Winnipeg Free Press - PRINT EDITION

Native fishery's tax-free status over last hurdle

Supreme Court rejects federal appeal bid

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A Supreme Court of Canada decision Thursday handed a group of Manitoba aboriginal fishers a tax victory that could allow First Nations across Canada to claim tax-free status for commercial ventures.

Canada's highest court rejected an appeal request from the Canada Revenue Agency, forcing Ottawa to forgo taxes on the annual commercial fishing catch by Norway House fishers.

"It's always good not to pay taxes, right?" chuckled Langford Saunders, a spokesman for the Norway House Fishermen Co-op, a group of 52 fishers with total revenue of about $1 million a year from selling pickerel, sauger and whitefish caught in Lake Winnipeg.

"Commercial fishing is a traditional way of life and I'm glad it is recognized by the courts," Saunders said.

An earlier ruling called on the federal government to repay taxes on the fishers' catch retroactively.

"We've been at this case for the last 10 years," he said. "We believed we were exercising our treaty rights and that we were tax-exempt... This means a lot. I'm very happy."

Aboriginal leaders say the Norway House tax victory puts the weight of the courts behind treaty rights for other native commercial ventures.

"I congratulate the Norway House Fishermen Co-op on this landmark decision, which has great significance for economic development for First Nations communities," Norway House Cree Nation Chief Ron Evans said in a statement Thursday.

"(It) affirms our treaty rights as First Nations and reflects the efforts and perseverance of the members of the NH Fisherman's Co-op."

The Assembly of Manitoba Chiefs applauded the wider ramifications of the decision. The ruling gives First Nations a boost in their efforts to create economic development on and near reserve lands, Grand Chief Derek Nepinak said.

"This decision by the Supreme Court of Canada... has acknowledged the right of First Nation peoples to evolve commercially and economically," he said.

In 2010, a tax- court ruling found two Norway House fishermen, Ronald Robertson and Roger Saunders, qualified for tax-exempt status under the federal Indian Act. And it ruled they had more than the law on their side, they had history.

Hudson Bay Co. historical records showed Norway House was the trade location for a thriving commercial fishery that was part of the aboriginal way of life. That was key to the tax victory confirmed Thursday.

The Canada Revenue Agency argued against the exemption, partly on the grounds the existence of a co-operative that markets fish to the Freshwater Fish Marketing Corp. effectively cancelled tax-exemption rights.

Ottawa lost its appeal, and with the Supreme Court rejecting the federal request for a hearing, the door is now open to First Nations commercial ventures that also seek tax exemptions, the fishers' lawyer said.

"If a First Nation has a corporation headquartered on a reserve and they bank on a reserve, work on or through a reserve or in proximity to a reserve, whatever goods they produce... are tax-free," Winnipeg lawyer Norm Boudreau said.

"The tax court can no longer view a First Nation enterprise in the commercial stream as a way to tax that First Nation," Boudreau said.

Saunders said it was funny the key to the fishers' victory lay in the production of liquor back in the 1700s.

Bladders from Lake Winnipeg sturgeon caught by his ancestors were shipped to Scotland so Highland distilleries could use isinglass, a substance in the bladders, to clarify scotch whiskey.

The trade receipts were the reason the commercial fishery qualified for tax exemption under the Indian Act.

Republished from the Winnipeg Free Press print edition October 26, 2012 A9

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