Excise Tax Act

Definition of specified supply

• 178.8 (1) In this section, specified supply means a supply of goods that

  • (a) are, at any time after the supply is made, imported; or

  • (b) have been imported in circumstances in which section 144 deems the supply to have been made outside Canada.

• Marginal note:Deemed importer of goods

  (2) Subject to subsections (4) and (7), if a recipient of a specified supply of goods made outside Canada does not, at any time before the release of the goods, supply the goods outside Canada and the recipient or any other person imported the goods for consumption, use or supply by the recipient (in this section referred to as the “constructive importer”), the constructive importer is deemed to have so imported the goods, and any amount paid or payable as or on account of tax on the goods under Division III in respect of the importation is deemed to have been paid or payable, as the case may be, by or on behalf of the constructive importer and not by or on behalf of any other person.

• Marginal note:Agreement to treat supply as made in Canada

  (3) If a registrant makes a specified supply of goods outside Canada that is a taxable supply, the recipient of the supply is the constructive importer of the goods and an amount is, in the absence of subsection (2), paid or payable by or on behalf of the registrant as or on account of tax on the goods under Division III in respect of the importation, the registrant and the recipient may at any time agree, in prescribed form containing prescribed information, to have subsection (4) apply in respect of the supply and importation.

• Marginal note:Effect of agreement

  (4) If a registrant and the constructive importer of goods have entered into an agreement under subsection (3) in respect of the supply and importation of the goods and the constructive importer has not entered into an agreement under subsection (5) in respect of any amount paid as or on account of tax on the goods under Division III in respect of the importation,

  • (a) the supply is deemed to have been made in Canada

    • (i) in the case of a constructive importer who is an individual to whom the goods are shipped to a destination in Canada by another person, at the address to which the goods are sent by mail or courier by the shipper or at the destination that is specified in the contract for carriage of the goods or at which the shipper has directed a common carrier or consignee retained on behalf of the constructive importer to transfer physical possession of the goods, and

    • (ii) in any other case, at the place at which the goods are released;

  • (b) except if subsection 155(1) applies, the consideration for the supply is deemed to be equal to the amount otherwise determined for the purposes of this Part plus any amount (in this paragraph referred to as “additional consideration”) not otherwise included in that consideration that the constructive importer at a particular time pays or is required to pay to the registrant in respect of duties or taxes payable on the goods under this Act (other than this Part), the Customs Tariff, the Excise Act, 2001, the Special Import Measures Act or any other law relating to customs and, despite section 168, the tax in respect of the supply that is calculated on the additional consideration becomes payable at the particular time;

  • (c) the registrant is deemed to have imported the goods for the purpose of supply in the course of commercial activities of the registrant; and

  • (d) any amount paid or payable as or on account of tax on the goods under Division III in respect of the importation is deemed to have been paid or payable, as the case may be, by or on behalf of the registrant and not by or on behalf of any other person.

• Marginal note:Agreement regarding rebates, abatements and refunds

  (5) If the constructive importer of goods is deemed under subsection (2) to be the person by whom the goods are imported but another person (in this section referred to as the “specified importer”) was identified, for the purposes of the Customs Act, as the importer of the goods when the goods were accounted for under section 32 of that Act and, in the absence of subsection (2), paid an amount as or on account of tax on the goods under Division III, the constructive importer and the specified importer may agree in writing to have subsection (7) apply in respect of that amount.

• Marginal note:Restriction

  (6) Subsection (5) does not apply to any amount in respect of which, because of section 263.01, the constructive importer of goods would not be entitled to a rebate referred to in that section if the constructive importer paid the amount as or on account of tax on the goods under Division III.

• Marginal note:Effect of agreement

  (7) If a constructive importer of goods and a specified importer have entered into an agreement under subsection (5) to have this subsection apply in respect of an amount paid as or on account of tax on the goods under Division III and the constructive importer has not entered into an agreement under subsection (3) with the supplier of the goods in respect of the importation,

  • (a) subsections 215.1(2) and (3) and 216(6) and (7) apply as if the specified importer and not the constructive importer were the person by whom the goods were imported and the amount was paid, but only if, within a reasonable time after any rebate under subsection 215.1(2) or 216(6) in respect of the amount is granted or any abatement or refund is, because of subsection 215.1(3) or 216(7), granted in respect of the amount, the specified importer issues to the constructive importer a note (in this subsection referred to as a “tax adjustment note”), in prescribed form containing prescribed information, indicating the amount of the rebate, abatement or refund;

  • (b) in applying subsection 215.1(2) or (3) in respect of the amount in accordance with paragraph (a), that subsection shall be read without reference to subparagraphs (a)(i) and (ii), and paragraph (c), of that subsection; and

  • (c) if the constructive importer receives a tax adjustment note indicating the amount of a rebate, abatement or refund,

    • (i) the amount that is rebated, abated or refunded is deemed to have been payable as tax and to have been recovered by the constructive importer and, except for the purposes of section 232, the tax adjustment note is deemed to be a credit note referred to in that section received by the constructive importer for the amount of the rebate, abatement or refund,

    • (ii) the amount of the rebate, abatement or refund shall be added in determining the net tax of the constructive importer for the reporting period in which the tax adjustment note is received, to the extent that the amount has been included in determining an input tax credit claimed by the constructive importer in a return filed for a preceding reporting period or the constructive importer is or was entitled to be compensated under a warranty for loss suffered because of any of the circumstances that gave rise to the rebate, abatement or refund by receiving a supply of replacement parts, or replacement property, that are goods included in section 5 of Schedule VII, and

    • (iii) if the amount rebated, abated or refunded has been included in determining a rebate under Division VI paid to, or applied to a liability of, the constructive importer before the particular day on which the tax adjustment note is received and the rebate so paid or applied exceeds the rebate under that Division to which the constructive importer would have been entitled if the amount rebated, abated or refunded had not been paid, the constructive importer shall pay to the Receiver General under section 264 the excess as if it were an excess amount of the rebate under that Division paid to the constructive importer

      • (A) if the constructive importer is a registrant, on the day on or before which the constructive importer’s return for the reporting period that includes the particular day is required to be filed, and

      • (B) in any other case, on the last day of the calendar month immediately following the calendar month that includes the particular day.

• Marginal note:Application

  (8) Subject to subsection (9), subsections (2) to (7) apply for the purposes of this Part other than

  • (a) Division III except subsections 215.1(2) and (3) and 216(6) and (7);

  • (b) sections 220.07, 236.3 and 273.1;

  • (c) Schedule VII; and

  • (d) the Non-Taxable Imported Goods (GST/HST) Regulations and the Value of Imported Goods (GST/HST) Regulations.

• Marginal note:Application

  (9) Subsections (2) to (7) do not apply in respect of goods imported in circumstances in which subsection 169(2) applies or in which section 180 or subparagraph 211.23(1)(c)(i) deems a person to have paid tax in respect of a supply of property equal to the tax under Division III in respect of the importation of goods.

• Marginal note:Limitation period where retroactive agreement

  (10) If a registrant and a constructive importer enter into an agreement under subsection (3) in respect of a previous importation of goods, the Minister has, despite section 298, until the day that is four years after the day on which the agreement under subsection (3) is entered into to make any assessment, reassessment or additional assessment for the purpose of taking into account an amount payable or remittable by the registrant or the constructive importer as a result of the application of subsection (4).