2 January 2001 GST/HST Interpretation 33717 - Refund of GST Paid on a Vehicle Imported into Canada and Subsequently Exported

Dear XXXXX

Thank you for your e-mail message of November 9, 2000 concerning the availability of a GST refund, under the Excise Tax Act (the Act), with respect to a vehicle imported into Canada and subsequently exported.

Our understanding of the facts is as follows:

An individual, formerly a U.S. resident, married a Canadian resident and came to live in Canada. On XXXXX, the individual applied for residency in Canada.

Pending his approval of permanent residency, the individual was permitted to temporarily import and use his vehicle for the purpose of commuting to and from his place of business in the U.S. It is our understanding that the temporary importation qualified as a non-taxable importation at that time.

The individual's application for residency in Canada was approved on XXXXX.

On XXXXX, the individual paid excise tax of $100.00 and GST of XXXXX to effect the importation of the vehicle (the vehicle was not subject to Customs duty). The importation was documented on form B15-1.

In the meantime, the individual learned that he could no longer drive his vehicle in Canada with U.S. plates, and that he would not be able to use his vehicle (for business purposes) in the U.S. with Canadian plates. On or after XXXXX, the individual exported the vehicle from Canada.

Interpretation Requested

You have requested confirmation that a GST refund cannot be granted to the individual under the Act[.] XXXXX[.]

Interpretation Given

Based on the information provided, it appears that the vehicle was properly subject to tax pursuant to section 212 of the Act (Division III tax) at the time the importation was effected on November 10, 1999 and that it did not qualify as a non-taxable importation pursuant to Schedule VII to the Act or pursuant to the Non-Taxable Imported Goods (GST) Regulations made under section 8 of that schedule.

A rebate of Division III tax paid, or an amount paid as Division III tax, on goods imported into Canada is available in certain circumstances under sections 215.1 and 216 of the Act. For example, subsection 215.1(1) of the Act provides for a rebate of Division III tax paid by a person on goods acquired by the person on consignment, approval, sale-or-return basis or similar terms where the goods are exported (without having been used or consumed except on a trial basis, and without having been damaged) within 60 days after their release for the purpose of returning them to the supplier.

However, a rebate or refund of the Division III tax paid by the individual in the circumstances described above would not be available under sections 215.1 or 216 of the Act, nor, for that matter, under any other provision of the Act.

XXXXX[.] Should you have any further questions or require clarification on the above matter, please do not hesitate to contact Béatrice Mulinda, Border Issues Officer, at (613) 954-4291.

Yours truly,

Patrick McKinnon
Manager
Border Issues Unit
General Operations and Border Issues Division
Excise and GST/HST Rulings Directorate