7 December 1989 Ministerial Correspondence 58664 F - Advertising Flyers and Similar Publications

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.

Subject:  24(1) Application of Section 19 to Advertising Flyers or Similar Publications

Issue

(i)      Representatives of 24(1)

(ii)      23

(iii)     Initially the corporation's representatives approached us on a "no-names" basis for our views on this subject.  When we advised them that our opinion would be unfavourable, they made further representations on an actual taxpayer and factual case basis.  In view of the foregoing, we have continued to consider this issue rather than refer it to Audit Applications Division.

(iv)     24(1)  21(1)(b)

Facts

1.      24(1)

2.     24(1)

Problem

3.     24(1)  21(1)(b)

Our Position

4.      Although the O'Leary Commission Report may not have contemplated purely advertising publications as being periodicals, the Department is obliged to administer section 19 as enacted by Parliament.  We note that former subsection 19(4) which exempted (a) a catalogue or (b) publications whose principal function was the "encouragement, promotion or development of the fine arts, letters, scholarship or religion" did not exempt publications that consisted of 100% advertising copy. (Subsection 19(4) was repealed effective January 1, 1976.)

5.     We also noted that in the Federal Court of Appeal decision in Bickle v MNR, 1979 DTC 5170, an Excise case, the court apparently took the view that a purely advertising publication was not necessarily excluded from the definition of a newspaper.  21(1)(b)

6.     In our interpretation of the terms newspaper or periodical in section 19 we have consistently used ordinary dictionary definitions.  For example, we have expressed the view that sales catalogues (similar to the 24(1) and real estate magazines (similar to the 24(1) and 24(1) are periodicals for section 19 purposes.

7.     All of the dictionary definitions define a periodical essentially as a publication issued on a periodic basis. 21(1)(b) 24(1)

8.     We have consistently stated that publications produced on a periodic basis are periodicals.

Alternative Courses of Action Available to the Corporation

24(1)  21(1)(b)

13.     24(1)  21(1)(b)

B.W. DathDirectorBusiness and General DivisionSpecialty Rulings DirectorateLegislative and IntergovernmentalAffairs Branch