29 June 2004 Excise Ruling 52760 - Cooking Wine

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.

Dear XXXXX:

Thank you for your letter XXXXX concerning the excise duty status of XXXXX Cooking Wine under the Excise Act, 2001. Your letter was accompanied by two sample bottles of this product for laboratory analysis.

The following information is taken from your letter and from your telephone conversation with Steve Mosher XXXXX. Other information was obtained in conjunction with our earlier ruling XXXXX on a number of cooking wine brands that are imported for packaging and sale by your company.

Statement of Facts

Our understandings of the facts are as follows:

1. XXXXX is a corporation registered under Business Number (BN) XXXXX.

2. XXXXX is a wine licensee and also holds a specially denatured alcohol registration under the Excise Act, 2001 ("Act"). Prior to July 1, 2003, wine was administered under the Excise Tax Act ("ETA"); under that legislation XXXXX held an excise tax licence for the purposes of bottling cooking wines that it imported in bulk.

3. Under the ETA, XXXXX paid excise tax on its cooking wine, either at the time of importation when it entered Canada already packaged, or at the time of delivery where the cooking wine was imported in bulk for packaging prior to resale. Under section 27 of the ETA, "wines of all kinds" were subject to excise tax.

4. XXXXX continues to import various brands of cooking wine in bulk for packaging prior to sale in Canada, including the XXXXX brands.

5. Salted cooking wine is imported under customs tariff item 2103.90.20, which covers "mixed condiments and mixed seasonings". Beverage wine is covered by various tariff items under chapter 22 of the List of Tariff Provisions under the Customs Tariff.

6. The XXXXX Cooking Wine samples were received in good order by the Laboratory and Scientific Services Directorate ("the laboratory") of the Canada Border Services Agency (CBSA), for the testing of their salt and alcohol contents, and to determine whether or not they are potable. The sample of this brand that was sent XXXXX for testing by our laboratory, along with several other samples of cooking wine brands that we ruled on XXXXX was not tested at that time. As we noted in that letter, the sample of the XXXXX Cooking Wine had been broken before it was received by the laboratory.

7. The above-referenced samples were found by the laboratory to have alcohol and salt contents as indicated below:

XXXXX COOKING WINE

Sample #1

XXXXX% absolute ethyl alcohol by volume at 20°C, XXXXX% salt

Sample #2

XXXXX% absolute ethyl alcohol by volume at 20°C, XXXXX% salt

Ruling Requested

You have asked that the above-named cooking wine not be treated as wine for the purposes of the Act, but rather as a denatured alcohol, and therefore not subject to excise duty.

Ruling Given

Based on the facts set out above and from the information and recommendation we have received from the laboratory, we regard the XXXXX Cooking Wine as a non-potable alcoholic formulation. Thus, we consider it to fall within the parameters of paragraph (b) of the definition of "approved formulation" under section 2 of the Act, and not under the definition for "wine".

We are bound by this ruling provided that none of the above issues is currently under audit, objection, or appeal under the provisions of the Act, that there are no relevant changes in the future to the Act or to our interpretative policy; and that you have fully described all the necessary facts and the product for which you requested this ruling.

Explanation

Under section 2 of the Act, paragraph (b) of the definition of "approved formulation" covers:

"any imported product that, in the opinion of the Minister, would be a product under paragraph (a) if it were made in Canada by a licensed user."

Paragraph (a) of the definition of "wine" under the same section of the Act provides for

a beverage, containing more than 0.5% absolute ethyl alcohol by volume, that is produced without distillation, other than distillation to reduce the absolute ethyl alcohol content, by the alcoholic fermentation of

(i) an agricultural product other than grain,

(ii) a plant or plant product, other than grain, that is not an agricultural product, or

(iii) a product wholly or partially derived from an agricultural product or plant or plant product other than grain;

Since the XXXXX Cooking Wine was determined to be a non-potable alcoholic formulation, it is not considered to fall within the Act's definition of "wine". Therefore, excise duty is not applicable to that brand.

If you wish to obtain from us an application ruling on the excise duty status of any other of your cooking wine brands that have not yet been tested by the laboratory, please submit samples of them to this office along with a written request for a ruling.

Should you have any further questions or require any clarification of the above matter, please call me at (613) 954-4208, or Steve Mosher, at (613) 941-1497.

Yours truly,

Ron Hagmann, CGA
A/Manager
Excise Duty Operations - Alcohol

2004/07/12 F — RITS 52920 — Exigences pour les stocks d'étiquettes de spiritueux emballés