First Nations Having a Self-Government Agreement Ending Indian Act Tax Relief – Determining Tax Relief for Indian Members Who Are Not Citizens

GST/HST Notices - Notice 238
October 2008

GST/HST Technical Information Bulletin (TIB) B-039 GST/HST Administrative Policy – the Application of GST/HST to Indians summarizes the CRA's tax relief policy for Indians, Indian bands and band-empowered entities. The treatment of Indian purchases under the GST/HST is consistent with section 87 of the Indian Act under which personal property of an Indian or an Indian band situated on a reserve and their interests in reserve or surrendered lands are not subject to tax.

TIB B-039 does not apply to First Nations and their citizens that have signed final or self-government agreements that end Indian Act tax relief. While these First Nations may have agreed to give up tax relief rights, their members are still entitled to carry a Certificate of Indian Status Card ("status card") as this card is also used for other purposes.

How does a vendor determine who is entitled to tax relief if all Indians are entitled to carry a status card but some are excluded from tax relief under section 87 of the Indian Act?

Vendors are required to document the registry number or the band name and family number from the status card when not charging tax to an Indian where the supply meets the requirements set out in TIB B-039. If the registry or band number matches the band name or number from the Appendix, additional information will be needed to determine whether the Indian member is a citizen of a First Nation where tax relief no longer applies. The Indian member will only be entitled to the tax relief outlined in TIB B-039 if he or she certifies that he/she is not a citizen of the First Nation. The following certificate is acceptable:

In some cases a vendor may sell goods or provide services on a tax-relieved basis on the strength of a certificate obtained from an Indian purchaser who is later found to be a citizen of a First Nation that no longer benefits from tax relief. In such a case, the CRA will not assess the vendor, provided that it has acted in good faith and with due diligence, but may instead assess the purchaser for any tax not properly paid.

Amounts paid as tax in error by an Indian purchaser

An Indian purchaser who meets the conditions for tax relief, but pays an amount as GST/HST, may apply for a refund by completing form GST189 General Application for Rebate of GST/HST.

First Nations Goods and Services Tax (FNGST)

Most of the First Nations who are now subject to tax have opted to enter into tax sharing agreements with the Government of Canada. The FNGST effectively replaces the GST on supplies made on the lands of these First Nations and is payable by all individuals including Indian purchasers. There are no separate reporting requirements for FNGST.

For more information on the FNGST, see booklet RC4365, First Nations Goods and Services Tax (FNGST).

For a list of the First Nations that have implemented the FNGST go to the First Nations Goods and Services Tax webpage.

Appendix

First Nations with final or self-government agreements in place that provide for an end to tax relief under section 87 of the Indian Act

Tlicho First Nation (NWT) subject to GST/HST as of August 4, 2005

Tlicho citizens, resident or not in the Northwest Territories, are no longer entitled to tax relief set out in TIB B-039.

Exception: Relief from the GST/HST, set out in TIB B-039, still applies to Tlicho members that are not Tlicho citizens.

Reserve status: There were no reserves on Tlicho lands.

Nisga'a Nation (BC) Final Agreement came into effect May 11, 2000

As of June 1, 2008, Nisga'a citizens resident on and off Nisga'a lands, are no longer entitled to tax relief set out in TIB B-039. This includes Nisga'a citizens in the urban locals of Prince Rupert/Port Edwards, Terrace and Greater Vancouver.

Exception: Relief from the GST/HST, set out in TIB B-039, continues to apply to Nisga'a members that are not Nisga'a citizens.

Reserve status: There are no longer any reserves on Nisga'a lands.

Yukon First Nations and their citizens that are resident in the Yukon

The tax exemption under section 87 of the Indian Act no longer applies when a Yukon First Nations' Final Agreement comes into effect. As a result, there are different effective dates as to when the relief described in TIB B-039 no longer applies.

Reserve status: For purposes of section 87 of the Indian Act there are no longer any reserves in the Yukon. Thus, TIB B-039 has limited application in the Yukon. For more information on Yukon First Nations, see GST/HST Notice 143 Application of GST/FNGST to Yukon First Nations and their Members.

Date modified:

2008-10-31