First Nations duck tax grab
Terry Halifax
Northern News Services
Yellowknife (Nov 06/00) - First Nations want to ensure their beneficiaries get the most from cash benefit payments, and it means being creative when it comes to avoiding the tax man.
Money paid through annual dividend or Impact Benefit Agreements (IBAs), is considered compensation by First Nations and income by government.
John B. Zoe, chief negotiator for the Dogrib First Nations, said they had to come up with something other than a direct payment so people weren't penalized by Income Support and Revenue Canada.
"Anyone who is working would declare it as income and so would anyone else, but if you're not working, then it takes away from you directly," he said.
"So all you're doing is passing off the benefit to the government agencies.
"This year, rather than do that and subsidize government for social services, we just put it into scholarships, so at least we can boost those people who are in post-secondary," said Zoe.
The Dogrib IBA monies now go into scholarships, healing, addiction and other social programs and services.
Different views
When the first IBA monies were paid out to the Dogribs, the NWT Housing Corporation did not recognize the payment as income, said Juanita Case, the manager of housing programs.
"Last year was the first time it was paid, and we were under the assumption that it was a one-only-time payment," she said.
"If it's a one-time-only payment, it's like winning a lottery, -- we don't include that as income. If it's an annual payment it's treated somewhat differently."
The housing corporation does not include land claim beneficiary payments as income.
Bruce Evelyn, director of income support for the Ministry Education, Culture and Employment, said all assets are considered income, with the exception of federal treaty or Inuvialuit Land Claim Agreement fund payments.
Evelyn said his office works with the housing corporation to harmonize their income and exemption policies, because they often share the same clients.
"What you'll see in the future is a better blending of how we treat income," he said.
Felix Lockhart of the Lutsel K'e Dene Band said the first money for his community is being held in trust until the community decides how they will spend the $250,000 payment from BHP.
"We had some prior meetings to discuss this, but now we have to make some determination on what we're going to do with this," Lockhart said. Chief Negotiator for the Beaufort Delta self-government team, Bob Simpson said the land claim payments are not included as income by the government.
"It is a problem with this dividend, bonuses or whatever and if they are going to be dealt with by social services or not," he said. "So far, social services has been sensitive enough in this area."
