8. In this Part,

“air carrier” means a person who provides transportation of a person by air;

“certified air carrier” means

(a) an air carrier who is authorized by the Canadian Transportation Agency under Part II of the Canada Transportation Act to operate a domestic service or an international service, and

(b) an air carrier, other than an air carrier described in paragraph (a), who, personally or by agent, sells in Canada transportation of a person by air that is to be provided in whole or in part by an air carrier described in paragraph (a);

“emplanement” does not include an emplanement resulting from a landing of an aircraft made solely to obtain ground services for the aircraft;

“licensed air carrier” means a certified air carrier to whom a licence has been granted under section 17;

“tax” means the air transportation tax imposed under this Part;

“taxation area” means

(a) Canada,

(b) the United States (except Hawaii), and

(c) the Islands of St. Pierre and Miquelon.

R.S., 1985, c. E-15, s. 8; R.S., 1985, c. 15 (1st Supp.), s. 2, c. 28 (3rd Supp.), s. 287; 1996, c. 10, s. 225.

9. This Part is binding on Her Majesty in right of Canada or a province.

R.S., c. E-13, s. 9.

10. (1) There shall be imposed, levied and collected an air transportation tax, determined under section 11, on each amount paid or payable in Canada for transportation of a person by air where that transportation begins at a point in the taxation area and ends at a point in the taxation area.

(2) There shall be imposed, levied and collected an air transportation tax, determined under section 11, on each amount paid or payable outside Canada for the transportation of a person by air where that transportation

(a) begins at a point in the taxation area and ends at a point in the taxation area, and

(b) includes an emplanement by the person on an aircraft at an airport in Canada on a specific flight having as a destination an airport in the taxation area outside Canada and subsequent deplanement by the person from the flight at an airport outside Canada,

payable by the person at the time when, in respect of the transportation, he emplanes at the airport in Canada described in paragraph (b) on the aircraft therein described, except where the air transportation tax has been paid before that time to a licensed air carrier or his agent and evidence of the prepayment of tax is submitted by the person, in a manner and form and to a member of a class of persons prescribed by regulation of the Governor in Council.

(3) For the purposes of subsection (1), transportation by air begins at a point in the taxation area and ends at a point in the taxation area if the transportation does not include a departure, destination or intermediate stop, other than a transfer stop, outside the taxation area.

(4) For the purposes of subsection (2), transportation by air begins at a point in the taxation area and ends at a point in the taxation area if the transportation

(a) does not include a departure, destination or intermediate stop, other than a transfer stop, outside the taxation area; and

(b) includes at least one departure from a point in Canada, other than a departure resulting from a transfer stop.

R.S., 1985, c. E-15, s. 10; R.S., 1985, c. 15 (1st Supp.), s. 3.

11. (1) Subject to subsections (2) and (2.1), the tax imposed under subsection 10(1) or (2) on each amount paid or payable for transportation of a person by air shall be an amount that is the lesser of

(a) the aggregate of

(i) the amount that is

(A) 4% of each amount paid or payable, if the amount is paid or payable in Canada after December 31, 1997 for transportation of a person by air that begins after February 28, 1998,

(B) 4% of each amount paid or payable, if the amount is paid or payable outside Canada after December 31, 1997 and the first emplanement by the person, as described in paragraph 10(2)(b), occurs after February 28, 1998, or

(C) 7% of each amount paid or payable, in any other case, and

(ii) $6 or such lesser amount as may, for the purposes of this subparagraph, be prescribed by order of the Governor in Council on the recommendation of the Minister of Transport, and

(b) such amount as may, for the purposes of this subsection, be prescribed by order of the Governor in Council on the recommendation of the Minister of Transport.

(2) Where the amount paid or payable in Canada for air transportation is for transportation by an aircraft that has been chartered for the purpose by one or more charterers, the tax imposed under subsection 10(1) on the amount paid or payable to a certified air carrier by each charterer shall be an amount that is the lesser of

(a) the aggregate of

(i) the amount that is

(A) 4% of each amount paid or payable, if the amount is paid or payable after December 31, 1997 to a certified air carrier by the charterer for transportation of a person by air that begins after February 28, 1998, or

(B) 7% of each amount paid or payable to a certified air carrier by the charterer, in any other case, and

(ii) the amount that is

(A) $1.50 in respect of each emplanement, pursuant to the charter agreement of that charterer, on the aircraft by any person, if the amount is paid or payable to a certified air carrier by the charterer after December 31, 1997 for transportation of the person by air that begins after February 28, 1998, or

(B) $3 in respect of each emplanement, pursuant to the charter agreement of that charterer, on the aircraft by any person, in any other case, and

(b) the aggregate of such amount as may, for the purposes of this subsection, be prescribed by order of the Governor in Council on the recommendation of the Minister of Transport, in respect of each emplanement, pursuant to the charter agreement of that charterer, on the aircraft by any person.

(2.1) Where the tax imposed under subsection 10(2) on an amount paid or payable outside Canada for transportation of a person by air is payable by the person at the time he emplanes at an airport in Canada and evidence of the amount paid or payable for the transportation is not submitted, in the manner and form prescribed by regulation of the Governor in Council, by the person to the licensed air carrier required by this Part to collect the tax in Canada, and an amount is prescribed by order of the Governor in Council pursuant to paragraph (1)(b), the tax payable by the person shall be the amount so prescribed.

(3) The tax imposed by subsection 10(1), as determined under subsection (1), on each amount paid or payable for transportation of a person by air is not payable in the case of transportation purchased as part of a continuous journey where

(a) the journey includes a charter flight in respect of which tax is imposed under section 10 or 12; and

(b) evidence of the continuous journey is submitted by the person to the licensed air carrier or his agent from whom the transportation by air is purchased.

R.S., 1985, c. E-15, s. 11; R.S., 1985, c. 15 (1st Supp.), s. 4, c. 7 (2nd Supp.), s. 4, c. 42 (2nd Supp.), s. 1, c. 12 (4th Supp.), s. 2; 1990, c. 45, s. 2; 1994, c. 29, s. 2; 1998, c. 21, s. 84.

12. (1) There shall be imposed, levied and collected an air transportation tax, determined under section 13, on each amount paid or payable in Canada for transportation of a person by air where that transportation begins at a point in the taxation area and ends at a point outside the taxation area.

(2) There shall be imposed, levied and collected an air transportation tax, determined under section 13, on each amount paid or payable outside Canada for the transportation of a person by air where such transportation

(a) begins at a point in the taxation area and ends at a point outside the taxation area, and

(b) includes an emplanement by the person on an aircraft at an airport in Canada on a specific flight having as a destination an airport outside Canada and subsequent deplanement by the person from the flight at an airport outside Canada,

payable by the person at the time when, in respect of the transportation, he emplanes at the airport in Canada described in paragraph (b) on the aircraft therein described, except where the air transportation tax has been paid before that time to a licensed air carrier or his agent and evidence of the prepayment of tax is submitted by the person, in a manner and form and to a member of a class of persons prescribed by regulation of the Governor in Council.

(3) For the purposes of subsection (1), transportation by air begins at a point in the taxation area and ends at a point outside the taxation area if the transportation or any part thereof includes at least one departure from a point in the taxation area, other than a departure resulting from a transfer stop, to a destination outside the taxation area.

(4) For the purposes of subsection (2), transportation by air begins at a point in the taxation area and ends at a point outside the taxation area if the transportation or any part thereof includes at least one departure from a point in Canada, other than a departure resulting from a transfer stop, to a destination outside the taxation area, whether or not there are any intermediate stops.

R.S., 1985, c. E-15, s. 12; R.S., 1985, c. 15 (1st Supp.), s. 5.

13. (1) Subject to subsection (2), the tax imposed under subsection 12(1) for transportation of a person by air shall be

(a) an amount that is the lesser of

(i) the amount of

(A) $30, if the amount paid or payable for transportation of the person by air is paid or payable after December 31, 1997 for transportation of the person by air that begins after February 28, 1998, or

(B) $55, in any other case, and

(ii) such amount as may, for the purposes of this subsection, be prescribed by order of the Governor in Council on the recommendation of the Minister of Transport; or

(b) fifty per cent of the amount provided in paragraph (a) when the person is a child under twelve years of age and is being transported at a fare reduced fifty per cent or more below the applicable fare.

(2) Where the amount paid or payable in Canada for air transportation is for transportation by an aircraft that has been chartered for the purpose by one or more charterers, the tax imposed under subsection 12(1) on the amount paid or payable to a certified air carrier by each charterer shall be an amount that is the aggregate of

(a) the lesser of

(i) the amount of

(A) $30, if the amount paid or payable for the transportation of a person by air is paid or payable to a certified air carrier by the charterer after December 31, 1997 for transportation of the person by air that begins after February 28, 1998, or

(B) $55, in any other case, and

(ii) such amount as may, for the purposes of this subsection, be prescribed by order of the Governor in Council on the recommendation of the Minister of Transport,

in respect of each emplanement, pursuant to the charter agreement of that charterer, on the aircraft by a person, other than a person described in paragraph (b); and

(b) fifty per cent of the amount provided in paragraph (a) in respect of each emplanement, pursuant to the charter agreement of that charterer, on the aircraft by a child who is under twelve years of age and is being transported at a fare reduced fifty per cent or more below the applicable fare.

(2.1) For the purposes of subsection (2), “emplanement” means an emplanement by a person at an airport in Canada on a specific flight that has as a destination an airport outside Canada and from which the person deplanes at an airport outside Canada.

(2.2) The tax imposed under subsection 12(2) for transportation of a person by air shall be

(a) where the first emplanement of the person occurs at an airport in Canada,

(i) an amount that is the lesser of

(A) the amount of

(I) $30, if the amount paid or payable for the transportation is paid or payable after December 31, 1997 and the first emplanement by the person, within the meaning of subsection (2.1), occurs after February 28, 1998, or

(II) $55, in any other case, and

(B) such amount as may, for the purposes of this paragraph, be prescribed by order of the Governor in Council on the recommendation of the Minister of Transport, or

(ii) 50% of the amount provided in subparagraph (i) where the person is a child under twelve years of age and is being transported at a fare reduced 50% or more below the applicable fare; and

(b) in any other case,

(i) an amount that is the lesser of

(A) the amount of

(I) $15, if the amount paid or payable for the transportation is paid or payable after December 31, 1997 and the first emplanement by the person, within the meaning of subsection (2.1), occurs after February 28, 1998, or

(II) $27.50, in any other case, and

(B) such amount as may, for the purposes of this paragraph, be prescribed by order of the Governor in Council on the recommendation of the Minister of Transport, or

(ii) 50% of the amount provided in subparagraph (i) where the person is a child under twelve years of age and is being transported at a fare reduced 50% or more below the applicable fare.

(3) Subsections 12(1) and (2) do not apply in respect of the transportation of a person by air at a fare ninety per cent or more below the applicable fare.

R.S., 1985, c. E-15, s. 13; R.S., 1985, c. 15 (1st Supp.), s. 6, c. 12 (4th Supp.), s. 3; 1990, c. 45, s. 3; 1994, c. 29, s. 3; 1995, c. 36, s. 1; 1998, c. 21, s. 85.

13.1 (1) Notwithstanding sections 11 and 13 but subject to subsection 11(3) and subsection (2) of this section, where two or more amounts are paid or payable at the same time for transportation of a person by air on a continuous journey,

(a) the total of the taxes imposed on all such amounts under subsection 10(1) or (2), determined under subsection 11(1), shall not exceed the lesser of

(i) the amount that is

(A) the total of 4% of the aggregate of all such amounts and $3, if the amount paid or payable for the transportation is paid or payable after December 31, 1997 for transportation of the person by air that begins after February 28, 1998, or

(B) the total of 7% of the aggregate of all such amounts and $6, in any other case, and

(ii) the amount, if any, prescribed by order of the Governor in Council under paragraph 11(1)(b);

(b) the total of the taxes imposed on all such amounts under subsections 10(1) and 12(1), determined under subsections 11(1) and 13(1), as applicable, shall not exceed the amount determined under subsection 13(1) in respect of any such amount in respect of which that subsection applies; and

(c) the total of the taxes imposed on all such amounts under subsections 10(2) and 12(2), determined under subsections 11(1) and 13(2.2), as applicable, shall not exceed the largest amount determined under subsection 13(2.2) in respect of any such amount.

(2) Subsection (1) does not apply to reduce any tax imposed under this Part in respect of transportation of a person by air unless the licensed air carrier or the carrier’s agent from whom the transportation is purchased records on each ticket issued at the same time the following information:

(a) ticket numbers, including air carrier codes, for all flights comprising the continuous journey; and

(b) flight numbers for all flights comprising the continuous journey.

R.S., 1985, c. 15 (1st Supp.), s. 7, c. 7 (2nd Supp.), s. 5, c. 12 (4th Supp.), s. 4; 1990, c. 45, s. 4; 1994, c. 29, s. 4; 1998, c. 21, s. 86.

14. The tax on each amount paid or payable in Canada for transportation of a person by air is payable

(a) at the time when the amount is so paid or becomes payable and in any case prior to the provision of the transportation; and

(b) by the person making the payment.

R.S., c. E-13, s. 12; 1976-77, c. 15, s. 3.

15. This Part does not apply in the case of any amount paid for transportation by air of a person described in section 2 of Part II of Schedule III.

R.S., c. E-13, s. 13.

16. (1) Where an amount is paid or payable outside Canada for the transportation of a person by air

(a) by transmission from within Canada to a place outside Canada, by means of telegraph or mail, of cash, cheque, postal telegram, money order or any similar draft to a ticket office, travel agency, air carrier or any representative of any of them,

(b) by delivery of the amount to an agency located within Canada for transmission to a ticket office, travel agency, air carrier or any representative of any of them located in any place outside Canada, or

(c) by any other arrangement with a person outside Canada for the benefit or convenience of a person in Canada,

the amount shall, for the purposes of this Part, be deemed to be an amount paid or payable in Canada and not outside Canada.

(2) Where an amount is paid or payable outside Canada for the charter of an aircraft for the transportation of a person by air and the transportation begins at a point in Canada, the amount shall, for the purposes of this Part, be deemed to be an amount paid or payable in Canada and not outside Canada.

R.S., c. E-13, s. 14.

16.1 No tax shall be imposed, levied or collected on any amount paid or payable for the transportation of a person by air that

(a) in the case of tax imposed under subsection 10(1) or 12(1), begins after October 31, 1998; or

(b) in the case of tax imposed under subsection 10(2) or 12(2), does not include an emplanement of the person, within the meaning of subsection 13(2.1), before November 1, 1998.

1996, c. 20, s. 104; 1998, c. 21, s. 87.

17. (1) Subject to this section, every certified air carrier, other than an air carrier that provides only air transportation that is exempt from the operation of this Part pursuant to paragraph 21(d), shall make an application in the prescribed form to the Minister for a licence for the purposes of this Part.

(2) The Minister may grant a licence to any person applying therefor under subsection (1).

(3) The Minister may cancel a licence issued under this Part if, in his opinion, it is no longer required for the purposes of this Part.

(4) Subsection (1) applies only to a certified air carrier that provides air transportation before November 1, 1998.

R.S., 1985, c. E-15, s. 17; R.S., 1985, c. 7 (2nd Supp.), s. 6; 1996, c. 20, s. 105; 1998, c. 21, s. 88.

18. (1) Every licensed air carrier is an agent of the Minister and as such shall, as provided in this section,

(a) levy and collect any taxes imposed by this Part for the transportation of a person by air; and

(b) make adjustments in or refund any portion of the tax paid on the transportation of a person by air that has not been provided or only partially provided or any tax that has been collected in error by the licensed air carrier.

(2) The tax imposed by this Part on each amount paid or payable in Canada for transportation of a person by air shall be collected by the licensed air carrier to whom payment for the transportation is made or is owing.

(3) The tax imposed by this Part on each amount paid or payable outside Canada for transportation of a person by air that is payable by the person at the time when he emplanes on an aircraft at an airport in Canada shall be collected by the licensed air carrier on whose aircraft the person emplanes, in this subsection referred to as the “emplaning air carrier”, except where the air transportation tax has been paid before that time to a licensed air carrier or his agent and evidence of the prepayment of tax is submitted by the person to the emplaning air carrier in a manner and form prescribed by regulation of the Governor in Council.

(4) In the case of tax imposed by this Part on any amount paid or payable in Canada for transportation of a person by air, where the transportation of a person by air is being provided by several air carriers, one or more of whom are licensed, the tax, where applicable, shall be collected by the licensed air carrier who sells the transportation by air or, if the transportation is not sold by a licensed air carrier, by the first licensed air carrier who provides any part of the transportation.

(5) Where tax has been reduced pursuant to subsection 13.1(1) in respect of two or more amounts paid or payable at the same time for transportation of a person by air on a continuous journey, no adjustment in or refund of all or any portion of the tax paid shall be made unless all of the tickets purchased at the same time for the transportation are cancelled at the same time.

R.S., 1985, c. E-15, s. 18; R.S., 1985, c. 15 (1st Supp.), s. 8, c. 28 (3rd Supp.), s. 288.

19. (1) Every person who, being required by or pursuant to this Part to collect an air transportation tax, fails to do so as required is liable to Her Majesty for the amount of the tax and that amount is recoverable in the Federal Court or in any other court of competent jurisdiction as a debt due to Her Majesty.

(2) A person who, not being a licensed air carrier, sells in Canada transportation of a person by air that is to be provided in whole or in part by a licensed air carrier is, in respect of the payment for that transportation and for the purposes of this Part, the agent of the first licensed air carrier who provides the transportation by air or any part thereof, as the case may be, and that person shall levy and collect on behalf of that licensed air carrier the taxes imposed by this Part and transmit them to the licensed air carrier.

R.S., c. E-13, s. 16; R.S., c. 10(2nd Supp.), s. 64; 1974-75-76, c. 24, s. 5.

20. (1) Every licensed air carrier that is required by this Part to collect tax shall make each month a true return, in the prescribed form and containing the prescribed information including statistical information relating to any tax not collected by the licensed air carrier during that period by reason of the prepayment thereof, of

(a) all amounts collected or collectible by the carrier by way of the tax imposed by this Part in the last preceding month; and

(b) all amounts collected, within or outside Canada by the carrier or the carrier’s agent in the last preceding month,

(i) by way of the tax imposed by this Part on amounts paid or payable outside Canada for the transportation of a person by air, and

(ii) before the time that the person is required by subsection 10(2) or 12(2), as the case may be, to pay the tax.

(2) Every licensed air carrier shall, if no amounts have been collected or are collectible as described in subsection (1) in the last preceding month, make a return as required by that subsection stating that fact.

(2.1) No return is required under subsection (2) if the last preceding month is a month after October 31, 1998.

(3) Notwithstanding subsections (1) and (2), the Minister may, by regulation,

(a) authorize any licensed air carrier to make a return in respect of any accounting period of not less than twenty-one days and not more than thirty-five days;

(b) authorize any licensed air carrier to make a return in respect of any period longer than one month but not longer than six months, if the amounts collected or collectible by the carrier by way of the tax imposed by this Part in the last preceding calendar year did not exceed four thousand eight hundred dollars; or

(c) authorize any licensed air carrier whose passenger air transportation service is predominantly limited to a seasonal period of operation to make a return in respect of any period longer than one month but not longer than six months, if the amounts collected or collectible by the carrier by way of the tax imposed by this Part in the equivalent period in the last preceding calendar year did not exceed an average of four hundred dollars per month throughout that equivalent period.

(4) Subject to subsection (8) and sections 20.1 and 79.2, the return required by this section shall be filed and the taxes that are collected or collectible by a licensed air carrier shall be remitted

(a) in a case where the return is required to be made in accordance with subsection (1) or (2), not later than the last day of the first month following the month to which the return relates;

(b) in a case where the return is authorized to be made in accordance with a regulation made under paragraph (3)(a), not later than the last day of the first authorized accounting period following the end of the accounting period to which the return relates; and

(c) in a case where the return is authorized to be made in accordance with a regulation made under paragraph (3)(b) or (c), not later than the last day of the first month following the end of the period to which the return relates.

(5) Subject to subsections (6) to (9), a licensed air carrier that defaults in remitting tax within the time prescribed by subsection (4), in addition to the amount in default, shall pay

(a) in the case of tax required to be remitted not later than the last day of a month, a penalty of one-half of one per cent and interest at the prescribed rate, in respect of each month or fraction of a month between that day and the day on which the total tax, penalty and interest outstanding is remitted, calculated on the total tax, penalty and interest outstanding in that month or fraction of a month; and

(b) in the case of tax required to be remitted not later than the last day of an accounting period, a penalty of one-half of one per cent and interest at the prescribed rate, in respect of each accounting period or fraction of an accounting period between that day and the day on which the total tax, penalty and interest outstanding is remitted, calculated on the total tax, penalty and interest outstanding in that accounting period or fraction of an accounting period.

(6) No penalty or interest is payable under subsection (5) if the licensed air carrier remits all taxes collected or collectible by the carrier under this Part and, at the time of the remittance, the total penalty and interest payable is less than ten dollars.

(7) A licensed air carrier that is liable to pay penalty or interest under subsection (5) shall pay the penalty or interest not later than the last day of the month or accounting period in respect of which the penalty or interest was calculated.

(8) The Minister may, before or after the expiration of the time prescribed by subsection (4), extend in writing the time for filing a return or remitting any tax, and where the Minister so extends the time,

(a) the return shall be filed or the tax shall be remitted within the time as so extended;

(b) interest accrues under subsection (5) in respect of the tax as if the time had not been so extended;

(c) no penalty accrues or shall be deemed to have accrued under subsection (5) in respect of the tax before the expiration of the time as so extended; and

(d) penalty accrues under subsection (5) in respect of a default in remitting the tax or any portion thereof within the time as so extended as if the default were a default referred to in that subsection.

(9) Where the Minister holds security under section 80.1 for the remittance of any tax under this Part that is not remitted within the time prescribed by subsection (4),

(a) interest accrues under subsection (5) in respect of the tax from the expiration of that time; and

(b) penalty accrues under subsection (5) only if the total tax, penalty and interest outstanding, as calculated in respect of each month or accounting period or fraction of a month or accounting period during which the default continues, exceeds the value of the security at the time it is accepted by the Minister and, if accruing, the penalty shall be calculated only on the amount of the excess.

R.S., 1985, c. E-15, s. 20; R.S., 1985, c. 15 (1st Supp.), s. 9, c. 7 (2nd Supp.), s. 7, c. 12 (4th Supp.), s. 5; 1996, c. 20, s. 106; 1998, c. 21, s. 89.

20.1 (1) For the purposes of this section,

(a) a licensed air carrier’s “instalment base”

(i) for a month is the lesser of

(A) the tax imposed by this Part that was collected or collectible by that carrier in that month, and

(B) the tax so collected or collectible in the last preceding month,

(ii) for an accounting period is the lesser of

(A) the tax imposed by this Part that was collected or collectible by that carrier in that accounting period, and

(B) the tax so collected or collectible in the last preceding accounting period, and

(iii) for any other period to which a return relates is the lesser of

(A) the tax imposed by this Part that was collected or collectible by that carrier in that period, and

(B) the tax so collected or collectible in the last preceding period multiplied by the ratio that the number of days in the period to which the return relates is to the number of days in the last preceding period; and

(b) a licensed air carrier is a “large taxpayer” at any particular time if

(i) the aggregate amount of taxes payable under Parts II.1, III, IV and VI, other than taxes payable in accordance with the Customs Act, and collected or collectible under this Part and Part II.2 by that licensed air carrier in the last preceding calendar year ending at least ninety days, or ninety-one days where that time falls in a leap year, before that time exceeded twelve million dollars, or

(ii) the licensed air carrier

(A) was, at any time in the last preceding calendar year ending at least ninety days, or ninety-one days where that time falls in a leap year, before that time, a member of a group of associated corporations (within the meaning of section 256 of the Income Tax Act) and the aggregate amount of taxes payable under Parts II.1, III, IV and VI, other than taxes payable in accordance with the Customs Act, and collected or collectible under this Part and Part II.2 by the group in that year exceeded twelve million dollars, and

(B) is not, at that time, authorized to make a return in accordance with a regulation made under paragraph 20(3)(b) or (c).

(2) A large taxpayer that is required to file a return and remit tax within the time prescribed by subsection 20(4) shall pay instalments on account of the tax in accordance with the following rules:

(a) in the case where the return is required to be made in accordance with subsection 20(1), the large taxpayer shall pay two instalments, each equal to one-half of the taxpayer’s instalment base for the month in which the tax was collected or became collectible, the first to be paid not later than the last day of that month and the second not later than the fifteenth day of the next following month; and

(b) in the case where the return is authorized to be made in accordance with a regulation made under paragraph 20(3)(a), the large taxpayer shall pay two instalments, each equal to one-half of the taxpayer’s instalment base for the accounting period to which the return relates, the first to be paid not later than the last day of that accounting period and the second not later than the fifteenth day of the next following accounting period.

(3) A licensed air carrier, other than a large taxpayer, that is required to file a return and remit tax within the time prescribed by subsection 20(4) shall pay an instalment on account of the tax in accordance with the following rules:

(a) in the case where the return is required to be made in accordance with subsection 20(1), the carrier shall pay an instalment, equal to the carrier’s instalment base for the month in which the tax was collected or became collectible, not later than the twenty-first day of the next following month;

(b) in the case where the return is authorized to be made in accordance with a regulation made under paragraph 20(3)(a), the carrier shall pay an instalment, equal to the carrier’s instalment base for the accounting period to which the return relates, not later than the twenty-first day of the next following accounting period; and

(c) in the case where the return is authorized to be made in accordance with a regulation made under paragraph 20(3)(b) or (c), the carrier shall pay an instalment, equal to the carrier’s instalment base for the period to which the return relates, not later than the twenty-first day of the month next following the end of that period.

(4) Subject to subsections (6) to (8), a large taxpayer that defaults in paying an instalment within the time prescribed by subsection (2) shall, in addition to the amount in default, pay in respect of the period between the end of that time and the end of the time prescribed for remittance of the tax on account of which the instalment was payable

(a) in the case of an instalment required to be paid not later than the last day of a month or an accounting period, a penalty of one-half of one per cent and interest at the prescribed rate, calculated on the amount by which

(i) one-half of the taxpayer’s instalment base for that month or accounting period

exceeds

(ii) the aggregate of all taxes on account of which the instalment was payable that were remitted not later than that day; and

(b) in the case of an instalment required to be paid not later than the fifteenth day of a month or an accounting period, a penalty of one-quarter of one per cent and interest at one-half of the prescribed rate, calculated on the amount by which

(i) one-half of the taxpayer’s instalment base for the last preceding month or accounting period

exceeds

(ii) the amount by which the aggregate of all taxes on account of which the instalment was payable that were remitted not later than that day exceeds the lesser of

(A) the aggregate of all taxes on account of which the instalment was payable that were remitted not later than the last day of the last preceding month or accounting period, and

(B) one-half of the taxpayer’s instalment base for the last preceding month or accounting period.

(5) Subject to subsections (6) to (8), a licensed air carrier that defaults in paying an instalment within the time prescribed by subsection (3) shall, in addition to the amount in default, pay in respect of the period between the end of that time and the end of the time prescribed for remittance of the tax on account of which the instalment was payable

(a) in the case of an instalment required by paragraph (3)(a) or (b) to be paid not later than the twenty-first day of a month or an accounting period, a penalty of one-sixth of one per cent and interest at one-third of the prescribed rate, calculated on the amount by which

(i) the carrier’s instalment base for the last preceding month or accounting period

exceeds

(ii) the aggregate of all taxes on account of which the instalment was payable that were remitted not later than that day; and

(b) in the case of an instalment required by paragraph (3)(c) to be paid not later than the twenty-first day of a month next following the end of a period, a penalty of one-sixth of one per cent and interest of one-third of the prescribed rate, calculated on the amount by which

(i) the carrier’s instalment base for that period

exceeds

(ii) the aggregate of all taxes on account of which the instalment was payable that were remitted not later than that day.

(6) No penalty or interest is payable under subsection (4) or (5) if the large taxpayer or other licensed air carrier liable to pay the instalment remits all taxes collected or collectible by the taxpayer or carrier under this Part and, at the time of the remittance, the total penalty and interest payable in respect of the instalment is less than five dollars and in respect of all those taxes is less than ten dollars.

(7) A large taxpayer or other licensed air carrier that is liable to pay penalty or interest under subsection (4) or (5) in respect of a default in paying an instalment shall pay the penalty or interest within the time prescribed by subsection 20(4) for the remittance of the tax on account of which the instalment is payable.

(8) The Minister may, before or after the expiration of the time prescribed by subsection (2) or (3), extend in writing the time for paying an instalment, for any period within the time prescribed by subsection 20(4) for the remittance of the tax on account of which the instalment is payable, and where the Minister so extends the time

(a) the instalment shall be paid within the time as so extended;

(b) interest accrues under subsection (4) or (5), as the case may be, in respect of the instalment as if the time had not been so extended;

(c) no penalty accrues or shall be deemed to have accrued under subsection (4) or (5), as the case may be, in respect of the instalment before the expiration of the time as so extended; and

(d) penalty accrues under subsection (4) or (5), as the case may be, in respect of a default in paying an instalment within the time as so extended as if the default were a default referred to in that subsection.

R.S., 1985, c. 12 (4th Supp.), s. 5; 1999, c. 31, s. 247(F).

20.2 (1) For greater certainty, amounts collected as described in paragraph 20(1)(b) shall be deemed to be sums payable under this Act.

(2) Each licensed air carrier that is required to make a return of the amounts described in paragraph 20(1)(b) shall keep records and books of account in such form and containing such information as will enable the amount of tax or other sums that have been paid to or collected by the carrier or the carrier’s agent to be determined and, for the purposes of this subsection, subsections 98(2.01), (2.1) and (3) and 100(2) apply, with such modifications as the circumstances require, as if the records and books of account were required to be kept by the carrier pursuant to subsection 98(1).

R.S., 1985, c. 12 (4th Supp.), s. 6; 1998, c. 19, s. 276.

21. The Governor in Council may by regulation

(a) prescribe, for those cases where the amount charged for transportation by air includes the transportation of persons and goods by air, the manner in which and by whom the amount charged shall be apportioned between the transportation by air of those persons and the transportation by air of those goods, for the purposes of the tax imposed under sections 10 to 12;

(b) prescribe, for those cases where the amount charged for transportation of a person by air provides him with transportation and other services or goods, the manner in which and by whom the amount charged shall be apportioned between the transportation by air of that person and the provision of the other services and goods, for the purposes of the tax imposed under sections 10 to 12;

(c) prescribe the manner and form in which and the class of persons to whom evidence of prepayment of any tax imposed under this Part shall be submitted;

(c.1) prescribe the manner and form in which evidence of an amount paid or payable for transportation of a person by air shall be submitted;

(d) exempt from the operation of this Part the transportation of a person by air on any classes or groups of air services, air carriers or aircraft;

(e) reduce the amount of the tax paid or payable in Canada under this Part in respect of transportation of a person by air, or remove that tax, for the reduction or avoidance of double taxation by Canada and a foreign country in respect of that transportation;

(f) vary the requirements of section 20 with respect to returns and the time of remitting for licensed air carriers who are authorized by the Canadian Transportation Agency to operate international charter flights from Canada, or exempt those carriers from the provisions of that section with respect to returns, subject to such terms and conditions as the Governor in Council considers to be in the public interest;

(g) prescribe, in cases where an air carrier provides transportation of a person by air on credit, the time when and the place where the amount payable for that transportation is deemed to be paid or payable for the purposes of this Part; and

(h) provide generally for the carrying out of the provisions of this Part.

R.S., 1985, c. E-15, s. 21; R.S., 1985, c. 15 (1st Supp.), s. 10, c. 28 (3rd Supp.), s. 289; 1996, c. 10, s. 226.