GST/HST Rulings and Interpretations
Directorate
Place Vanier, Tower C, 10th Floor
25 McArthur Avenue
Vanier, Ontario
XXXXX K1A 0L5
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Subject:
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GST/HST APPLICATION RULING
Application of GST/HST to Supplies of Fruit and Fruit Salads
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Dear XXXXX
Thank you for your facsimile of December 19, 1997 concerning the application of the Goods and Services Tax (GST) Harmonized Sales Tax (HST) to supplies of fruit and fruit salads.
We understand that your stores have been receiving complaints from customers with respect to the application of the GST/HST on particular items.
Statement of Facts
Your stores sell the following products:
1. Fruit sections packed in water and ascorbic acid and sold in plastic containers.
a) XXXXX Grapefruit Sections 1 litre
b) XXXXX Pineapple Sections 1 litre
c) XXXXX Mango Sections 1 litre
d) XXXXX Orange Sections 1 litre
2. Fruit salads that are a combination of pineapple, orange, cantaloupe, grapes and honeydew and which are packed in a passion fruit juice and sold in plastic containers.
a) XXXXX Fruit Salad 750 ml
b) XXXXX Fruit Salad 2 litres
Ruling Requested
You are requesting confirmation of the application of the GST/HST to the supply of these products.
Ruling Given
Based on the facts set out above, we rule that:
One litre plastic containers of XXXXX Grapefruit Sections, XXXXX Pineapple Sections, XXXXX Mango Sections and XXXXX Orange Sections are considered to be supplies of food for human consumption and their supplies are taxable at 0% (zero-rated) pursuant to section 1 of Part III of Schedule VI to the Excise Tax Act (the Act).
Supplies of XXXXX Fruit Salad 750 ml and XXXXX Fruit Salad 2 litres, packed in plastic containers, are subject to the GST/HST at the rate of 7%/15%. Subparagraph 1(o.1) of Part III of Schedule VI to the Act provides that all salads that are not canned or vacuum sealed are excluded from the zero-rating provision.
Analysis
A fruit salad is considered to be comprised of whole fruit, fruit portions or fruit pieces of two or more types of fruit with or without dressing. A product that is only one fruit is not considered a salad. Therefore, supplies of sections of one type of fruit, sold in plastic containers, are zero rated. Supplies of XXXXX Fruit Salad, sold in plastic containers, are taxable at 7%/15%.
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, to the extent that they are taxable supplies (which are not zero-rated), tax must be collected at the harmonized rate.
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 transaction(s) for which you requested a ruling.
Should you have any further questions or require clarification on the above matter, please do not hesitate to contact me at 952-0419.
Yours truly,
Isabelle Breault
Rulings Officer
Industries Unit
General Operations and Border Issues Division
GST/HST Rulings and Interpretations Directorate
Encl.
Legislative References: Section. 1 of Part III of Schedule VI of the Excise Tax Act, Subparagraph 1(o.i) of part III of the Excise Tax Act
NCS Subject Code(s): 11850-04 and 11850-05
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