Words and Phrases - "municipal service"

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Canada v. 407 ETR Concession Company Limited, 2017 FCA 220

Ontario government charges to the 407 Highway operator for OPP patrol services were for an HST-exempt supply of a “municipal service”

The appellant, which was a private company operating an Ontario toll highway (the “407 ETR”), paid fees to the Ontario government for the provision to it of OPP policing services, comprising both enforcement of the provisions of the Highway Traffic Act and the same services that municipal police forces are required to provide under subsection 4(2) of the Police Services Act, namely, crime prevention, law enforcement, assistance to victims of crime, maintenance of public order and emergency response. In affirming the finding below that such services were exempted under Sched. V, Pt. VI, s. 21, Webb JA stated (at paras 14, 16):

[T]he plain meaning of these words [‘municipal service”] would suggest that whether a particular service is a municipal service would be determined based on a finding of what type of services would normally be provided by a municipality. The word municipal is simply used as an adjective to delineate the type of service that will qualify as an exempt supply.

The Crown … submitted that “municipal service” is only intended to apply to a service provided by a federal or provincial government when that government is acting as a municipal authority. However, in my view, this would require additional language to be added to section 21. Section 21 … does not provide that a “municipal service” will only be a service provided by a government acting as a municipal authority.

Webb JA then stated (at paras 23, 24 and 25):

[The Crown’s] argument is essentially that a municipal service can only be a service that a municipality (and not the federal or provincial government) is obligated to provide. …

Applying this interpretation to the national park example would mean that for any residents of a national park, for whom no municipality is obligated to provide services, the services provided by the federal government would not be “municipal services” for the purpose of section 21, even though such services would normally be provided by a municipality. …

In my view, this result is not the result that Parliament intended and does not take into account that section 21 applies to services provided by a government or a municipality. …

Words and Phrases
municipal service

407 ETR Concession Company Limited v. The Queen, 2016 TCC 213, aff'd 2017 FCA 220

Ontario government charges to the 407 Highway operator for OPP patrol services were for a “municipal service”

The appellant, which was a private company operating an Ontario toll highway (the “407 ETR”), paid fees to the Ontario government for the provision to it of OPP policing services, comprising both enforcement of the provisions of the Highway Traffic Act and the same services that municipal police forces are required to provide under subsection 4(2) of the Police Services Act, namely, crime prevention, law enforcement, assistance to victims of crime, maintenance of public order and emergency response. Before finding that the services were exempt under section 21 of Part VI of Schedule V, D’Arcy J. noted (at paras. 70, 72):

[I]nterpreting “a municipal service”, as that phrase is used in section 21, to mean a service that is in the nature of service as typically provided by municipalities satisfies Parliament’s intention that the service may be supplied by either a government or a municipality.

…[S]ection 21…is intended to exempt supplies of services that are made by a government authority (federal, provincial or municipal) that the owner or occupant of land has no option but to receive and that would normally be financed by taxes charged by the provider of the services (i.e., the federal, provincial or municipal government). The section is intended to cover such services regardless of whether they are provided by a municipality, the federal government or a province.

As “policing services are one of the core services provided by a municipality” (para. 74) and “the policing services provided by the OPP to the Appellant were of the same nature as services typically provided by municipalities” (para. 78), the exemption applied.

Words and Phrases
municipal service