9 September 2003 GST/HST Ruling 45390 - Application of the GST/HST with Respect to Certain Meal Replacement Products

Dear XXXXX:

Thank you for your letter XXXXX (with attachments), concerning the application of the Goods and Services Tax (GST)/Harmonized Sales Tax (HST) to the transactions described below.

Statement of Facts

Our understanding of the facts, the transactions, and the purpose of the transactions is as follows:

1. XXXXX is a GST registrant residing in XXXXX which distributes a variety of food items, including vitamins, dietary supplements, meal replacement products and nutritional supplements, XXXXX.

2. XXXXX (the "Tea") is sold in powdered form. The Tea has to be mixed with water, either hot or cold, before drinking.

XXXXX

3. The Tea is sold in a container that holds enough XXXXX to make XXXXX servings.

4. There are XXXXX flavours of the Tea: XXXXX contains the following ingredients by composition:

XXXXX

5. The XXXXX are composed of the following ingredients:

XXXXX

6. The Tea labels state that XXXXX

7. The XXXXX web site describes the Tea as follows:

XXXXX

Transactions

XXXXX sells the Tea XXXXX.

Ruling Requested

XXXXX is an ice tea mix that is zero-rated pursuant to the zero-rating of beverages in section 1 of Part III of Schedule VI.

Ruling Given

Based on the facts set out above, we rule that XXXXX (in all flavours) is a beverage mix that is zero-rated pursuant to section 1 of Part III of Schedule VI.

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 in the future to the Excise Tax Act, or to our interpretative policy; and that you have fully described all necessary facts and transactions for which you requested a ruling. In particular, it should be noted that our administrative position concerning the application of GST/HST to tea and similar products is under review and may be subject to change in the future.

Should you have any further questions or require clarification on the above matter, please do not hesitate to contact me at (613) 952-7909.

Yours truly,

Gunar Ozols
Goods Unit
General Operations and Border Issues Division
Excise and GST/HST Rulings Directorate