Please note that the following document, although correct at the time of issue, may not represent the current position of the Agency. / Veuillez prendre note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'Agence.
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Excise and GST/HST Rulings Directorate
Place de Ville, Tower A, 15th floor
320 Queen Street
Ottawa ON K1A 0L5
Case Number: 119136
Attention: XXXXX XXXXX
October 21, 2010
Dear XXXXX:
Subject:
EXCISE TAX RULING
Kerosene Used for Lighting
Thank you for your letter of XXXXX concerning the application of the Excise Tax Act to kerosene used for the intended purpose of lighting. We apologize for the delay in responding to your question.
All legislative references are to the Excise Tax Act (Act) and the regulations therein, unless otherwise specified.
Statement of Facts
We understand that you require clarification on the tax status of kerosene when purchased by end users for use in kerosene lamps for lighting.
Ruling Requested
Whether kerosene used for lighting is subject to excise tax.
Ruling Given
Based on the information provided, we rule that kerosene intended for use or used in a lamp for lighting is subject to excise tax.
Explanation
Subsection 2(1) of the Act defines diesel fuel to be any fuel oil that is suitable for use in internal combustion engines of the compression-ignition type, other than any such fuel that is intended for use and is actually used as heating oil.
For fuel oil to be exempt from excise tax it must be intended for use and actually used as heating oil. Our current position is that the term "heating oil" means any fuel oil for use in oil burning equipment for generation of heat for domestic or industrial purposes. For further details I refer you to Excise Tax Policy Statement 'The Meaning of the Term "Heating Oil" for the Purpose of the Definition of "Diesel Fuel" in Subsection 2(1) of the Excise Tax Act (ETA)' which can be found at: http://www.cra-arc.gc.ca/E/pub/gi/ep-001/README.html
Furthermore, we consider the term "oil burning equipment" to mean any liquid-fuel-burning device that contains a burner to produce an open flame, but does not include internal combustion engines. Oil burning equipment would include oil burners, boilers and furnaces.
Consequently, fuel oil used in a lamp for lighting would be subject to excise tax as it does not fall within the meaning of the term "heating oil" or the exempting provision of subsection 2(1) of the Act.
XXXXX.
We conclude that excise tax is payable for kerosene purchased for use in a lamp for lighting.
This ruling is subject to the qualifications in GST/HST Memorandum 1.4, Goods and Services Tax Rulings. 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 Excise Tax 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 613-954-6720.
Yours truly,
Sharon Kendall
Excise Taxes and Other Levies Unit
Excise Duties and Taxes Division Division
Excise and GST/HST Rulings Directorate
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UNCLASSIFIED
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