File: 11820-1(DRM)
XXXXX
XXXXX February 7, 1995
I refer to your e-mail of December 14, 1994 wherein you outlined several issues that arose from your presentation to the XXXXX . Please note the following issues are address in the order in which they appear in your e-mail.
1. Regarding the concerns expressed by the meeting planners that the legislation does not provide a definition of the term meeting; it was never contemplated that the term meeting should be given any other definition beside its normal everyday meaning. Rather, meeting is, but one construct of the definition of the term "convention". I would hasten to add that the definition of convention must be considered in its entirety to determine whether a "meeting" qualifies as a convention. In this regard, I would suggest that changing the name of an award ceremony would not be sufficient in and of itself for it to be considered a convention. The award ceremony must still meet the criteria and the purpose test identified in the definition of convention, to qualify as a convention.
On the issue of expenses and eligibility for rebate, a sponsor of a "foreign convention" is eligible to claim the GST paid on all expenses related to the convention except those delineated in the paragraphs (a) through (d) of the definition of "related convention supplies". Therefore, if a registered "key note" speaker charges GST for ber/his services, the sponsor of the "foreign convention" may claim a rebate of the GST paid. The fact that the address given by the "key note" speaker is of an inspirational nature would not impact on the ability of the sponsor of the "foreign convention" to claim the rebate.
2. I will assume that the questions about off-site events arise from the fact that GST is not rebated on expenses related to entertainment and transportation other than chartered transportation services between venues. Unless it can be established that a meeting held off-site, at a place that ordinarily provides for amusement, entertainment or recreation, is within the scope of the convention, a rebate will not be allowed with respect to that venue. For example, a conference of marine biologist is held in Vancouver. One of the venues of the conference is the Vancouver aquarium where the delegates study the effects of captivity on marine species. If GST is paid, by the sponsor for admissions to the aquarium, the admission will be considered a "related convention supply" for which the sponsor is eligible to claim a rebate.
3. I understand from your e-mail transmission that the meeting planners do not normally pay a separate fee for room rental, instead negotiations with the catering manager results in the space being provided for free. In other words, the price of catering probably includes a cost for room rental. In recognition that GST is not recoverable on meals and that room rental costs are eligible for a rebate, the meeting planners will ensure that the cost for the room rental and catering are shown separately and will endeavour to negotiate a lower price for the catering.
It is my opinion that separately identifying room rental fees and catering fees would not contravene the Act. That these fees were not separated previously would not impact on the ability of the hotel or convention centre to invoice them separately in the future. However, negotiations resulting in an unreasonable high fee for room rental offset by a unreasonably lower fee for catering appears to contravene subsection 153(2) of the Act. Subsection 153(2) of the Act requires a reasonable attribution of the total amount of consideration between the separate charges.
4. The reference to "conduct business" on page 3 of the guide "Information for Non-Resident Meeting Planners and Convention Organizers" is in relation to paragraph (c) of the definition of convention.
Convention means a formal meeting or assembly that is not open to the general public, but does not include a meeting or assembly the principal purpose of which is
(c) to transact the business of the convenor or attendees
(i) in the course of a trade show that is open to the general public, or
(ii) otherwise than in the course of a trade show
This means that where the purpose of the meeting is to carry on business normally conducted by the delegates at their place of business then the meeting would not qualify as a convention. For example, an American association holds a meeting in Canada. The purpose of the meeting is the solicitation of sales by the sponsor. As a result, the meeting would not qualify as a convention as the purpose would be to transact business.
5. 1 was able to identify the author of the document "Canada - The World Next Door - Laws of the Land" that you have submitted. It is a production of Tourism Canada.
If you have any questions or comments, please do not hesitate to contact Dwayne Moore, Tax Policy Officer at (613) 954-4206.
A. D'Abramo
Manager, Services Unit
Tax Policy - Special Sector
GST Policy & Legislation
c.c.: A. Belyea
c.c.: D. Moore
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