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.
Excise and GST/HST Rulings Directorate
Place de Ville, Tower A, 15th floor
320 Queen Street
Ottawa ON K1A 0L5XXXXX
XXXXX
XXXXXXXXXX
XXXXX
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Case Number: 63876December 7, 2005
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Subject:
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GST/HST RULING
A Box of Cookies Packaged for Sale to Airlines and Institutions
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Dear XXXXX:
Thank you for your letter XXXXX concerning the application of the Goods and Services Tax (GST)/Harmonized Sales Tax (HST) to the supply of a box of XXXXX cookies.
All legislative references are to the Excise Tax Act (the Act) and the regulations therein, unless otherwise specified.
Statement of Facts
1. The corrugated box of XXXXX cookies consists of XXXXX portions of XXXXX cookies that are individually wrapped.
2. The box contains the following information: a list of ingredients, the number of individually wrapped portions and the universal product code (UPC).
3. Each pack (inside the box) contains XXXXX cookies. The information on this package also contains a list of ingredients, nutrition information and the net weight, but no UPC code.
4. This box of XXXXX cookies is generally sold to airline companies and institutions.
5. The cookies are generally given away on airlines or distributed without a specific charge in institutional settings. You are not aware that the individually wrapped packages of XXXXX cookies are being sold by any person.
Ruling Requested
Is the box containing XXXXX portions of XXXXX cookies wrapped individually considered to be pre-packaged for sale to consumers and therefore, zero-rated?
Ruling Given
Based on the facts set out above, we rule that the supply of a box of XXXXX portion packages of XXXXX cookies is zero-rated in accordance with section 1 of Part III of Schedule VI to the Act.
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.
Explanation
Pursuant to subparagraph 1(m)(i) of Part III of Schedule VI, cookies that are prepackaged for sale to consumers in quantities of less than six items, each of which is a single serving, are subject to tax at 7% or 15% if applicable. Therefore, a zero-rated prepackaged unit would be a box of six or more single servings packaged by the manufacturer in a container intended for purchase by the final consumer. A box that is considered to be prepackaged for sale to consumers normally contains the information required under the Consumer Packaging and Labelling Act. This information includes a list of ingredients and net weight. The universal product code (UPC) is another indication that the box is prepackaged for sale to consumers.
The box of XXXXX cookies is zero-rated because it is prepackaged for sale to consumers and includes six or more servings.
If you require clarification with respect to any of the issues discussed in this letter, please call me directly at (613) 952-9585.
Yours truly,
Gabrielle Nadeau
Goods Unit
General Operations and Border Issues Division
Excise and GST/HST Rulings Directorate
2005/11/29 — RITS 65402 — Application of GST/HST to Purse Winnings