15 March 2000 GST/HST Interpretation 23770 - GST/HST Tax Treatment to a Supply of Services Made to a Non-Resident

Dear XXXXX

Thank you for your letter of December 2, 1999 (with attachments), addressed to Mr. Ivan Bastasic, Manager of the Border issues Unit, concerning the application of the Goods and Services Tax (GST)/Harmonized Sales Tax (HST) to certain weather information services supplied by XXXXX[.] I have been asked to respond to your request for an interpretation.

In consideration of the information provided in your request and of the facts outlined in the background information, we are prepared to issue to you, instead of an interpretation, a GST/HST ruling[.]

Statement of Facts

Our understanding of the facts, the transaction(s) is as follows:

Transaction(s)

-    XXXXX consulting services in connection with the weather data it supplies to XXXXX.

Ruling Requested

Whether A Direct Payment Permit issued by the state of XXXXX to XXXXX XXXXX, which authorizes XXXXX customers to make direct payment of state sales and other taxes directly to the state XXXXX in lieu of to XXXXX, can exempt XXXXX from paying the GST/HST or should XXXXX be charging GST/HST to non-residents for services done via e-mail.

Ruling Given

Based on the facts set out above, we rule:

1 - That the nature of XXXXX has only applicability in the XXXXX[.]

2 - That the supply of the services made by XXXXX (an unregistered non-resident) are in the form of professional services that are zero-rated (taxed at 0%) pursuant to section 23 of Part V of Schedule VI to the Excise Tax Act.

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%, 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/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 transaction(s) for which you requested a ruling.

Should you have any further questions or require clarification on the above or any other GST/HST matter, please do not hesitate to contact me at 957-8220.

Yours truly,

Daniel E.B. Chamaillard
Senior Technical Analyst