18 March 2004 GST/HST Interpretation 50111 - December 2001 Deadline for GST Rebates for Indian Band-empowered Entities

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

Dear XXXXX:

Thank you for your letter XXXXX wherein you requested an extension to the time limit for claiming GST/HST rebates by XXXXX.

From the information provided, we understand that the XXXXX has filed GST/HST rebates as a public service body. We also understand that the XXXXX is a band-empowered entity with a presence on reserve for purposes of Technical Information Bulletin B-039R GST Administrative Policy - Application of GST to Indians (B-039R).

XXXXX it did not submit claims to recover the GST/HST it had paid prior to the December 31, 2001, deadline announced by the Canada Revenue Agency (CRA). Based on figures compiled from past invoices, XXXXX is that portion of the GST paid by the XXXXX that was not recoverable by it through a rebate claimed as a selected public service body under section 259 of the Excise Tax Act (ETA). Section 259 of the ETA provides a four-year time limitation for claiming rebates.

Interpretation Requested

Can the two-year time limit applicable under section 261 of the ETA be extended to allow for the filing of GST/HST rebates by the XXXXX?

Interpretation Given

Based on the information provided, the two-year time limit applicable under section 261 of the ETA cannot be extended to allow for the filing of GST/HST rebates by the XXXXX.

Explanation

GST/HST rebates for Indians, Indian bands and band-empowered entities (BEEs) are provided under the mechanism of section 261 of the ETA. In order to be eligible for a rebate of tax, Indians, Indian bands and BEEs must file a complete application for rebate within two years after the day the amount was paid or remitted by the person.

Prior to January 1, 2002, CRA approved, on a case-by-case basis, applications filed by Indians, Indian bands and BEEs that were beyond the two-year statutory limit. Because of this practice, claimants may have been led to believe that the legislative time frame imposed under section 261 of the ETA did not apply.

In February 2001, CRA took the position that the two-year time limit would be strictly enforced for all claims received on or after January 1, 2002. For consistency and fairness to all Indians, Indian bands and BEEs, CRA took the administrative position that it would continue to consider rebate applications beyond the two-year time limit until December 31, 2001.

Following February 2001, the position that the two-year time limit would be enforced for all claims made on or after January 1, 2002, was made known by CRA XXXXX through an advertisement placed in XXXXX newspaper and to all First Nation media contacts. A brochure explaining the two-year limit for claiming a GST/HST rebate was mailed directly to all First Nation band chiefs and friendship centres for distribution. At the same time, a Fact Sheet to this effect was also posted on the CRA website.

Section 261 of the ETA puts all people on equal footing by giving them a timeframe within which to claim tax relief where GST/HST was paid by a person and later found not to be payable or remittable by the person.

While we appreciate the position of XXXXX, CRA has no alternative but to adhere to the statutory time frame set out in section 261 of the ETA. Should you have any further questions or require clarification on the above matter, please do not hesitate to contact me at (613) 954-7952.

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 Revenue Agency with respect to a particular situation.

Yours truly,

Lynn Fournier Renner
Aboriginal Affairs Unit
Public Service Bodies and Governments Division
Excise and GST/HST Rulings Directorate