Cameco CEO Tim Gitzel
Uranium miner Cameco CEO Tim Gitzel has slammed Canada Revenue Agency’s (CRA’s) decision to seek leave from the Supreme Court to appeal a lower court ruling in the tax dispute between the parties, arguing that the agency’s actions “cast a chill” over Canadian companies trying to compete on the world stage.
“If CRA feels the laws aren’t accomplishing what they want, then the government should change the laws moving forward and not pursue the same arguments over and over again before a different court and expect a different outcome,” he said in a statement on Friday.
The CRA is seeking leave from the Supreme Court to appeal the June 26 ruling of the Federal Court of Appeals that found in Cameco’s favour in its dispute of the CRA’s reassessments issued for the 2003, 2005 and 2006 tax years.
The Federal Court of Appeal ruling followed a ruling from the Tax Court of Canada that also confirmed that Cameco followed the letter and intent of the law.
Cameco estimates that, if leave to appeal is granted, it could take until the second half of 2022 before a decision is rendered.
If leave to appeal is not granted, then the dispute over the three tax years in question is resolved in Cameco’s favour.
Based on prior court decisions, Cameco is entitled to a refund of C$5.5-million plus interest for installments the company paid on previous reassessments issued by CRA for the 2003, 2005 and 2006 tax years, costs in the amount of C$10.25-million for legal fees incurred, and an amount for disbursements of up to C$17.9-million.
Cameco pointed out that the Federal Court of Appeal’s decision and CRA’s request for leave to appeal to the Supreme Court pertain only to the 2003, 2005 and 2006 tax years. Any decisions regarding this case would not be legally binding on the remaining tax years in dispute (2007 through 2013), although the company said it believed the principles in the Federal Court of Appeal’s ruling should apply to all subsequent years (2007 through 2019).
The Canadian government holds C$303-million in cash and C$482-million in letters of credit that Cameco has been required to pay as instalments on the reassessments issued by CRA for all tax years in dispute (2003 through 2013), which the company said tied up a significant amount of its financial capacity.
Cameco said it was pursuing the return of these installments to the company, despite the leave to appeal being requested by CRA.
“At a time when Canadian businesses are facing unprecedented economic upheaval, challenging global markets and a world-wide pandemic, CRA’s actions cast a chill over all Canadian companies trying to compete on the world stage,” said Gitzel.