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.
February 22, 1990
19(1) EACC8835
Dear 19(1)
Re: Canada - Venezuela International Air and Shipping Taxation
I am writing to confirm certain comments which I made during our telephone conversation today.
Paragraph 81(1)(c) of the Income Tax Act provides that income of a non-resident earned in Canada from the operation of a ship or aircraft in international traffic is exempt from taxation in Canada if the country where that person resides grants substantially similar relief to a person resident in Canada. If the other country does not provide similar relief from taxation for Canadian residents operating in that other country, no exemption is available in Canada.
Should Venezuela tax income earned in Venezuela by a resident of Canada from operations of a ship or aircraft in international traffic, no exemption from tax in Canada would be available for Venezuelan residents carrying on similar activities in Canada. Such venezuelan residents would be liable for tax under the laws of Canada.
The procedure we would follow to notify our auditors of the non-application of the exemption would be to send a communique to our District Offices. I trust this provides the information which you require. If further elaboration is required please do not hesitate to call me.
Yours sincerely,
C. Savage
A/Director
Provincial and International
Relations Division
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