Vancouver: Federal Revenue Minister Herb Dhaliwal granted a one-year reprieve against stepped-up taxation on foreign actors – a move that promised to devastate the Canadian service production industry.

Representatives from across the country – including film commissioners, unions, studios such as Disney, service and domestic producers – converged in Ottawa Jan. 22 for a one-hour hearing with the minister. Delegates outlined how Revenue Canada’s plan to require actors to file complete tax returns on any work completed in Canada would simply drive service work away, creating lost employment and lost taxes.

The status quo allows foreign actors to, as usual, remit a 15% withholding tax to RevCan instead of up to 55% of income under more rigorous enforcement.

A meeting between the industry and ministries of revenue and finance is scheduled for sometime this month to forge a solution that is amenable to all parties, including the stars, the studios and RevCan, says George Chapman, a delegate and representative of b.c.’s service industry. He expects that the issue will be concluded by spring after one or two meetings to iron out the details.

‘The truth is that Revenue Canada has been turning a blind eye to the law for years,’ admits Chapman, who as a service producer will get back two of three Hearst mows that fled Vancouver because of the tax fears. ‘Either they have to change the law or come to an arrangement that is fair and reasonable.’

For Californian actors, especially, the new RevCan focus could mean double taxation since California State law does not allow for full credits for tax paid elsewhere.

In related news, the formation of the Canadian Production Service Industries Association, announced prior to the meeting with Dhaliwal, will not proceed, says Chapman, since the cftpa has pledged support for service producers.