17 November 1998 GST/HST Interpretation HQR0000871 - GST/HST Status of Amino Acid Feed Ingredients

Dear XXXXX

Thank you for your letter of September 19, 1997 ( with attachments) concerning the application of the Goods and Services Tax (GST)/Harmonized Sales Tax (HST) to methionine hydroxy analogue (MHA) and methionine hydroxy analogue calcium. I apologize for the delay of my response.

Interpretation Requested

GST/HST status of methionine hydroxy analogue (MHA) and methionine hydroxy analogue calcium.

Interpretation Given

Section 10 of Part IV of Schedule VI to the Excise Tax Act provides a zero-rated tax status for a supply of "prescribed property". The Agriculture and Fishing Property (GST) Regulations (the "Regulations") prescribe property relating to agriculture and fishing.

Subsection 1(2) of the schedule to the Regulations prescribes the following:

(2) Feed, when sold in bulk quantities of at least 20 kg (44 lbs) or in bags that contain at least 20 kg (44 lbs), that

(a) is a complete feed, supplement, macro-premix or micro-premix, all as defined in the Feeds Regulations,

(b) is labelled in accordance with the Feeds Regulations, and

(c) is designed for a unique species or class of farm livestock, fish or poultry that are ordinarily raised or kept to produce, or to be used as, food for human consumption or to produce wool.

Methionine hydroxy analogue and methionine hydroxy analogue calcium are classified as single ingredient feeds in accordance with the Feeds Regulations. Since these ingredients are not classified as a complete feed, supplement, macro-premix or micro-premix in accordance with the Feeds Regulations, they are not a zero-rated supply pursuant to subsection 1(2) of the schedule to the Regulations.

Furthermore, subsection 1(3) of the schedule to the Regulations prescribes the following:

(3) By-products of the food processing industry and plant or animal products, when sold in bulk quantities of at least 20 kg (44 lbs) or in bags that contain at least 20 kg (44 lbs) and ordinarily used as feed, or as ingredients in feed, for farm livestock, or poultry, described in paragraph (2)(c).

Methionine hydroxy analogue and methionine hydroxy analogue calcium do not qualify as zero-rated supplies under subsection 1(3) of the schedule to the Regulations.

Please note that if these ingredients are also used as an ingredient in food or beverages for human consumption, they may qualify under Section 1 of Part III of Schedule VI for zero-rating. If a zero-rated ingredient is also used as an ingredient for animal feed, it remains zero-rated.

On April 1, 1997, the harmonized sales tax (HST) replaced the goods and services tax (GST) and the provincial sales tax (PST) in the three participating provinces of Nova Scotia, New Brunswick and Newfoundland with a harmonized tax rate of 15%. If you supply goods that are delivered or made available in a participating province.

The foregoing comments represent our general views with respect to the subject matter of your letter. Proposed amendments to the Excise Tax Act, if enacted, could have an effect on the interpretation provided herein. These comments are not rulings and, in accordance with the guidelines set out in section 1.4 of Chapter 1 of the GST/HST Memoranda Series, do not bind the Department with respect to a particular situation.

For your convenience, find enclosed a copy of section 1.4 of Chapter 1 of the GST/HST Memoranda Series.

Should you have any further questions or require clarification on the above matter, please do not hesitate to contact me at (613) 952-0419.

Yours truly,

Kevin W. Smith
Goods Unit
General Operations and Border Issues Division
GST/HST Rulings and Interpretations Directorate

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