Revenues

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Revenues consist of all tax and other amounts which enter into the calculation of the annual surplus or deficit of the Government.

Accounting for revenues

The Government reports all revenues on an accrual basis.

Tax revenues are recognized in the period in which the taxable event occurs and when they are authorized by legislation or the ability to assess and collect the tax has been provided through legislative convention. They are reported net of refunds and are exclusive of amounts collected on behalf of provinces and territories.

Tax revenues are measured from amounts assessed/reassessed and from estimates of amounts not yet assessed/reassessed based on cash received that relates to the fiscal year ended March 31. Annual revenues also include adjustments between the estimated revenues of previous years and actual amounts, as well as revenues from reassessments relating to prior years. Revenues do not include estimates of unreported taxes, or the impact of future reassessments that cannot yet be reliably determined.

Tax expenditures that reduce taxes paid or payable are considered tax concessions and are netted against applicable tax revenue. Tax expenditures that provide a financial benefit through the tax system and are not related to the relief of taxes paid or payable are shown as other transfer payment expenses and are not netted against tax revenue.

Income tax revenue is recognized when the taxpayer has earned the income subject to tax.

Domestic goods and services tax revenue is recognized at the time of the sale of goods or the provision of services. These revenues are reported net of input tax credits, GST rebates, and the GST quarterly tax credits. The GST quarterly tax credit for low-income individuals and families is recorded in the period to which it relates.

Customs duties and goods and services tax revenue on imports is recognized when goods are authorized to enter Canada.

Excise tax revenue is recognized when a taxpayer sells goods taxable under the Excise Tax Act. Excise duties revenue is recognized when the taxpayer manufactures goods taxable under the Excise Act and the Excise Act, 2001.

Employment insurance premiums are recognized as revenue in the same period as the insurable earnings are earned.

Other revenues are recognized in the period to which they relate.

Tax revenues

Tax revenues include personal, corporate and non-resident income tax revenues, and other taxes and duties as summarized in Table 3.2.

Table summary

The table presents, in millions of dollars, a two-year comparative of the tax revenues. It consists of three columns: a detailed listing of components; current year; previous year. The first series of rows presents the income tax revenues. The second series of rows presents the other taxes and duties. It is divided into four sub-sections with their respective subtotals. The final row of the series presents the total for other taxes and duties. A final row presents the total for this table.

Table 3.2
Tax revenues

(in millions of dollars)

  2015–2016 2014–2015
Tax revenues
Income tax revenues
Personal 144,897 135,743
Corporate 41,444 39,447
Non-resident 6,505 6,216
Total income tax revenues 192,846 181,406
Other taxes and duties
Goods and services tax, Table 3.3 32,952 31,349
Energy taxes
Excise tax—Gasoline 4,350 4,318
Excise tax—Aviation gasoline and diesel fuel 1,215 1,210
Total energy taxes 5,565 5,528
Customs import duties 5,372 4,581
Other excise taxes and duties
Excise duties 4,844 4,813
Air travellers security charge 721 696
Softwood lumber products export charge 130 (negative 5)
Other miscellaneous excise taxes and duties 221 220
Total other excise taxes and duties 5,916 5,724
Total other taxes and duties 49,805 47,182
Total tax revenuesLink to footnote 1 242,651 228,588

Personal income tax

Personal income tax is levied on personal income under the provisions of the Income Tax Act.

Corporate income tax

Corporate income tax is levied on corporate income under the provisions of the Income Tax Act.

Non-resident income tax

Non-resident income tax is levied on income earned in Canada by non-residents under the provisions of the Income Tax Act. This tax is derived from tax withheld from dividends, interest, rents, royalties, alimony, and income from estates and trusts paid to non-residents.

Non-resident income tax revenues also include withholding taxes on income earned in Canada by non-resident life insurance companies and income from trusts.

Other taxes and duties

Other taxes and duties are collected under the Excise Act, the Excise Act, 2001, the Excise Tax Act, Customs Tariff (Act) and other acts. They include the goods and services tax, energy taxes, customs import duties, as well as other excise taxes and duties.

Goods and Services Tax

The goods and services tax (GST) became effective January 1, 1991. It is applied at a rate of 5 per cent on most goods and services consumed in Canada, with only a limited set of exclusions that consists of certain medical devices, prescription drugs, basic groceries, residential rents as well as most health and dental care services. A comparative analysis of the GST is presented in Table 3.3.

Table summary

The table presents, in millions of dollars, a two-year comparative of the goods and services tax (GST). It consists of three columns: a detailed listing of components; current year; previous year. A final row presents the total for this table.

Table 3.3
Goods and services tax (GST)
Link to footnote 2
(in millions of dollars)

  2015–2016 2014–2015
GST 39,312 37,439
Less: remission order for the GST paid and accrued by ministries on or for goods and services purchased from outside parties 2,003 1,896
Gross GST from outside parties 37,309 35,543
Less: quarterly tax credits 4,357 4,194
Net GST from outside parties 32,952 31,349

Energy taxes

Energy taxes primarily include the excise tax on gasoline, aviation gas and diesel fuel.

Customs import duties

Revenues from customs import duties consist mainly of ad valorem taxes on the importation of goods levied under the Customs Tariff (Act).

Other excise taxes and duties

Excise taxes and duties are levied on alcoholic beverages and tobacco products. In addition, excise taxes are imposed on other items such as passenger vehicle air conditioners. The Air Travelers Security Charge is collected by air carriers at the time of payment for the air travel by the purchaser of an air transportation service.

The softwood lumber products export charge is assessed on exports of softwood lumber products to the United States after September 30, 2006. The charge on refunds of softwood lumber duty deposits is assessed on amounts refunded to Canadian companies related to an American duty order on the importation of softwood lumber products into the United States between May 22, 2002 and September 30, 2006.

Employment insurance premiums

Premiums from employees and employers are levied under the provisions of the Employment Insurance Act and are classified as part of revenues. Additional details on employment insurance premiums are provided in Section 4 of this volume.

Other revenues

Other revenues include revenues from Crown corporations, other program revenues and net foreign exchange revenues.

Table summary

The table presents, in millions of dollars, a two-year comparative of other revenues. It consists of three columns: a detailed listing of components; current year; previous year. The first series of rows presents revenues from Crown corporations. The second series of rows presents revenues from other programs. The third series of rows presents miscellaneous revenues. The fourth series of rows presents revenues from net foreign exchange. A final row presents the total for this table.

Table 3.4
Other revenues

(in millions of dollars)

  2015–2016 2014–2015
Other revenues
Crown corporations
Consolidated Crown corporations 4,544 4,174
Enterprise Crown corporations and other government business enterprises
Share of annual profit 7,316 8,365
Interest and other 600 941
Total Crown corporations 12,460 13,480
Other programs
Return on investments, Table 3.5 1,081 1,927
Sales of goods and services
Rights and privileges 2,520 2,873
Lease and use of public property 655 634
Services of a regulatory nature 1,446 1,360
Services of a non-regulatory nature 3,494 3,290
Sales of goods and information products 219 225
Other fees and charges 671 568
Total sales of goods and services 9,005 8,950
Miscellaneous
Interest and penalties 4,364 4,538
Other 500 944
Total other programs 14,950 16,359
Net foreign exchange
Exchange Fund Account 2,186 840
International Monetary Fund 133 495
Other 3 20
Total 2,322 1,355
Total other revenuesLink to footnote 1 29,732 31,194

Crown corporations

Crown corporation revenues include revenues earned from third parties by consolidated Crown corporations, interest earned on loans to enterprise Crown corporations and other government business enterprises as well as the government's share of the accumulated profits or losses of enterprise Crown corporations and other government business enterprises.

Other programs

Other program revenues include sales of goods and services, return on investments, and miscellaneous revenues. Details are reported by individual ministry in Volume II of the Public Accounts of Canada.

Net foreign exchange

Net foreign exchange revenues include the revenues from investments held in the Exchange Fund Account and the International Monetary Fund, as well as the net gains or losses resulting from the translation of these investments to Canadian dollars at March 31. Net foreign exchange revenues also include the net gains or losses resulting from foreign debt and currency swap revaluations.

Return on investments

Return on investments consists mainly of interest from loans and advances, dividends from investments, and transfer of profits and surpluses for loans, investments and advances other than those in enterprises Crown corporations and government business enterprises. A comparative analysis of return on investments is presented in Table 3.5.

Table summary

The table presents, in millions of dollars, a two-year comparative of the return on investments. It consists of three columns: a detailed listing of components; current year; previous year. The first series of rows presents cash and accounts receivable. The second series of rows presents loans, investments and advances. The third series of row presents other accounts. The following rows present the total ministerial return on investment, net gain on exchange, the accrual of other revenues and the elimination of return on investments internal to the Government. A final row presents the total for this table.

Table 3.5
Return on investments
Link to footnote 3
(in millions of dollars)

  2015–2016 2014–2015
Cash and accounts receivable
Interest on bank deposits 222 313
Loans, investments and advances
Portfolio investments 1
National governments including developing countries 11 6
International organizations 3 2
Provincial and territorial governments Link to footnote 4 Link to footnote 4
Other loans, investments and advances 707 961
Total loans, investments and advances 721 970
Other accounts
Esso Ltd—Norman Wells Project—Profits 10 75
Other Link to footnote 4 Link to footnote 4
Total other accounts 10 75
Total ministerial return on investments 953 1,358
Net gain on exchange 124 572
Accrual of other revenues 22 23
Total return on investments 1,099 1,953
Elimination of return on investments internal to the Government (negative 18) (negative 26)
Total external return on investments 1,081 1,927

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