Guillermo del Toro is feuding with the Ontario government over a tax bill

Guillermo del Toro loves Toronto, and Toronto loves him right back. Last year, the filmmaker called Toronto his “second home,” and Mayor Olivia Chow presented him with the Key to the City for his decades-long commitment to our film community.

The director frequently shouts out his favourite Toronto haunts on social media and has shot many of his biggest productions in the city—most recently Frankenstein, which picked up three Academy Awards at this month’s Oscars ceremony, including one for its Canadian production designers. But, according to a recently filed court case, del Toro and his beloved Ontario are having relationship problems.

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Del Toro’s production company, Necropia, the US-based business through which he conducts his filmmaking activities, is fighting the provincial government’s attempt to impose the Employer Health Tax (EHT) partly on the basis of leisure time the director spent at his Ontario vacation property.

According to a notice of appeal filed by Necropia in the Ontario Superior Court of Justice, the company—whose owner and sole employee is del Toro—objects to the Ministry of Finance’s assessment that it had a “deemed permanent establishment” in Ontario, exposing it to liability for the EHT, a payroll tax used to fund the province’s health care system.

While the court filings say that del Toro’s company has paid the EHT for other years in which it operated in Ontario, the dispute relates to 2017 and 2018, when the director owned a vacation property in the province, where he would spend leisure time with his family.

In 2017, Necropia was assessed almost $17,000 in taxes, penalties and interest despite the fact that 13 of del Toro’s 62 days in Ontario were spent at his vacation property. For 2018, Ontario has billed Necropia a total of $47,000 even though del Toro claims his entire 39-day presence in the province was personal time unrelated to his film business.

Related: James Cameron doesn’t think Frankenstein should qualify for an Oscar

“The basis of this position appears to be the Ministry’s view that a creative person is always creating, even during the person’s vacation time, thus Mr. del Toro’s vacation time in Ontario should give rise to EHT,” Necropia’s notice of appeal reads. “Aside from the fact the legislation does not support such a position, this would be highly discriminatory against individuals involved in the creative arts.”

Necropia did not respond to Toronto Life’s request for comment, and a spokesperson for the Ministry of Finance declined to comment as the matter is before the courts.