6 December 2006 GST/HST Ruling 82659 - Supplies of Stents

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 facsimile transmissions XXXXX concerning the application of the Goods and Services Tax (GST)/Harmonized Sales Tax (HST) to supplies of an admission made by the City XXXXX. Specifically, you would like to know whether GST applies to supplies of an admission made for $1.00 by the City to members of the public to skate or swim XXXXX at the City's recreational facilities, as described in the two scenarios you put forward.

In your second facsimile, you indicated that the information contained therein was more specific to your ruling request than what was provided in your first. For this reason, we have relied on the information contained in your second facsimile transmission. Further, XXXXX you confirmed that for purposes of responding to your request for a GST/HST ruling, we could use the City's name and the information posted on its website. As a result, we have taken the liberty of using this information and substituted your reference to XXXXX with the terms specifically used by the City XXXXX, as indicated on its website.

All legislative references are to the Excise Tax Act (ETA) and the regulations therein, unless otherwise specified.

Statement of Facts

1. The City is registered for GST/HST purposes.

2. The City is a "municipality", as defined in subsection 123(1) of the ETA.

3. A "public sector body", as defined in subsection 123(1) of the ETA includes a public service body such as a municipality. As a city falls within the definition of "municipality", the City is a public sector body.

4. The City provides public access to its various recreational facilities, such as the XXXXX Recreation Centre, the XXXXX Recreation Centre and the XXXXX Arena. The main features of both the XXXXX Recreation Centre and the XXXXX Recreation Centre are, among other things, a swimming pool and an ice arena/ice surface. The XXXXX Arena is a full-size ice arena.

XXXXX

5. The XXXXX Recreation Centre and the XXXXX Recreation Centre each house a swimming pool.

XXXXX Recreation Centre

6. XXXXX the City charges members of the public an admission fee of $1.00 to swim in the pool at the XXXXX Recreation Centre. XXXXX. XXXXX the City charges members of the public an admission fee of $2.00 for the XXXXX. The City also hosts other sessions such as the XXXXX. These sessions are offered on differing days of the week and at differing times of day and night. The XXXXX sessions held on XXXXX involve pool games and pool toys.

7. For XXXXX, the fees payable by members of the public to the City for an admission to swim in the pool at the XXXXX Recreation Centre are as follows:

Child under 3  XXXXX

Child (3-12)  XXXXX

Teen/Student  XXXXX

Adult (18-60)  XXXXX

Senior (over 60)  XXXXX

Family   XXXXX

XXXXX   XXXXX

Admission fees include the GST.

One-month, three-month and yearly passes are also available for a certain fee.

XXXXX Recreation Centre

8. XXXXX the City charges members of the public an admission fee of $1.00 to swim in the pool at the XXXXX Recreation Centre. XXXXX. The City also hosts other sessions referred to as the XXXXX. These sessions are offered on differing days of the week and at differing times of day and night.

9. For XXXXX, the fees payable by members of the public to the City for an admission to swim in the pool at the XXXXX Recreation Centre are as follows:

Child under 3  XXXXX

Child (3-12)  XXXXX

Teen/Student  XXXXX

Adult (18-60)  XXXXX

Senior (over 60)  XXXXX

Family   XXXXX

XXXXX   XXXXX

Admission fees include the GST.

One-month, three-month and yearly passes are also available for a certain fee.

XXXXX

10. The XXXXX Recreation Centre, the XXXXX Recreation Centre and the XXXXX Arena each house an ice arena/ice surface.

11. The City charges members of the public an admission fee of $1.00 to skate on the ice surface/arena at any one of these recreational facilities. XXXXX. These sessions are offered on differing days of the week and at differing times of day and night. At other times of the day and week, the City charges members of the public an admission fee for the XXXXX sessions. The XXXXX session held on XXXXX involves games and music.

12. For XXXXX, the fees payable by members of the public to the City for an admission to skate on the ice surface/arena at the XXXXX Recreation Centre, the XXXXX Recreation Centre and the XXXXX Arena are as follows:

Child under 3  XXXXX

Child (3-12)  XXXXX

Teen (13-17)  XXXXX

Student   XXXXX

Adult (18-60)  XXXXX

Senior (60+)  XXXXX

Family   XXXXX

XXXXX   XXXXX

Admission fees include the GST.

One-month, three-month and yearly passes are also available for a certain fee.

Ruling Requested

You would like to know whether the supplies of an admission by the City to its XXXXX and XXXXX sessions are exempt of the GST/HST where:

1. The XXXXX and XXXXX sessions are no different from any other public swim or skate sessions hosted by the City at other times.

2. The XXXXX and XXXXX sessions are different (i.e., play special games, different times) from the other public swim or skate sessions hosted by the City at other times.

Ruling Given

Based on the facts set out above, we rule that:

The fees payable by members of the public to the City for an admission to its XXXXX session at the XXXXX Recreation Centre and the XXXXX Recreation Centre, and an admission to its XXXXX session at the XXXXX Recreation Centre, the XXXXX Recreation Centre or the XXXXX Arena are consideration for a taxable supply as no exempting provision within the ETA applies.

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

Section 9 of Part VI of Schedule V to the ETA exempts the following:

"A supply made by a public sector body of an admission in respect of a place of amusement where the maximum consideration for a supply by the body of such an admission does not exceed one dollar."

The definition of "admission" in subsection 123(1) of the ETA means:

"In respect of a place of amusement or a seminar, an activity or an event, means a right of entry or access to, or attendance at, the place of amusement or the seminar, activity or event."

The definition of "place of amusement" in subsection 123(1) of the ETA includes "any place ... the purpose of which is to provide any type of amusement or recreation".

The City - a public sector body -charges members of the public an admission fee of $1.00 for the XXXXX and XXXXX sessions that it hosts at its recreational facilities - the XXXXX Recreation Centre, the XXXXX Recreation Centre and the XXXXX Arena.

The purpose of the admissions supplied to members of the public by the City for the XXXXX and XXXXX sessions is to provide a "type of amusement or recreation" - to swim or skate. As the purpose of the admissions is to provide recreation, each of its recreational facilities - the XXXXX Recreation Centre, the XXXXX Recreation Centre and the XXXXX Arena - constitute a place of amusement.

Accordingly, when the City permits members of the public to enter the City's premises and use its recreation facilities (e.g., a swimming pool or ice surface/arena), it has made a supply of an admission to a place of amusement. The supply of an admission to a place of amusement is a taxable supply subject to tax at 6% unless an exempting provision within Schedule V to the ETA applies.

The City supplies to members of the public an admission to a place of amusement, in this case the XXXXX Recreation Centre, the XXXXX Recreation Centre and the XXXXX Arena (hereinafter referred to collectively as recreational facilities). The consideration charged for supplies of an admission to these recreational facilities to skate or swim varies depending upon the session offered, the time it is offered and to whom it is offered. Special games or music may be played during some of these sessions.

Differences such as the time when the XXXXX or XXXXX sessions are offered, the admission fee payable or the activities that may be carried out during those sessions does not change the nature of the supply. The supply is that of an admission to a place of amusement to swim or skate.

As the City charges members of the public an admission fee to swim in a pool at its recreational facilities that exceeds $1.00, and an admission fee to skate on the ice surface/arena at its recreational facilities that exceeds $1.00, section 9 of Part VI of Schedule V to the ETA does not apply to exempt the supply of an admission for its XXXXX or its XXXXX sessions.

Accordingly, GST/HST applies to supplies of an admission made to the public by City for its XXXXX and XXXXX sessions.

As the admission fee of $1.00 payable by members of the public to the City for its XXXXX and XXXXX sessions are a GST-included amount, the City is correctly charging the tax.

If you require clarification with respect to any of the issues discussed in this letter, please call me directly at 613-954-7952.

Yours truly,

Lynn Fournier Renner
Municipalities and Health Care Services Unit
Public Service Bodies and Governments Division
Excise and GST/HST Rulings Directorate

2006/12/15 — RITS 83781 — Discounts