User:Ground Zero/sandbox

Tax protesters make the following false arguments.

They cannot be taxed. They support this claim by stating that : The Income Tax Act is valid, but it does not apply to natural persons. The Act only applies to a legal representative of the legal person that is created through a SIN. They do not define themselves as persons under the Income Tax Act. There is no intent (mens rea), because they believe (despite a number of cases to the contrary) that they are not subject to tax. Income tax is not legal. They support this argument by stating that income tax was deemed illegal in the constitution (Magna Carta) and the British North America Act when applied to natural persons. They can challenge their obligation to pay taxes under the law through the Charter of Rights and Freedoms. They support this argument by stating that: : They do not want to pay taxes because the money is used to make weaponry, which is against the Human Rights Convention. Anyone trying to enforce tax laws is violating the rights of taxpayers. Tax protesters treat themselves as two people for income tax purposes. They define the natural person as the individual that performs the labour required to earn income, and the legal person as the legal entity that the federal government creates through the issuing of a social insurance number (SIN). Tax protesters allege that the legal person has to file an income tax and benefit return, and that income received as a natural person is not subject to Canadian income tax.

Canadian courts have consistently rejected the natural-person arguments often used by tax protesters in order to avoid paying taxes.

http://www.cra-arc.gc.ca/gncy/lrt/txprtstrs-eng.html

Natural vs Legal Person

One of the most common false arguments tax protesters use is the natural vs. legal person argument, in which they treat themselves as two separate people for income tax purposes. They define the natural person as the individual that performs the labour required to earn income, and the legal person as the legal entity that the federal government creates through the issuance and use of the social insurance number (SIN). Tax protesters allege that the legal person has to file an income tax and benefit return, and that income received belongs to the natural person and is therefore not subject to Canadian income tax.

Canadian courts have repeatedly and consistently rejected all arguments made in these tax protester schemes.

http://www.cra-arc.gc.ca/nwsrm/lrts/2011/l111130-eng.html

The National Post has identified 385 pending tax cases — most using florid and arcane language and claiming bizarre laws that supersede or nullify Canada’s regulations and laws; it prompted the Tax Court to adopt a triage approach to cope with the deluge, grouping cases and directing them to specific judges.

The cases are part of a burgeoning movement that is convincing people they can avoid paying taxes by adopting one of various but similar philosophical stances.

None are known to have been successful. In fact, the increasing burden placed on court and government resources suggests a punitive crackdown is underway.

Like many of the cases, Mr. Dillon is self-represented in court as he fights an assessment over unpaid income tax dating back to 2007, according to court files. He filed an appeal in the Tax Court of Canada titled: “Notice of Appeal & Notice of Default & Notice of Dishonor.”

In it, Mr. Dillon insists the government first needs to prove Canada is “a real entity and not a fiction.” He further claims he “goes by a higher order of laws” and “has never agreed to be under jurisdiction” of Canadian law.

At his Toronto hearing in Tax Court before Justice Judith M. Woods on July 19, Mr. Dillon made little progress pressing his claims.

“Shortly after the hearing commenced with the Crown’s argument, [Mr. Dillon] indicated that he wished to interject. I did not permit the interruption, however, because [he] repeatedly refused to stand to address the court unless I stepped down from the bench and stood on even ground with him,” Judge Woods wrote in her decision.

After she reserved her judgment and adjourned court, Mr. Dillon refused to leave.

“I was informed by the court staff that [Mr. Dillon] would not comply with requests to leave the counsel table and eventually [he] was removed from the premises by the police,” she wrote.

Last week, Judge Woods issued her ruling: His appeal was deemed an abuse of the court process and was dismissed. Mr. Dillon did not return a message from the Post seeking an interview, Tuesday.

Last year, John Rooke, associate chief justice of the Court of Queen’s Bench in Alberta, gave a thorough legal debunking of the movement in the divorce case of Dennis Larry Meads, who relied on similar arguments.

Judge Rooke put them all under one umbrella term: Organized Pseudolegal Commercial Argument litigants.

“These persons employ a collection of techniques and arguments promoted and sold by ‘gurus’… to disrupt court operations and to attempt to frustrate the legal rights of governments, corporations, and individuals,” Judge Rooke wrote.

In a February ruling, Tax Court Justice Diane Campbell revealed the triage applied by the court, when she dismissed the case of Adrian Cassa as “an absurd blend of the ridiculous arguments” and “unintelligible, incomprehensible, meaningless, irrelevant and factually hopeless.”

“These appeals form part of a large group that I have been assigned to case manage,” wrote Judge Campbell.

“Because of the thread of similarities in wording in hundreds of these appeals, it is apparent that these appellants have received ‘counsel’ from a third party,” she wrote.

Earlier this year, Tel Sutherland, an avowed tax scofflaw from Alberta went to jail for more than two months for contempt of court after arguments similar to Mr. Dillon’s failed to sway the Federal Court of Canada.

The stern action against Mr. Sutherland and the order for Mr. Dillon and Mr. Cassa to pay $1,000 towards the government’s legal fees, suggests the judiciary is losing patience.

http://news.nationalpost.com/2013/08/06/judges-losing-patience-as-anti-government-tax-deniers-clogging-courts-with-absurd-claims/ Judges losing patience as anti-government tax-deniers clogging courts with ‘absurd’ claims Adrian Humphreys | 06/08/13 9:18 PM ET

There are two arguments that are brandished by tax protesters. The first argument is that taxes are illegal. In Canada, this is usually narrowed to say that federal income and other federal direct taxes are illegal, with protesters usually brandishing the decision in Attorney General of Nova Scotia v. Attorney General of Canada and Lord Nelson Hotel Company Ltd.

This is the case where the Supreme Court ruled that one level of government cannot delegate its powers (stipulated in the Constitution Act) to another. For example, the federal government in Canada cannot delegate its power of currency and coinage (section 91(14) of the Constitution Act) to the provinces and the provinces cannot delegate their power of municipal institutions (section 92(8) of the Constitution Act).

Tax protesters use this decision to say, ah ha, that the federal government cannot impose income and other direct taxes. They argue that because income and other federal taxes are direct taxes and direct taxes are only delegated to the provinces under section 91(2) of the Constitution Act, this means that federal direct taxes are illegal.

Legend has it that tax fighter Gerry Hart used this argument in court to successfully defend his non-payment of federal taxes. I hate to burst the bubble of those that refer to Mr. Hart as a modern day Gandhi, but no such cases exist. Instead, a number of cases exist, none of which involved Hart, where this argument was dismissed by the courts.

What is wrong with this argument that federal direct taxes are illegal? The fundamental flaw of this argument is that section 91(3) of the Constitution Act allows the federal government to raise money by any “mode or system of taxation.” The mode includes both direct and indirect taxes.

The second argument is currently making news and is the one for which I was recently interviewed. The essence of this argument is that only legal persons are required to pay taxes whereas natural persons are not. The concept of a legal person is not made up by tax protesters. The concept of a legal person is what allows natural persons to create an artificial person (a composite person) to which the law still applies. Corporations, for example, are legal persons which are formed by one or more natural persons.

The originator of the “natural persons” theory appears to be Russell Porisky. Not only did he apparently develop this theory, but he even ran fee-based seminars to train others in his “method.” Porisky’s Paradigm Education Group even has videos on YouTube where he advocates his method.

Be warned, however, as Mr. Porisky’s argument holds no water. For the purposes law, including tax law, the natural vs. legal persons definition is a distinction without a difference. B.C. Supreme Court Justice Meyers agrees, writing that the argument “lacks logic, coherence and consistency.” Mr. Porisky and many of his followers have already been convicted of tax evasion.

http://www.theglobeandmail.com/report-on-business/economy/economy-lab/why-modern-day-tax-revolts-are-doomed-to-fail/article4105306/ Why modern-day tax revolts are doomed to fail LINDSAY TEDDS The Globe and Mail Published Tuesday, May. 08 2012, 8:16 AM EDT Last updated Monday, Sep. 10 2012, 2:02 PM EDT