Transfer Tax Exemption
The Ontario government has revived the transfer tax exemption for transfers of electricity assets within the public sector. The move is designed to encourage consolidations among municipal electrical utilities. To qualify, the transfer must be made to a municipal corporation, a municipal electricity utility, Hydro One Inc. or Ontario Power Generation Inc. or a subsidiary of either of them, that is exempt from federal income tax under subsection 149 (1) of the Income Tax Act (Canada).
The exemption applies to transfers made after October 16, 2006 where an application for approval is made to the Ontario Energy Board before October 17, 2008 and a written agreement to make the transfer is complete before October 17, 2008 and is not materially changed after that date.
