Section 4 — Excise Tax Act: Tax on premiums in respect of insurance effected outside Canada

Every person resident in Canada by whom or on whose behalf a contract of insurance, other than a contract of reinsurance, is entered into or renewed against a risk ordinarily within Canada at the time the contract is entered into or renewed, with any insurer not incorporated under the laws of Canada or of any province or not formed in Canada, or any exchange having its chief place of business outside Canada or having a principal attorney-in-fact whose chief place of business is outside Canada, that at the time the contract is entered into or renewed is not authorized under the laws of Canada or of any province to transact the business of insurance, or with any insurer that at the time the contract is entered into or renewed is authorized under the laws of Canada or of any province to transact the business of insurance, if the contract is entered into or renewed through a broker or agent outside Canada, shall, on or before April 30 in each year, pay to the Minister, in addition to any other tax payable under any other law, a tax of ten per cent on the net premiums paid or payable during the immediately preceding calendar year in respect of that insurance. Subsection (1) does not apply to any contract of life insurance, personal accident insurance, sickness insurance or insurance against marine risks, or any contract of insurance against nuclear risks to the extent that the insurance against nuclear risks is not, in the opinion of the Commissioner, available within Canada; or any other contract of insurance entered into after February 19, 1973 to the extent that the insurance is not, in the opinion of the Commissioner, available within Canada. For the purposes of this section, every corporation carrying on business in Canada shall be deemed to be a person resident in Canada. Where a contract of insurance is entered into or renewed through more than one broker or agent, or where payment of the premium or any part of the premium thereon is effected through more than one broker or agent, the contract shall, for the purposes of this Part, be deemed to have been entered into or renewed, as the case may be, through the broker or agent directly retained or instructed by the insured and not through any other broker or agent.