Please note that the following document, although correct at the time of issue, may not represent the current position of the Canada Revenue Agency. / Veuillez prendre note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'Agence du revenu du Canada.
Excise and GST/HST Rulings Directorate
Place de Ville, Tower A, 11th floor
320 Queen Street
Ottawa ON K1A 0L5
[Addressee]
Case Number: 190982
Business Number: [...]
Dear [Client]:
Subject: GST/HST RULING
Supply of various feeding utensils and other gripping devices
Thank you for your fax of September 26, 2017, concerning the application of the goods and services tax/harmonized sales tax (GST/HST) to sales of various products by […] (the Company). […].
The HST applies in the participating provinces at the following rates: 13% in Ontario; and 15% in New Brunswick, Newfoundland and Labrador, Nova Scotia and Prince Edward Island. The GST applies in the rest of Canada at the rate of 5%.
All legislative references are to the Excise Tax Act (ETA) unless otherwise specified.
STATEMENT OF FACTS
We understand the following from your correspondence and the Company’s websites (Footnote 1):
1. The Company is registered for GST/HST under the business number noted above. The Company […][sells] products, including the products described below.
2. Liftware Steady
The Liftware […][describes a handle with built-in sensors and computer that counteracts tremors and shaking when activated].
[…]
[…][Item #] Liftware Steady Starter Kit […][describes kit that includes stabilizing handle, soup spoon attachment, travel charge and travel case].
[…][Item #] Liftware Fork attachment […][describes fork attachment].
[…][Item #] Liftware Everyday Spoon attachment […][describes spoon attachment].
3. Angled / Contoured Cutlery
[…][describes knife with built-up handle and curved blade to cut using a rocker motion and other cutlery with angled and built-up handles to allow easier gripping].
[…][Item #s]
4. Weighted utensils
[…][describes cutlery with weighted handles to help counter shaky hands].
[…][Item #s]
5. Knork®
[…][describes a knife that has features of both a knife and fork to allow the cutting of food with one hand].
[…][Item #]
6. Scooper Bowl
[…][describes bowl with a high rim that has a reverse curve on one side similar to an ice-cream scoop to allow user to push food onto a utensil].
[…][Item #]
7. Scoop Dish
[…][describes flat dish with high walls and a thick rim to allow user to push food onto a utensil].
[…][Item #]
8. Soup/Cereal Bowl
[…][describes bowl with deep cavity and wide rim].
[…][Item #]
9. Round Up Plate
[…][describes plate with high inner wall around the circumference of the plate to prevent food sliding off plate].
[…][Item #]
10. Inner Lip Plate
[…][describes plate with deep inner lip to allow user to push food onto utensil].
[…][Item #s]
11. […]Plate
[…][describes plate with four legs, deep inner lip and high slope on one side to prevent food from sliding off the plate].
[…][Item #]
12. HALO™ Cup
[…][describes cup with large base and large handle].
[…][Item #]
13. […]Mug
[…][describes mug with large handle for ease in lifting and holding. The mug comes with two different lids for easy flow of liquid; one with a spout and one with anti-splash features. Both lids can be used with a straw].
[…][Item #]
14. Soft Nosey Cup
[…][describes plastic cup with nose cut-out to simplify drinking without moving shoulders or bending the neck].
[…][Item #]
15. […][X Cup]
[…][describes plastic cup with nose cut-out to simplify drinking without moving shoulders or bending the neck].
[…][Item #s]
16. Universal Built-Up Handles
[…][describes soft-ribbed, built-up handles rounded to fit in hands comfortably].
[…][Item #]
17. Anti-slip sheath
[…][describes an anti-slip sheath that fits over cutlery handles].
[…][Item #]
18. Closed-Cell Foam Tubing
[…][describes foam tubing that fits over cutlery handles].
[…][Item #]
RULING REQUESTED
You would like to know the GST/HST treatment of the assisted living items described above.
RULINGS GIVEN
Based on the facts set out above, we rule the following:
1) Sales of the following products are zero-rated under section 38 of Part II of Schedule VI:
- Liftware Steady Starter Kit - […][Item #]
- Angled / Contoured Cutlery - […][Item #s]
- Weighted utensils - […][Item #s]
2) Sales of the following products are zero-rated under section 32 of Part II of Schedule VI:
- Liftware Fork attachment - […][Item #]
- Liftware Everyday Spoon attachment - […][Item#]
3) Sales of the following products are subject to GST/HST:
- Knork® - […][Item #]
- Scooper Bowl - […][Item #]
- Scoop Dish - […][Item #]
- Soup/Cereal Bowl - […][Item #]
- Round Up Plate - […][Item #]
- Inner Lip Plate - […][Item #s]
- […]Plate - […][Item #]
- HALO™ Cup - […][Item #]
- […]Mug – […][Item #]
- Soft Nosey Cup - […][Item #]
- […][X Cup] - […][Item #s]
- Universal Built-Up Handles - […][Item #]
- Anti-slip sheath - […][Item #]
- Closed-Cell Foam Tubing - […][Item #]
EXPLANATION
Generally, all supplies of property and services made in Canada are taxable unless an exemption from the GST/HST applies. Taxable supplies are supplies made in the course of a commercial activity and may be taxable at the rate of 0% (zero-rated supplies), 5%, 13%, or 15% on the value of the consideration for the supply depending on the province in which the supply is made. Exempt supplies are not subject to the GST/HST and are included in Schedule V. Zero-rated supplies are included in Schedule VI. Part II of Schedule VI zero-rates supplies of certain medical and assistive devices.
Section 38 - Feeding utensils and other gripping devices
Section 38 of Part II of Schedule VI zero-rates a supply of a feeding utensil or other gripping device that is specially designed for use by an individual with impaired use of hands or other similar disability.
The expressions “feeding utensil” and “other gripping device” are not defined in the ETA and therefore for GST/HST purposes their common or ordinary meaning apply. In addition, it is the Canada Revenue Agency’s (CRA) view that the reference made to “other gripping device” in section 38 of Part II of Schedule VI restricts the scope of feeding utensils that may be zero-rated under this section. As a result, in the context of section 38 of Part II of Schedule VI, the CRA considers that a feeding utensil refers to a gripping device that is specially designed for the use described in this section, and as such, must have a connection with gripping as well as with feeding.
Based on the CRA’s position outlined above, the supply of the following products are feeding utensils specially designed for use by an individual with impaired use of hands or other similar disability and are zero-rated under section 38 of Part II of Schedule VI:
- Liftware Steady - […][Item #]
- Angled / Contoured Cutlery - […][Item #s]
- Weighted utensils - […][Item #s]
In contrast, although the following products are feeding utensils, it is the CRA’s view that these products do not have design features that demonstrate a connection with gripping, regardless of whether the product has suction cups or non-skid pads:
- Knork® - […][Item #]
- Scooper Bowl - […][Item #]
- Scoop Dish - […][Item #]
- Soup/Cereal Bowl - […][Item #]
- Round Up Plate - […][Item #]
- Inner Lip Plate - […][Item #s]
- […]Plate - […][Item #]
In addition, the following feeding utensils, although they may have design features that allow for easy gripping, are not specially designed for use by an individual with impaired use of hands or other similar disability:
- HALO™ Cup - […][Item #]
- […]Mug - […][Item #]
- Soft Nosey Cup - […][Item #]
- […][X Cup] - […][Item #s]
Therefore, for the last eleven items listed above the requirements in section 38 of Part II of Schedule VI have not been met. There are no other provisions in the ETA to zero-rate supplies of these products and, as such, any sales are subject to GST/HST at the applicable rate, depending on the place of supply.
Section 32 - Parts, accessories and attachments
Section 32 of Part II of Schedule VI zero-rates the supply of a part, accessory or attachment that is specially designed for medical or assistive devices listed in Part II of Schedule VI.
Based on the information provided, it is the CRA’s view that sales of the following products are zero-rated under section 32 of Part II of Schedule VI as a specially designed part, accessory or attachment to the Liftware feeding utensil packaged in the Liftware Steady Starter Kit and zero-rated under section 38 of Part II of Schedule VI:
It is the CRA’s view that the following products do not have design features that allow us to conclude these products are a part, accessory or attachment specially designed for a medical device listed in Part II of Schedule VI:
- Universal Built-Up Handles - […][Item #]
- Anti-slip sheath - […][Item #]
- Closed-Cell Foam Tubing - […][Item #]
Accordingly, supplies of the last three items listed above are not zero-rated under section 32 of Part II of Schedule VI. There are no other provisions in Part II of Schedule VI to zero-rate supplies of these products and, as such, any sales are subject to GST/HST at the applicable rates, depending on the place of supply.
In accordance with the qualifications and guidelines set out in GST/HST Memorandum 1.4, Excise and GST/HST Rulings and Interpretations Service, the Canada Revenue Agency (CRA) is bound by the ruling(s) given in this letter provided that: none of the issues discussed in the ruling(s) are currently under audit, objection, or appeal; no future changes to the ETA, regulations or the CRA’s interpretative policy affect its validity; and all relevant facts and transactions have been fully and accurately disclosed.
If you require clarification with respect to any of the issues discussed in this letter, please call Chantal Desrosiers at 613-670-7931. Should you have additional questions on the interpretation and application of GST/HST, please contact a GST/HST Rulings officer at 1-800-959-8287.
Yours truly,
Alison Jones
Health Care Sectors Unit
Public Service Bodies and Governments Division
Excise and GST/HST Rulings Directorate
FOOTNOTES
1. […].
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