Federal-Provincial Fiscal Arrangements Act

Marginal note:General rule

• 3.2 (1) Subject to the other provisions of this Part, the fiscal equalization payment that may be paid to a province for a fiscal year beginning after March 31, 2008 is the amount, as determined by the Minister, equal to the greater of

  • (a) the amount determined by the formula

    (A + B) × C

    where

    A

    is the aggregate of the amounts obtained by subtracting, for each revenue source except the one referred to in paragraph (e) of the definition revenue source in subsection 3.5(1), the average annual per capita yield in that province for the revenue source for that fiscal year from the average annual per capita national yield for the revenue source for that fiscal year,

    B

    is 50% of the amount obtained by subtracting, for the revenue source referred to in paragraph (e) of the definition revenue source in subsection 3.5(1), the average annual per capita revenue to be equalized for that province for that fiscal year from the average annual per capita national revenue to be equalized for that fiscal year, and

    C

    is the average annual population of that province for that fiscal year, and

  • (b) the amount determined by the formula

    A × C

    where

    A

    and C have the same meaning as in paragraph (a).

• Marginal note:Province may elect otherwise

  (2) Despite subsection (1), a province may elect, at the prescribed time and in the prescribed manner, that the fiscal equalization payment that may be paid to that province for a fiscal year be equal to the amount determined by the formula set out in paragraph (1)(a).

• Marginal note:Negative amount

  (3) For the purposes of this Part, if the amount of a fiscal equalization payment computed in accordance with subsection (1) or (2) is negative, that amount is considered to be zero.

• Marginal note:Fiscal year 2009–2010

  (4) Despite subsections (1) and (2), for the fiscal year beginning on April 1, 2009, the fiscal equalization payment that would be received by Nova Scotia or Newfoundland and Labrador, as the case may be, if the amount of that payment were determined in accordance with this section is $1,645,198,000 for Nova Scotia and $856,986,000 for Newfoundland and Labrador.