Legislative and Regulatory Proposals Relating to the Excise Tax Act, the Excise Act, 2001 and the Select Luxury Items Tax Act
PART 1Draft Amendments to the Excise Tax Act
1 (1) Subsection 22(1) of the Excise Tax Act is amended by adding the following in alphabetical order:
- licensed manufacturer
licensed manufacturer has the meaning assigned to that expression by section 42; (fabricant titulaire de licence)
(2) Subsection (1) is deemed to have come into force on April 1, 2021.
2 (1) Subsection 23(1) of the Act is replaced by the following:
Marginal note:Tax on various articles at schedule rates
23 (1) Subject to subsections (6) to (8.1), whenever goods mentioned in Schedule I are imported or are manufactured or produced in Canada and delivered to a purchaser of those goods, there shall be imposed, levied and collected, in addition to any other duty or tax that may be payable under this or any other law, an excise tax in respect of the goods at the applicable rate set out in the applicable section of that Schedule, computed, if that rate is specified as a percentage, on the duty paid value or the sale price, as the case may be.
(2) Subsection 23(3.1) of the Act is replaced by the following:
Marginal note:Deemed sale
(3.1) For the purposes of this Part, a person who, under a contract for labour, manufactures or produces goods mentioned in Schedule I from any article or material supplied by another person, other than a licensed manufacturer, for delivery to that other person is deemed to have sold the goods, at a sale price equal to the charge made under the contract in respect of the goods, at the time they are delivered to that other person.
(3) Subsection 23(4) of the Act is replaced by the following:
Marginal note:Tax on resale by licensed wholesaler of Schedule I goods
(4) Subject to subsection (8.1), whenever goods mentioned in Schedule I are sold by a licensed wholesaler or are retained for the licensed wholesaler’s own use or for rental by the licensed wholesaler to others, there shall be imposed, levied and collected, in addition to any other duty or tax payable under this Act or any other Act or law, an excise tax in respect of those goods at the applicable rate set out in the applicable section in that Schedule, computed, where that rate is specified as a percentage, on the duty paid value or the price at which the goods were purchased by the licensed wholesaler, as the case may be, payable by the licensed wholesaler at the time the goods are delivered to the purchaser or so retained for use or rental.
(4) Paragraphs 23(7)(a) and (b) of the Act are replaced by the following:
(a) goods that are purchased or imported by a licensed manufacturer and that are to be incorporated into and form a constituent or component part of an article or product that is subject to excise tax under this Act, if the tax on the article or product has not yet been levied under this section; or
(b) the sale of a new motor vehicle designed for highway use, or a chassis for such a vehicle, to a person described in paragraph (h) of the definition manufacturer or producer in subsection 2(1) who is a licensed manufacturer.
(5) Section 23 of the Act is amended by adding the following after subsection (8):
Marginal note:Tax not payable — exports
(8.1) The tax imposed under subsection (1) or (4) is not payable in respect of a quantity of fuel that is gasoline, diesel fuel or aviation fuel and that is sold and delivered to a purchaser by a vendor that is a licensed manufacturer or a licensed wholesaler if the following conditions are met:
(a) the quantity of the fuel is not less than 1,000 litres;
(b) the purchaser intends to export the fuel and the fuel is not acquired by the purchaser for consumption, use or resale in Canada before the exportation of the fuel by the purchaser;
(c) the purchaser certifies, and the vendor reasonably believes, that the purchaser will export the fuel;
(d) the purchaser exports the fuel as soon after the fuel is delivered to the purchaser as is reasonable having regard to the circumstances surrounding the exportation and, if applicable, to the normal business practice of the purchaser;
(e) after the fuel is delivered and before the purchaser exports the fuel, the fuel is not further processed, transformed or altered in Canada, except to the extent reasonably necessary or incidental to its transportation; and
(f) the vendor maintains evidence satisfactory to the Minister of the exportation of the fuel by the purchaser.
(6) Subsections (1) to (4) are deemed to have come into force on April 1, 2021.
(7) Subsection (5) applies in respect of a quantity of fuel that is delivered to a purchaser after March 2021.
3 (1) Subsection 298(1) of the Act is amended by adding the following after paragraph (a):
(a.01) despite paragraph (a), in the case of an assessment of the net tax of the person for a reporting period of the person that is made solely to take into account an amount of tax payable under section 218.01, more than seven years after the later of the day on or before which the person was required under section 238 to file a return for the period and the day the return was filed;
(2) Subsection (1) is deemed to have come into force on Announcement Date.
PART 2Draft Amendments to the Excise Act, 2001
4 (1) Paragraph 14(1)(f) of the Excise Act, 2001 is replaced by the following:
(2) Subsection (1) comes into force or is deemed to have come into force on January 1, 2024.
(3) For greater certainty, a vaping product licence issued to a person before January 1, 2024 under paragraph 14(1)(f) of the Act also authorizes the person under subparagraph 14(1)(f)(ii) of the Act, as enacted by subsection (1), as of that day.
5 (1) Section 158.46 of the Act is renumbered as subsection 158.46(1) and is amended by adding “and” at the end of paragraph (b) and by replacing paragraphs (c) and (d) with the following:
(c) before the end of the month following the month in which the licensee packages the vaping product,
(i) the vaping product is stamped by the licensee to indicate that vaping duty has been paid, and
(ii) if the vaping product is to be entered in the duty-paid market of a specified vaping province, the vaping product is stamped by the licensee to indicate that additional vaping duty in respect of the specified vaping province has been paid.
(2) Section 158.46 of the Act is amended by adding the following after subsection (1):
Marginal note:Stamping of imported packaged vaping products
(2) A vaping product licensee that imports a packaged vaping product for stamping shall not enter the vaping product into the duty-paid market unless
(a) the vaping product is packaged in a package that has printed on it prescribed information; and
(b) before the end of the month following the month in which the vaping product is released under the Customs Act,
(i) the vaping product is stamped by the licensee to indicate that vaping duty has been paid, and
(ii) if the vaping product is to be entered in the duty-paid market of a specified vaping province, the vaping product is stamped by the licensee to indicate that additional vaping duty in respect of the specified vaping province has been paid.
(3) Subsection (1) applies in respect of vaping products manufactured in Canada that are packaged after 2023.
(4) Subsection (2) applies in respect of vaping products that are imported into Canada or released (as defined in subsection 2(1) of the Customs Act) after 2023.
6 (1) Subsection 158.47(2) of the Act is amended by adding the following after paragraph (a):
(a.1) that is a packaged vaping product imported by a vaping product licensee for stamping by the licensee;
(2) Subsection (1) applies in respect of vaping products that are imported into Canada or released (as defined in subsection 2(1) of the Customs Act) after 2023.
7 (1) Section 158.49 of the Act is replaced by the following:
Marginal note:Unstamped products to be warehoused
158.49 If vaping products (other than vaping product drugs) manufactured in Canada are not stamped by a vaping product licensee, the vaping product licensee must immediately enter the vaping products into the licensee’s excise warehouse.
(2) Section 158.49 of the Act, as enacted by subsection (1), is replaced by the following:
Marginal note:Unstamped products to be warehoused
158.49 (1) If vaping products manufactured in Canada are not stamped by a vaping product licensee before the end of the particular month that follows the month in which the vaping product licensee packages the vaping products, the vaping product licensee must enter the vaping products into its excise warehouse before the end of the particular month.
Marginal note:Imported unstamped packaged products to be warehoused
(2) If a vaping product licensee imports packaged vaping products for stamping but does not stamp the vaping products before the end of the particular month that follows the month in which the vaping products are released under the Customs Act, the vaping product licensee must enter the vaping products into its excise warehouse before the end of the particular month.
Marginal note:Exceptions
(3) Subsections (1) and (2) do not apply
(3) Subsection (1) is deemed to have come into force on October 1, 2022.
(4) Subsection (2) applies in respect of vaping products manufactured in Canada that are packaged after 2023 and in respect of vaping products that are imported into Canada or released (as defined in subsection 2(1) of the Customs Act) after 2023.
8 (1) Subsection 158.51(3) of the Act is replaced by the following:
(2) Subsection (1) applies in respect of vaping products that are imported into Canada or released (as defined in subsection 2(1) of the Customs Act) after 2023.
9 (1) The Act is amended by adding the following after section 158.51:
Marginal note:Imports for stamping — delivery to premises
158.511 If a vaping product licensee imports a packaged vaping product for stamping by the vaping product licensee, the vaping product licensee shall, immediately after the vaping product is released under the Customs Act, deliver the vaping product to its premises for stamping.
(2) Subsection (1) applies in respect of vaping products that are imported into Canada or released (as defined in subsection 2(1) of the Customs Act) after 2023.
10 (1) Paragraphs 158.57(a) and (b) of the Act are replaced by the following:
(a) in the case of vaping products manufactured in Canada, by the vaping product licensee that packaged the vaping products and at the time they are stamped;
(a.1) in the case of packaged vaping products that are imported by a vaping product licensee for stamping by the vaping product licensee, by the vaping product licensee and at the time they are stamped; and
(b) in the case of any other imported vaping products, by the importer, owner or other person that is liable under the Customs Act to pay duty levied under section 20 of the Customs Tariff or that would be liable to pay that duty on the vaping products if they were subject to that duty.
(2) Subsection (1) applies in respect of vaping products manufactured in Canada that are packaged after 2023 and in respect of vaping products that are imported into Canada or released (as defined in subsection 2(1) of the Customs Act) after 2023.
11 (1) Paragraphs 158.58(a) and (b) of the Act are replaced by the following:
(a) in the case of vaping products manufactured in Canada, by the vaping product licensee that packaged the vaping products and at the time they are stamped;
(a.1) in the case of packaged vaping products that are imported by a vaping product licensee for stamping by the vaping product licensee, by the vaping product licensee and at the time they are stamped; and
(b) in the case of any other imported vaping products, by the importer, owner or other person that is liable under the Customs Act to pay duty levied under section 20 of the Customs Tariff or that would be liable to pay that duty on the vaping products if they were subject to that duty.
(2) Subsection (1) applies in respect of vaping products manufactured in Canada that are packaged after 2023 and in respect of vaping products that are imported into Canada or released (as defined in subsection 2(1) of the Customs Act) after 2023.
12 (1) Section 158.59 of the Act is replaced by the following:
Marginal note:Application of Customs Act
158.59 The duties imposed under paragraphs 158.57(b) and 158.58(b) on imported vaping products shall be paid and collected under the Customs Act, and interest and penalties shall be imposed, calculated, paid and collected under that Act, as if the duties were a duty levied under section 20 of the Customs Tariff, and, for those purposes, the Customs Act applies with any modifications that the circumstances require.
(2) Subsection (1) comes into force or is deemed to have come into force on January 1, 2024.
13 (1) Subsections 159.2(1) and (2) of the Act are replaced by the following:
Marginal note:Definition of calendar quarter
159.2 (1) In this section, calendar quarter means a period of three months beginning on the first day of January, April, July or October.
Marginal note:Reporting period — calendar quarters
(2) On application by a cannabis licensee, the Minister may, in writing, authorize the reporting periods of the cannabis licensee to be calendar quarters, beginning on the first day of a calendar quarter.
(2) Subsection 159.2(4) of the Act is repealed.
(3) Subsections 159.2(6) and (7) of the Act are replaced by the following:
Marginal note:Notice of revocation
(6) If the Minister revokes an authorization in respect of a cannabis licensee, the following rules apply:
(a) the Minister shall send a notice in writing of the revocation to the cannabis licensee and shall specify in the notice the fiscal month of the cannabis licensee for which the revocation becomes effective; and
(b) if the revocation becomes effective before the last day of a calendar quarter, the period beginning on the first day of the calendar quarter and ending immediately before the first day of that fiscal month is deemed to be a reporting period of the cannabis licensee.
(4) Subsections (1) to (3) are deemed to have come into force on April 1, 2023.
14 The Act is amended by adding the following after section 233.2:
Marginal note:Contravention of section 158.47
233.3 Every person that is liable to pay a duty imposed under paragraph 158.57(b) on a vaping product is liable to a penalty equal to the amount determined by the following formula if the vaping product is released under the Customs Act for entry into the duty paid market in contravention of section 158.47:
(A + B) × 200%
where
15 The portion of section 234.2 of the Act before the formula is replaced by the following:
Marginal note:Contravention — sections 158.35 and 158.43 to 158.45
234.2 Every person that contravenes section 158.35, 158.43, 158.44 or 158.45 is liable to a penalty equal to the amount determined by the formula
16 The Act is amended by adding the following after section 249:
Marginal note:Contravention of section 158.511
249.1 Every person that contravenes section 158.511 is liable to a penalty equal to the amount determined by the formula
(A + B) × 50%
where
- A
- is the amount determined under Schedule 8 in respect of the vaping products to which the contravention relates, using the rates of duty applicable at the time the contravention occurred; and
- B
- is
17 Sections 14 to 16 come into force on the day on which the Act enacting those sections receives royal assent.
PART 3Draft Amendments to Various Regulations
DIVISION 1Financial Services and Financial Institutions (GST/HST) Regulations
18 The Financial Services and Financial Institutions (GST/HST) Regulations are amended by adding the following after section 3.1:
3.2 (1) For the purposes of this section,
(2) The following services are prescribed for the purposes of paragraph (r.6) of the definition financial service in subsection 123(1) of the Act:
(a) a service that is supplied by a payment card network operator and that enables a merchant to accept payments by payment card by providing the merchant, or a payment service provider engaged by the merchant, with access to a payment card network for the transmission or processing of the payments;
(b) a service that is rendered to a holder of a payment card and that is supplied by a payment card network operator in its capacity as the issuer of the payment card; and
(c) a service, in respect of the settlement of a transaction made by payment card, that is supplied
(i) by a payment card network operator, in its capacity as the acquirer for the transaction, to the issuer of the payment card,
(ii) by a payment card network operator, in its capacity as the issuer of the payment card, to the acquirer for the transaction, or
(iii) by a payment card network operator to the acquirer for the transaction if the amount of consideration for the supply of the service is equal to the amount of the fee that is payable, by the payment card network operator to the issuer of the payment card, in respect of the settlement of the transaction.
19 Section 18 applies to a supply of a service for which
(a) any consideration becomes due after March 28, 2023 or is paid after that day without having become due; or
(b) all of the consideration became due or was paid before March 29, 2023.
DIVISION 2Amalgamations and Windings-Up Continuation (GST/HST) Regulations
20 The schedule to the Amalgamations and Windings-Up Continuation (GST/HST) Regulations is amended by adding the following in numerical order:
- Subsections 177(1.1) and (1.11)
21 Section 20 is deemed to have come into force on Announcement Date.
DIVISION 3Returning Persons Exemption Regulations
22 Paragraph 3(2)(b) of the Returning Persons Exemption Regulations is replaced by the following:
(b) tobacco or vaping products (other than a vaping product drug as defined in section 2 of the Excise Act, 2001) imported by a person who has not attained 18 years of age.
23 Section 22 comes into force on the day on which the Act enacting that section receives royal assent.
DIVISION 4Selected Listed Financial Institutions Attribution Method (GST/HST) Regulations
24 The definition plan merger in subsection 16(1) of the Selected Listed Financial Institutions Attribution Method (GST/HST) Regulations is amended by adding “and” at the end of paragraph (a), by striking out “and” at the end of paragaph (b) and by repealing paragraph (c).
25 The description of B in subsection 24(2) of the Regulations is replaced by the following:
- B
- is the total of its net premiums for the particular period in respect of the insurance of risk in respect of property and of its net premiums for the particular period in respect of the insurance of risk in respect of persons, that are included in computing its income for the purposes of Part I of the Income Tax Act or that would be included in computing its income for the purposes of Part I of that Act if the financial institution were an insurance corporation.
26 The portion of paragraph 28(d) of the Regulations before subparagraph (i) is replaced by the following:
(d) if the particular person is not a selected listed financial institution and is either a qualifying small investment plan or a qualifying private investment plan for the purposes of Part 1, or if the particular person is not a selected listed financial institution by operation of section 11 or 12, the amount that would, if the particular person were a selected listed financial institution, be the particular person’s percentage for the participating province and for the taxation year of the particular person in which the fiscal year that includes the following reporting period of the particular person ends:
27 Sections 24 to 26 apply in respect of any reporting period of a person that ends after Announcement Date.
DIVISION 5Regulations Respecting Excise Licences and Registrations
28 (1) The portion of subsection 5(1) of the English version of the Regulations Respecting Excise Licences and Registrations before paragraph (a) is replaced by the following:
5 (1) For the purposes of paragraph 23(3)(b) of the Act, the amount of security to be provided by an applicant for a spirits licence, a tobacco licence, a cannabis licence or a vaping product licence must be an amount of not less than $5,000 and
(2) Subsection 5(1) of the Regulations is amended by striking out “and” at the end of paragraph (a) and by replacing paragraph (b) with the following:
(b) in the case of a tobacco licence or a vaping product licence, be sufficient to ensure payment of the amount of duty referred to in paragraph 160(b) of the Act up to a maximum amount of $5 million per licence; and
(c) in the case of a cannabis licence,
(i) if the licensee is authorized under subsection 159.2(2) of the Act to have reporting periods that are calendar quarters, be sufficient to ensure payment of one-third of the amount of duty referred to in paragraph 160(b) of the Act up to a maximum amount of $5 million per licence, and
(ii) in any other case, be sufficient to ensure payment of the amount of duty referred to in paragraph 160(b) of the Act up to a maximum amount of $5 million per licence.
29 Section 28 is deemed to have come into force on April 1, 2023.
DIVISION 6Stamping and Marking of Tobacco, Cannabis and Vaping Products Regulations
30 The portion of section 3.6 of the Stamping and Marking of Tobacco, Cannabis and Vaping Products Regulations before paragraph (a) is replaced by the following:
3.6 For the purposes of paragraphs 158.46(1)(b) and (2)(a) of the Act, the prescribed information is
31 Sections 3.6 and 3.7 of the Regulations are replaced by the following:
3.6 For the purposes of paragraphs 158.46(1)(b) and (2)(a) of the Act, the prescribed information is
(a) one of the following:
(b) the volume in millilitres of the vaping substance in liquid form, and the weight in grams of the vaping substance in solid form, contained in each vaping device or immediate container in the package and the number of vaping devices and immediate containers in the package.
3.7 For the purposes of paragraph 158.47(1)(a) of the Act, the prescribed information is
(a) if the vaping product was imported by a vaping product licensee, the licensee’s name and address or vaping product licence number;
(b) if the vaping product was imported by a person other than a vaping product licensee, the person’s name and address; and
(c) the volume in millilitres of the vaping substance in liquid form, and the weight in grams of the vaping substance in solid form, contained in each vaping device or immediate container in the package and the number of vaping devices and immediate containers in the package.
32 The portion of section 3.8 of the Regulations before paragraph (a) is replaced by the following:
3.8 For the purposes of paragraphs 158.46(1)(b) and (2)(a) and 158.47(1)(a) of the Act, the following information is prescribed for cases of vaping products:
33 Paragraph 4(4)(b) of the Regulations is replaced by the following:
(b) a person that has in their possession vaping excise stamps only for the purpose of applying adhesive to the stamps on behalf of the person to which the stamps are issued.
34 Sections 30 and 32 come into force or are deemed to have come into force on January 1, 2024.
35 Section 31 comes into force on the day that is six months after the first day of the month following the month in which the Act enacting that section receives royal assent.
36 Section 33 is deemed to have come into force on June 23, 2022.
DIVISION 7Select Luxury Items Tax Regulations
37 The Select Luxury Items Tax Regulations are made as follows:
Select Luxury Items Tax Regulations
Interpretation
Marginal note:Definition of Act
1 In these Regulations, Act means the Select Luxury Items Tax Act.
PART 1Prescribed Aircraft and Vessels
Marginal note:Exclusion from subject aircraft — agreements before 2022
2 For the purposes of paragraph (g) of the definition subject aircraft in subsection 2(1) of the Act, an aircraft is a prescribed aircraft if ownership of the aircraft is transferred to a purchaser from a vendor by way of sale under an agreement in writing (in this section referred to as the “sale agreement”) and
(a) it is the case that
(b) the sale agreement was entered into between the purchaser and the vendor in the course of the vendor’s business of offering aircraft for sale;
(c) the aircraft is delivered or made available in Canada in relation to the sale agreement;
(d) possession of the aircraft is transferred to the purchaser under the sale agreement at a particular time;
(e) the vendor is a registered vendor in respect of subject aircraft at the particular time; and
(f) the purchaser is neither registered, nor required to be registered, as a vendor in respect of subject aircraft under Division 5 of the Act at, or at any time before, the particular time.
Marginal note:Exclusion from subject vessel — agreements before 2022
3 For the purposes of paragraph (h) of the definition subject vessel in subsection 2(1) of the Act, a vessel is a prescribed vessel if ownership of the vessel is transferred to a purchaser from a vendor by way of sale under an agreement in writing (in this section referred to as the “sale agreement”) and
(a) it is the case that
(b) the sale agreement was entered into between the purchaser and the vendor in the course of the vendor’s business of offering vessels for sale;
(c) the vessel is delivered or made available in Canada in relation to the sale agreement;
(d) possession of the vessel is transferred to the purchaser under the sale agreement at a particular time;
(e) the vendor is a registered vendor in respect of subject vessels at the particular time; and
(f) the purchaser is neither registered, nor required to be registered, as a vendor in respect of subject vessels under Division 5 of the Act at, or at any time before, the particular time.
Marginal note:Partial ownership
4 For the purposes of sections 2 and 3, a particular person transfers ownership of an aircraft or vessel to another person even if, at the time ownership is transferred to the other person, the particular person retains partial ownership or transfers partial ownership to any third person.
PART 2Sale of Partial Ownership
Marginal note:Prescribed circumstances — taxable amount
5 (1) For the purposes of subsection 18(7) of the Act, the circumstances set out in this section are prescribed circumstances.
Marginal note:Taxable amount — sale of partial ownership
(2) Subject to subsection (3), for the purposes of section 18 of the Act and for the purposes of determining under section 34 of the Act the amount of tax payable under section 18 of the Act, if a vendor sells only partial ownership of a subject item to a purchaser, the taxable amount of the subject item is the amount determined by the formula
A + B
where
- A
- is the greater of the value of the consideration for the sale of the subject item and the retail value of the subject item at the time at which the sale is completed; and
- B
- is the total of all amounts, each of which is the greater of the value of the consideration for, and the fair market value of, an improvement in respect of the subject item that is provided by the vendor, or a person that does not deal at arm’s length with the vendor, in connection with the sale of the subject item, but only to the extent that the amount is not included in the determination of A.
Marginal note:Multiple sales of partial ownership
(3) For the purposes of section 18 of the Act and for the purposes of determining under section 34 of the Act the amount of tax payable under section 18 of the Act, if a particular sale of only partial ownership of a subject item between a vendor and a purchaser is completed at a particular time and if another sale of only partial ownership of the subject item between the vendor and a purchaser is completed at or after the particular time, the taxable amount of the subject item in respect of the other sale is equal to zero if
PART 3Exportation
Marginal note:Prescribed circumstances — aircraft
6 (1) For the purposes of subsection 36(3) of the Act, the circumstances set out in this section are prescribed circumstances.
Marginal note:Exemption certificate — aircraft
(2) Subject to subsection (3), an exemption certificate applies in respect of a sale of a subject aircraft by a vendor to a purchaser if
(a) the vendor is a registered vendor in respect of subject aircraft at the particular time at which the sale is completed;
(b) the certificate is made in prescribed form containing prescribed information;
(c) the certificate includes
(i) the identification number of the subject aircraft,
(ii) a declaration by the purchaser that
(A) the subject aircraft is to be exported as soon after the particular time as is reasonable having regard to the circumstances surrounding the exportation, the sale and, if applicable, the normal business practice of the purchaser and vendor,
(B) the subject aircraft is not to be used in Canada at any time before the exportation except to the extent reasonably necessary or incidental to its manufacture, offering for sale, transportation or exportation,
(C) the subject aircraft is not to be registered with the Government of Canada or a province before the exportation except if the registration is done solely for a purpose incidental to its manufacture, offering for sale, transportation or exportation, and
(D) the purchaser is neither registered, nor required to be registered, as a vendor in respect of subject aircraft under Division 5 of the Act at the particular time, and
(iii) an acknowledgement by the purchaser that the purchaser is assuming liability to pay any amount of tax in respect of the subject aircraft that is or may become payable by the purchaser under this Act;
(d) the purchaser provides, in a manner satisfactory to the Minister, the certificate in respect of the sale to the vendor; and
(e) the vendor retains the certificate.
Marginal note:Exemption certificate — multiple purchasers
(3) If a subject aircraft is sold by a vendor to more than one purchaser, an exemption certificate applies in respect of the sale of the subject aircraft only if, in the absence of this subsection, an exemption certificate would apply in respect of each purchaser in accordance with subsection (2).
Marginal note:Prescribed circumstances — aircraft
7 (1) For the purposes of section 33 of the Act, the circumstances set out in this section are prescribed circumstances.
Marginal note:Tax not payable — aircraft
(2) The tax under section 18 of the Act in respect of a sale of a subject aircraft by a vendor to a purchaser is not payable if
(a) the vendor is a registered vendor in respect of subject aircraft at the particular time at which the sale is completed;
(b) the purchaser is neither registered, nor required to be registered, as a vendor in respect of subject aircraft under Division 5 of the Act at the particular time;
(c) an exemption certificate does not apply in respect of the sale in accordance with section 36 of the Act;
(d) the subject aircraft
(i) is to be exported as soon after the particular time as is reasonable having regard to the circumstances surrounding the exportation, the sale and, if applicable, the normal business practice of the purchaser and vendor,
(ii) is not to be used in Canada at any time before the exportation except to the extent reasonably necessary or incidental to its manufacture, offering for sale, transportation or exportation, and
(iii) is not to be registered with the Government of Canada or a province before the exportation except if the registration is done solely for a purpose incidental to its manufacture, offering for sale, transportation or exportation; and
(e) the vendor maintains evidence satisfactory to the Minister of the exportation of the subject aircraft.
PART 4Miscellaneous
Marginal note:Information return — prescribed person
8 For the purposes of subsection 59(1) of the Act, a person is a prescribed person for a reporting period of the person if the person
(a) is a registered vendor in respect of subject vehicles throughout the reporting period; and
(b) is not otherwise registered, or required to be registered, under Division 5 of the Act at any time during the reporting period.
Marginal note:General penalty — prescribed provision
9 For the purposes of paragraph 119(a) of the Act, subsection 71(2) of the Act is a prescribed provision.
PART 5Transitional Relief — Agreements Before 2022
Marginal note:Prescribed circumstances
10 (1) For the purposes of section 33 of the Act, the circumstances set out in this section are prescribed circumstances.
Marginal note:Tax not payable on sale
(2) Neither the tax under section 18 of the Act nor the tax under section 29 of the Act in respect of a subject item that is sold by a vendor to a purchaser is payable if the purchaser entered into an agreement in writing before 2022 with the vendor for the sale of the subject item in the course of the vendor’s business of offering for sale that type of subject item.
Marginal note:Tax not payable on import
(3) The tax under section 20 of the Act in respect of a subject item that is imported is not payable if
Marginal note:Tax not payable on use
(4) The tax under section 26 of the Act in respect of a subject item that is used in Canada at a particular time is not payable if
(a) a person entered into an agreement in writing before 2022 with a vendor for the transfer of ownership of the subject item to the person by way of sale;
(b) the agreement was entered into in the course of the vendor’s business of offering for sale that type of subject item; and
(c) the person is an owner of the subject item at the particular time.
- Date modified: