INFLATION, TAXATION AND DAMAGE ASSESSMENT

Abstract

In several civil cases, the Supreme Court of Canada has discussed quantum of damages using methods for considering inflation and taxation, but has done so in the absence of economic evidence. The author attempts to expose errors in calculation and to debunk the claim that inflation and taxation can be simply ignored on the pretext that they offset each other. He describes how the rate of inflation affects the rate of taxation, and attempts to illustrate how this led the Supreme Court to make a substantial error in one of these cases, when articulating rules related to inflation and taxation.