The 14 provincial and territorial bodies governing Canada's legal profession have filed a petition challenging the constitutionality of the new mandatory disclosure regime (MDR) for reportable and notifiable transactions.

The rules, enacted as part of Bill C-47 in June this year, require taxpayers, promoters and advisors including legal professionals to report to the government information in respect of certain tax avoidance transactions with which they are involved, on pain of heavy penalties. They apply to transactions entered into after 22 June 2023, but reporting will be required where the taxpayer signed up before that date to make 'notifiable transactions' and 'reportable uncertain tax treatments'.

However, ...