The Conservatives have won an arcane court battle with Elections Canada that will force the agency to accept a $591,000 cheque from the party.
"This may be the first time in history that a political party went to court to try to give money back to Elections Canada," said a Conservative memo released on Thursday.
The Conservatives say they had brought the application against Elections Canada in the Ontario Superior Court of Justice to prevent so-called "rebate double-dipping."
The Tories explained that "double-dipping" happens when political parties receive both a GST rebate and an Elections Canada rebate for the same campaign expenses.
Elections Canada did not want to accept the funds because the GST rebate is meant to offer financial support for political parties, which are listed as non-profit organizations.
Before the case went to trial, the country's chief electoral officer, Marc Mayrand, wrote a lengthy letter outlining his position: "Like the reimbursement of election expenses under the Canada Elections Act, (it) is intended as a form of support and does not serve to eliminate tax indebtedness."
Mayrand was also concerned that taking back the funds could result in an unfair advantage for some parties, because those that give back the rebate can then spend more on their election campaigns.
However, Justice H.J. Wilton-Siegel sided with the Tories, meaning that the party's 2004 and 2006 finances will now be rewritten to reflect the changes.
There had been speculation that the decision could force the Liberals to refund a similar amount to Elections Canada.
While the Tories say the gambit will save Canadian taxpayers money, the Liberals have said that the plan is anything but altruistic.
"We're looking into it, but at first glance it smells of Tories continuing to play partisan games with our institutions," Liberal party spokesman Dan Lauzon said in August, as the case wound its way through the court system.
A few months ago, the New Democrats said that they wouldn't be affected by the changes because their party had never applied for the rebate in the first place.
"(The Conservatives) obviously made a decision to apply for it and now they don't want it," said NDP spokesman Brad Lavigne.
On Aug. 26, 2008, the Tories offered to reimburse Elections Canada to the tune of $700,000. The offer was made only 12 days before Prime Minister Stephen Harper announced that he would send Canadians back to the polls to vote in a snap election.
However, the sum was later reduced to $591,117.40, which has been sitting in trust since the court case began.
It isn't yet clear how much the legal costs are for both sides or if an appeal will be forthcoming.
