By Ahmad Hathout
OTTAWA – A trio of travel vacation productions has been granted a review of a decision by Canadian Heritage to deny them tax credits on the basis that they met an excluded threshold for advertising.
The Federal Court ruled last week that the decision by the Heritage minister to deny the tax credits to Filmoptional International was based on the 15 per cent threshold for excluded advertising that was “arbitrary” and ill-defined in the regulations.
In its reasons for denial, the minister referenced the same court’s decision in Serdy, which upheld the rejection of tax credits because the production mostly fell into the specifically excluded category of “games, questionnaires or contests.”
In this case, however, the court ruled it did not agree with the minister’s reference because the exclusionary aspects of the travel vacation productions – Croisières de rêve 4, Soleil tout inclus 8, and Soleil tout inclus 9 – are not so defined in the regulations.
“The scope of the ‘advertising’ exclusion, like that which concerns pornography, is much more restricted than that which applies to games, questionnaires or contests,” the decision said. “There is no term used here that allows only part of the production to be considered advertising (or pornography).”
The court added that the 15 per cent threshold “seems…particularly low” when considering that the exclusion – in lieu of the production having terminology similar to games – requires productions be comprised “mainly” of disqualifying material.
It noted that this type of interpretation should be made by the legislature and not the minister.
Barring an appeal, the ruling sends the decision back to the minister for a reconsideration of the matter.
Photo via Filmoptional
