Tlicho gain own tax
The Tlicho government passed the new tax law at its fall sitting in October and it took effect after it was signed in Ottawa by the federal government.
"It's a big accomplishment for aboriginal people," said Tlicho Grand Chief George Mackenzie. "The GST agreement is not charity; it represents the right of the Tlicho Government to share in the taxes generated in their communities and on their lands."
Tlicho residents now pay the seven per cent Tlicho Goods and Services Tax (TGST), which is collected by the Canada Revenue Agency, as opposed to the seven per cent federal GST they were paying previously. The only difference is the Tlicho government gets the money, not the feds.
As before, people who received GST credit payments based on low-income will continue to receive those payments from the federal government.
Tax payments will be made to the Tlicho government monthly and recalculated annually.
"We won't actually know what the figures are until the system operates and payments are made," said Colin Salter, legal council for the Tlicho government.
Estimates for 2006 put the TGST revenue at approximately $2.07 million.
The tax returned is approximated based on the number of people living on Tlicho land and their purchasing power, or income levels, relative to the rest of the NWT.
"The better the economy, the more tax revenues there are," he said.
The estimated funds coming to the Tlicho government are already incorporated into its 2005-2006 budget that was approved in October, he said.
"It's pretty fantastic when you think about it," he said. "It promotes self-sufficiency. It allows the government to have its own independent source of revenue. Like governments the world over, they survive on access to tax."
One of the laws passed on the day the Tlicho Agreement was signed on Aug. 4, was the Tlicho Income Tax Law, providing another source of revenue for the new government.
Under this law, approximately two-thirds of the income tax revenue collected from all Tlicho residents will go to their government, as opposed to Ottawa. The remaining one-third goes to the GNWT as the tax deal does not include the territorial government.
For 2005, it is estimated Tlicho income tax revenues will be about $2.47 million from income tax revenues.
When filing tax returns, Tlicho residents (citizen and non-citizen) will tick off the appropriate box to indicate their residency.