13 June 2007 GST/HST Interpretation 88506 - Tax Refund or Credit from Direct Seller

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.

This is in response to your XXXXX concerning the application of the Goods and Services Tax (GST)/Harmonized Sales Tax (HST) to supplies of maple sap.

Maple sap is used in the production of maple syrup, maple taffy, maple butter, and other maple products. According to different documentation you have reviewed, the maple sap is taken from the tree and boiled to make the desired product.

Maple trees are tapped in early spring when daytime temperatures go above freezing and night time temperatures fall below freezing. Sap generally flows for 4 to 6 weeks as long as the freezing nights and warm days continue. The sap is boiled in a slow process whereby most of the water contained in the sap is evaporated. It takes approximately 40 litres of sap to make one litre of maple syrup. The maple syrup can be boiled down further to make maple sugar, maple taffy, maple cream, and maple butter.

Maple products are regulated by the Maple Products Regulations (MPR), Food and Drugs Act (FDA) & Regulations (FDR), and the Consumer Packaging and Labelling Act (CPLA) & Regulations (CPLR).

Based on definitions of maple syrup and maple products in the MPR and Chapter 13 of The Canada Food Inspection Agency's 2003 Guide to Food Labelling and Advertising, Guide to the Labelling of Maple Products, maple syrup and other maple products are single ingredient foods. That single ingredient is maple sap. Maple sap currently does not appear to be used for any other purpose than the production of maple syrup and other maple products.

Opinion Requested

You have asked whether the maple sap is a taxable or non-taxable product.

Opinion Given

It is our opinion that supplies of maple sap are zero-rated.

Section 1 of Part III of Schedule VI zero-rates supplies of food or beverages for human consumption (including sweetening agents, seasonings and other ingredients to be mixed with or used in the preparation of such food or beverages), other than supplies listed in paragraphs (a) to (r) of that section.

Maple sap is an ingredient used in the preparation of maple syrup and other maple products. Since none of the exclusions in paragraphs (a) to (r) of section 1 of Part III of Schedule VI apply to maple sap, supplies of maple sap are zero-rated.

If you require clarification with respect to any of the issues discussed in this letter, please call me directly at 306-975-6214.

2007/05/31 — RITS 89397 — Eligibility for Accommodation Rebate