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Canada Mulls Changes to Interest Deduction Limitation Rule

May 17, 2022, 10:40 PM

Canada is considering multiple changes to proposed limits on corporations’ interest deductions after getting dozens of comments on the draft law, tax authorities said Tuesday.

The Department of Finance received 60 submissions during a public comment period for the Excessive Interest and Financing Expenses Limitation, or EIFEL, rules, which would curtail deductions using interest and financing expenses, Trevor McGowan, director general of the tax legislation division at Finance Canada, told the International Fiscal Association’s annual Canada tax conference.

Among the most common comments were exemption requests—including for entire sectors like real estate, infrastructure, utilities, and infrastructure projects built for ...