Mi'kmaw chiefs drop plans to sue province over tax-sharing agreements

Six Mi'kmaw chiefs say they have abandoned a lawsuit against the Higgs government over its cancellation of tax-sharing agreements and will instead negotiate "a new economic relationship" with the province.

The chiefs filed the lawsuit June 8 in response to the province announcing it would pull out of the agreements, which have seen First Nations governments collect provincial sales taxes from on-reserve retail operations and keep 95 per cent of the revenue.

Premier Blaine Higgs called the agreements "unsustainable and unfair" when he announced in April that he was terminating them.

At the time, Chief George Ginnish of Natoaganeg First Nation called the move "completely disrespectful."

• Higgs government pulls out of gas-tax sharing with First Nations

But Ginnish is one of the six chiefs who said in a news release Tuesday that they have agreed to work on a new deal with the province.

"Both parties quickly recognized there was more to be gained from sitting down and working out a new path towards a new economic relationship [rather than] fighting over the old agreements in court," they said in the release.

"The Chiefs would like to acknowledge the province for recognizing the impact that losing these funds would have on communities and agreeing to a fairer negotiation process."

The six chiefswere not doing interviews Tuesday, a spokesperson said.

Wolastoqeychiefs also challenging termination plan

Six Wolastoqey chiefs are also challenging the termination of tax agreements with their First Nations.

Under the consent order that halted the Mi'kmaw lawsuit, the existing agreements with the six bands Amlagog (Fort Folly), Metepenagiag, Upi'ganjig (Eel River Bar), Esgenopetitj, Tjipogtotjg (Buctouche) and Natoaganeg (Eel Ground) will end next month as expected.

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After that, the bands will continue to collect and remit taxes and the province will "make payments to the six communities as if they were under the 'new' tax agreements" until the end of 2023, the release says.

In a separate news release, Aboriginal Affairs Minister Arlene Dunn thanked the chiefs.

"We understand there is a great deal of work ahead of us, but we are committed to working collaboratively with First Nations leaders to achieve sustainable agreements that work for them and for the province," she said.

In announcing the termination of the agreements, Higgs said they diverted $47 million in provincial revenue to reserves in 2019-2020 and estimated that would grow to $75 million a decade from now.

The premier said the agreements were unfair because some reserves were earning far more than others.

According to figures released by the province at the time, four Wolastoqey communities were the top beneficiaries of the tax revenue, while Mi'kmawcommunities received less.

Earlier this year, Court of Queen's Bench Justice Richard Petrie ruled that the gas tax agreements extend to about $5 million in carbon tax revenue.

Higgs argued in April the gas-tax agreements are independent of Aboriginal and treaty rights protected by the Constitution.