3 The Valuation Problem

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Lyrics

[Verse 1]
When section six says value the benefit received
Fair market value seems the way to proceed
But what happens when there's no market to find
No comparable sales to help us define

[Chorus]
Fair market value, arm's length deal
But when no market exists, what is real?
One-third, fifty percent, numbers in the air
The Act stays silent, CRA fills the gap there
Valuation problem, arbitrary choice
Legal fiction speaking with official voice

[Verse 2]
Mixed-use arrangements pose the hardest test
Personal and business use all compressed
How do you split what can't be cleanly split
When methodology's not in the Act's writ

[Chorus]
Fair market value, arm's length deal
But when no market exists, what is real?
One-third, fifty percent, numbers in the air
The Act stays silent, CRA fills the gap there
Valuation problem, arbitrary choice
Legal fiction speaking with official voice

[Bridge]
No prescribed method in the statutory text
CRA invented rules, what comes next?
When arm's length markets are just pretend
On whose authority do we depend?

[Verse 3]
The fiction works when markets can be found
But breaks apart when there's no solid ground
Allocation percentages pulled from thin air
Taxpayers wondering if the system's fair

[Final Chorus]
Fair market value, arm's length deal
But when no market exists, what is real?
One-third, fifty percent, numbers in the air
The Act stays silent, CRA fills the gap there
Valuation problem, who decides what's right?
Legal fiction fading in the light

[Outro]
Section six requires the value be known
But leaves us guessing when the method's not shown
Valuation problem, the gap remains wide
Between what's written and what we apply

← 2 The "Primarily for Employer's Benefit" Doctrine | 1 R v. Savage [1983] 2 SCR 428 →