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AGREEMENT ON FISCAL MATTERS
RELATED TO TOBACCO, PETROLEUM
AND ALCOHOL PRODUCTS
BETWEEN QUÉBEC
AND KAHNAWAKE

WHEREAS Quebec and Kahnawake have signed a Statement of Understanding and Mutual Respect and a Framework Agreement which provides for the negotiation of sectoral agreements in a number of areas, including fiscal matters;

AND WHEREAS the Mohawks of Kahnawake have the right to the tax exemptions described in the Indian Act (R.S.C. (1985) c. I-5).

AND WHEREAS the present situation with regard to taxation of tobacco, petroleum and alcohol products is not satisfactory and has resulted in misunderstandings which have caused conflicts between the parties;

AND WHEREAS the parties wish to conclude an agreement for the purpose of establishing certain principles and procedures that will resolve these misunderstandings and avoid future conflicts between themselves;

AND WHEREAS the parties are intended to sign a complementary agreement on fiscal matters related to consumer goods and services.

NOW THEREFORE THE PARTIES AGREE TO THE FOLLOWING:

Part 1

OBJECT OF THE AGREEMENT


1. The purpose of this Agreement is to identify the principles and procedures that will define the relationship between the parties in fiscal matters regarding tobacco, petroleum and alcohol products.

2. The Territory of Kahnawake (hereinafter referred to as the "Territory") is, for the purpose of this Agreement, the territory over which the Mohawk Council of Kahnawake (hereinafter referred to as the "Council") has jurisdiction.

3. The Preamble is an integral part of this Agreement.

4. The following Schedules are an integral part of this Agreement:

1. Definitions;
2. Monitoring of the general level of prices.

5. The taxes covered by this Agreement are the tax on tobacco under the Tobacco Tax Act (R.S.Q., c. I-2), the tax on petroleum products under the Fuel Tax Act (R.S.Q., c.T-1) and the tax on alcoholic beverages under Title II of the Act respecting the Québec Sales Tax (R.S.Q., c.T-0.1), (hereinafter referred to collectively as "specific taxes").

Part 2

SPECIAL PRODUCTS


6. Kahnawake will provide for a regulatory framework for the supply and sale of tobacco, petroleum and alcohol products (collectively referred to as "special products") within the Territory.

7. Kahnawake will establish a single supply system for all special products sold in the Territory.

8. Kahnawake will provide that all special products supplied in the Territory to persons who are not Mohawks have been legally obtained from sources acceptable to both parties.

9. Except to the extent that the operation of this Agreement provides otherwise, the supply of special products outside the Territory is subject to applicable taxes.

Part 3

REMITTANCE TO KAHNAWAKE


10. The Minister of Revenue shall remit to Kahnawake, or such entity as may be identified by Kahnawake, the amount of the specific taxes which have been collected on the special products supplied in the Territory to Mohawks for personal use or consumption; no reimbursement of any specific tax will be made directly to an individual or merchant by Québec.

11. This remittance is made, following a request by the Council on the terms and conditions determined by the parties. The amount of the remittance is calculated on the basis of the special products that have been supplied during the period through the single supply channel referred to in section 7 to the Mohawk merchants and supplied again by them to the Mohawks for their own consumption.

12. The Minister of Revenue may deduct from this remittance an amount established in a manner agreed upon by the parties, corresponding, in whole or in part, to the cost of the identification card system defined in Schedule 1.

Part 4

ASSESSMENT MECHANISMS

Price Structure Monitoring


13. The parties agree that in the event the retail price of the special products supplied in the Territory to persons who are not Mohawks are not within the prevailing market prices in the surrounding region, it shall not be attributable to operation of this Agreement.

14. The parties agree to set up a joint mechanism for the monitoring of the general price levels in the Territory and in the surrounding region as provided in Schedule 2.

Exchange of Information

15. The parties agree to exchange regularly all the informations, data and statistics required for each party to be in a position to appraise the implementation of this Agreement. Each party will respect the confidentiality of such information and use it, in accordance with applicable laws, for no other purpose than matters identified in this Agreement.

16. The parties agree to exchange regularly all the informations, data and statistics required for each party to be in a position to appraise the implementation of this Agreement. Each party will respect the confidentiality of such information and use it, in accordance with applicable laws, for no other purpose than matters identified in this Agreement.

Part 5

COOPERATION


17. The parties to this Agreement recognize the need to cooperate and to combine their efforts to achieve the purposes of this Agreement.

Implementation

18. The chief of the Office defined in Schedule 1 and the deputy-minister of Revenue are responsible for the application and implementation of this Agreement. Each of them may delegate to any person of the Office or the Department the power to implement any section of this Agreement.

19. Quebec agrees to take, as quickly as possible, whatever measures are necessary to ensure the implementation of this Agreement.

20. Kahnawake agrees to shall take, as quickly as possible, whatever measures are necessary to ensure the implementation of this Agreement.

Liaison Committee

21. The Liaison Committee defined in Schedule 1 is charged with supervising the application of this Agreement.

22. The Liaison Committee shall have the power to make joint recommendations to the parties concerning any matter relative to the implementation of this Agreement.

Part 6

FINAL PROVISIONS

Duration of the Agreement


23. This Agreement shall take effect on the date of its signing by both parties and remain in effect for a period of five years, subject to the provisions of this Agreement.

However, sections 6, 7, 8 and 10 shall come into effect on the date agreed upon in writing by the parties.

24. The parties may agree on an agenda for the progressive implementation of this Agreement and, if necessary, on transitional arrangements.

Amendment of the Agreement

25. The parties may, by written agreement, amend this Agreement or conclude supplementary agreements by an exchange of letters with respect to the implementation of this Agreement on matters not specified herein

Difficulties of Application

26. The parties agree to submit to the Liaison Committee any disagreement or situation that may hinder the application of any or all of the provisions of this Agreement.

27. Should the difficulty remain unresolved at the expiry of a delay of thirty (30) days from the date it was submitted to the committee, the party that submitted it may address the other party a written resiliation notice as provided in section 28.

Cancellation of the Agreement

28. This Agreement is canceled at the expiry of a delay of sixty (60) days from the date a written resiliation notice is forwarded by either of the parties, unless the parties agree on different terms before the end of such delay.

29. In case of cancellation, the Liaison Committee shall recommend to the parties the transitional or final arrangements to be made.

Renewal of the Agreement

30. This Agreement is renewed automatically unless one of the parties gives the other a written notice of termination. This Agreement remains in effect for a maximum period of sixty (60) days after its expiry unless the parties agree otherwise.

In the event of non renewal of this Agreement, section 29 applies.

31. This Agreement is not intended to be an agreement or a treaty as contemplated in section 35 of the Constitution Act, 1982 nor is it to be interpreted in any way as abrogating, derogating, negating or recognizing any aboriginal, treaty or other rights, except to the extent that it recognizes the right of the Mohawks to tax exemptions.

32. Nothing in this Agreement affects the rights of a person who is not a Mohawk to whom this Agreement applies to benefit from the tax exemptions provided for in the Indian Act.

33. Should any provision of this Agreement be declared null or void by a competent tribunal, the parties undertake to remedy this nullity or invalidity as quickly as possible so that the purposes of this Agreement can be achieved.

N WITNESS WHEREOF the parties have signed this _____ day of _____ 1999:

Pour le Québec

_______________
Guy Chevrette
Ministre délégué aux Affaires autochtones

Pour Kahnawake,

_______________
Joseph Tokwiro Norton
Grand chef
Conseil mohawk de Kahnawake

_______________
Rita Dionne-Marsolais
Ministre du Revenu

_______________
Bernard Landry
Vice-Premier ministre
Ministre d'État à l'Économie et aux Finances
Ministre de l'Industrie et du Commerce
Ministre des Finances

Signature gouvernementale
Secrétariat aux affaires autochtones
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