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Highlights
MUNICIPAL GST REBATE
The Devil Is in the Details: GST/HST Legislative Changes
Affecting Municipalities
Mike Matthews, Jim Vincze
Mike Matthews and Jim Vincze provide a timely
article on some of the complex issues associated with the new 100%
rebate of the federal portion of the GST (municipalities were previously
entitled to a 57.14% rebate). While this is welcome for municipalities
as it effectively makes them GST-free from February 1, 2004 forward, it
does add a lot of confusion, particularly in the HST provinces where the
rebate continues to range from 0 to 57.14%. It also affects a number of
supplies made by municipalities as the property subject to the rebate
must be subjected to tax when resold or it will escape the tax
altogether. Other affected GST provisions included the exempt supply
provision, the basic tax content provisions and the change-in-use rules
affecting the deposition of capital personal property and the claiming
of input tax credits. The authors provide a timely and comprehensive
overview.
PARTNERSHIPS AND PST
If the Partners Do Not Own the Assets – Who Does?
Terry G. Barnett, Jeanette W. Wang
Terry Barnett and Jeanette Wang provide a summary of
the legal nature of a partnership interest and how the retail sales tax
can apply to the creation of partnerships, the admission of new partners
and transfers of property to and from partnerships. It must be
remembered that a partnership is not a legal entity. The partners are
the legal owners. The question is whether this is a direct ownership
interest in the assets or simply an intangible right to the net gain on
the disposition of the assets when sold. The different characterizations
can lead to quite different retail sales tax results, not to mention GST
consequences. This is particularly the case on the admission and
departure of partners. Also, the different provincial rules in this
regard are explored. The authors note that Ontario has just recently
proposed a new regulation dealing with transfer of assets to and from
partnerships.
QST UPDATE
GST and QST Changes in Quebec
Christian Meighen, Glenn A. Cranker
Christian Meighen and Glenn Cranker provide an
update on some important administrative changes affecting GST
registrants doing business in Quebec. Previously, such businesses were
able to use the nine-digit business root number as their GST number but
this has led to confusion as to the nature of the registration (whether
it was for GST (RT) or income tax (CT) or, perhaps, for importation
purposes (the RM suffix)) and Revenue Quebec is now requiring that the
full fifteen-digit number containing the Business Number suffixes be
used.
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Board
Dalton J. Albrecht
Editor-in-Chief
Fraser Milner Casgrain LLP
Thomas B. Akin
McCarthy Tétrault LLP
Terry G. Barnett
Thorsteinssons
Glenn A. Cranker
Stikeman Elliott
Craig M. McDougall
Felesky Flynn LLP
W. Jack Millar
Millar Wyslobicky Kreklewetz LLP
D. Blair Nixon
Felesky Flynn LLP
Jonathan Spencer
PricewaterhouseCoopers LLP
Jim Vincze
Deloitte & Touche LLP |
