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
Case Number: 183686
Business Number: […]
[Addressee]
December 15, 2017
Dear [Client]:
Subject: GST/HST RULING
Electric vehicle charging stations
Thank you for your [correspondence], concerning the application of the goods and services tax/harmonized sales tax (GST/HST) to electric vehicle charging stations.
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:
1. The […](County) is registered for GST/HST purposes. The County has set up an electric vehicle charging station at each of the following [#] sites: […][locations] in […][City 1], Ontario. The County received government funding from the Ministry of Transportation in Ontario to establish the charging stations. Each charging station cost approximately $[…] to purchase and install.
2. The charging stations went live on [mm/dd/yyyy] and were free of charge for [#] months as a trial. The County will be setting a […][fee] to recover operating expenses (administrative and maintenance) related to the charging stations and will accept debit and credit cards for payment.
3. The County entered into a […](Agreement) with […][Company X] on [mm/dd/yyyy]. […].
4. According to the terms of the Agreement, [Company X] operates, maintains, administers and supports the […] Network and the County will register its [#] electrical charging stations on the […] Network. In addition, [Company X] will provide the County with management, collection and/or processing services for […] the fees set by the County and payable by a customer for […][charging sessions] ([…], a period during which a customer charges his/her electric vehicle at a charging station), including any applicable taxes and/or regulatory charges. The County also paid up front a license fee for […][a period of time] use of the […][software system].
5. The Ontario Energy Board (OEB) has provided an opinion that ownership and operation of electric vehicle charging stations, and the selling of electric vehicle charging services from that facility, do not constitute distributing or retailing (selling) of electricity. Based on this opinion, the County does not require a licence to engage in this activity under the Ontario Energy Board Act, 1998, and the OEB’s codes, rules and other regulatory requirements do not apply to it.
RULING REQUESTED
You would like to know if the [fee] charged by the County for [charging sessions] is subject to the HST.
RULING GIVEN
Based on the facts set out above, we rule that the [fee] charged by the County for [charging sessions] is consideration for a taxable supply and subject to the HST.
EXPLANATION
Generally, every recipient of a taxable supply (other than a zero-rated supply) made in Ontario is required to pay HST at the rate of 13% on the value of the consideration for the supply pursuant to subsections 165(1) and 165(2). Generally, persons making a taxable supply must collect the GST/HST pursuant to subsection 221(1).
A taxable supply is defined in subsection 123(1) to mean "a supply that is made in the course of a commercial activity" where the definition of "commercial activity" reads in part to mean "a business carried on by a person… except to the extent to which the business involves the making of exempt supplies". An exempt supply is a supply that is not subject to GST/HST and that is included in Schedule V.
Certain supplies made by a municipality are exempt under Part VI of Schedule V. However, there are no exempting provisions in Part VI of Schedule V (or any other Part of Schedule V) that would apply to exempt the supply (described above) by the County, nor are there any other provisions that would relieve tax on the supply. Accordingly, the County’s supply is taxable and the fee charged for the supply is subject to the HST.
For additional information on supplies by municipalities, please refer to GST/HST Guide RC4049, GST/HST Information for Municipalities.
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 me directly at 905-984-2332. 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,
Maria Forte-Long
Municipal Sectors Unit
Public Service Bodies and Governments Division
Excise and GST/HST Rulings Directorate
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