In 2007 and 2008, the Minister assessed to deny input tax credits for GST paid by the appellant on fees of investment managers who managed three defined benefit Pension Plans of which the appellant was the administrator. In 2016, the Minister made a reassessment which allowed such ITCs, but included an equivalent amount of unreported GST collectible by the appellant in respect of an alleged resupply of the investment management services by the appellant to the Pension Plans. In justifying this reassessment beyond the normal reassessment period, the Minister took the position that “unlike the corresponding provisions of the Income Tax Act, subsection 298(3) imposes no limits on the Minister’s power to reassess,” and that thus “the Minister is not precluded from reassessing on the basis of different transactions or even from increasing net tax” (para. 18).
While the wording of subsection 298(3) of the GST Act is different than the wording of subsection 165(5) of the Income Tax Act, Parliament’s intention is, in my view, the same: the Minister cannot, after the expiry of the reassessment period, use subsection 298(3) of the GST Act to increase the net tax of the GST registrant or to take into account different transactions that the ones that formed the basis of the reassessment that was made within the statutory reassessment period.
However, he found that the Rule 58 materials before him were insufficient to determine whether the 2016 reassessment was made taking into account a different transaction, stating (at paras 45, 46):
In order to answer the Rule 58 Question, the Court must determine whether the supply of the investment management services by third parties to the Appellant and by the Appellant to the Pension Plans is part of the same transaction, or a series of transactions, such that the Minister did not consider any new transactions when reassessing the Appellant. The relevant facts, including agreements, required to make such a determination are not before the Court.
For example … there may be an interrelationship between the Appellant’s acquisition of the investment management services and its resupply of such services to the Pension Plans. … The Court cannot answer the Rule 58 Question … in a factual vacuum.