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LEGAL REPORT/TAX LAW purposes and the employee regularly has to use his or her own automobile or one supplied to do his or her duties. Michael Templeton, a senior part- ner at McMillan LLP, sees the situation somewhat differently. "I don't think free parking should ever be a taxable benefit. Unfortunately the courts seem to have adopted the position that free parking is a taxable benefit. There is some pretty strong case law for that, but I think the case law is actually wrong." Templeton says if one looks at it from a basic economic point of view, income tax is supposed to be a tax imposed on an increase in your wealth. "It's a bit of a slippery slope," says Templeton. "For the small amounts involved why not let employers give employees free parking?" He feels there is an argument that NEW EDITION BRITISH COLUMBIA ANNUAL PRACTICE, 2012 EDITION THE HONOURABLE MADAM JUSTICE JANICE R. DILLON AND GORDON TURRIFF, Q.C. Easily research the rules of civil procedure in British Columbia. To ensure portability, British Columbia Annual Practice, 2012 Edition is now in a two- volume format. 1. Main Volume – Everything you need for Court is in one volume, including: • The Supreme Court Civil Rules, Supreme Court Family Rules, Court of Appeal Rules, Supreme Court Act, and Court of Appeal Act, fully annotated with personally selected cases • The full text of 15 key statutes ON SUBSCRIPTION ORDER # 804535-65204 $85 Hardcover + Softcover + CD-ROM + Mobile Version August 2011 Approx. 1600 pages (Hardcover) approx. 420 pages (Softcover) 978-0-88804-535-5 ONE TIME PURCHASE ORDER # 804535-65204 $90 Hardcover + Softcover + CD-ROM + Mobile Version August 2011 Approx. 1600 pages (Hardcover) approx. 420 pages (Softcover) 978-0-88804-535-5 Multiple copy discounts available • A two-way Table of Concordance of the old and new Civil Rules and more. 2. Forms Volume – provides easy access to the essential forms. 3. CD-ROM – includes the full text of British Columbia Annual Practice with links to the full-text judgments referred to in the text and Word "fillable" forms. 4. Mobile Version – includes all the Rules and case annotations, a two-way table of concordance of the old and new Civil Rules, and the text of several key statutes. 5. e-Notes – Standing order customers automatically receive email updates containing the latest case annotations with links to the full-text judgments available at no extra charge. AVAILABLE RISK-FREE FOR 30 DAYS Order online at www.canadalawbook.ca Call Toll-Free: 1-800-387-5164 In Toronto: 416-609-3800 Shipping and handling are extra. Price subject to change without notice and subject to applicable taxes. CANADA LAW BOOK® providing parking to employees helps workers do their job and get them to work more engaged than if they had to pay, which benefits the employer, not the employee. "If somebody can get to work in half an hour if they drive, as opposed to an hour if they take public transit, that really is good for the employer. If you spend less time on the road you're going to be willing to spend more time at work and be more relaxed at work. So it really is less of a benefit to the employee — you're helping them get to the job." However, Templeton does think the court is going to revisit that argument. "They accepted it in Schroter that if you get this cost covered that it is a taxable benefit. As soon as you reach that con- clusion you start running into all the problems that are coming out. What if you hire a nanny and allow them to park in your driveway, are you now going to have to include in the nanny's wages an element for the free parking you're giving on the parking lot?" The appellants argue that unlike Schroter there aren't other people who pay to park, the lot is not a commercial one in a commercial area, and the school is not for profit. The school, they argue, pays maintenance only on the parking area, such as snow removal in winter — costs estimated to be about $20,000 per year. As the application of the taxable benefit becomes more common, employers with large lots will find they must assess the land they currently provide as free park- ing. "For employers who have big parking lots where they have a lot of employees, they will have to go out and compute what is a fair market value for parking," says Templeton, who adds there are many unfair aspects to applying the policy across the board. "Why should people who work at a place where the parking is cheap be taxed less heavily than people who work where parking is more expensive? In some ways the policies contribute to the hollow- ing out of big cities because the parking is expensive and the employer is already paying a high premium for the real estate. There are all sorts of policy reasons to rant against this approach, but at the end of the day the majority of the courts have been finding that it's a taxable benefit." 46 JAN UARY 2012 www. CANADIAN Lawyermag.com