further appeal to that Court, with the Chief
Justice and Justice Gonthier agreeing in result but writing a minority
concurring opinion on narrower grounds, viz. the findings of the Board
of Inquiry.
[16] One argument made by the respondent in Mr. B was
that in order to make a finding of discrimination, the claimant is required to
belong to an identifiable sub‑group. The seven-member majority of the
Court rejected this argument, and held at paragraph 47 that while a category of
persons is often identifiable given the existence of historically disadvantaged
groups, it is not a necessary requirement to making a finding of
discrimination. Mr. Giorno cites following dicta of Abella J., then of
the Ontario Court of Appeal, which was quoted with approval at paragraph 56
of Supreme Court decision in Mr. B:
Discrimination is
not only about groups. It is also about individuals who are arbitrarily
disadvantaged for reasons having largely to do with attributed stereotypes,
regardless of their actual merit. While it is true that disadvantageous stereotypes
usually arise when characteristics are attributed to someone based on what
people in a particular group are deemed to be capable of, this does not
mean that when dealing with a complaint, a complainant must be
artificially slotted into a group category before a claim of discrimination can
be upheld under the Code.
Whether or not a
disadvantaged group can be fashioned out of the facts of any particular case is
largely irrelevant. The Code stipulates grounds in s. 5(1), not groups.
The question is whether an individual has been discriminated against on the
basis of a prohibited ground, not whether he or she necessarily fits into a
group requiring redress.
There is no doubt
that the Code contemplates that an individual's membership in a group
may result in discrimination based on perceived characteristics attributed to
the group. Some of the grounds in s. 5(1), for example, such as race, sex or
ethnic origin, anticipate arbitrary barriers attaching to individuals belonging
to certain historically disadvantaged groups. But other grounds, such as family
or marital status or age, may have less to do with whether a disadvantaged
group emerges easily from an individual's complaint than with whether the
individual, regardless of group membership, is being stereotyped or arbitrarily
disadvantaged.
[17] In light of the above, Mr. Giorno’s position
that a claimant need not belong to an identifiable group is a sound one. That
does not end the matter, however; it must still be considered whether the
impugned provision discriminates against the appellant under the three-stage
inquiry articulated in Law.
[18] Applying the analysis set out in Law, it
is clear that subsection 118(5) creates a distinction in that it denies
equivalent to spouse credits to payers of support while allowing such credits
to taxpayers who do not pay support.
[19] Turning to the second stage of the inquiry, the distinction must be
based on a personal characteristic that is an enumerated ground under section
15 of the Charter or an analogous ground. The appellant complains that
the ground is "... that I am required to pay child support by virtue of an
agreement". The face of subsection 118(5) clearly disallows the tax
credit to a taxpayer who is obligated to pay child support. An obligation to pay
child support is not an enumerated ground under section 15 of the Charter.
Is it an analogous ground?
[20] Counsel for the respondent referred me to my
decision in Keller v. Canada,
The alleged ground of discrimination in that case, like the present appeal, was
the obligation to pay child support. In the analysis of whether this
constitutes an analogous ground, I referred to the following comments of the
Supreme Court of Canada in Corbiere v. Canada:
What then are the
criteria by which we identify a ground of distinction as analogous? The obvious
answer is that we look for grounds of distinction that are analogous or like
the grounds enumerated in s. 15 - race, national or ethnic origin, colour,
religion, sex, age, or mental or physical disability. It seems to us that what
these grounds have in common is the fact that they often serve as the basis for
stereotypical decisions made not on the basis of merit but on the basis of a
personal characteristic that is immutable or changeable only at unacceptable cost
to personal identity. This suggests that the thrust of identification of
analogous grounds at the second stage of the Law analysis is to reveal grounds
based on characteristics that we cannot change or that the government has no
legitimate interest in expecting us to change to receive equal treatment under
the law. To put it another way, s. 15 targets the denial of equal treatment on
grounds that are actually immutable, like race, or constructively immutable,
like religion. Other factors identified in the cases as associated with the
enumerated and analogous grounds, like the fact that the decision adversely
impacts on a discrete and insular minority or a group that has been
historically discriminated against, may be seen to flow from the central concept
of immutable or constructively immutable personal characteristics, which too
often have served as illegitimate and demeaning proxies for merit-based
decision making.
[21] In Keller, I concluded
that an obligation to pay child support is not an immutable, or constructively
immutable, personal characteristic. The appellant argues that Keller is
no longer good law in the wake of Mr. B. I cannot agree with this
position. While Mr. B did clarify that an individual need not be a
member of a group, historically disadvantaged or otherwise, to succeed in a
claim for discrimination, the law with respect to analogous grounds of
discrimination did not change. The obligation to pay child support is not
immutable in the sense that it cannot be changed. Further, an obligation to pay
child support may be based on the income of the payer. Far from being an
immutable personal characteristic, income is a function of activity, merit and
circumstance. As alluded to in Keller, parental status may be immutable,
but an obligation to pay child support is not.
[22] Even if an obligation to pay
child support can sometimes be said to be an analogous ground in some
circumstances insofar as it may be an obligation imposed by a court or by
operation of law, that is not the case here. Mr. Giorno's own evidence shows
that the Separation Agreement was just that – an agreement. The obligation to
pay child support does not arise out of a personal characteristic, but from an
agreement between the appellant and his former spouse.
[23] Subsection 118(5) does not
infringe section 15 of the Charter because in this case no
discrimination has occurred on the basis of a personal characteristic. I share
the following comments of Professor Hogg:
Of
all the distinctions found in the statute books, there must be very few that
are based on the named grounds of discrimination, and only a few more that are
based on immutable personal characteristics that would be regarded as analogous
to the named grounds. The interpretation of discrimination that restricts s. 15
to distinctions based on the named or analogous grounds has caused a dramatic
reduction in the reach of s. 15. However, there is much to be said for the
view, articulated well in Andrews, that the
narrower version of s. 15 is much better targeted to its purpose, which is to
correct disadvantages imposed through prejudices that may have distorted the
political process. Complaints of unequal treatment that cannot be related to a
named or analogous ground must be addressed to elected officials, not to the
Courts.
[24] The appeal for the 2002 taxation year is dismissed.
Signed
at Ottawa, Canada, this 3rd day of March 2005.
"Gerald J. Rip"
Email this Content