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.
Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.
Principal Issues:
Whether subsection 19(8) would apply where a publication qualifies as a "Canadian newspaper or periodical" as defined in subsection 19(5) and the corporation holding the right to publish is owned by a corporation not described in paragraphs (a) to (e) of the definition "Canadian newspaper or periodical" in subsection 19(5), but ultimate control is held, and excercised, by a Canadian citizen (or a controlling group of Canadian citizens).
Position:
No.
Reasons:
Subsection 19(8) is an anti-avoidance provision aimed at ensuring that Candadian newspapers and periodical are in fact controlled by Canadians. In this situation, the specific requirements for qualification under subsection 19(5) have been met and, given there is actual Canadian control, there is no avoidance of the fundamental objective of section 19.
972760
XXXXXXXXXX B.G. Dodd
October 30, 1997
Dear Sir:
Re: Section 19 of the Income Tax Act (the "Act")
We are writing in reply to your letter dated October 16, 1997 concerning XXXXXXXXXX.
It is our view that where ultimate control of the person holding the right to publish a "Canadian newspaper or periodical", as that expression is defined in subsection 19(5) of the Act, is, as a factual matter, held and exercised by one Canadian citizen, or a controlling group of Canadian citizens, the provisions of subsection 19(8) of the Act would not have application.
The foregoing is an expression of opinion only and as such, is not binding on the Department with respect to any particular situation.
Yours truly,
for Director
Resources, Partnerships
and Trusts Division
Income Tax Rulings and
Interpretations Directorate
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