As the Depression ground on in the late 1930s, Canadian provinces faced increasing fiscal obligations but limited funds, while the dominion had fewer responsibilities but lucrative revenue sources. In 1937, a public inquiry was struck. After much federal-provincial wrangling, a plan for a bold new form of federalism based on the national collection of taxes and unconditional transfers of these revenues to provinces based on fiscal need was struck. This astute examination shows that the commission's report provided a storehouse of innovative ideas and shaped policy--and thinking--about federalism for decades.
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