The federal government enacted the Goods and Services Tax (GST).
The province of Alberta challenged the constitutionality of the GST Act, arguing it infringed on provincial jurisdiction over property and civil rights, amounted to taxation of provincial property, and unconstitutionally appropriated provincial funds by requiring the province to collect and remit the tax.
The Supreme Court of Canada held that the GST Act was a valid exercise of the federal taxation power under s. 91(3) of the Constitution Act, 1867.
The Court found that the collection and remittance obligations were necessarily incidental to the federal scheme and did not violate intergovernmental immunity or entitle suppliers to compensation for collection costs.
