Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.
Principal Issues: General
Position: General comments only
Reasons: No specific question.
November 29, 2011
XXXXXXXXXX
Dear XXXXXXXXXX :
The Honourable John Duncan, Minister of Aboriginal Affairs and Northern Development, forwarded to me a copy of your correspondence addressed to your member of Parliament, XXXXXXXXXX , which I received on September 20, 2011, concerning taxes paid by an individual who is an Indian as defined in the Indian Act.
As Minister of National Revenue, I cannot comment on taxes charged by provincial, municipal, or border authorities, but I can offer the following general information on federal taxes.
Generally, Indians are taxable in Canada on the same basis and in the same manner as non-Indian individuals. However, an Indian's personal property, which includes income, qualifies for an exemption from income tax under paragraph 81(1)(a) of the Income Tax Act and paragraph 87(1)(b) of the Indian Act if the property is situated on a reserve. For example, if an Indian works on a reserve, his or her employment income may be situated on the reserve and, therefore, exempt from income tax.
The goods and services tax/harmonized sales tax (GST/HST) does not apply to goods bought on a reserve by Indians. Generally, goods bought off a reserve by Indians are subject to the GST/HST, unless the goods are delivered to a reserve by the vendor or the vendor's agent. This is consistent with the exemption provided for personal property situated on a reserve.
You can find more information regarding the taxation of individuals, including specific information regarding the taxation of Indians, on the CRA Web site at www.cra.gc.ca.
I trust that the information I have provided is helpful.
Yours sincerely,
Gail Shea, P.C., M.P.
Pamela Burnley
613-957-2100
2011-042206
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