GST/HST Rulings and Interpretations
Directorate
Place Vanier, Tower C, 10th Floor
25 McArthur Road
Vanier, Ontario
XXXXX K1A 0L5
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XXXXX
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GST/HST Application Ruling
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Dear XXX:
This GST/HST application ruling supersedes that which was provided to you in our letter dated November 7, 1997.
Our understanding of the facts, the transactions, and the purpose of the transactions is as follows.
Statement of Facts
1. XXXXX states that "There shall be a Registrar of Motor Vehicle Dealers and Salesmen who shall be appointed by the Lieutenant Governor in Council."
2. XXXXX states that "No person shall,
(a) carry on business as a motor vehicle dealer unless the person is registered under this Act; or
(b) act as a salesperson of or on behalf of a motor vehicle dealer unless the person is registered as a salesperson of such dealer and such dealer is registered as a motor vehicle dealer under this Act."
3. XXXXX made pursuant to the XXXXX enumerates fees payable to the Registrar for the application for registration or renewal of registration as a motor vehicle dealer or salesperson. Under XXXXX the fee payable upon application for registration as a motor vehicle dealer or renewal of the registration is XXXXX Under XXXXX , the fee payable upon application for registration of a salesperson or renewal of registration is XXXXX states that the "purpose of this Act is to facilitate the administration of designated Acts named in the Schedule by delegating to designated administrative authorities certain powers and duties relating to the administration of those Acts." The Schedule lists various legislation including the XXXXX t defines an "administrative authority" as "a not-for-profit corporation without share capital incorporated under the laws of XXXXX or XXXXX that operates in XXXXX but that does not form part of the Government of XXXXX any other government or an agency of a government ..."
6. XXXXX states that "Subject to XXXXX the Lieutenant Governor in Council may, by regulation, designate one or more administrative authorities for the purpose of administering designated legislation."
7. XXXXX states that "The powers to make regulations that designated legislation confers on the Lieutenant Governor in Council or the Minister responsible for the administration of the designated legislation are not delegated to the designated administrative authority." (emphasis added)
8. XXXXX states that "The Lieutenant Governor in Council may not designate an administrative authority for the purpose of designated legislation until the Minister and the administrative authority have entered into an administrative agreement."
9. XXXXX XXXXX states that "A designated administrative authority shall carry out the administration of designated legislation delegated to it ..."
10. XXXXX Act states that "Designated administrative authorities ... are not agents of the Crown ..."
11. XXXXX states that "The money that a designated administrative authority collects in carrying out the administration delegated to it is not public money within the meaning of the Financial Administrative Act and the administrative authority may use it to carry out activities in accordance with its objects or any other purpose reasonably related to its objects."
12. XXXXX states that "The following are designated as designated legislation for the purposes of section (1) of the Act:
1. All provisions of the XXXXX except for XXXXX
2. All provisions of the regulations made under that Act."
13. XXXXX
14. XXXXX
15. XXXXX
Ruling Requested
1. Is XXXXX required to charge and remit GST on all, or a portion of, registration and renewal fees collected from motor vehicle dealers and salespeople?
2. If so, what treatment for GST purposes, will be given to registration and renewal fees submitted by dealers and salespeople to the provincial government and then transferred by the provincial government to XXXXX entitled to register for GST/HST purposes?
Ruling Given
Based on the facts set out above, we rule that
1. XXXXX is not required to charge and remit GST on registration and renewal fees collected from motor vehicle dealers and salespeople under the XXXXX as the supplies made in respect of these fees are exempt pursuant to paragraph (c) of section 20 of Part VI of Schedule V to the Excise Tax Act.
2. Amounts of registration and renewal fees forwarded to XXXXX by the provincial government of XXXXX during the transition period are not consideration for a supply and therefore not subject to GST.
3. XXXXX is not entitled to register for GST/HST purposes if its revenue is derived solely from the provision of exempt supplies. Should XXXXX provide taxable supplies, it will be required to remain as a GST/HST registrant if its total revenue in four consecutive calendar quarters or any particular calendar quarter from the provision of taxable supplies is more than $30,000. (Note: Amendments to the Excise Tax Act increases this threshold for public service bodies, such as non-profit organizations, to $50,000 effective April 23, 1996.)
This ruling is subject to the general limitations and qualifications outlined in section 1.4 of Chapter 1 of the GST Memoranda Series. We are bound by this ruling provided that none of the above issues is currently under audit, objection, or appeal; that there are no relevant changes in the future to the Excise Tax Act, or to departmental interpretative policy; and that you have fully described all necessary facts and transactions for which you requested a ruling.
Explanation
Paragraph (c) of section 20 of Part VI of Schedule V to the Excise Tax Act exempts a supply of a licence, permit, quota or similar right when made by a government or other body established by a government. As XXXXX was created for the purpose of being the delegated authority for the administration of the XXXXX and the objects for which it was incorporated relate solely to the administration of the XXXXX it is considered to be a body established by government for purposes of the aforementioned section of the Excise Tax Act.
As the amounts of registration and renewal fees forwarded to XXXXX by the provincial government of XXXXX during the transition period belong to XXXXX and are not public money in accordance with subsection 12(4) of the XXXXX the provision of these amounts to XXXXX is simply a transfer of money and not consideration for any supply made by XXXXX
Should you have any further questions or require clarification on the above matter, please do not hesitate to call me at (613) 954-7656 or Donna Harding, Manager, Governments Unit at (613) 954-3551.
Yours truly,
J.A. Venne
Director
Public Service Bodies and Governments Division
GST/HST Rulings and Interpretations Directorate
| c.c.: |
Lynn F. Renner
D. Harding, A/Manager, Governments Unit
J.A. Venne, Director, Public Service Bodies and Governments Division |
ATIP
Legislative References: paragraph (c) of section 20 of Part VI of Schedule V to the ETA
NCS Subject Code(s): 11849-6 XXXXX
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