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.
MINISTER/DM'S OFFICE YS 93-4036 ADM'S OFFICE CENTRAL RECORDS RETURN TO RULINGS, ROOM 303, MET. BLDG.
XXXXXXXXXX
Dear XXXXXXXXXX
I am replying to your letter of May 28, 1993, which was sent to The Honourable Otto Jelinek, former Minister of National Revenue, by the Right Honourable Don Mazankowski, former Minister of Finance, on June 24, 1993, concerning the proposed small business investment tax credits (the "SBITC") as they relate to the leasing of equipment.
In your letter, you expressed concern with respect to the treatment under the SBITC provisions for equipment used by a qualifying taxpayer in qualifying conditions under a lease financing arrangement. You suggest that no distinction should be made between this situation and one where the equipment is acquired in an outright sale.
It is the position of the Department that when a lease portrays the true legal relationship of the parties thereto the subject property has been leased and not "acquired" as the proposed SBITC rules require.
I regret that my reply cannot be more favourable. Nevertheless, I trust that my comments have explained the Department's position on this matter.
Yours sincerely,
Pierre Gravelle, Q.C.
July 23, 1993
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© Her Majesty the Queen in Right of Canada, 1993
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© Sa Majesté la Reine du Chef du Canada, 1993
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