4 December 2003 GST/HST Interpretation 48592 - Rebate of the GST/HST on Hymn Books

Please note that the following documents, although correct at the time of issue, may not represent the current position of the Agency. / Veuillez prendre note que ces documents, bien qu'exacts au moment émis, peuvent ne pas représenter la position actuelle de l'Agence.

Dear XXXXX:

Thank you for your letter XXXXX concerning the application of the Goods and Services Tax (GST)/Harmonized Sales Tax (HST) to hymn books being purchased for use in congregational singing and worship.

As outlined in your letter, a church proposes to purchase a new set of hymnals for use in congregational singing and worship. The hymnals will not be put in the church's lending library but rather placed in the pews of the church. The church is a registered religious institution for charitable purposes.

Interpretation Requested

You requested information as to whether the purchase of hymn books for the use of the congregation within the church would be eligible for the 100% rebate of GST.

Interpretation Given

Section 259.1 of the ETA provides for a rebate of 100% of the GST paid by a specified person in respect of the purchase of certain printed books and scripture that are acquired for purposes other than resale.

Specified persons include charities that operate a public lending library. For purposes of the rebate, "charity" is defined under subsection 123(1) of the ETA, as a registered charity or a registered Canadian amateur athletic association within the meaning assigned to those expressions by subsection 248(1) of the Income Tax Act, but excludes a public institution.

The rebate provision for printed material, pursuant to subsection 259.1(2) of the ETA, is for the GST paid where:

"... a specified person acquires or imports, otherwise than for the purpose of supply by way of sale, property that is

(a) a printed book or an update of such a book,

(b) an audio recording all or substantially all of which is a spoken reading of a printed book, or

(c) a bound or unbound printed version of scripture of any religion ..."

A further explanation of the terms printed book, audio recording, scripture and public lending library is contained in the Memorandum 13.4, Rebates for Printed Books, Audio Recordings of Printed Books, and Printed Versions of Religious Scriptures, a copy of which is enclosed.

In accordance with the provision of subsection 259.1(2) of the ETA, a specified person such as a charity that operates a lending library accessible to the public, would be entitled to a 100% rebate of the GST paid on the purchase of religious scripture such as hymn books, provided they are not acquired for the purpose of sale (which includes those given away free of charge). The location or placement of the book within the charitable organization does not affect entitlement for purposes of the rebate provision.

The foregoing comments represent our general views with respect to the subject matter of your letter. Proposed amendments to the Excise Tax Act, if enacted, could have an effect on the interpretation provided herein. These comments are not rulings and, in accordance with the guidelines set out in section 1.4 of Chapter 1 of the GST/HST Memoranda Series, do not bind the Canada Customs and Revenue Agency with respect to a particular situation.

Should you have any further questions or require clarification on the above matter, please do not hesitate to contact me at 613-952-0420.

Yours truly,

Debra Murphy
Charities, NPO & Educational Services Unit
Public Service Bodies & Governments Division
Excise and GST/HST Rulings Directorate

Encl.