Joint Committee articulates its understanding of reasonable limitations on CRA’s discretion to extend reassessment periods during COVID-19

S. 7 of the Time Limits and Other Periods Act (COVID-19) (the “Proposals”) would grant the Minister the exceptional power inter alia to order the suspension or extension of a time limit, or any other period, that is established under any ITA or ETA listed in the Schedule. The Joint Committee suggests that there are provisions missing from the Schedule, and suggests that it contain more generic language to cover what is being aimed at.

One set of provisions that are already listed are ITA ss. 152(3.1) and (4) and ETA ss. 298(1) and (2), setting out permitted (re)assessment periods. Based on informal discussions with CRA officials, it is understood that the “Minister would likely exercise the authorities provided under s. 7 of the Proposals in a manner that would not displace acquired rights by reopening administrative proceedings which had achieved finality before the announcement of the Proposals, nor in a manner that could be duplicative or inordinately disruptive of certainty in proceedings and the rule of law, or not justified by the need to avoid unfair or undesirable effects of the COVID-19 crisis.” The following observations of the Joint Committee give shape to that understanding:

• Where such reassessment periods had already expired before the announcement of the Proposals, any such order would not permit an assessment without the taxpayer’s consent.
• For audits that had not been materially disrupted by COVID-19, no order would extend such a reassessment period.
• Any order(s) would not result in a total prolongation exceeding six months.
• Any such order would not suspend or extend any such reassessment period which would otherwise expire within a reasonable amount of time after September 13, 2020.

Neal Armstrong. Summary of "COVID-19 Measures", 1 June 2020 Joint Committee Submission under s. 180(1), s. 152(3.1) and ETA s. 298(1)(a).