I write on occasion about tax protestors and their persistent tilting at windmills to defeat the income tax. I find them fascinating and a reminder that income taxation is a really difficult tax to administer. Taxpayers will do everything they can to avoid it, justifying their actions in myriad ways. A major difference between the tax protestors (who usually represent themselves) and tax planners (whose business it is to represent others) is that the latter are well-trained and sophisticated. When tax planners make ridiculous arguments about the applicability of income tax, they typically do so in highly technical and targeted ways, and they can sometimes confuse administrators and courts into believing them. Not generally so with protestors. My student Marc Roy points me to a recently decided Canadian Federal Court of Appeal decision of interest: Brown v. Canada. Marc describes the case as follows:
The Federal Court of Appeal decided against a novel argument presented by self-represented taxpayer whose business losses the CRA had denied. In his appeal, Ian Brown raised, along with a more technical argument, an argument that the entire Income Tax Act is void as a constitutional matter “due to vague and convoluted interpretations in the [Act].”
His argument was essentially that the definitions in s. 248(1) of “business,” “employee,” “employment,” “person,” and “taxpayer,” are incomplete and render the Act unconstitutionally vague. These are inclusive definitions, a non-exhaustive style frequently used to define terms in the Act, which leaves room for the defined words to encompass things not explicitly contemplated in the statutory definition.
Unsurprisingly, the Court rejected Mr. Brown’s challenge to these terms and to the act as a whole, walking quickly through the approach to vagueness — a law is only unconstitutionally vague if it is so imprecise that it fails to provide sufficient guidance to legal debate. The court indicated that even if these terms were entirely undefined, there is sufficient meaning that their precise definitions could be, and beyond their inclusive definitions are, judicially determined according to their ordinary meanings in accordance with standard approaches to statutory interpretation.
This case nonetheless raises the question of access to justice for individual taxpayers. It is not unfair to note that the Income Tax Act and its interpretations are at times incredibly convoluted, and it may be impossible for an individual without legal training to accurately and confidently determine her tax liability without costly advice from tax professionals. As in criminal law, in tax ignorance of the law is no excuse — but ordinary persons’ meaningful access to this knowledge is increasingly illusory.
Thanks to Marc, for this succinct summary.