Federal Income Tax
A Brief History
Our Constitution
A constitution is supposed to do two things, protect the rights and freedoms of individuals and, more importantly, limit the powers of government. As you may or may not already realize, these prerogatives have been abused over the years primarily because those who hold the REAL power and control governments, no matter what the party affiliation, the international bankers, have taken advantage of our ignorance of who we are and the inalienable rights that we have and have economically enslaved us through a heavy burden of unnecessary taxation.
A little history on Taxation
By this definition, direct taxes would include "modes" or "systems" such as; sales taxes, income taxes, property taxes and inheritance/estate taxes. Indirect taxes would include "modes" or "systems" such as; import/export taxes, taxes at the manufacturing level and other duties or tariffs.
Sections 91 and 92 of the BNA Act of 1867 sought to divide these powers of taxation fairly. The Provinces wanted to ensure that they had a source of tax revenue in order to carry on the business of government at the Provincial level while, at the same time, recognize that the newly created Federal government needed a source of revenue to carry out its obligations. Under Section 91, "Powers of the Parliament" Section 3 gave the Federal government the power to "the raising of money by any mode or system of taxation".( It is interesting to note that during the Quebec Conferences in 1864 and 1865, leading up to the passing of the BNA Act in 1867, this phrase was originally written as "the raising of money by any other mode or system of taxation.") This authority pertains only to the indirect "field" of taxation as intended under Section 91 of the BNA Act of 1867. Under Section 92, "Exclusive Powers of Provincial Legislatures" section 92.2 gave the Provinces the exclusive authority to "direct taxation within the Province in order to the raising of a revenue for Provincial purposes." The phrase "for provincial purposes" was clarified in an earlier court case as "an explanation and not a limitation" on the authority of the Provincial legislatures. Direct taxation is exclusive to the Provinces and the Federal Parliament has no authority to levy such a tax.
It seems, by this explanation of direct and indirect taxation and by the Sections 91.3 and 92.2 of the BNA Act of 1867, the federal government has invaded an area of provincial authority in the levying of federal income tax and the GST. A direct violation of the Constitution. Now, lets look at some of the historical evidence. The second reading of the BNA Act of 1867 in the British Parliament gives convincing evidence of this violation.
IMPORTANT!! When a bill reaches second reading, it cannot be changed in any way. It cannot be added to, deleted from or revised in any fashion. It must pass, as is, or the bill is dead.
In February of 1867 the second reading gives the following evidence;
Lord Carnarvon the Fourth stood before the house and delivered the reading:
"In this Bill the division of powers has been mainly affected by a distinct classification. That classification is fourfold; first, those subjects of legislation which are attributed to the Central Parliament exclusively; second, those which belong to the Provincial Legislatures exclusively; third, those which are subjects of concurrent (joint) legislation; and fourth, a particular question which is dealt with exceptionally. To the Central Parliament belong all the questions of the public debt or property, all regulations with regard to trade or commerce, customs and excise, loans, the raising of revenue by any mode or system of taxation, all provisions as to currency, coinage, banking, postal arrangements, the regulation of the census, and the issue and collection of statistics. To the Central Parliament will also be assigned the enactment of the Criminal Code."
"The principal subjects reserved to the local Legislatures are the sale and management of the public lands, the control of their hospitals, asylums, charitable and municipal institutions, and the raising of money by means of direct taxation."
"The several Provinces, which are now free to raise a revenue as they may think fit, surrender to the Central Parliament all powers under this head except that of direct taxation. But there is, as I have said, a concurrent power of legislation to be exercised by the Central and Local Parliaments. It extends over three separate subjects - immigration, agriculture and public works." (There is, therefore, no shared authority over direct taxation.)
Lord Carnarvon continues by saying: "As I have said, it is proposed that the Provinces shall surrender to the Central Parliament all powers of raising revenue except by direct taxation. In return for this concession the Central Government will remit to the Local Legislatures certain fixed sums and proportionate capitation payments, in order to enable them more conveniently to defray the costs of local administration." (These transfer payments, with no strings attached, have been discontinued through the repeal of Section 118 of the BNA Act)
There have been a number of cases since confederation, which support the Province's exclusive authority over direct taxation. In the case Citizens Insurance Co. v. Parsons and Queen Insurance v. Parsons, 1881, His Lordship, SirMontague Smith, of the Privy Council of England made the following statement in his decision; "So,' the raising of money by any mode or system of taxation' is enumerated among the classes of subjects in Section 91; but, though the description is sufficiently large and general to include 'direct taxation within the Province, in order to the raising of a revenue for Provincial Purposes,' assigned to the Provincial legislatures by Section 92, it obviously could not have been intended that, in this instance also, the general power should override the particular one." He continues by saying; " It could not have been the intention that a conflict should exist; and, in order to prevent such a result, the two sections must be read together, and the language of one interpreted, and, where necessary, modified, by the other. In this way it may, in most cases, be found possible to arrive at a reasonable and practical construction of the language of the sections, so as to reconcile the respective powers they contain, and give effect to all of them."
In another case, Bank of Toronto v. Lambe, 1887, Lord Hobhouse, of the Privy Council of England, stated the following in his decision; " It is impossible to give exclusively to the Dominion the whole subject of raising money by any mode of taxation, and, at the same time to give to the Provincial Legislatures, exclusively or at all, the power of direct taxation for Provincial or any other purposes. Their Lordships adhere to that view, and hold that, as regards to direct taxation within the Province to raise revenue for Provincial purposes, that subject falls wholly within the jurisdiction of the Provincial Legislatures."
Again, it seems clear that the federal government has broken our constitutional law by invading this area of taxation exclusive to the provinces.
Additional evidence is supplied when, in 1894, the British Parliament attempted to pass a Finance Bill. It called for the levying of estate/inheritance tax on property situated within the borders of the newly formed Canadian Dominion. Sir Charles Tupper, who was the High Commissioner for Canada at the time, filed a letter of protest. In this letter he stated:
"So far as Canada is concerned, the case is even stronger than in the other colonies, as under the Confederation Act (BNA Act of 1867) passed by the Imperial Parliament in 1867, the power of imposing taxation of this description was exclusively assigned to the local governments and legislatures of the Provinces of the Dominion, for the purpose of enabling them to provide the revenue required to carry on the administration of local affairs. In many of those Provinces, considerable difficulty has been experienced in providing the necessary amount of revenue for this purpose, and this invasion of a field of taxation thus exclusively assigned to them would result in very serious inconvenience."
Sir G.Baden-Powell made the following statement concerning the Finance Bill before the House in the British Parliament July 4,1894:
" But the government had conceded in this amendment a very important point, but one which he did not think needed conceding - namely that they could not pay twice over the same Queen's taxes on the same property. That, he understood, had been illegal all along, and he happened to know at least in one case where taxes were charged twice on the same property in Australia. The case was given against a man who had been forced to pay, but on appeal home, it was shown to be illegal to pay the Queen's taxes twice on any property; therefore, he does not think any trouble need be taken in regard to this fact of property being taxed twice over because it was distinctly illegal to so tax it."
With regard to this statement, one's income is one's own property. Definition of "property" was established and defined in various provincial Acts since 1853, before the creation of the BNA Act of 1867, and became a very important part of the BNA Act, under Section 92.l3 "Property and Civil Rights" which falls under exclusive provincial jurisdiction. Today, we have both the Federal Government and the Provincial Governments levying a tax on the same property, income.
Sir G. Baden-Powell continues by saying:
"He wishes now to allude to what he would venture to call the rights of our colonies. This House, without doubt, had conceded to our self-governing colonies independent legislative and executive sovereignty so far as matters of taxation were concerned. He thought there was no one who could doubt that that has been done, and he thought that it would also be conceded when we had delegated the power, which we had the right to exercise or to delegate, we could not both delegate and exercise the power. Without doubt, we had done this, and he might bring forward one instance which, he thought, must have escaped the observation of the authorities who had drafted this bill."
"It was an instance of legislation by the Imperial Parliament. In the Imperial Act (BNA Act of 1867), by which we enabled the Provinces of North America to federate into one Dominion in 1867, the Dominion Government, by the Imperial Act, was expressly forbidden levying any direct taxes, and that prerogative of taxation and of legislative and executive sovereignty was expressly reserved to the Provincial Governments. How, therefore, this Parliament was to take the double step of not only levying direct taxes in the Canadian Dominion, but levying them in spite of this particular clause and gift of power to the Provincial Governments, he could not see."
The evidence is very conclusive. Sections 91.3 and 92.2 have never been altered since 1867 and therefore remain in effect as they were originally written and intended. The federal government is either in violation of our constitution or something has changed in recent time to allow the Federal Government to levy such a tax.
Although, the Constitution gives exclusive authority to the provinces to "direct taxation within the Province in order to the raising of a revenue for Provincial purposes" (Section 92.2), they appear to be acting unlawfully as well. Under the Constitution the federal and provincial governments must administer, assess and collect their own taxes. Most of the Provinces, including British Columbia, have entered into "tax collection" agreements whereby, the Provinces have delegated their authority to the Federal government (specifically, the Deputy Minister of National Revenue for Taxation of Canada) to administer, assess and collect Provincial Income taxes. Both the Federal Government and the Provinces involved in these agreements appear to be in contempt of a Supreme Court ruling made in 1950 in the case of the Attorney-General for Nova Scotia v. the Attorney-General for Canada.
In this case, a number of significant statements were made:
Chief Justice C.J. Rinfret stated: "No power of delegation is expressed either in Section 91 or in Section 92, no, indeed is there to be found the power of accepting delegation from one body to the other; and I have no doubt that if it had been the intention to give such powers it would have been expressed in clear and unequivocal language."
He continues by saying; " Under the scheme of the British North America Act there were to be, in the words of Lord Atkin in the Labour Conventions Reference, watertight compartments which are an essential part of the original structure. Neither legislative body, federal or provincial, possess any portion of the powers respectively vested in the other and they cannot receive it by delegation. In that connection, the word "exclusively" used in both Section 91 and in Section 92 indicates a settlement line of demarcation and it does not belong to either Parliament, or the Legislatures, to confer powers upon the other."
Mr. Justice J. Rand, quoting from a reference, Huth v. Clarke (1890, 25, Q.B.D., at 395) states; "If it is correct to use the word in the way in which it is used in the maxim as generally understood, the word 'delegate' means little more than an agent."
Mr. Justice J. Estey is recorded as saying; " It is beyond the jurisdiction of these respective bodies to give legislative jurisdiction one to the other." And "there is no express provision nor is there any under which it could be reasonably implied that these bodies were intended to act as agents one for the other."
Mr. Justice J. Fauteux stated; " Had it been the intention of the Imperial Parliament to give one legislative body the right to delegate to the other, the word "exclusively" in both sections would have been omitted. In the context, this word is without object unless it is to debar one legislative body from exercising any kind of Legislative authority with respect to matters within the jurisdiction of the other."
Chief Justice C.J. Rinfret made the following statement;
"The Parliament of Canada and the Legislatures of the several Provinces are sovereign within their sphere defined by the British North America Act, but none of them has the unlimited capacity of an individual. They can exercise only the legislative powers respectively given to them by Sections 91 and 92 of the Act, and these powers must be found in either of these sections."
"The Constitution of Canada does not belong to the Parliament, or to the Legislatures; it belongs to the country and it is there that the citizens of the country will find the protection of the rights to which they are entitled."
This is a very significant statement coming from the highest court in Canada, Clearly, the Federal and Provincial Governments are either ignoring and breaking the law or something has transpired to either allow the two levels of government to operate in spite of the 1950 Supreme Court decision or they have found a way to circumvent the law. The existing agreements in 1950 were due to expire in 1962 and the Prime Minister in 1961, Mr. John Diefenbaker, was prepared to allow these agreements to expire and withdraw the federal government from the personal income tax field in favour of the provinces. Unfortunately, he lost the federal election to the liberals who promptly renewed these unlawful agreements and they still exist today. It would appear that between 1950 and 1962, something happened that allowed the two levels of government to legally renew these tax collection agreements. ( Just a thought...if federal income tax was lawful, then why did the federal government wait 50 years to implement it?) You may want to dig deeper and find out the answers by visiting the site Paradigm
So, Sections 91.3 and 92.2 have never been altered or deleted from our constitution. They remain virtually word for word, today, as they did in 1867. Therefore, the object and spirit of the law remains the same despite the deception, manipulation expressed by legal and constitutional "experts". It is no wonder that a growing number of Canadians are cynical towards our political system when our elected representatives, through their ignorance of our laws, have failed to protect the rights and freedoms of the people of this country in upholding the constitution. We, the people, are also to blame in that we have failed to recognize who we really are as human beings and that we do have fundamental rights and those rights are still protected within our laws in this country. The problem is , the people have been deliberately kept ignorant of their rights as well through deception and manipulation. (Remember Schedule B, Part V11, Section 52.1, "The Constitution of Canada is the supreme law of Canada, and any law that is inconsistent with the provisions of the Constitution is, to the extent of the inconsistency, of no force or effect." )
It is absolutely imperative, if The Constitution Acts of 1867 and 1982 are to be our "rule book" (these must be ratified by the people of Canada in order to be our true Constitution), that both levels of government must obey it and the Supreme Court must uphold it in order to protect the rights and freedoms of the Canadian people and limit government to its jurisdictional authority. It is also imperative that we, the people, recognize who we are as human beings, know our rights, and, most importantly, learn to exercise our rights so that we can no longer be taken advantage of.
The manipulation of our Constitutional Law must stop! The fraud and deceit inflicted upon the people of this country must stop! The people are starting to wake up to this injustice!! Any person in an elected position in government and in the judiciary, at any level, must know and obey the law. Section 19 of the Criminal Code states " Ignorance of the law by a person who commits an offence is not an excuse for committing that offense." If they do not obey the law, they are in contempt of the law and therefore, in breach of the trust placed with them and would be liable to charges under Section 122 of the Criminal Code.
Our elected representatives have the power and responsibility to make the changes necessary to restore trust and integrity in the hearts and minds of the people but it is up to all of us to ensure that it happens!
