Exner v. The Queen, docket 2002-42-IT-I (Informal Procedure)

Date: 20020814

Docket: 2002-42-IT-I

BETWEEN:

DANIEL PETER EXNER,

Appellant,

and

HER MAJESTY THE QUEEN,

Respondent.

__________________________________________________________________

                   For the Appellant:                                The Appellant himself

                   Counsel for the Respondent:                Tracey Harwood-Jones

____________________________________________________________________

Reasons for Judgment

(Delivered orally from the Bench at Regina, Saskatchewan,

on Wednesday, May 1, 2002 and revised as to style and syntax at

New Glasgow, Nova Scotia on August 18, 2002)

Margeson, J.T.C.C.

[1]      The matter before the Court at this time for decision is that of Daniel Peter Exner and Her Majesty the Queen.

[2]      The issue is whether or not the Minister properly assessed the Appellant in the 1999 taxation year. The Minister in reassessing the Appellant concluded that the Appellant was 65 years of age during the 1999 taxation year. His net income was $33,387.23. The Appellant was entitled to an age tax credit calculated at 17 percent of the age amount of $2,363.00 pursuant to subsection 118(2) of the Income Tax Act ("Act"). The age amount used to calculate the Appellant's age tax credit entitlement was determined by reducing the 1999 maximum allowable base amount of $3,482.00 by 15 percent of the Appellant's income in excess of $25,921.00. That is exactly what the section of the Act provides.

[3]      The Appellant's argument          is that he is being treated unfairly because other people ¾ he referred to a widow, and I do not know which one he is talking about, but some other people are treated differently under the Act, and that is contrary to the Canadian Charter of Rights and Freedoms ("Charter").

[4]      First of all, the Court is satisfied that section 118.2 of the Act has been properly applied and that the section is properly in force and is properly a part of the Act. The Court is satisfied on the evidence that the assumptions as set out in the Reply have not been destroyed.

[5]      Secondly, the Court is satisfied that the Appellant is not entitled to make the argument that he did based upon section 57 of the Federal Court Act, that section 118.2 is discriminatory because he has not complied with section 57 of the Federal Court Act by giving the appropriate notices.

[6]      However, if he had given the proper notices and the Court was required to decide whether or not there was an infringement of the Charter, this Court is satisfied on the basis of all of the evidence that there has been no abridgement of the Charter in this particular case. Just because some people are treated differently under the statute than others, does not mean that there has been an infringement or a violation of the Charter.

[7]      In the case of Her Majesty the Queen v. Helmut Swantje, (Court File No. A-144-94) the Federal Court of Appeal at page 4 said:

      It is well established that Part 1.2 of the Act provides for the repayment of benefits received by a taxpayer under the Family Allowances Act and the Old Age Security Act to the extent that the taxpayer's income is in excess of a $50,000 (indexed) threshold (see Thomson v. Canada, (1992), No. 92-899(IT)).

[8]      In this particular case, the section that is being questioned, does permit a reduction or deduction, for those persons whose income is in excess of a certain amount as set out in the Reply.

[9]      The Court went on to say:

...What Part 1.2 of the Act, completed by paragraph 60(w), realizes is the repayment of social benefits by taxpayers who, because of their higher incomes, have a lesser need of them.

That is the same effect as section 118.2 in this case. It just recognizes that some taxpayers in certain brackets have a higher income and therefore it reduces the social benefits received by those taxpayers. In this case it reduced the amount of the deduction, so that is exactly what Swantje, supra, is talking about.

[10]     Then we have the case of Donna E. Kasvand v. Her Majesty the Queen, (Court File No. A-321-93) where the Court had a Charter argument before it of the same nature. There the applicant challenged the constitutionality of paragraph 146(1)(c) of the Act which defined the term "earned income" upon which the deductible amount of RRSP savings was determined and which included income from all other sources reported by her. She argued that the paragraph violated her rights guaranteed by sections 7, 8, 15(1) and 20(1) of the Charter and asked for a remedy under section 24(1), which is what the Appellant is doing here. She was self-represented and alleged discrimination on the basis of age and disability.

[11]     The Court said, "the applicant's perception is that paragraph 146(1)(c) denies the deduction in respect of income from sources on which many elderly, disabled persons disproportionately depend while allowing it in respect of income from sources usually more accessible to younger, able-bodied persons. That may be so, but it remains that the distinction among taxpayers is drawn on the basis of sources of income. It is not drawn on any basis of discrimination prescribed by subsection 15(1). Elderly and disabled persons who have earned income are as entitled as any other taxpayers to deductions while the young and able-bodied are identically limited". The same applies here.

[12]     In the case of John v. Canada, [1997] T.C.J. No. 1326 the Court said at page 5:

      In my view, although the effect of the calculation might appear as though the foreign pension were being taxed, the Act does not impose tax by virtue of the provisions in subsection 118(2). It does no more than realize the reduction of a social benefit, i.e. the age tax credit, for those taxpayers "who, because of their higher incomes, have a lesser need of them".

That is the case here.

[13]     It may very well be that the appellant believes that he does not have a lesser need of them. His indication is that he has as much or more of a need for them as he did before and as much need as anybody else, but the point is that the actions of the Minister do not amount to discrimination.

[14]     The end result is that the Court is satisfied the Charter has not been violated, if the Appellant were inclined to argue that, but I am satisfied that there is no basis for the appeal. It will have to be dismissed and the Minister's assessment confirmed.

Signed at New Glasgow, Nova Scotia this 18th day of August 2002.

"T.E. Margeson"

J.T.C.C.

COURT FILE NO.:                             2002-42(IT)I

STYLE OF CAUSE:                           Daniel Peter Exner and

                                                          Her Majesty The Queen

PLACE OF HEARING:                      Regina, Saskatchewan

DATE OF HEARING:                        May 1st, 2002

REASONS FOR JUDGMENT BY:     The Honourable T.E. Margeson

DATE OF REASONS FOR JUDGMENT:    August 18, 2002

APPEARANCES:

For the Appellant:                                The Appellant himself

Counsel for the Respondent:                Tracey Harwood Jones

COUNSEL OF RECORD:

For the Appellant:

Name:                   

Firm:           

                                                         

For the Respondent:                            Morris Rosenberg

                                                          Deputy Attorney General of Canada

                                                          Ottawa, Canada