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

Full Document:  

Act current to 2022-07-25 and last amended on 2022-06-23. Previous Versions

PART IXGoods and Services Tax (continued)

DIVISION IInterpretation (continued)

Consideration (continued)

Marginal note:Rolling stock penalties and demurrage

 For the purposes of this Part, an amount that is paid

  • (a) as or on account of demurrage, or

  • (b) by one railway corporation to another railway corporation as or on account of a penalty for failure to return rolling stock within a stipulated time,

shall be deemed not to be consideration for a supply.

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 1993, c. 27, s. 29

Marginal note:Consideration for portions of tour package

  •  (1) For the purposes of determining tax payable in respect of portions of a tour package, the consideration for a supply of the provincially taxable portion of the tour package or the non-provincially taxable portion of the tour package, as the case may be, (in this subsection referred to as the “relevant portion”) is deemed to be

    • (a) where the supply is made by the first supplier of the tour package, the amount determined by the formula

      A × B

      where

      A
      is the taxable percentage in respect of the relevant portion at the time the supply is made, and
      B
      is the total consideration for the entire tour package; and
    • (b) where the supply is made by any other person, the amount determined by the formula

      A × B

      where

      A
      is the percentage that the consideration for the supply to the person of the relevant portion is of the total consideration paid or payable by the person for the entire tour package, and
      B
      is the total consideration paid or payable to the person for the entire tour package.
  • Marginal note:Taxable and non-taxable portions

    (2) For the purpose of determining tax payable in respect of a tour package and for the purposes of Part VI of Schedule VI, the provision of all that part of the taxable portion of a tour package that is not included in the provincially taxable portions of the tour package and the provision of the part of the tour package that is not included in the taxable portion of the tour package are each deemed to be a supply separate from, and not incidental to, the provision of the remaining parts of the tour package.

  • Marginal note:Provincially taxable portion

    (2.1) For the purpose of determining tax payable in respect of a tour package and for the purposes of Part VI of Schedule VI, the provision of the part of the taxable portion of a tour package that is the provincially taxable portion of the tour package in respect of a participating province is deemed to be a supply made in the participating province that is separate from, and not incidental to, the provision of the other parts, if any, of the tour package and those other parts are deemed to be supplied outside the participating province.

  • Marginal note:Transition

    (2.2) Where a supply of a provincially taxable portion of a tour package in respect of a participating province is made by a supplier who acquired the tour package from another person and was not required to pay tax under subsection 165(2) in respect of the tour package, the supplier is deemed to be the first supplier of the tour package for the purposes of determining the base percentage, initial taxable percentage and taxable percentage, in respect of the provincially taxable portion of the tour package and the non-provincially taxable portion of the tour package.

  • Marginal note:Definitions

    (3) In this section and in Part VI of Schedule VI,

    base fraction

    base fraction [Repealed, 1997, c. 10, s. 159]

    base percentage

    base percentage, at any time, in respect of the provincially taxable portion of a tour package or the non-provincially taxable portion of a tour package, as the case may be, (in this definition referred to as the relevant portion) means the percentage determined by the formula

    A/B

    where

    A
    is the part of the amount (in this definition referred to as the base price) that would be charged by the first supplier of the tour package for a supply at that time of the tour package that is, at that time, reasonably attributable to the relevant portion, and
    B
    is the base price; (pourcentage de référence)
    first supplier

    first supplier of a tour package means the person who first supplies the package in Canada; (premier fournisseur)

    initial taxable percentage

    initial taxable percentage in respect of the provincially taxable portion of a tour package or the non-provincially taxable portion of a tour package, as the case may be, (in this definition referred to as the relevant portion) means the percentage determined, at the time the first supplier of the tour package first determines the amount (in this definition referred to as the initial price) to be charged by that supplier for a supply of the tour package, by the formula

    A/B

    where

    A
    is the part of the initial price that is, at that time, reasonably attributable to the relevant portion, and
    B
    is the initial price; (pourcentage taxable initial)
    non-provincially taxable portion

    non-provincially taxable portion of a tour package means all property and services included in the taxable portion of the tour package that are not included in the provincially taxable portions of the tour package; (partie non taxable au provincial)

    provincially taxable portion

    provincially taxable portion of a tour package, in respect of a participating province, means all property and services that are included in the tour package and the supplies of which, if made otherwise than as part of the tour package, would be supplies made in the participating province in respect of which tax under subsection 165(2) would be payable; (partie taxable au provincial)

    taxable percentage

    taxable percentage, at a particular time, in respect of the provincially taxable portion of a tour package or the non-provincially taxable portion of a tour package, as the case may be, (in this definition referred to as the relevant portion) means

    • (a) where the difference between the base percentage at that time in respect of the relevant portion and either the initial taxable percentage in respect of the relevant portion or the base percentage at an earlier time in respect of the relevant portion is more than 10 percentage points, the base percentage at the particular time in respect of the relevant portion, and

    • (b) in any other case, the initial taxable percentage in respect of the relevant portion; (pourcentage taxable)

    taxable portion

    taxable portion of a tour package means all property and services included in the tour package and in respect of which tax under Division II would be payable if the property or service were supplied otherwise than as part of a tour package; (partie taxable)

    tour package

    tour package means a combination of two or more services, or of property and services, that includes transportation services, accommodation, a right to use a campground or trailer park, or guide or interpreter services, where the property and services are supplied together for an all-inclusive price. (voyage organisé)

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 1990, c. 45, s. 12
  • 1997, c. 10, s. 159

Marginal note:Donation — value of consideration

 For the purposes of this Part, if a charity or a public institution makes a taxable supply of property or service to another person, if the value of the property or service is included in determining the amount of the advantage in respect of a gift by the other person to the charity or public institution under subsection 248(32) of the Income Tax Act and if a receipt referred to in subsection 110.1(2) or 118.1(2) of that Act may be issued, or could be issued if the other person were an individual, in respect of part of the consideration for the supply, then the value of the consideration for the supply is deemed to be equal to the fair market value of the property or service at the time the supply is made.

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 1990, c. 45, s. 12
  • 1993, c. 27, s. 30
  • 1997, c. 10, s. 16
  • 2016, c. 7, s. 64

Meaning of feed

  •  (1) For the purposes of this section, feed means

    • (a) grain, seed or fodder that is described in section 2 of Part IV of Schedule VI and used as feed for farm livestock that is ordinarily raised or kept to produce, or to be used as, food for human consumption or to produce wool;

    • (b) feed that is a complete feed, supplement, macro-premix, micro-premix or mineral feed (other than a trace mineral salt feed), the supply of which in bulk quantities of at least 20 kg would be a zero-rated supply included in Part IV of Schedule VI; and

    • (c) by-products of the food processing industry and plant or animal products, the supply of which in bulk quantities of at least 20 kg would be a zero-rated supply included in Part IV of Schedule VI.

  • Marginal note:Supplies by a feedlot

    (2) For the purposes of this Part, where, in the course of operating a feedlot that is a farming business within the meaning of the Income Tax Act, a person makes a supply of a service and the consideration for the supply (in this subsection referred to as the “total charge”) includes a particular amount that is identified in the invoice or agreement in writing for the supply as being attributable to feed,

    • (a) the provision of the feed shall be deemed to be a supply separate from the supply of the service and not to be incidental to the provision of any other property or service;

    • (b) the portion, not exceeding 90%, of the total charge that is reasonably attributable to the feed and is included in the particular amount shall be deemed to be the consideration for the supply of the feed; and

    • (c) the difference between the total charge and the consideration for the supply of the feed shall be deemed to be the consideration for the supply of the service.

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 1993, c. 27, s. 30
  • 1994, c. 9, s. 7

Marginal note:Payments by unions or associations

 For the purposes of this Part, where

  • (a) an individual, because of membership in a trade union or association referred to in paragraph 189(a), participates in activities of the union or association and, as a consequence, is unable to perform duties, under a contract of employment, for the individual’s employer during a period during which the individual would, were it not for the individual’s participation in those activities, be obligated to provide such services, and

  • (b) the union or association pays an amount to the employer as compensation for expenses incurred by the employer as a consequence of the individual’s participation in those activities or for remuneration or benefits given by the employer to the individual in respect of that period,

the amount shall be deemed not to be consideration for a supply.

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 1993, c. 27, s. 30

DIVISION IIGoods and Services Tax

SUBDIVISION AImposition of Tax

Marginal note:Imposition of goods and services tax

  •  (1) Subject to this Part, every recipient of a taxable supply made in Canada shall pay to Her Majesty in right of Canada tax in respect of the supply calculated at the rate of 5% on the value of the consideration for the supply.

  • Marginal note:Tax in participating province

    (2) Subject to this Part, every recipient of a taxable supply made in a participating province shall pay to Her Majesty in right of Canada, in addition to the tax imposed by subsection (1), tax in respect of the supply calculated at the tax rate for that province on the value of the consideration for the supply.

  • Marginal note:Zero-rated supply

    (3) The tax rate in respect of a taxable supply that is a zero-rated supply is 0%.

  • Marginal note:Application in offshore areas

    (4) Subsection (2) does not apply to a supply of property or a service made in the Nova Scotia offshore area or the Newfoundland offshore area unless the supplier makes the supply in the course of an offshore activity or the recipient of the supply acquires the property or service for consumption, use or supply in the course of an offshore activity.

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 1990, c. 45, s. 12
  • 1993, c. 27, s. 31
  • 1997, c. 10, ss. 17, 160
  • 2006, c. 4, s. 3
  • 2007, c. 18, s. 7, c. 35, s. 184

Marginal note:Pay telephones

  •  (1) Where the consideration for a supply of a telecommunication service is paid by depositing coins in a coin-operated telephone, the tax payable in respect of the supply is equal to

    • (a) zero where the amount deposited for the supply does not exceed $0.25; and

    • (b) in any other case, the total of the amounts computed in accordance with subsections 165(1) and (2), except that where that total is equal to a multiple of $0.05 plus a fraction of $0.05, the fraction

      • (i) if less than $0.025, may be disregarded for the purposes of this Part, and

      • (ii) if equal to or greater than $0.025, shall be deemed, for the purposes of this Part, to be an amount equal to $0.05.

  • Marginal note:Coin-operated devices

    (2) Where the consideration for a supply of tangible personal property or a service is paid by depositing a single coin in a mechanical coin-operated device that is designed to accept only a single coin of twenty-five cents or less as the total consideration for the supply and the tangible personal property is dispensed from the device or the service is rendered through the operation of the device, the tax payable in respect of the supply is equal to zero.

  • Marginal note:Supply of right to use device

    (3) For the purpose of subsection (2), a supply of a right to use a device described in that subsection is deemed to be a supply of a service rendered through the operation of the device.

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 1997, c. 10, s. 160
  • 2007, c. 18, s. 8

Marginal note:Calculation of tax on several supplies

  •  (1) Where two or more taxable supplies are included in an invoice, receipt or agreement and tax under section 165 is imposed in respect of each of those supplies at the same rate or rates, the tax payable in respect of those supplies, calculated on the consideration for those supplies that is included in the invoice, receipt or agreement, may be calculated on the total of that consideration.

  • Marginal note:Rounding of tax

    (2) Where tax that is at any time payable under this Division in respect of one or more supplies included in an invoice, receipt or agreement is an amount that includes a fraction of a cent, the fraction

    • (a) if less than half of a cent, may be disregarded for the purposes of this Part; and

    • (b) if equal to or greater than half of a cent, shall be deemed, for the purposes of this Part, to be an amount equal to one cent.

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 1997, c. 10, s. 160
 
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