BILL NO. 137

(as introduced)

2nd Session, 60th General Assembly
Nova Scotia
57 Elizabeth II, 2008

Private Member's Bill

Income Tax Act
(amended)

Diana Whalen
Halifax Clayton Park

First Reading: April 28, 2008

(Explanatory Note)

Second Reading:

Third Reading:

This Bill amends the Income Tax Act to permit a taxpayer to obtain an income tax credit for expenses that the taxpayer incurs and pays for using public transit. If another person pays the expenses on behalf of the taxpayer, that other person is entitled to the tax credit.

1 Chapter 217 of the Revised Statutes, 1989, the Income Tax Act, is amended by adding immediately after Section 38 the following heading and Section:

38A (1) In this Section,

(a) "eligible individual" means, in respect of a taxation year, an individual other than a trust who is resident in the Province on the last day of the year and subject to tax under this Act;

(b) "public transit expenses" means expenses incurred by an eligible individual for personal transportation on a regular transportation service operated by, for or on behalf of the Government of the Province, a municipality or a transit commission or authority.

(2) Subject to subsection (8), an eligible individual for a taxation year ending after December 31, 2006, may deduct from the amount of tax otherwise payable under this Act for the taxation year an amount not exceeding the amount of the individual's public transit expense tax credit determined under this Section.

(3) Subject to subsection (8), a taxpayer who pays public transit expenses on behalf of an eligible individual for a taxation year ending after December 31, 2006, may deduct from the amount of tax otherwise payable by that taxpayer under this Act for the taxation year an amount not exceeding the amount of the payer's public transit expense tax credit determined under this Section.

(4) Subject to subsection (6), the amount of an eligible individual's public transit expense tax credit for a taxation year is one hundred per cent of the public transit expenses that the individual incurs and pays in respect of the taxation year.

(5) Subject to subsection (6), the amount of a payer's public transit expense tax credit for a taxation year is one hundred per cent of the public transit expenses that an eligible individual incurs in respect of the taxation year and that payer pays on behalf of that individual.

(6) No person may claim a tax credit under this Section for the public transit expenses that an eligible individual incurs unless the individual

(a) obtains receipts, in a form approved by the Minister of Finance, for the expenses issued by the provider of the transportation service to which the expenses relate; and

(b) forwards the receipts to the person who paid the expenses on behalf of the individual, if the person is not the individual.

(7) A provider of a transportation service to which an eligible individual's public transit expenses relate shall, at the request of the individual and at no cost to the individual, provide to the individual a receipt in a form approved by the Minister of Finance for any such expense.

(8) The moneys required for the purpose of this Section shall be paid out of moneys appropriated for that purpose by the Legislature and, for greater certainty, no deduction may be made pursuant to this Section until the moneys are appropriated by the Legislature.