• SECTION 83 TOOLKIT: SPECIFIC ACTIVITY OR SERVICES OPTIONS

First Nations may make Local Service or Improvement Tax By-laws under SECTION 83 of the Indian Act.

These taxes are levied to fund the costs of providing a specified service or improvement to an area.

The Specific Activity or Service Options By-laws available are:

  • Local Improvement By-laws
  • Business Licensing By-laws
  • Telephone Companies By-laws

The FNTC has established Standards for the Form and Content of Specific Activity or Service Options.

  • SECTION 83 Local Improvement By-laws

First Nations can make Local Improvement Tax By-laws under SECTION 83 of the Indian Act.

Unlike property taxes, which provide revenues that may be expended in a number of areas, local improvement taxes are collected to fund a specific service being provided by or on behalf of the First Nation.

All of the revenues collected from a local improvement tax must be spent only on the specific service for which they are collected.

Local improvement taxes are often levied to fund a specific capital improvement and are levied for a fixed number of years to pay for the cost of the improvement.

Capital improvement projects that may be funded by a service tax include:

  • Transportation infrastructure
  • Sewer and water systems
  • Park acquisitions and improvements

The cost of the work undertaken is usually paid up front by the First Nation then recovered from property owners through the tax. Local improvement taxes may apply to the entire reserve, or only to a defined area.

Local improvement tax by-laws set out the service or work provided by or on behalf of the First Nation for which the tax will be levied, the estimated cost and the portion that will be recovered through the tax, the basis on which the tax will be levied, the rate and duration of the tax, the construction schedule of the local improvement area; any exemptions; details regarding the tax roll, notice requirements, and review panel; and enforcement measures.

Local improvement tax by-laws set out the service or work provided by or on behalf of the First Nation:

  • For which the tax will be levied
  • The estimated cost and the portion that will be recovered through the tax
  • The basis on which the tax will be levied
  • The rate and duration of the tax
  • The construction schedule of the local improvement area
  • Any exemptions
  • Details regarding the tax roll
  • Notice requirements
  • Review panel
  • Enforcement measures

Service and local improvement tax by-laws enacted under the Indian Act must comply with the Act and any policies established by the FNTC. The FNTC has established policies for service and local improvement tax by-laws that provide further requirements for the form and content of these by-laws.

  • SECTION 83 Business Licensing By-laws

First Nations may make Business Licensing By-laws under SECTION 83 of the Indian Act.

Business licensing by-laws are established to regulate licensing of businesses, business activities and persons engaged in business, trades and occupations on reserve.

Business licensing by-laws enacted under the Indian Act must comply with the Act and any policies established by the FNTC. The FNTC has established a Policy for Business Licensing By-laws that provide further requirements for these by-laws.

Business licensing by-laws set out the requirements for:

  • Obtaining a license to conduct or carry on a business on a reserve
  • The business license application process
  • The appointment and duties of a license inspector
  • The licensing period
  • The license fee structure
  • The requirements for retaining, refusing, suspending and revoking business licenses
  • The appeal process
  • Any penalties under the by-law

When you are ready to proceed with Business Licensing by-law development:

  1. Review the policies and sample by-laws
  2. Develop a work plan in conjunction with the FNTC

  • SECTION 83 Telephone Companies By-laws

First Nations may make a Telephone Companies Taxation By-law under SECTION 83 of the Indian Act.

A telephone companies taxation by-law establishes the framework for the taxation of real property interests held by telephone companies operating on reserve.

The basis for assessment and valuation of the real property interests is a percentage of the total gross receipts collected from on-reserve customers.

Telephone companies taxation by-laws enacted under the Indian Act must comply with the Act and policies established by the FNTC.

When you are ready to proceed with Telephone Companies Taxation by-law development:

  1. Review the policies and sample by-laws
  2. Develop a work plan in conjunction with the FNTC

  • NEXT STEPS: SECTION 83 TAXATION

First Nations establish Property Taxation and Assessment by-laws, along with the required Rates by-law and the Expenditure by-laws, then consider building on that established framework with Specific Activity and Service Options by-laws.

Property Taxation System

Guide to Development & Administration of Property Taxation & Related Laws under the Indian Act

Sample By-Laws & Policies

Sample by-laws & polices for by-laws enacted under the Section 83 of the Indian Act