9 September 1994 GST/HST Interpretation 1994-09-09[2] - Auctions of Live Animals

This letter is in response to a telephone conversation you had with Ken Mathews of my staff on September 7, 1994. You have requested written confirmation of when GST must be collected on sales of live animals by auction, with specific reference to horse auctions.

When a GST registered auctioneer sells a horse on behalf of another person (i.e. the principal) by auction, GST must be collected on the sale. Whether or not GST must be collected when an auctioneer who is not a GST registrant sells a horse on behalf of a principal by auction, will depend on whether the principal is a GST registrant. If the principal for whom the non-registrant auctioneer is selling the animal is a GST registrant, then 7% GST must be collected, providing the animal is sold in the course of the person's commercial activity. Where the principal for whom the non-registrant auctioneer is selling the animal is not a GST registrant, or is selling the animal outside of their commercial activities, no GST is payable.

The above will apply to the sale of any live animal sold on a taxable basis, unless the specific type of animal is ordinarily raised or kept to produce or to be used as food for human consumption; or to produce wool, in which case the sale would be zero-rated. Attached are pages 5 and 6 of GST Memorandum 300-3-4, which provide a list of common animals and their corresponding tax status.

I trust the above information will address your concerns on this issue. A copy of the pamphlet New Streamlined GST Rules for Auctioneers has been forwarded to you under separate cover.

H.L. Jones
Director
General Tax Policy
Policy and Legislation

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