A country’s revenue laws reflect its political sovereignty and create property rights that affect relationships. Hence, sovereign states will not enforce the revenue laws of foreign countries and domestic courts will not exercise jurisdiction beyond their national boundaries. This rule, known as the “revenue rule”, is long standing in the common law.
A judgment based on a tax debt is normally not enforceable in a foreign jurisdiction. Thus, the Canada Revenue Agency (“CRA”) cannot enforce collection against a non-resident with no assets in Canada, unless it issues a Requirement to Pay to a Canadian resident that owes or will owe money to the non-resident.
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