19 July 2000 GST/HST Ruling 7876/HQR0001482 - Application of the GST/HST to Fees and Assessments

Dear XXXXX

Thank you for the letter of November 27, 1998, with attachments, concerning the application of the Goods and Services Tax (GST)/Harmonized Sales Tax (HST) to the fees and assessments charged by XXXXX[.] The annual assessments based on a predetermined formula will be dealt with under separate cover.

Please note that the rulings made in respect to the user pay charges follow the same numbering as is used in the XXXXX XXXXX[.] All underlining throughout the statement of facts is for the purpose of adding emphasis.

Statement of Facts

XXXXX

Ruling Requested

Are the fees charged pursuant XXXXX subject to the GST/HST.

Rulings Given

1. Supplies provided in respect of applications referred to in XXXXX are exempt pursuant to paragraph 20(c) of Part VI of Schedule V to the ETA and, therefore, the fees are not subject to the GST/HST.

2. The supply provided in respect of an application referred to in XXXXX is exempt pursuant to paragraph 20(b.1) of Part VI of Schedule V to the ETA.

3. Supplies provided in respect of applications referred to in XXXXX are taxable and consideration paid in respect of these supplies are subject to the GST/HST.

4. The supply provided in respect of an application referred to in XXXXX is exempt pursuant to paragraph 20(d) of Part VI of Schedule V to the ETA.

We require more information in order to provide rulings regarding XXXXX[.] In particular, we require an explanation or legislative reference in order to determine exactly what is being provided under each of these items. This information was previously requested in a fax to your office.

These rulings are 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 these rulings 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.

Explanation

In accordance with section 165 of the ETA, every recipient of a taxable supply made in Canada is required to pay tax on the value of the consideration for that supply except where the supply is zero-rated (i.e. tax rate is 0%). Section 221 of the ETA requires that every person who makes a taxable supply to collect the tax payable by the recipient of the supply, and section 225 requires them to include the amount collected in their net tax calculation. A taxable supply is defined to be a supply made in the course of a commercial activity, where commercial activity is defined to include a business carried on by a person except to the extent to which the business involves the making of exempt supplies. Therefore, tax is payable on supplies unless they are determined to be either zero-rated or exempt pursuant to Schedules V and VI to the ETA, respectively.

Ruling 1

Paragraph 20(c) of Part VI of Schedule V to the ETA exempts supplies made by government where the supply is of a licence, permit, quota or similar right and the supply of any service in respect of an application for such a right. Where the approval XXXXX to undertake a particular action, it has been determined that this permission results in the provision of a "similar right" and is, therefore, exempt. This includes cases where the permission granted is in the form of an order. Accordingly, any service undertaken in respect of the application for one of these "similar rights" is also exempt.

Ruling 2

Where XXXXX has decided to amend XXXXX XXXXX, the XXXXX must, where they choose to have input, file representations regarding that order. This service is exempt pursuant to paragraph 20(b.1) of Part VI of Schedule V to the ETA as this paragraph exempts supplies made by government where the supply provided is of a service of the filing of a document in accordance with legislative requirements.

Ruling 3

The supply of written rulings and interpretations is a taxable supply as there is no provision in the ETA which would exempt this supply. Although the service is a taxable supply, it may be zero-rated depending on the facts of a particular case.

Ruling 4

Under XXXXX XXXXX charges a fee to provide copies XXXXX[.] Paragraph 20(d) of Part VI of Schedule V to the ETA exempts a supply made by government where the supply is "of a service of providing information in respect of, or any certificate or other document evidencing ... any other status of a person," where "person" is defined in subsection 123(1) of the ETA to mean "... a corporation ... or a body that is a society, ... association, ... or other organization of any kind." Since XXXXX evidence the status of the XXXXX, the provision of these documents is determined to be exempt.

Should you have any further questions or require clarification on the above matter, please do not hesitate to contact me at (613) 952-0370.

Yours truly,

Brent Fleming
Governments Unit
Public Service Bodies and Governments Division
Excise and GST/HST Rulings Directorate