18 February 2005 General Information Letter 56825 - GENERAL INFORMATION LETTER GST Treatment of Interchange Fee

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 application of the Goods and Services Tax (GST)/Harmonized Sales Tax (HST) to the interchange fee paid in relation to ATM transactions.

Thank you for your suggestions with respect to finding a reasonable resolution regarding the tax status and verifiability of the above-noted fee through a focus group discussion involving representatives of entities at all scenario levels. We have noted your concerns relating to the collection of the tax as it relates to this fee. As you may be aware from our letter to you XXXXX, we have postponed the implementation date regarding the GST/HST treatment of the supply for which the interchange fee is the consideration because we are considering the application of the GST/HST to interchange fees in light of new information being received from representatives of various entities. Should you have further information or agreements relevant to the tax status of the above-noted fee and the feasibility of payment and collection processes relating to fees at your specific scenario level, please provide them and we would be pleased to review them.

Should you have any further questions or require clarification on the above matter, please do not hesitate to contact Duncan Jones, Manager, Financial Institutions Unit, at 613-952-9210.

Yours truly,

Ivan Bastasic
Director
Financial Institutions and Real Property Division
Excise and GST/HST Rulings Directorate

2005/04/05 — RITS 57021 — Documentary Requirements and Basic Tax Content