18 October 1995 GST/HST Interpretation 11645-5 - Rebates of the Goods and Services Tax (GST) Overpaid on Imported Goods

                                                                        File : 11645-5 (ms)
XXXXX                                                                                 October 18, 1995

 XXXXX

Thank you for your letter dated June 20, 1994, concerning rebates of the Goods and Services Tax (GST) overpaid on imported goods. We regret the delay in replying.

A person who is not a GST registrant can recover an overpayment of customs duties and GST by filing Form B2, Canada Customs Adjustment Request. Canada Customs will refund the customs duties part of the claim and the Summerside Tax Centre (STC) will send a rebate for the GST portion. Only GST was overpaid at the time of importation because the goods were not subject to customs duties, overpayments of GST can be recovered by filing Form GST 189E, General Application for Rebate of Goods and Services Tax. However, if the reason for the overpayment relates to a customs issue, such as the re-determination of the tariff classification or the re-appraisal of the value of the goods, Form B2 should instead be filed with Canada Customs, who will then ask STC to pay the GST rebate after the claim has been reviewed and approved by Customs.

A GST registrant should use Form B2 to recover an overpayment of customs duties and Form 189E to recover a GST overpayment on imported goods. If the rebate claim involves a customs issue, Canada Customs must approve the Form B2 request before a GST rebate claim on Form 189E will be accepted by STC. However, if there is no customs issue involved, Form 189E may be submitted directly to STC. We are not currently aware of any specific non-customs issues that would fit into this category. Alternatively, a registrant may claim an input tax credit to recover an amount overpaid as GST on imported goods. There will be no penalty or interest implications, provided a rebate is also not claimed for the same amount.

If you are aware of specific instances in which the Summerside Tax Centre has refused to consider a rebate application where there was no customs issue, please forward details to the nearest Tax Services Office. As you are aware, however, there may be customs issues involved even where the goods are duty free, for example, with respect to valuation.

A copy of your letter, and our reply, have been forwarded to the Domestic Rebates Division, STC, for their consideration in any future administrative policy decisions.

The foregoing comments represent our general views with respect to the subject matter of your letter. Unannounced, proposed or future amendments to the legislation may result in changes to our interpretation. These comments are not rulings and, in accordance with the guidelines in Chapter 1.4 of the GST Memoranda Series, do not bind the Department with respect to a particular situation.

Thank you for bringing these concerns to our attention. Should you have any further questions or comments, please contact Mark Seigel of the GST Imports Unit at (613) 952-1512.

Yours truly,

H. L. Jones
Director
General Applications Division
GST Rulings and Interpretations - DOC: 704(GEN) XXXXX