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.
[Addressee]
Excise and GST/HST Rulings Directorate
Place de Ville, Tower A, 15th floor
320 Queen Street
Ottawa ON K1A 0L5
Case Number: 108268
December 21, 2010
Dear [Client]:
Subject:
GST/HST APPLICATION RULING
STATUS OF [...] PROTECTIVE UNDERWEAR
This refers to your letter of September 12, 2008 with enclosed product samples, in which you requested a ruling on the application of the Goods and Services Tax (GST)/Harmonized Sales Tax (HST) to [...] Protective Underwear, a product of [...]. We regret the delay in our response.
Your request for an application ruling on the tax status of the [...] was provided under separate cover.
HST applies at the rate of 15% in Nova Scotia, 13% in Ontario, New Brunswick, and Newfoundland and Labrador, and 12% in British Columbia. GST applies at the rate of 5% in the remaining provinces and territories.
All legislative references are to the Excise Tax Act (ETA) and the regulations therein, unless otherwise specified.
Statement of Facts
We understand from the [...] website that:
- [...] Protective Underwear is designed like regular underwear to address the needs of adults with medium to heavy incontinence.
- The product features built-in [...].
Ruling Requested
You would like to know if the supply of [...] Protective Underwear is zero-rated for purposes of the GST/HST.
Ruling Given
The general rule in section 165 is that every recipient of a taxable supply made in Canada shall pay tax calculated at the rate of 5%, 12%, 13% or 15% (depending on the place of supply) on the value of the consideration for the supply, unless the supply is zero-rated. A zero-rated supply is a supply that is included in Schedule VI to the ETA. The tax rate in respect of a zero-rated supply is 0%.
Based on the facts set out above, we rule that supplies of [...] Protective Underwear are zero-rated pursuant to section 37 of Part II of Schedule VI to the ETA. This section zero-rates a supply of an incontinence product that is specially designed for use by an individual with a disability.
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 changes to the ETA, regulations or our interpretative policy affect its validity, and all relevant facts and transactions have been fully disclosed.
Should you have any further questions or require clarification regarding this letter, please contact me at (613) 952-9590. [...]
Yours truly,
Elaine Bonnah
Municipalities and Healthcare Services Unit
Public Service Bodies and Governments Division
Excise and GST/HST Rulings Directorate
UNCLASSIFIED
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