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: 191471
Dear [Client]:
Subject: EXCISE INTERPRETATION
Stamping Requirements for Manufactured Tobacco
Thank you for your [correspondence] of [mm/dd/yyyy], concerning the application of the Excise Act, 2001 to the importation of tobacco products into Canada from […][Country X].
All legislative references are to the Excise Act, 2001 (Act) and the regulations therein, unless otherwise specified.
We understand that […]. […][The Company] is considering the importation of […][the tobacco product] in 50 gram packages. Specifically, you have described the product to be ‘fine cut tobacco’ that will be packaged in 50 gram packages. No additional details were provided.
INTERPRETATION REQUESTED
You would like to know the tobacco classification, excise duty rate and the stamping and prescribed information requirements for [the tobacco product] in a 50 gram package, which are to be imported and subsequently sold in Canada. This product will be sold in Canada and not exported or for delivery to a foreign duty free shop or delivery as foreign ships’ stores.
INTERPRETATION GIVEN
Based on the information provided, [the tobacco product] in a 50 gram package would be classified as manufactured tobacco under the Act. The Act defines manufactured tobacco to mean every article other than a cigar or packaged raw leaf tobacco that is manufactured in whole or part from raw leaf tobacco from any process.
Excise Duty Rate
The rate of excise duty for manufactured tobacco, is set out in Schedule 1 to the Act, and is currently $7.45425 per 50 grams or fraction of 50 grams contained in any package.
Stamping & Packaging
Tobacco products that are imported into Canada and destined for sale in the duty paid market must be packaged and stamped. “Stamped", in respect of a tobacco product, means that an excise stamp, and all prescribed information in a prescribed format, are stamped, impressed, printed or marked on, indented into or affixed to the product or its container in the prescribed manner to indicate that duty, other than special duty, has been paid on the product. The prescribed manner for affixing an excise stamp and the prescribed information and format for purposes of the Act are set out in the Stamping and Marking of Tobacco Products Regulations (Regulations). A copy of the Regulations is enclosed for reference purposes.
The Regulations require that an excise stamp be affixed to the package in a conspicuous manner that seals the package and will remain affixed to the package after the package is open. The excise stamp must also be affixed in a manner that does not interfere with the stamp’s security features and that does not obstruct any information required by or under an Act of Parliament.
A package for a tobacco product is defined by the Act to be a prescribed package. The Regulations define a prescribed package for a tobacco product to be when it is packaged in the smallest package, including any outer wrapping that is customarily displayed to the customer, in which it is normally offered for sale to the general public.
In the instance of an imported tobacco product, the prescribed information required on each package is set out in section 3.1 of the Regulations:
a) The name and address of the manufacturer who packaged the tobacco product;
b) If the tobacco product is imported by a tobacco licensee, the licensee’s name and address or tobacco licence number; or
c) If the tobacco product was imported by a person other than a tobacco licensee, the person’s name and address.
The Regulations also prescribe information for cases of manufactured tobacco. The term “Case” is defined in section 1 of the Regulations and means a corrugated cardboard box in which packages or cartons of tobacco products are packed, primarily for the purpose of transport and protection against damage.
Prescribed information for cases of imported manufactured tobacco is set out in in section 3.3 of the Regulations:
a) If the case is packed with cartons, the number of cartons in the case and the number of packages in each carton; and
b) If the case is packed with packages, the number of packages in the case and the weight of the tobacco product in each package.
[…].
Please contact the provincial/territorial jurisdictions you intend to supply for any additional stamping and marking conditions and requirements.
In accordance with the qualifications and guidelines set out in GST/HST Memorandum 1.4, Excise and GST/HST Rulings and Interpretations Service, the interpretation(s) given in this letter, including any additional information, is not a ruling and does not bind the Canada Revenue Agency (CRA) with respect to a particular situation. Future changes to the Act, regulations, or the CRA’s interpretative policy could affect the interpretation(s) or the additional information provided herein.
If you require clarification with respect to any of the issues discussed in this letter, please call me directly at (613) 670-7356.
Yours truly,
Faye Chen
Tobacco Operations Unit
Excise Duty & Taxes Division
Excise and GST/HST Rulings Directorate
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