Excise Tax Act (R.S.C., 1985, c. E-15)

Act current to 2017-09-27 and last amended on 2017-07-01. Previous Versions

Marginal note:Calculation of sale price and duty paid value

 For the purpose of determining the consumption or sales tax payable under this Part,

  • (a) in calculating the sale price of goods manufactured or produced in Canada, there shall be included the amount charged as price for or in respect of

    • (i) the wrapper, package, box, bottle or other container in which the goods are contained, and

    • (ii) any other goods contained in or attached to the wrapper, package, box, bottle or other container;

  • (b) in calculating the duty paid value of imported goods that, when imported, are wrapped, packaged, put up in boxes or bottles or otherwise prepared for sale, there shall be added to the value of the goods as determined in the manner prescribed in this Part the value, similarly determined, of the wrapper, package, box, bottle or other container in which the goods are contained; and

  • (c) in calculating the sale price of goods manufactured or produced in Canada, there may be excluded

    • (i) any fees paid to the Government of Canada or the government of a province for the inspection, marking, stamping or certification thereof in respect of capacity, accuracy, standard or safety, if the fees are shown as separate items on the manufacturers’ sales invoices, and

    • (ii) under such circumstances as the Governor in Council may, by regulation, prescribe, an amount representing

      • (A) the cost of erection or installation of the goods incurred by the manufacturer or producer where the goods are sold at a price that includes erection or installation, or

      • (B) the cost of transportation of the goods incurred by the manufacturer or producer in transporting the goods between premises of the manufacturer or producer in Canada, or in delivering the goods from the premises of the manufacturer or producer in Canada to the purchaser, where the goods are sold at a price that includes those costs of transportation,

      determined in such manner as the Governor in Council may, by regulation, prescribe.

  • NOTE: Application provisions are not included in the consolidated text;
  • see relevant amending Acts. R.S., 1985, c. E-15, s. 46;
  • R.S., 1985, c. 12 (4th Supp.), s. 13.
Marginal note:Deemed manufacturer of photographic prints, etc.

 Where a person has, in Canada,

  • (a) processed exposed photographic film supplied by a customer to make a negative, transparency, photographic print or other photographic related good,

  • (b) produced or manufactured a negative, transparency, photographic print or other photographic related good from any good supplied by a customer, or

  • (c) sold a right to the processing, production or manufacture by him of goods described in paragraph (a) or (b),

he shall, for the purposes of this Part, be deemed to be the producer or manufacturer of the negative, transparency, photographic print or other photographic related good, and the goods shall be deemed to be sold

  • (d) in the case mentioned in paragraph (a) or (b), at the time the goods are delivered to the customer, and

  • (e) in the case mentioned in paragraph (c), at the time the right is sold,

and the charge made shall be deemed to be the sale price.

  • NOTE: Application provisions are not included in the consolidated text;
  • see relevant amending Acts. 1980-81-82-83, c. 68, s. 8.
Marginal note:Application by manufacturer
  •  (1) Any licensed manufacturer may make an application in writing to the Minister to be considered, for the purposes of this Act, as the manufacturer or producer of all other goods, in this section and section 49 referred to as “similar goods”, that the licensed manufacturer sells in conjunction with his sales of goods of his manufacture or production in Canada or that are of the same class as goods the licensed manufacturer manufactures or produces in Canada.

  • Marginal note:Additional information

    (2) The Minister may at any time request an applicant under this section to supply additional information in respect of his application.

  • Marginal note:Consideration of application

    (3) On receiving an application, the Minister shall decide whether to approve or reject the application and shall send to the applicant a notice in writing setting out his decision and, where the Minister approves the application, the date on and after which the approval is effective.

  • Marginal note:Effect of approval

    (4) Subject to subsection 49(2), on and after the date set out in a notice of decision pursuant to subsection (3), the applicant shall be deemed to be the manufacturer or producer of all similar goods that the applicant sells and those goods shall be deemed to be

    • (a) at the time the applicant acquires them,

      • (i) for the purposes of this Part, partly manufactured goods, and

      • (ii) for the purposes of Part III, goods described in paragraph 23(7)(a); and

    • (b) thereafter, goods produced or manufactured in Canada.

  • NOTE: Application provisions are not included in the consolidated text;
  • see relevant amending Acts. R.S., 1985, c. E-15, s. 48;
  • R.S., 1985, c. 15 (1st Supp.), s. 18, c. 12 (4th Supp.), s. 14;
  • 2002, c. 22, s. 371.
Marginal note:Revocation of approval
  •  (1) The Minister may at any time, and shall on request of the applicant, revoke any approval of an application given pursuant to subsection 48(3) and, where the Minister does so, he shall send to the applicant a notice in writing of the revocation setting out the date on and after which the revocation is effective.

  • Marginal note:Effect of revocation

    (2) On and after the date set out in a notice of revocation pursuant to subsection (1),

    • (a) subsection 48(4) ceases to apply to the applicant; and

    • (b) all taxes imposed by this Act are payable, at the rate in force on that date, on any similar goods then in possession of the applicant that have been acquired free of tax by virtue of subsection 48(4) and shall be computed

      • (i) on the duty paid value of the goods, if they were imported by the applicant, or

      • (ii) on the price for which the goods were purchased by the applicant, if they were not imported by him, and the price shall include the amount of the excise duties on goods sold in bond.

  • Marginal note:Presumption

    (2.1) For the purposes of subparagraph (2)(b)(ii), where an applicant has purchased goods from, or property in goods has otherwise been transferred to an applicant by, a person with whom the applicant was not dealing at arm’s length at the time of the purchase or transfer for no price or for a price that was less than the price (in this subsection referred to as the “reasonable price”) that would have been reasonable in the circumstances if the applicant and that person had been dealing at arm’s length at that time, the applicant shall be deemed to have purchased the goods at that time for a price equal to the reasonable price.

  • Marginal note:Restriction on re-application

    (3) Where an application is rejected pursuant to subsection 48(3) or approval of an application is revoked pursuant to subsection (1), the applicant may not make an application under subsection 48(1) within two years after the date of the notice of decision or the date on and after which the revocation is effective, as the case may be.

  • NOTE: Application provisions are not included in the consolidated text;
  • see relevant amending Acts. R.S., 1985, c. E-15, s. 49;
  • R.S., 1985, c. 12 (4th Supp.), s. 15.

Tax Imposed

Marginal note:Consumption or sales tax
  •  (1) There shall be imposed, levied and collected a consumption or sales tax at the rate prescribed in subsection (1.1) on the sale price or on the volume sold of all goods

    • (a) produced or manufactured in Canada

      • (i) payable, in any case other than a case mentioned in subparagraph (ii) or (iii), by the producer or manufacturer at the time when the goods are delivered to the purchaser or at the time when the property in the goods passes, whichever is the earlier,

      • (ii) payable, in a case where the contract for the sale of the goods, including a hire-purchase contract and any other contract under which property in the goods passes on satisfaction of a condition, provides that the sale price or other consideration shall be paid to the manufacturer or producer by instalments (whether the contract provides that the goods are to be delivered or property in the goods is to pass before or after payment of any or all instalments), by the producer or manufacturer at the time each of the instalments becomes payable in accordance with the terms of the contract, and

      • (iii) payable, in a case where the goods are for use by the producer or manufacturer thereof, by the producer or manufacturer at the time the goods are appropriated for use;

    • (b) imported into Canada, payable in accordance with the provisions of the Customs Act by the importer, owner or other person liable to pay duties under that Act;

    • (c) sold by a licensed wholesaler, payable by him at the time of delivery to the purchaser, and the tax shall be computed

      • (i) on the duty paid value of the goods, if they were imported by the licensed wholesaler, or

      • (ii) on the price for which the goods were purchased by the licensed wholesaler, if they were not imported by him, which price shall include the amount of the excise duties on goods sold in bond; or

    • (d) retained by a licensed wholesaler for his own use or for rental by him to others, payable by the licensed wholesaler at the time the goods are put to his own use or first rented to others, and the tax shall be computed

      • (i) on the aggregate of the duty paid value of the goods and the amount of any taxes payable on the goods under section 27, if they were imported by the licensed wholesaler, or

      • (ii) on the aggregate of the price paid by the licensed wholesaler for the goods, the amount of any excise duties payable on the goods if sold in bond and the amount of any taxes payable on the goods under section 27, if they were not imported by the licensed wholesaler.

  • Marginal note:Rates of tax

    (1.1) Tax imposed by subsection (1) is imposed

    • (a) in the case of wines, and goods on which a duty of excise is imposed under the Excise Act or would be if the goods were produced or manufactured in Canada, at the rate of nineteen per cent;

    • (b) in the case of goods enumerated in Schedule IV (Construction Materials and Equipment for Buildings), at the rate of nine per cent;

    • (c) in the case of regular gasoline, unleaded gasoline, premium leaded gasoline, premium unleaded gasoline and diesel fuel, at the rate set opposite the applicable item in Schedule II.1, adjusted according to subsection 50.1(1) and multiplied by the rate of tax specified in paragraph (d), expressed as a decimal number and multiplied by one hundred;

    • (c.1) in the case of goods imported into Canada and classified under tariff item No. 9804.30.00 of Schedule I to the Customs Tariff, at the rate of tax specified in paragraph (d); and

    • (d) in any other case, at the rate of thirteen and one-half per cent.

  • Marginal note:Deemed sale and delivery of gasoline or diesel fuel

    (2) Notwithstanding subsection (1), where gasoline or diesel fuel is delivered to a retail outlet by or on behalf of the manufacturer or producer thereof, the gasoline or diesel fuel shall be deemed to have been sold and delivered to a purchaser thereof.

  • Marginal note:Transitional

    (2.1) Notwithstanding subsection (1), where gasoline, diesel fuel or aviation fuel was, immediately prior to March 1, 1987, held in inventory by or on behalf of a person described in paragraph (e) of the definition manufacturer or producer in subsection 2(1), as that subsection read immediately prior to March 1, 1987, who was a licensed manufacturer under this Act of gasoline, diesel fuel or aviation fuel solely by virtue of that paragraph, and the consumption or sales tax thereon had not been paid or become payable on or before February 28, 1987, the gasoline, diesel fuel or aviation fuel shall be deemed to have been sold and delivered to a purchaser thereof immediately prior to March 1, 1987.

  • (3) and (4) [Repealed, R.S., 1985, c. 7 (2nd Supp.), s. 16]

  • Marginal note:Sales tax not payable on certain goods

    (5) Notwithstanding anything in subsection (1), the consumption or sales tax shall not be payable on goods

    • (a) sold by a licensed manufacturer to another licensed manufacturer if the goods are partly manufactured goods;

    • (b) imported by a licensed manufacturer if the goods are partly manufactured goods;

    • (c) imported by a licensed wholesaler otherwise than for his own use or for rental to others, on importation;

    • (d) sold by a licensed manufacturer to a licensed wholesaler otherwise than for his own use or for rental to others;

    • (e) sold by a licensed wholesaler to a licensed manufacturer if the goods are partly manufactured goods;

    • (f) sold by a licensed wholesaler to another licensed wholesaler, but if a licensed wholesaler sells goods to another licensed wholesaler at a price less than the value on which the tax would be computed under paragraph (1)(c), the vendor forthwith becomes liable to pay the tax on the difference between the value and his sale price;

    • (g) sold to or imported by a person described in paragraph (d) of the definition manufacturer or producer in subsection 2(1) who is a licensed manufacturer under this Act, if the goods are cosmetics;

    • (h) [Repealed, R.S., 1985, c. 12 (4th Supp.), s. 16]

    • (i) being new motor vehicles designed for highway use, or chassis therefor, imported by a person described in paragraph (g) of the definition manufacturer or producer in subsection 2(1) who is a manufacturer licensed for the purposes of this Part;

    • (j) being new motor vehicles designed for highway use, or chassis therefor, sold to a person described in paragraph (h) of the definition manufacturer or producer in subsection 2(1) who is a manufacturer licensed for the purposes of this Part;

    • (k) sold to or imported by a person described in paragraph (i) of the definition manufacturer or producer in subsection 2(1) who is a licensed manufacturer under this Act, if the goods are goods enumerated in Schedule III.1; or

    • (l) sold or leased to, or imported by, a person described in paragraph (j) of the definition manufacturer or producer in subsection 2(1) who is a licensed manufacturer under this Act, if the goods are prerecorded video cassettes that are new or have not been used in Canada.

  • Marginal note:Where exemption not applicable

    (6) Where any person, other than the manufacturer or producer, importer, owner, licensed wholesaler or jobber mentioned in this section, acquires from or against any one of those persons the right to sell any goods, whether as a result of the operation of law or of any transaction not taxable under this section, the sale of the goods by him shall be taxable as if made by the manufacturer or producer, importer, owner, licensed wholesaler or jobber, as the case may be, and the person so selling is liable to pay the tax.

  • Marginal note:Diversion of certain articles to non-exempt use, sale, etc.

    (7) Where a motor vehicle, tractor or aircraft or a ship or other marine vessel, or a machine or tool for operation by a motor vehicle or tractor or a part or equipment for an aircraft or ship or other marine vessel

    • (a) has been purchased or imported by a person for a use by that person that renders the purchase or importation exempt from tax imposed under this Part and Part III or either of those Parts, or

    • (b) has been purchased as described in subsection 68.19(1),

    the following rules apply:

    • (c) if within five years of the time the article was first purchased or, if imported, released under the Customs Act for a use rendering the purchase or release exempt from tax imposed under this Part and Part III or either of those Parts, the article is applied to any use, other than of a casual nature, for which it could not, at the time of such first purchase, have been purchased or released exempt from the tax, the article shall be deemed to have been sold at the time of its first application to that use and tax imposed under this Part and Part III or either of those Parts, shall be imposed, levied and collected at the time of its first application to that use,

      • (i) in the case of an article mentioned in Schedule I having a specific rate of tax set opposite the item, at the lesser of the specific rate applicable at that time, and the specific rate, if any, applicable in the case of the article at the time the article was first purchased or imported for a use rendering the purchase or importation exempt from the tax or taxes, and

      • (ii) in any other case, on the sale price that would have been reasonable in the circumstances if the article had been sold, at the time of its first application to that use, to a person with whom the person so applying the article was dealing at arm’s length,

      payable by the owner of the article at the time of its first application to the use rendering it subject to tax; and

    • (d) if within five years of the time the article was first purchased or, if imported, released under the Customs Act for a use rendering the purchase or release exempt from tax imposed under this Part and Part III or either of those Parts, the article is sold or leased, the article shall be deemed to have been sold at the time of the sale or lease and tax imposed under this Part and Part III or either of those Parts, shall, if applicable, be imposed, levied and collected at the time of the sale or lease,

      • (i) in the case of an article mentioned in Schedule I having a specific rate of tax set opposite the item, at the lesser of the specific rate applicable at that time, and the specific rate, if any, applicable in the case of the article at the time the article was first purchased or imported for a use rendering the purchase or importation exempt from the tax or taxes, and

      • (ii) in any other case,

        • (A) where the article was sold, on the sale price, or

        • (B) where the article was leased by a person to another person, on the sale price that would have been reasonable in the circumstances if the article had been sold, at the time of the lease, to that other person,

      payable by the person who sold or leased the article.

  • Marginal note:Diversion of fuel

    (8) Where fuel that has been purchased or imported for heating or lighting is sold or appropriated by the purchaser or importer for a purpose for which the fuel could not have been purchased or imported exempt from tax under this Part at the time of the purchase or importation, the tax imposed under this Part shall be payable by the purchaser or importer

    • (a) where the fuel is sold, at the time of delivery to the person to whom it is sold, computed at the rate of tax in force at that time

      • (i) in the case of gasoline or diesel fuel, on the volume sold, and

      • (ii) in any other case, on the sale price; and

    • (b) where the fuel is appropriated, at the time of the appropriation, computed at the rate of tax in force at that time

      • (i) in the case of gasoline or diesel fuel, on the volume appropriated, and

      • (ii) in any other case, on the sale price that would have been reasonable in the circumstances if the fuel had been sold, at that time, to a person with whom the purchaser or importer was dealing at arm’s length.

  • (9) [Repealed, 2002, c. 22, s. 372]

  • NOTE: Application provisions are not included in the consolidated text;
  • see relevant amending Acts. R.S., 1985, c. E-15, s. 50;
  • R.S., 1985, c. 15 (1st Supp.), s. 19, c. 1 (2nd Supp.), s. 190, c. 7 (2nd Supp.), s. 16, c. 42 (2nd Supp.), ss. 4, 5, c. 12 (4th Supp.), s. 16;
  • 1988, c. 65, s. 114;
  • 1989, c. 22, s. 3;
  • 2002, c. 22, s. 372.
 
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