1 October 1998 GST/HST Ruling HQR0001341 - Application of the GST/HST to the Supply of "Lunchables"

                                                                        GST/HST Rulings and Interpretations
 Directorate
Place Vanier, Tower C, 10th Floor
25 McArthur Avenue
Vanier, ON K1A 0L5

Dear XXXXX

Thank you for your letter of July 2, 1998 (with attachments), concerning the application of the Goods and Services Tax (GST)/Harmonized Sales Tax (HST) to the supply of XXXXX ("Lunchables").

Statement of Facts

Our understanding of the facts, the transaction, and the purpose of the transaction is as follows: XXXXX[.] In the course of their commercial activitie XXXXX supplies in Canada of certain varieties of XXXXX[.]

XXXXX XXXXX

XXXXX varieties of lunch combinations at issue are as follows:

XXXXX

XXXXX

XXXXX

XXXXX

XXXXX

XXXXX

XXXXX

XXXXX

Ruling Given

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

1. Supplies made by XXXXX are 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%. Note that taxable supplies (other than zero-rated supplies) made in a participating province attract tax at the rate of 15%.

This ruling is subject to the general limitations and qualifications outlined in section 1.4 of Chapter 1 of the GST/HST 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

Section 1 of Part III of Schedule VI to the Excise Tax Act (the "Act") provides a zero-rated tax status for "(S)upplies of food or beverages for human consumption (including sweetening agents, seasonings and other ingredients to be mixed with or used in the preparation of such food or beverages)" other than supplies under paragraphs (a) through (r) of this section.

The Department considers that a supply made by XXXXX is a supply that does not fall within any of the excepting paragraphs (a) through (r) of section 1 of Part III of Schedule VI to the Act. Accordingly, supplies of XXXXX are zero-rated supplies of food and/or beverages.

Should you have any further questions or require clarification on the above matter, please do not hesitate to contact me at (613) 941-3971.

Yours truly,

Robert Smith
Rulings Officer
General Operations and Border Issues Division
GST/HST Rulings and Interpretations Directorate