GSTHST Rulings and
InterpretationsDirectorate
Place Vanier, Tower C, 10th Floor
25 McArthur Avenue
Vanier, Ontario
XXXXX K1A 0L5
|
XXXXX
|
Business Number: XXXXX
|
March 17, 1998
|
Subject:
|
GSTHST INTERPRETATION
Shipping and handling fees on books
|
Dear XXXXX
Thank you for your letter of October 30, 1997, with attachments, concerning the application of the GSTHST federal book rebate to your purchase of books.
Interpretation Requested
You asked us to confirm that the supplier is not regarded as making a separate supply of a freight transportation service when the XXXXX (the Library) takes title to the books only when they are received at the XXXXX premises. You also requested confirmation that in these circumstances, the XXXXX is entitled to a rebate of the full amount (i.e., 100%) of the GST paid or payable on both the books and the shipping and handling charges, even though the shipping and handling charge is itemized separately on the supplier's invoice.
Interpretation Given
Based on the information provided, we wish to confirm that the supplier is not regarded as making a separate supply of a freight transportation service when the XXXXX takes title to the books only when they are received at the XXXXX premises. As mentioned in the article entitled "Delivery of goods" in the Fall 1997 "GSTHST News", a copy of which you included with your inquiry, the supplier is not regarded as making a separate supply of a freight transportation service in these circumstances, even where a delivery charge is itemized separately on an invoice.
We also wish to confirm that, in the circumstances outlined in your letter, the XXXXX is entitled to a rebate of the full amount (i.e., 100%) of the GST paid or payable in accordance with the provisions of subsection 259.1 (2) of the Excise Tax Act (the Act), because the delivery at your premises is considered to be a single supply of books, with the shipping and handling included in the supply. Please note, however, that the books must meet the definition of "printed book" in subsection 259.1(1) of the Act.
Conversely, as mentioned in the "Delivery of goods" article in the Fall 1997 "GSTHST News", the supplier is considered to have made a separate supply of a freight transportation service if the goods are sold FOB the vendor, i.e., title to the goods passes when the goods are given to the carrier. Please note that if the XXXXX were to purchase books in these circumstances, the rebate under section 259.1 would not apply to the shipping and handling charges.
The foregoing comments represent our general views with respect to the subject matter of your letter. These comments are not rulings and, in accordance with the guidelines set out in section 1.4 of Chapter 1 of the GST Memoranda Series, do not bind the Department with respect to a particular situation.
For your convenience, please find enclosed a copy of section 1.4 of Chapter 1 of the GST Memoranda Series, as well as a copy of the Technical Information Bulletin (B076) relating to the book rebate, in which you will find a section pertaining to the expression "printed book" on page 6.
Should you have any further questions or require clarification on the above matter, please do not hesitate to contact me at 952-9215.
Yours truly,
JoAnne Ward
Rulings and Interpretations Officer
Municipalities and Health Care Services Unit
Public Service Bodies and Governments Division
GSTHST Rulings and Interpretations Directorate
Encl.: Memorandum 1.4
TIB076
| Legislative References: |
Section 259.1 |
NCS Subject Code 11895
Email this Content