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 Duties and Taxes Division
Place de Ville, Tower A, 20th floor,
320 Queen Street
Ottawa, ON K1A 0L5
[Addressee]
Case Number: 161007
Dear [Client]:
Subject: EXCISE RULING
[Application of the Federal Excise Tax to Gasoline and Diesel products]
Thank you for your fax of March 25, 2014 requesting a ruling as to the application of the Federal Excise Tax (FET) on two products.
All legislative references are to the Excise Tax Act and the regulations therein, unless otherwise specified.
STATEMENT OF FACTS
From our initial phone conversation and the information submitted by fax, […] [which included] a Material Safety Data Sheet (MSDS) for each of the two products, we understand:
1. The following products were imported into Canada:
a. Light Petroleum Distillate described as “Additized Detergent Gasoline”, with an additional note, “this product does not meet the requirements for reformulated gasoline and may not be used in any reformulated gasoline area.”
b. B100 Biodiesel, Canola Methyl Ester (RME)
RULING REQUESTED
You would like to know:
1. Do the products (i.e., Light Petroleum Distillate and Canola Methyl Ester) fit the definition of gasoline and diesel fuel and therefore are subject to the FET?
2. What applicable rate of FET is payable on importation of these products by a non-licensed person?
RULING GIVEN
Based on the information provided, we rule that:
A. The first product, Light Petroleum Distillate described as “Additized Detergent Gasoline”, in our opinion meets the definition of “gasoline” as defined in subsection 2(1) of the Act. The applicable rate of FET payable on importation of these products by a non-licensed person is 10 cents per litre.
B. The second product, B100 Biodiesel, Canola Methyl Ester (RME), in our opinion meets the definition of “diesel fuel” as defined in subsection 2(1) of the Act. The applicable rate of FET payable on importation of these products by a non-licensed person is 4 cents per litre.
EXPLANATION
According to Subsection 2(1) of the Act;
“gasoline” means gasoline type fuels for use in internal combustion engines other than aircraft engines;
“diesel fuel” includes any fuel oil that is suitable for use in internal combustion engines of the compression-ignition type, other than any such fuel oil that is intended for use and is actually used as heating oil;
Schedule I to the Act specifies the following taxes;
9(a) Unleaded gasoline and unleaded aviation gasoline, $0.10 per litre.
9. 1 Diesel fuel and aviation fuel, other than aviation gasoline, $0.04 per litre.
Our rulings are based on the MSDS information provided as well as industry definitions of these products. The MSDS for the Light Petroleum Distillate described as “Additized Detergent Gasoline” stated properties which correspond with the specifications for a gasoline.
B100 Biodiesel, Canola Methyl Ester (RME), is considered suitable to run in diesel engines in numerous industry publications and therefore considered to meet the definition of diesel fuel under the Act.
This ruling is subject to the qualifications and guidelines set out in GST/HST Memorandum 1.4, Excise and GST/HST Rulings and Interpretations Service. We are bound by this ruling provided that none of the above issues is currently under audit, objection, or appeal, that no future change to the Act, regulations or our interpretative policy affect its validity, and all relevant facts and transactions have been fully disclosed.
If you require clarification with respect to any of the issues discussed in this letter, please call me directly at 613 952 0048.
Yours sincerely,
Michael Ryder
Excise taxes and Other Levies
Excise Duties and Taxes Division
Excise and GST/HST Rulings Directorate
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