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The Canadian government has been introducing tax policy by press release for far too long. Sometimes it’s inevitable in order to restore fairness to the system or to curb perceived abuses.

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Lately, however, these press releases have been the tool du jour.

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For example, during COVID-19, tax practitioners were often glued to their screens waiting for the next press release affecting the steady stream of tax measures and extensions. An extension to the filing deadline for the 2022 Underused Housing Tax Returns was made by press release. The same for bare trusts in 2023.

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Then came the capital gains inclusion rate proposals in the 2024 federal budget. Fraught with problems from the start, the proposals were first “deferred” until Jan. 1, 2026, by a Department of Finance press release on Jan. 31, 2025, and then apparently killed by Prime Minister Mark Carney through an unusual press release through the PM’s website.

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Now, the digital services tax (DST) was rescinded by a press release on Sunday. The DST applies to certain large corporations and was passed into law in June 2024, retroactive to 2022.

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The first collections of such tax were required to be made by affected corporations on June 30, 2025. Carney, when questioned about the timing of the announcement, said it “did not make sense to collect a tax and then remit the revenue back.” In other words, if you’re going to repeal it, then do so before it requires payments to be made by taxpayers.

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But what if affected companies had already paid their otherwise required remittances? I’m aware of some companies that made remittances amounting to hundreds of millions of dollars before the June 30 deadline. Can they now get a swift refund?

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Well, notwithstanding that the Canada Revenue Agency (CRA) has said it will not require the filing of DST returns or enforce DST payments, it also said it has no legal authority to refund such amounts until the DST legislation is formally repealed.

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On its face, that may be correct, given that the DST legislation is still valid law, despite the June 29 press release killing it. However, if correct, on what legal authority does the CRA have to not require filing and collection? Where is the symmetry?

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More importantly, is that fair?

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It isn’t. Why? Let’s start with CRA’s long-standing policy to administer proposed tax legislation as if it were law. This approach was recently debated during the capital gains debacle: the proposals were on life support, but the CRA was still administering them as if they were law. This caused havoc amongst taxpayers and their advisers.

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Earlier this month, the proposed one per cent personal tax rate reduction was introduced as a bill to Parliament, but did not pass before it recessed for the summer. In other words, the cut still has substantial legislative hurdles to overcome before it becomes law, retroactive to July 1, 2025. But the CRA is administering this as if it were law and the government is trumpeting the reduction.