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Publications and Reports

Recent research projects conducted under the direction of the Indian Taxation Advisory Board (the ITAB) and the Department of Indian Affairs Research and Analysis Directorate have identified a lack of infrastructures such as water and sewer treatment and distribution systems and roads on First Nations land. The under-provision of infrastructure contributes to the high costs of doing business on First Nations’ land. The lack of infrastructure, and more specifically, a lack of any policy or regulation that contemplates the provision of such infrastructure, increases uncertainty for potential investors and hence increases the level of risk of any investment.

Building Bridges
no means no

Most Canadians support the concept that First Nations have a right to self-determination. While it is supported in principle, there has been little agreement on what form the First Nation government should take. This research contemplates a First Nation government that assumes tax jurisdiction as well as associated expenditure responsibilities. The principles and benefits of such an approach are discussed and these are compared and contrasted with current federal and provincial policies. Case studies of tax and related expenditure models are used to illustrate the tangible benefits of such an approach. The first case study examines the Indian Taxation Advisory Board’s use of budget-based tax rates in property taxation regimes. The other case studies examine the Sliammon and Kamloops community improvement fees.

The costs of doing business on First Nation land are high for a variety of reasons. The Indian Taxation Advisory Board retained Fiscal Realities Economists to identify the competitive challenges First Nations face and develop responses that will lead to improved economic development. A multi-faceted approach will be required to turn on the taps. The table below describes some of the projects, processes and institutions that are working to lower the costs of doing business on First Nation land.

Turning on the taps
Expanding Commercial

Opponents of First Nation governments often argue that what they advocate is in the best interests of First Nation persons. The usual argument is that First Nation governments themselves force many people to leave the reserve in order to find opportunity. The implication is that First Nation governments are limiting their prospects and so the solution is to do away with these governments.

Indigenous people in Australia, New Zealand, and the United States have socio-economic characteristics very similar to Canada's Indians. They also suffer from sub-standard public services and infrastructure. Each of these peoples also has movements for self-government or "self-determination"; outstanding claims, and demands for improvements in the infrastructure and services they receive. Each of these peoples desires a land base and more powers. They all wish to use these powers to improve their economic opportunities and protect cultural sites. These aspirations are creating political pressure to improve their place within their respective national fiscal frameworks. 

Fiscal Framework

The paper finds that First Nations require a new fiscal relationship if they are to ever develop tax regimes and significant revenues from these. A new fiscal relationship is a key to developing incentives to tax and, more importantly, developing the tax base on First Nation lands. A new fiscal relationship could therefore provide an opportunity for First Nations to greatly improve self-sufficiency and economic opportunity.

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