By Canadian Press

Military tax exemption applies to overseas missions, not training: Vance

Nov 30, 2017 | 12:00 PM

OTTAWA — Canada’s defence chief is sticking to his guns when it comes to tax relief for deployed military personnel, saying the benefit will only apply to service members involved in recognized overseas missions as a matter of fairness.

The decision ends months of questions about the tax measure, which the government announced in the spring as part of its new defence policy and Gen. Jonathan Vance described Thursday as a “great thing.”

“The country is rewarding people who have to be away from kith and kin,” Vance told The Canadian Press in a wide-ranging interview. “Short time, long time, dangerous or not dangerous, it doesn’t really matter.”

The tax measure, which Vance told service members this week is now set to come into effect, will see the salaries of military personnel and police officers sent on specific operations exempted from federal income tax for the duration of their deployments.

The move, retroactive to Jan. 1, 2017, exempts eligible salaries up to the pay level of lieutenant-colonel and is expected to cost the federal treasury about $85 million over the next five years.

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Personnel would still be eligible for extra hardship and risk pay if deployed into dangerous environments.

However, one of the main questions over the past several months has been exactly who would be eligible for the benefit.

The measure was initially promised to military personnel deployed only on “named operations,” such as Operation Impact, which is Canada’s mission in Iraq, and Operation Unifier, its training mission in Ukraine.

But many military personnel deployed overseas for extended periods are never attached to a named operation, or may only spend a portion of their time in such a situation.

Those can include soldiers deployed on training exercises in Europe or Africa, and sailors on Canadian frigates training and travelling in different parts of the world.

Officials had started to back off the explicit reference to named operations in the summer, raising the hopes of some that the criteria would be broadened.

But Vance said confirmed the measure will only apply to named operations, during which members are “doing the business of the country in an international domain” and not simply training.

“Just because you’re fortunate enough to be in the navy, where you might do (training) activities in international waters and are therefore technically outside the country,” he said, “how would it be fair that we send troops to CFB Wainwright for the same amount of time and they’re just not outside the country?”

While the decision may spark grumbles and complaints from some service members, Vance said the tax measure was something to “celebrate” as the Forces tries to better support those in uniform and their families.

— Follow @leeberthiaume on Twitter

Lee Berthiaume, The Canadian Press

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