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Ottawa, February 3, 1997
1997-006

Government Releases Discussion Paper on Excise Act Review

Related document:

• Excise Act Review.

Finance Minister Paul Martin and Minister of National Revenue Jane Stewart today announced a proposal for a revised framework for the federal taxation of alcohol and tobacco products.

The proposal, contained in a joint discussion paper released today by the Department of Finance and Revenue Canada, is the result of a collaborative project known as the Excise Act Review. The review was prompted by the need to update the Excise Act to accommodate modern production and administrative practices. It does not address rates of taxation for alcohol and tobacco products.

The review is being done in consultation with industry associations and provincial liquor jurisdictions. The objective is to create a new legislative and administrative framework that will safeguard the revenues the government receives from alcohol and tobacco products, without imposing unrealistic or unnecessary costs and administrative burdens on industry or government.

In announcing the proposal for a revised framework, Minister Martin said: "The proposals we are putting forward today will go a long way to providing industry with greater flexibility to organize their commercial affairs under a modern tax structure with less direct government intervention."

Minister Stewart added: "The proposal also sets out an administrative structure that will simplify and streamline requirements for industry. At the same time, it helps to address the government's ongoing concern over the smuggling of alcohol and tobacco products. The proposed framework includes control measures and offence and penalty provisions that will ensure compliance and assist law enforcement agencies in their efforts to reduce contraband activity."

The proposal follows up on recommendations contained in the September 1996 Report of the Auditor General of Canada, which urged Revenue Canada and the Department of Finance to complete the Excise Act Review and to make any needed changes to the excise program.

The discussion paper invites written comments on the government's proposal by March 14, 1997. Copies of the discussion paper are available through Revenue Canada tax services offices and on the Internet at http://www.fin.gc.ca/ or http://www.rc.gc.ca/.

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