21 January 2002 GST/HST Interpretation 37543 - Tax Status of Prescription Eyeglasses and Frames

This refers to XXXXX, concerning the tax status of frames for prescription eyeglasses and sunglasses (frames) imported by other than eye-care professionals.

XXXXX wording of sections 9 and 32 in Part II of Schedule VI to the Act as well as paragraphs 15 and 61 of GST/HST Memorandum 4.2, Medical and Assistive Devices.

XXXXX frames are zero-rated effective October 8, 1999, when imported at the pre-retail level. XXXXX[.] Section 6 of Schedule VII provides for non-taxable importation of goods, the supply of which is included in Parts I to IV and VIII of Schedule VI to the Act. Thus, section 6 provides for prescription eyeglasses and frames, which are zero-rated under sections 9 and 32 respectively of Part II of Schedule VI to the Act.

Prior to October 9, 1999, section 9 of Part II of Schedule VI to the Act provided for zero-rating of a supply of eyeglasses or contact lenses when the eyeglasses or lenses are supplied on the written order of an eye-care professional for the treatment or correction of a defect of vision of a consumer named in the order where the eye-care professional is entitled under the laws of the province in which the professional practices to prescribe eyeglasses or contact lenses for such purpose.

Section 32 of Part II to Schedule VI to the Act provides for a supply of a part, accessory or attachment that is specially designed for a property described in this Part. Therefore, spectacle frames for prescription eyeglasses will qualify for zero-rating providing that the supply of eyeglasses are, or are to be, supplied on the written order of an eye-care professional to treat or correct a defect of vision of a consumer. Parts accessories or attachments were not zero-rated prior to the amendment unless they were sold as a single supply for purposes of section 9 of Part II of Schedule VI to the Act.

A Notice of Ways and Means Motion to Amend the Excise Tax Act, dated December [0]2, 1999, refers to the amendment to section 9 of Part II of Schedule VI to the Act. This Notice can be found under Announcements in the Excise Automated Reference Library ("EARL") (Appendix A). Amended section 9 of Part II of Schedule VI to the Act permits eyeglasses and contact lenses that are intended to be sold under prescription at the retail level to be zero-rated at the pre-retail level as well. This amendment is reflected in the Act, which can also be found in EARL.

Since supplies of prescription eyeglasses made at the pre-retail level may now qualify for zero-rating, effective October 9, 1999, a supply of a part, accessory, or attachment specially designed for prescription eyeglasses that is also made at the pre-retail level is also zero-rated pursuant to section 32 of Part II of Schedule VI to the Act.

GST/HST Memorandum 4.2, Medical and Assistive Devices, will be revised to reflect the amendment.

XXXXX[.] Should you require any additional information, please do not hesitate to call me at (613) 952-6743.