Please note that the following document, although correct at the time of issue, may not represent the current position of the Canada Revenue Agency. / Veuillez prendre note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'Agence du revenu du Canada.
[Addressee]
Excise and GST/HST Rulings Directorate
Place de Ville, Tower A, 15th floor
320 Queen Street
Ottawa ON K1A 0L5
Case Number: 139939
Business Number: [...]
March 12, 2012
Dear [Client]:
Subject:
GST/HST INTERPRETATION
Supplies of a cellular telephone service made to an Indian
Thank you for your [...][correspondence] of November 2, 2011, concerning the application of the Goods and Services Tax (GST)/Harmonized Sales Tax (HST) to supplies of cellular telephone services made to Indians.
HST applies at the rate of 15% in Nova Scotia, 13% in Ontario, New Brunswick, and Newfoundland and Labrador, and 12% in British Columbia. GST applies at the rate of 5% in the remaining provinces and territories.
All legislative references are to the Excise Tax Act (ETA) unless otherwise specified.
On November 2, 2011, you contacted the Aboriginal Affairs unit of the Excise and GST/HST Rulings Directorate [...]. In your [correspondence] you requested a [...] reply confirming that when making a supply of a cellular telephone service to an Indian there is no requirement that the telephone number provided be located on a reserve. [...].
Interpretation Given
Section 87 of the Indian Act provides tax relief for "personal property of an Indian or band situated on a reserve". The administrative policy of the Canada Revenue Agency (CRA) concerning the application of the GST/HST to Indians, bands and band-empowered entities is explained in GST/HST Technical Information Bulletin B-039, GST/HST Administrative Policy - Application of the GST/HST to Indians (B-039). The guidelines in B-039 are consistent with the relieving provisions in section 87 of the Indian Act affecting the personal property of an Indian situated on a reserve. In addition, the guidelines reflect governmental tax policy by extending the relief to other supplies, such as services, acquired by Indians where the conditions of B-039 have been met.
An Indian, as defined in the Indian Act, is a person who pursuant to the Indian Act is registered as an Indian or is entitled to be registered as an Indian. Tax relief is not available to individuals who do not qualify as Indians under the Indian Act.
It is the CRA's position that the supply of cellular telephone service is a supply of a telecommunication service under the ETA. The location of the supply of a cellular telephone service is normally considered to be on a reserve when the account is billed to an address on a reserve. Therefore, a supply of a cellular telephone service made to an Indian will be relieved of the GST/HST where the account/billing address is on a reserve, and the remaining conditions of B-039 are met. The account/billing address is not synonymous with the mailing address as not all reserves have postal services within the boundaries of the reserve. There is no requirement that the telephone number be identified as being a number located on a reserve.
Vendors must maintain adequate evidence that the supply for which no GST/HST was payable was made to an Indian. The CRA will accept as adequate evidence a notation on the invoice, or other sales document which is retained by the vendor, of the nine or ten digit registry number or the band name and family number.
The foregoing comments represent our general views with respect to the subject matter of your request. These comments are not rulings and, in accordance with the guidelines set out in GST/HST Memorandum 1.4, Excise and GST/HST Rulings and Interpretations Service, do not bind the CRA with respect to a particular situation. Future changes to the ETA, regulations, or our interpretative policy could affect this interpretation.
If you require clarification with respect to any of the issues discussed in this letter, please call me directly at 613-952-9264. Should you have additional questions on the interpretation and application of GST/HST, please contact a GST/HST Rulings officer at 1-800-959-8287.
Yours truly,
C. Christmas
Aboriginal Affairs Unit
Public Service Bodies and Governments Division
Excise and GST/HST Rulings Directorate
UNCLASSIFIED
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