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, 15th floor
320 Queen Street
Ottawa ON K1A 0L5
[Addressee]
Case Number: 152937
June 5, 2013
Dear [Client]:
Subject: GST/HST INTERPRETATION
Application of the HST to a temporary importation of a boat
Thank you for your letter of [mm/dd/yyyy], concerning the application of the Goods and Services Tax (GST)/Harmonized Sales Tax (HST) to a temporary importation of a boat.
The HST applies in the participating provinces at the following rates: 13% in Ontario, New Brunswick and Newfoundland and Labrador, 14% in Prince Edward Island and 15% in Nova Scotia. The GST applies in the rest of Canada at the rate of 5%.
Effective April 1, 2013, the 12% HST in British Columbia has been replaced by the 5% GST and a provincial sales tax.
All legislative references are to the Excise Tax Act (ETA) unless otherwise specified.
We understand that you are a Canadian citizen residing in [...][City 1, Province 1]. You have rented a [#] foot sailboat for a period of [#] week and plan to sail the boat this summer. You are not purchasing the sailboat. The sailboat is owned by and registered to an American citizen. You will pick up the boat in [...][Country X] and you and [...] will be the only persons on board. At some point during the period of your rental, you plan to sail the boat into Canadian waters and stay in Canada overnight. At the end of the rental period you will sail the boat back to [Country X] and return it to the registered owner.
Interpretation Requested
You request relief from paying the HST on the value of the sailboat upon its importation into Canada.
Interpretation Given
Pursuant to section 212, every person who is liable under the Customs Act to pay duty on imported goods, or would be liable if the goods were subject to duty, is required to pay 5% GST on the value of the goods. The value of the goods is determined by the Canada Border Services Agency (CBSA), pursuant to section 215, under the valuation rules of the Customs Act and the Customs Tariff. Where the person importing the goods is a resident of a participating province and the goods are not accounted for as commercial goods under section 32 of the Customs Act, the provincial part of the HST at the applicable rate is also payable pursuant to section 212.1.
The following provisions provide relief from the GST/HST in the case of temporary importations of conveyances.
1. Pursuant to the Temporary Importation of Conveyances by Residents of Canada Regulations, under the Customs Tariff, a conveyance may be temporarily imported under certain circumstances. However, the term "conveyance" as defined in section 2 of those regulations excludes "water-borne craft". Please refer to CBSA Memorandum D2-4-1, Temporary Importation of Conveyances by Residents of Canada for further information.
2. Under subsection 215(2) of the ETA and section 14 of the Value of Imported Goods (GST/HST) Regulations, the value for GST/HST purposes of the imported leased buses and aircraft is calculated as 1/60th of the value for duty for each month or part of a month that the conveyance remains in Canada. This provision applies to leased buses and aircraft only. Please refer to CBSA Memorandum D8-1-1, Amendments to Temporary Importation Regulations for further information.
Therefore, no relief is available from the HST payable upon your temporary importation of a sailboat.
Further information on the relief discussed above, on permission to import a sailboat, or on any duties payable on importation can be obtained from the CBSA by contacting the Border Information Service (BIS) line, free of charge throughout Canada, by calling 1-800-461-9999. If you are calling from outside Canada, you can access the BIS line by calling 204-983-3500 or 506-636-5064 (long-distance charges will apply). You may also contact the CBSA by email at Contact@cbsa.gc.ca.
The foregoing comments represent our general views with respect to the subject matter of your request. These comments are not rulings and, in accordance with the guidelines set out in GST/HST Memorandum 1.4, Excise and GST/HST Rulings and Interpretations Service, do not bind the Canada Revenue Agency with respect to a particular situation. Future changes to the ETA, regulations, or our interpretative policy could affect this interpretation.
If you require clarification with respect to any of the issues discussed in this letter, please call me directly at 613-952-9585. 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,
Ben Boboski
Goods Unit
General Operations and Border Issues Division
Excise and GST/HST Rulings Directorate
Email this Content