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: 126341
September 8, 2011
Dear [Client]:
Subject:
GST/HST RULING
Point of Sale (POS) Rebate eligibility for printed owner's manuals and sales catalogues
Thank you for your letter of July 5, 2010, concerning the application of the Goods and Services Tax (GST)/Harmonized Sales Tax (HST) to the supply of automobile literature.
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) unless otherwise specified.
Statement of Facts
We understand the facts to be as follows:
1. [...] (the Company) is a registrant for GST/HST purposes.
2. The Company supplies publications, which consist of original owner's manuals, shop manuals, parts books, brochures, and sales catalogues. The publications are for automobiles of all ages, but primarily [...] vehicles.
3. The Company supplies owner's manuals to customers who want to replace the owner's manual for their [...] automobile. The owner's manuals contain information for the operation, care, and maintenance of the vehicle.
4. The Company supplies catalogues for vehicles of various ages. The catalogues list the features, advantages, and benefits of each vehicle.
5. The Company's publications are [...].
6. The Company provided copies of [...]. The publications are described as follow: [...]
Ruling Requested
You have requested a ruling regarding whether supplies of the publications listed in the statement of facts above are qualifying books for purposes of the POS rebate for books.
Ruling Given
None of the publications are eligible for the POS book rebate. Pursuant to the Deduction for Provincial Rebate (GST/HST) Regulations, the publications are specifically excluded from the rebate as an owner's manual or a catalogue pursuant to subsection 259.1(1) of the ETA.
This ruling is subject to the qualifications 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 are 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.
Explanation
For GST/HST purposes, most supplies of goods and services that are made in the participating provinces are taxable supplies subject to the HST (15% in Nova Scotia, 13% in Ontario, New Brunswick, Newfoundland and Labrador and 12% in British Columbia). This includes the sale of most books and other similar publications. However, the participating provinces provide a point-of-sale (POS) rebate of the provincial part of the HST payable on supplies of qualifying property.
Qualifying property includes printed books and updates of printed books, audio recording all or substantially all of which is a spoken reading of a printed book, and bound or unbound printed versions of scripture of any religion. The term "printed book" is not defined in the ETA. Therefore, for purposes of the rebate, the term takes on its ordinary meaning; however, certain types of publications are excluded from the definition of printed book under subsection 259.1(1) of the ETA, and are therefore excluded from the POS book rebate.
Under section 259.1 of the ETA, a printed book excludes, in part, anything that is, or the main component of which is a sales catalogue, a price list or advertising material, and a warranty booklet or an owner's manual.
A catalogue is a publication that lists, enumerates, describes or depicts names, titles, persons, things, properties or services, with or without explanatory or descriptive remarks, designed primarily to promote the sale of the property or service. Under Info Sheet GI 065 Harmonized Sales Tax for Ontario and British Columbia -Point-of-Sale Rebate on Books (Footnote 2) , catalogues with a reference function such as art exhibition catalogues, coin catalogues, stamp catalogues, antique catalogues, and reprints of historical catalogues are not excluded from the definition of a printed book. However, the items [...], listed in the statement of facts as 6(c) and 6(j) respectively, do no serve a reference function as much of their value is based upon the fact that they are original publication designed to sell the vehicles. Therefore, as catalogues they are excluded from the POS rebate for books.
An owner's manual is a publication that relates to the operation and maintenance of a given product, and is normally supplied with a new product for no extra consideration. The age of the owner's manual is not a determinative factor for qualifying for the POS book rebate.
We rule that the publications listed in the statement of facts under 6(c) and 6(j) are catalogues, and the remaining items are owner's manuals. The supply of the publications is excluded from the point-of-sale rebate for books, given for the provincial portion of the HST in the participating provinces, under paragraphs 259.1(1) (e) and (f) of the ETA.
If you require clarification with respect to any of the issues discussed in this letter, please call me directly at 613-954-5124. 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,
Angela Stachowski
Goods Unit
General Operations and Border Issues Division
Excise and GST/HST Rulings Directorate
UNCLASSIFIED
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