Canada Customs & Revenue Agency
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Released: 29 September, 1998

Minister Announces Formation Of Technical Advisory Groups In Response To Report On Electronic Commerce

OTTAWA, September 29, 1998...The Honourable Herb Dhaliwal, Minister of National Revenue and M.P. (Vancouver South-Burnaby), today released his response to the recommendations contained in the report of his Advisory Committee on Electronic Commerce.

Electronic commerce and its implications for tax administration are important components of the Canadian Electronic Commerce Strategy that was announced by Prime Minister Chrétien on September 22, 1998. The Honourable John Manley, Minister of Industry is the lead minister in the development of this strategy and he joined Mr. Dhaliwal today in responding to the general recommendations of the report

The Advisory Committee examined the growth of electronic commerce and its implications for tax administration both domestically and internationally. Its report, Electronic Commerce and Canada's Tax Administration, made 72 tax-specific recommendations which address the opportunities and challenges that arise for Revenue Canada as a result of electronic commerce.

"One message came through clearly in both the Advisory Committee's report and during subsequent consultations--the private sector would like an intensified working relationship with Revenue Canada on the development of new or revised tax compliance and administrative policies and procedures on electronic commerce," said Mr. Dhaliwal.

Mr. Dhaliwal made it clear that his response to the report does not mean new taxes or new reporting requirements for electronic commerce activities. "My Department is simply trying to ensure that electronic commerce activities are properly taxed without placing an unreasonable compliance burden on taxpayers. It will provide needed guidance to taxpayers on electronic commerce matters and it will work towards improving established electronic services and providing new ones," said Mr. Dhaliwal.

Mr. Manley outlined the importance of an overall electronic commerce strategy to ensure Canada's world leadership in the global electronic marketplace. That strategy relies on government, business, and consumer participation.

"The Canadian Electronic Commerce Strategy demonstrates the partnership between government and the private sector, and recognizes that the private sector must take the lead to develop new markets, new products, and new trading relationships supported by appropriate government frameworks," concluded Mr. Manley.

In response to the Committee's report, the Minister announced the formation of four electronic commerce technical advisory groups to provide expert advice on the implementation of the Committee's recommendations. The advisory groups will provide advice to Revenue Canada in the following areas: taxpayer service, compliance and administration, interpretation and international co-operation, and consumption tax. In addition to the creation of these advisory groups, the Minister committed to intensifying Revenue Canada's dialogue and working relationships with the provinces and territories on tax and compliance issues related to electronic commerce.

Revenue Canada is a world leader in the use of electronic commerce. Electronic program and service delivery is the Department's preferred way of doing business because it reduces the costs to businesses and taxpayers, and reduces the cost to government. "We are proud of our efforts to improve program and service delivery through electronic commerce, but the reality is that the challenges posed by electronic commerce cannot be dealt with in isolation. These challenges must be dealt with by all countries together, and we will continue to work closely with our international partners to ensure that these challenges are met," concluded Mr. Dhaliwal.

From October 7 to 9, the OECD and the Government of Canada will hold a ministerial conference on electronic commerce in Ottawa. The response to the Advisory Committee's recommendations will provide an important contribution to the conference, where governments, the private sector, NGOs, and international organizations will agree on principles and actions to ensure the development and growth of global electronic commerce. The Ottawa conference is expected to be a major milestone in the international community's efforts to maximize the economic and social benefits of electronic commerce.

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The Minister's Response, the Advisory Committee's report, this news release, and its accompanying background documents are available on the Internet at: ./ecomm, or http://e-com.ic.gc.ca

Printed copies of these documents are available from:

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