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Consolidated Newfoundland Regulation 1996


CONSOLIDATED NEWFOUNDLAND REGULATION 1155/96

CONSOLIDATED NEWFOUNDLAND REGULATION 1155/96

Retail Sales Tax Regulations
under the
Retail Sales Tax Act
(O.C. 96‑875)

Under the authority of section 52 of the Retail Sales Tax Act and the Subordinate Legislation Revision and Consolidation Act, the Lieutenant‑Governor in Council makes the following regulations.

REGULATIONS

Analysis


        1.   Short title

        2.   Definitions

        3.   Use of registration certificate

        4.   Application of refund procedure

        5.   Tangible personal property

        6.   Tour operations

        7.   Sale and resale of motor vehicle

        8.   Change of seller's circumstances

        9.   Return to be filed

      10.   Motor vehicle dealer

      11.   Separate return
required

      12.   No tax collected

      13.   Purchase by seller

      14.   Purchase by persons other than sellers

      15.   Solicitation for unregistered principals

      16.   Entries to be distinguishable

      17.   Tax shown separately

      18.   Form of receipt

      19.   Length of document preservation

      20.   Ministerial direction re records

      21.   Services taxable

      22.   Tangible personal property included in real property

      23.   Property for temporary use

      24.   Interest on sum due

      25.   Refund of overpayment

      26.   Interest on refund

      27.   Exemptions

      28.   Exemption for farm equipment

      29.   Rebate for farm equipment

      30.   Exemption for fishing equipment

      31.   Rebate for fishing equipment

      32.   Preauthorized exemption and rebate

      33.   Productive capital equipment

      34.   Insurance exemptions

      35.   Parent and subsidiary companies

      36.   Tax not owed by second company

      37.   Repeal


Short title

        1. These regulations may be cited as the Retail Sales Tax Regulations.

49/79 s1

Definitions

        2. In these regulations

             (a)  "accident insurance", "sickness insurance", "life insurance" and "marine insurance" have the same meanings as in the Insurance Companies Act;

             (b)  "Act" means the Retail Sales Tax Act;

             (c)  "basic groceries" means basic groceries as described in Part III of Schedule VI of the Excise Tax Act (Canada) which are a zero rated supply under that Act;

             (d)  "children's clothing" means

                      (i)  dresses, suits, coats, blouses, sweaters, undershirts, pyjamas, combinations, snowsuits, overalls and other garments that fit the upper half of or the whole body, up to and including girl's commercial trade size 14X or boy's commercial trade size 18 or girl's "Canada Standard Size" 16 or boy's "Canada Standard Size" 18 depending upon the size designation applicable or sweaters designed for girls or boys and sized small, medium and large,

                     (ii)  trousers, slacks, jeans, slims, undershorts, briefs, outer shorts and other garments that fit at or below the waist, up to and including girl's commercial trade size 14X and boy's commercial trade size 18 or girl's "Canada Standard Size" 16 or boy's "Canada Standard Size" 18, depending upon the size designation applicable,

                    (iii)  dress and sport shirts as designated for boys, up to and including commercial trade size designation 14 1/2 or "Canada Standard Size" 14 neck depending upon the size designation applicable,

                    (iv)  hose, up to and including girl's commercial trade size designation 10 and boy's commercial trade size designation 10 1/2 or stretchy socks designed for children,

                     (v)  hats in styles designed for children, up to and including girls' commercial trade size designation 22 and boy's commercial trade size 7 1/8, and

                    (vi)  gloves in styles designed for children, up to and including girl's and boy's commercial trade size designation 7;

             (e)  "children's footwear" means footwear up to and including commercial trade size designation 6 in styles designated for boys or girls and female footwear normally designated by the manufacturer as "small";

              (f)  "craft producer" means a natural person, co‑operative, corporation, other association, production group or studio which hand crafts articles by personal skill;

             (g)  "crafts" means tangible personal property which is hand made by a craft producer who personally controls each aspect of production and subject to subparagraphs (v), (vi), (vii), (viii), (ix), (x) and (xi) includes

                      (i)  sewn, woven, knitted or quilted products,

                     (ii)  painted, dyed, printed or batiked textiles,

                    (iii)  carvings, including stone, bone and wood,

                    (iv)  jewellery, pottery, leatherwork, woodwork, metal work and glass work,

but does not include

                     (v)  an individual item the purchase price of which exceeds $500,

                    (vi)  artwork such as paintings, drawings, etchings, prints,

                   (vii)  photography,

                  (viii)  jewellery constructed wholly or in part from commercially made or premanufactured castings, stampings or other materials, excepting hand crafted jewellery incorporating functional small findings such as pin backs, safety backs and ear posts that do not form a significant part of the overall design,

                    (ix)  furniture and building materials,

                     (x)  goods that are constructed wholly or in part from, or are sold in, the form of kits,

                    (xi)  goods that are mass produced or produced through assembly line techniques, or contain premanufactured components, unless those components are incidental to the overall design and value of the finished product,

                   (xii)  goods which in the opinion of the minister are not crafts;

             (h)  "custom designed computer program" means a computer program designed to the particular specifications of a single consumer that contains a preponderance of original programming more significant than parameterization, modification, customization or adaptation or pre‑written computer programs;

              (i)  "domestic establishment" means a residential unit whether or not contained in a multiple unit complex, but does not include establishments registered or required to be registered under the Tourist Establishment Regulations and having accommodation for more than 4 persons at any time;

              (j)  "farmer" means a person in the business of producing natural products for sale, who is a registered producer under paragraph 9(1)(k) of the Natural Products Marketing Act, and

                      (i)  has produced at least $5,000 in gross sales of natural products in the previous year, or

                     (ii)  can demonstrate to the satisfaction of the minister that based upon a farm business and investment plan, he or she can achieve $5,000 in annual sales within a reasonable time having regard to the type of natural products produced;

             (k)  "farming" means the production of natural products for sale;

              (l)  "fisher" means a person registered under the Atlantic Fishery Regulations (Canada) who is the registered owner of a commercial fishing vessel and holds one or more limited entry licences;

            (m)  "fishing" means the commercial catching of fish;

             (n)  "hospital" includes orphanage, nursing home, old people's home and a health or welfare institution;

             (o)  "manufacture" or "manufacturing" means the work applied directly to material to transform that material into a different product, commencing with delivery of that material from an immediately adjacent storage or receiving area to the first operation causing transformation and ending with delivery of the product from the final operation of transformation to an immediately adjacent storage or shipping area and includes remanufacturing but does not include receiving, storing, handling or shipping material, supplies or product, work incidental to manufacturing which is not applied directly to the material being transformed into a different product, work on real property, the work of an advertising agent, architect, engineer, dentist, optometrist or a related technician, cleaning, polishing, painting, undercoating, sharpening, cutting, bending or shaping, unless performed in direct conjunction with other manufacturing work by the same person, repairing, refinishing or reupholstering, salvage, demolition, design, research or development of a product, design of computer software, generating, transforming or distributing electricity, photography, preserving, grading, packaging or catering of food, preparation of food in a hotel, restaurant, donut shop, dairy bar, fast food outlet, supermarket, convenience store or institution, cold storage, extracting, harvesting or transporting natural resources, primary phases of mining and quarry operations conducted at a mine or quarry site such as blasting, rock breaking, cutting, crushing, handling, storing and transporting material, but not secondary phases of those operations nor concentrating, milling, smelting, refining, palletizing or fabricating minerals or stone, logging operations conducted in a forest including cutting, limbing, sizing, grading and transporting round wood, and operating a utility system as defined under section 14 of the Act;

             (p)  "manufacturer" means a person engaged in manufacturing but only to the extent of that person's manufacturing work;

             (q)  "manufacturing equipment" means a machine or apparatus which is a capital asset having a useful life of more than one year used directly in manufacturing, which has direct contact with the material being manufactured and includes equipment ancillary to the foregoing such as conveyors, electrical panel boxes, catwalks, stairways, balconies, control computers, monitoring equipment, pollution control equipment, safety equipment, waste removal equipment, air conditioning equipment and ventilating equipment when dedicated and required for proper operation of the machine or apparatus but does not include other equipment which is not used directly in manufacturing, such as equipment used for repair or maintenance of manufacturing equipment, general purpose lighting, heating, air conditioning, ventilating or general maintenance of a manufacturing premises, a housing, structure, enclosure, covering, storage facility, footing, piling, support, base, foundation, tower, wire or cable, unless supplied as a component of manufacturing equipment, or real property other than affixed machinery or apparatus;

              (r)  "medical devices" means medical devices as described in Part II of Schedule VI of the Excise Tax Act (Canada) which are a zero rated supply under that Act;

             (s)  "natural product" means an agricultural, aquacultural, avicultural, floricultural or horticultural product and includes animals, meats, eggs, poultry, wool, dairy products, berries, grains, seeds, fruit, fruit products, vegetables, vegetable products, cultivated furs and Christmas trees;

              (t)  "patient" means a person admitted to, residing in or receiving treatment at a hospital;

             (u)  "productive capital equipment" means capital equipment not otherwise exempt from the tax under the Act or these regulations used by a manufacturer in carrying on manufacturing and which has an estimated useful life in excess of one year;

             (v)  "remanufacturing" means the work applied directly to a used product, other than repair work, to rebuild or restore that product for resale when performed by or on behalf of an owner of the product who has not previously used the product;

            (w)  "school board" means a board as defined by section 2 of the Schools Act;

             (x)  "thermal insulation materials" includes batt, blanket, loose fill, rigid or reflective insulation that is used solely for the purpose of preventing heat transfer and that is

                      (i)  poured, packed, blown, sprayed or otherwise placed in bulk as permanent fill between the confining structural members of a building, or

                     (ii)  material in solid form that is permanently placed between or attached to structural members of a building

but does not include

                    (iii)  weather stripping and caulking materials,

                    (iv)  storm windows and doors,

                     (v)  pipe, boiler and duct wrapping material,

                    (vi)  acoustical insulation,

                   (vii)  wallboard or drywall, or

                  (viii)  materials incorporated into a building primarily for their structural or decorative value; and

             (y)  "visiting force" means a visiting force as defined under the Visiting Forces Act (Canada).

49/79 s2; 282/82 s1; 312/82 s1; 155/84 s1; 315/85 s1; 124/87 s1; 181/87 s1; 111/89 s1; 234/89 s1; 290/90 s1; 44/92 s1; 143/93 ss1&2; 226/94 s1; 77/95 s1

Use of registration certificate

        3. (1) Sellers may use their registration certificate to purchase, without being required to pay the tax to the supplier, tangible personal property for resale purposes or merchandise which will become part of tangible personal property intended for resale and exempt from the tax under paragraphs 27(1)(aa) and (bb).

             (2)  A seller shall at the time of each purchase supply the person selling the tangible personal property with the number of his or her registration certificate and this number shall be noted on the invoice in the supplier's books and in all other records kept in connection with the sale so made.

             (3)  When a seller referred to in subsection (2) fails to provide the number of his or her registration certificate in accordance with that subsection, the supplier shall collect the tax and refund of it may be made in accordance with section 12 of the Act.

             (4)  A seller shall not use his or her registration certificate to purchase tangible personal property of which he or she is the ultimate consumer or user in his or her business operations or for his or her personal or household consumption or use without paying the appropriate amount of tax to the suppliers from whom he or she purchases the tangible personal property.

             (5)  A seller who does not ordinarily sell tangible personal property on which the tax is payable to a retail purchaser shall not be required to obtain a registration certificate.

             (6)  A seller who has paid the tax on tangible personal property and who sells same before making any use of it, other than retention, demonstration or display while holding it for sale in the regular course of business, may apply for a refund under section 12 of the Act and the refund shall be made by the minister upon receipt of evidence satisfactory to him or her that the tax should be refunded.

             (7)  Where there is doubt as to the purpose for which the tangible personal property is purchased by the holder of a registration certificate, manufacturers, wholesalers, distributors and all sellers may require a written confirmation from the purchaser to the effect that the tangible personal property purchased under the registration certificate is for resale purposes or further incorporation into other tangible personal property for resale purposes.

             (8)  Where the seller collects the tax at a sale or where there is no seller's registration number on the bill or invoice as required by these regulations, the onus shall be on the seller to prove that the sale was a sale other than a retail sale.

49/79 s3; 135/79 s1

Application of refund procedure

        4. The procedure outlined in subsection 3(6) shall also apply in the following circumstances:

             (a)  the particular tangible personal property is of a kind not ordinarily sold or stocked by the seller and is the subject of an unusual sale, such as a sale for the accommodation of a customer or employee;

             (b)  the particular tangible personal property is generally for the consumption or use of the seller but a small portion is incidentally resold; or

             (c)  through error, the tax is paid by the seller in respect of the purchase for resale in the regular course of business.

49/79 s4

Tangible personal property

        5. (1) Where tangible personal property is sold within the province to a retail purchaser and the tangible personal property is subsequently taken out of the province within 30 days after the sale to be used solely outside the province, the tax collected at the time of the sale may be refunded by the minister on receipt of evidence satisfactory to him or her of the removal of the tangible personal property from the province.

             (2)  A refund shall not be given under subsection (1) unless the amount of the refund claim exceeds $11.99.

315/85 s2

Tour operations

        6. (1) A group tour operator who operates a packaged tour in the province and who has paid tax on the supply of lodgings and prepared meals provided by him or her as part of the packaged price of the tour may apply to the minister for a refund of the tax.

             (2)  The minister, upon receipt of information satisfactory to him or her that the tax was paid, shall refund the tax to the tour operator.

             (3)  A refund shall not be given under subsection (2), unless

             (a)  the tour operator provides accommodation for at least one night in a tourist establishment that is or is required to be registered under the Tourist Establishment Regulations; and

             (b)  the primary and common purpose of the group is tourism rather than the desire for direct and expeditious transportation between 2 points.

             (4)  For the purpose of this section,

             (a)  "group tour operator" means a person who provides packaged tours to the public whereby tourists are provided with tours to scenic, historic or other points of interest by means of a common mode of travel;

             (b)  "packaged tour" means a tour where a group shares a common itinerary and where charges for travel, the supply of lodgings and prepared meals are sold for an all inclusive price and includes packaged expeditions to hunting and fishing camps.

315/85 s3

Sale and resale of motor vehicle

        7. Where a motor vehicle is sold within the province but the vehicle is subsequently resold within 7 days to another person, the first sale shall be considered to be a sale for resale and the tax paid by the purchaser in the first instance may be refunded by the minister on receipt of evidence satisfactory to him or her that the tax should be refunded.

49/79 s6

Change of seller's circumstances

        8. (1) Where a seller changes the name or address of his or her business, he or she shall immediately return his or her registration certificate to the minister for amendment.

             (2)  Where a seller changes the nature of his or her business, he or she shall immediately notify the minister.

             (3)  When a seller disposes of or discontinues his or her business, he or she shall, not later than 15 days after that, inform the minister of the disposition or discontinuance giving details of the transaction and submit his or her registration certificate for cancellation and make a return for a period unreported.

             (4)  Where a registration certificate is lost or destroyed, application shall immediately be made to the minister for a copy of it.

49/79 s7

Return to be filed

        9. (1) Unless otherwise required by the minister under subsection (2), a seller shall make a separate return for each calendar month and shall file the return with the minister not later than 20 days after the end of the month in respect of which the return is made together with payment of the tax collectable and payable by the seller.

             (2)  The minister may in addition to or instead of the returns required under subsection (1) order a person who sells tangible personal property to make a return of sales or purchases of tangible personal property made and tax collected or payable by that person, in respect of a period prescribed by the minister in the order, and in that case the person so ordered shall make the return within the period that may be prescribed by the minister in the order together with payment of the tax collected and payable by that person.

             (3)  Where a return required to be made under this section is made by a corporation, it shall be signed by an officer, director or agent of the corporation or a person authorized in writing to sign on behalf of the officer, director or agent.

             (4)  A return is considered to have been filed when it is received by the minister.

49/79 s8; 205/84 s1; 121/93 s1

Motor vehicle dealer

     10. In addition to the regular return required to be filed by a seller, a seller who is also a motor vehicle dealer shall be required to file a form prescribed by the minister.

49/79 s9

Separate return required

     11. A separate return shall be made for each place of business unless a consolidated return has been approved by the minister.

49/79 s10

No tax collected

     12. If a seller during a reportable period prescribed by or under section 9 has collected no tax, he or she shall nevertheless make a report to that effect on the prescribed return form.

49/79 s11

Purchase by seller

     13. (1) Sellers shall report on the form prescribed by the minister and shall pay the tax in respect of all items of tangible personal property purchased or taken out of stock by themselves for their own consumption or use and shall collect the tax from their employees in respect of tangible personal property supplied to them out of stock where that property has not been included as a retail sale.

             (2)  Where tangible personal property is removed from stock in trade by the owner and applied to his or her own use temporarily and subsequently returned to stock for the purpose of selling or reselling it, the owner shall pay assessment in respect of that portion of the tangible personal property as was consumed in the course of that use, and for the purpose of this subsection the value of the portion so consumed shall be the depreciation in worth as determined by the minister.

49/79 s12

Purchase by persons other than sellers

     14. A person, other than a seller, who sells taxable tangible personal property or who take out of stock for his or her own consumption or use tangible personal property purchased by that person free of tax shall immediately report the sale or taking out of stock to the minister and remit the tax on it, and shall collect the tax from their employees in respect of tangible personal property supplied to them out of stock where that tax has not otherwise been reported.

49/79 s13

Solicitation for unregistered principals

     15. (1) All persons who solicit, on behalf of principals who are not registered under the Act, orders for the sale of tangible personal property, the consumption or use of which is taxable under the Act, shall file returns concerning the orders for sales or sales with the minister and the returns shall be filed within 20 days after the expiration of a reportable period prescribed by or under section 9.

             (2)  The returns required under subsection (1) shall contain

             (a)  the name and address of each purchaser from whom an order is taken;

             (b)  the description and sale price of the tangible personal property sold or to be sold under that order;

             (c)  the date upon which the order is taken; and

             (d)  the date, as nearly as can be determined, on which the tangible personal property is to be delivered to the purchaser.

             (3)  All persons, including local representatives of sellers who are located outside the province, who, when taking orders for taxable tangible personal property, collect all or part of the purchase price shall collect the appropriate amount of tax on the full purchase price of the tangible personal property and shall remit the tax to the minister in accordance with section 9 or 14.

49/79 s14; 205/84 s2

Entries to be distinguishable

     16. All entries concerning the tax in books of account, records and documents, required under section 28 of the Act, shall be separate and distinguishable from other entries made in it.

49/79 s15

Tax shown separately

     17. (1) Where a receipt, bill, invoice or other document is issued by a person selling tangible personal property at a retail sale, the tax shall be shown as a separate item on that document.

             (2)  This section shall not apply to the sale of alcoholic liquor through the Newfoundland Liquor Corporation.

49/79 s16

Form of receipt

     18. Where for the purpose of accounting for the tax collected a receipt for the amount of tax is issued by the seller, it shall be in a form satisfactory to the minister.

49/79 s17

Length of document preservation

     19. A person shall preserve all books of account, records and documents required under the Act until the time that the minister authorizes their destruction.

49/79 s18

Ministerial direction re records

     20. If a person fails or refuses to keep books of account, records and documents adequate for the purpose of the Act and these regulations, the minister may require the person to keep the books of account, records and documents that he or she may prescribe.

49/79 s19

Services taxable

     21. (1) Persons engaged in the business of rendering service, whether or not the service is taxable, are consumers of the tangible personal property that they use in rendering the service and as such are subject to tax on their purchases.

             (2)  If persons engaged in the business of rendering service sell tangible personal property at retail, in addition to rendering services, they must collect the tax on the sales, and if the retail selling is a regular and significant proportion of their total operations or if they render taxable services as defined in section 15 of the Act, they must register as sellers for that purpose.

49/79 s20; 205/84 s3

Tangible personal property included in real property

     22. Where in the province real property which is furnished or equipped with tangible personal property is acquired for use through a lease, contract or rental agreement under the terms of which the lease or rental charge is inclusive of both real and tangible personal property and also of the lessor's undertaking to repair and maintain the tangible personal property in usable or operable state, then the owner of the tangible personal property is considered to be the consumer of that tangible personal property and of other tangible personal property used in the repair and maintenance of that tangible personal property and the owner shall be liable for the payment of the tax on all the tangible personal property and the lessee is not liable for payment of tax on the lease or rental charge.

49/79 s21

Property for temporary use

     23. (1) Subject to this section, where tangible personal property is brought into the province by the owner for his or her temporary use, the tax may be applied on the basis of the equivalent of the portion of the total worth of the tangible personal property which is considered by the minister to have been consumed in that temporary use.

             (2)  When tangible personal property is brought into the province for temporary use, the owner shall, unless the minister by order otherwise directs, deposit with the minister a sum of money or provide him or her with a surety bond or personal sureties for an amount of the tax which would, apart from the provisions of this section, be payable by the owner on the tangible personal property so brought in, and when the owner removes the tangible personal property from the province

             (a)  there shall be returned to the owner the sum of money as shall represent the difference between an amount which may have been deposited originally, and the tax payable; or

             (b)  the bond shall be returned to the owner or the sureties shall be discharged upon the minister being satisfied that the amount of tax due by virtue of this section has been paid.

             (3)  For the purpose of this section, temporary use means for a period of less than one year.

49/79 s22

Interest on sum due

     24. (1) Interest shall be levied upon a sum due at the rate of 1.2% compounded per month or part of a month from the date the sum is required to be paid to the date of payment.

             (2)  Interest shall not be levied for a month in which the sum due is less than $100.

121/93 s2

Refund of overpayment

     25. (1) Where a person has paid or paid over to the Crown an amount which exceeds the amount required to be paid, he or she may apply in writing to the minister for a refund of the overpayment.

             (2)  An application for refund shall be supported by the relevant facts, documentation or other information that the minister may request.

             (3)  Upon verification of an application for refund, the minister shall pay the verified amount of overpayment to the person to whom the refund is due.

             (4)  A refund shall not be paid under this section where the amount of the tax is less than $10.

121/93 s2

Interest on refund

     26. (1) Where the minister issues a refund under section 25, he or she shall, at the same time, pay interest on the amount of the refund at the rate of 0.7% compounded per month from the date the application is received to the date the refund is approved.

             (2)  Where the minister issues a refund of tax resulting from a review or appeal of an assessment, interest shall be paid to the taxpayer at the rate specified in subsection (1) from the date that the assessment or part of the assessment was paid to the date the refund is approved.

             (3)  Interest shall not be paid under this section when the amount of refund is less than $100.

121/93 s2

Exemptions

     27. (1) The following classes of tangible personal property are exempt from the tax:

             (a)  newspapers published within the province;

             (b)  wood, coal and peat when sold for consumption as fuel;

             (c)  petroleum products known as furnace fuel, stove oil, bunker C and kerosene oil and electricity consumed for the purpose of heating, cooking, illumination or as a source of energy by

                      (i)  the owner or tenant of a domestic establishment,

                     (ii)  a school board, or

                    (iii)  the Memorial University of Newfoundland;

             (d)  propane gas when sold for consumption in domestic establishments in cylinders of not less than 89 litres capacity;

             (e)  electricity consumed

                      (i)  for a street lighting service provided for the public under an agreement between a public authority and an electric utility, or

                     (ii)  by a person in the operation of a swimming pool;

              (f)  electricity, gasoline, fuel oil and gas purchased or acquired by

                      (i)  a manufacturer or processor for consumption or use directly in the manufacture or processing of tangible personal property, or

                     (ii)  a person for consumption and use in the generation of electricity for sale;

             (g)  wood and peat burning stoves and furnaces, which produce heat for cooking or heating a building, including

                      (i)  stoves and furnaces which are capable of using other fuels if they are designed to burn wood or peat, and

                     (ii)  stationary fuel handling equipment, silos, emission control equipment and stacks purchased for wood or peat burning heating systems when purchased for use in commercial or industrial buildings;

             (h)  thermal insulation materials;

              (i)  basic groceries;

              (j)  tangible personal property purchased by a printer to be consumed solely in the printing process for the printing of products for sale including materials specifically designed for paste up, photo typesetting papers, colour separations, lithographic film, chemicals for processing film, printing plates, press blankets and printing chemicals;

             (k)  food and beverages sold or served

                      (i)  within a hospital and provided free of charge to patients of the hospital,

                     (ii)  to guests in boarding houses and registered tourist homes having accommodation for not more than 4 paying guests at any time,

                    (iii)  to employees of contractors in logging, mining and construction camps,

                    (iv)  in an elementary or secondary school cafeteria when provided primarily to students except for food or beverages

                            (A)  sold or served for a private party, meeting or similar private event,

                            (B)  sold through a vending machine,

                            (C)  that is carbonated beverages,

                            (D)  as described in paragraphs 1(d), (e), (f), (g), (h), (i), (j), (k) and (l) of Part III of Schedule VI of the Excise Tax Act (Canada) when prepackaged for sale to consumers, and

                     (v)  by a school authority primarily to elementary or secondary school students during the course of extra curricular activities organized under the authority and responsibility of the school authority,

                    (vi)  to a student at a university or public college when the meal is provided under a plan which the student purchases, for a single consideration, not less than 10 meals weekly for a period of not less than one month;

              (l)  a form of animal life of a kind the product of which ordinarily constitutes food for human consumption;

            (m)  sales of plants, trees or seeds that produce food for human consumption or feeds for the sustenance of a form of animal life of a kind the product of which ordinarily constitutes food for human consumption;

             (n)  food when purchased for consumption by pets being raised by persons for the sole purpose of resale;

             (o)  children's clothing and children's footwear;

             (p)  tangible personal property purchased by a non‑profit organization for distribution, other than by retail sale, to persons making voluntary donations to the organization in an amount to be determined solely by the donor;

             (q)  the trade‑in allowance given by a seller in respect of a motor vehicle being traded which was originally brought into the province on a tax‑exempt basis by a person taking up residence in the province;

              (r)  tangible personal property obtained by way of bona fide gift and brought into or received in the province by the recipient of it while he or she is resident in the province and provided the fair value of the gift does not exceed $300;

             (s)  uncancelled postage stamps and uncancelled revenue stamps valid for the transportation of mail or for revenue purposes in the jurisdiction issuing the stamps, if the consideration for the sale of it does not exceed the equivalent face value of it in Canadian funds;

              (t)  coin, paper money or bank notes, unless purchased at a price greater than the equivalent face value of it in Canadian funds;

             (u)  stocks, bonds or like financial securities;

             (v)  tangible personal property purchased by persons engaged in interprovincial transportation operations as common carriers and utilized for the purpose of the movement of goods or passengers by road but only to the extent that the total of kilometres travelled outside the province bears to the total of kilometres travelled for a stated period of time;

            (w)  railway rolling stock and all tangible personal property for the maintenance, equipping or operation of the rolling stock, purchased solely for consumption or use on a railway line connecting the province with another province of Canada but only to the extent of the proportion which the total purchase price of the rolling stock and tangible personal property bears to the ton kilometres of the railway carrying the rolling stock outside the province over the total ton kilometres of the railway carrying the rolling stock irrespective of location;

             (x)  aircraft purchased for use in

                      (i)  the public transportation of fee paying passengers or freight from one location to another for the purpose of making a profit by commercial air carriers engaged in provincial, foreign or interprovincial trade,

                     (ii)  the operation of flying schools for the purpose of pilot training, or

                    (iii)  a combination of both subparagraphs (i) and (ii),

together with the following tangible personal property consumed or used in the equipping or operation of aircraft so purchased and used, lubrication oils and greases, hydraulic fluids, gasoline and other fuels, first aid supplies, safety supplies and equipment, and emergency survival supplies, provided that where the aircraft are also used for other purposes than stated above, a partial exemption shall be allowed based upon the proportion that the total purchase price of the aircraft bears to the total hours set out in subparagraph (i), (ii), (iii), over the total hours logged for all purposes;

             (y)  metal balls and rods used for the purpose of grinding or otherwise processing mineral ores;

             (z)  tangible personal property coming within Article XIV of the agreement forming Schedule A to the American Bases Act, 1941;

           (aa)  chemical, animal, mineral or vegetable matter purchased by manufacturers or processors and used as a catalyst or as a direct agent for the transformation or manufacture of a product by contact or temporary incorporation and for the purpose of this paragraph, the expression "direct agent" means the chemical, animal, mineral or vegetable matter that is used or consumed directly to produce a reaction or combination of materials comparable to that resulting from the use of a catalyst;

          (bb)  tangible personal property acquired for the purpose of being processed, fabricated or manufactured into, attached to or incorporated into other tangible personal property for the purpose of

                      (i)  resale, or

                     (ii)  personal use when that other tangible personal property is exempted under section 21 of the Act or this regulation;

           (cc)  household goods and personal effects brought into the province within 6 months after his or her taking up residence in the province by a person who was previously resident for more than 6 months continuously outside the province if the household goods and personal effects are for his or her own consumption and use and were owned by him or her for a period of not less than 30 days before his or her taking up residence in this province;

          (dd)  a motor vehicle brought into the province for his or her own consumption or use by a person who is

                      (i)  attending or about to attend an educational establishment within the province, or

                     (ii)  undergoing or about to undergo within the province a course of training under written articles or contract of apprenticeship or under internship, and

whose residence would, apart from the attendance or training, be outside the province;

           (ee)  every text book necessarily purchased by a student or for or on behalf of the student by his or her parent or guardian for consumption and use by him or her in connection with a course of study, whether or not the course of study involves attendance at an educational institution;

            (ff)  containers and wrapping materials, excluding pallets, purchased by sellers and consumed or used for the purpose of effecting shipment or delivery of tangible personal property sold, when the containers or wrapping materials are not required to be returned by the buyers of the goods contained in them, including disposable containers for use in serving food or beverage for consumption on the premises of the seller or served by means of mechanical dispensers but not including containers or wrapping materials which remain the property of the sellers and are required to be returned or to be paid for if not returned by the buyer of the goods contained in them;

          (gg)  all repair or replacement parts purchased for the repair of tangible personal property specifically exempted from tax under section 21 of the Act or under this section, when the parts are specifically designated for and will become integral parts of the exempted tangible personal property;

          (hh)  tangible personal property purchased by diplomatic and consular agents, officers or employees, including spouses of the persons, who are so accredited by the Department of External Affairs (Canada) and who have been issued identity cards authorizing the exemption in the province, provided that that person is not a Canadian citizen, nor a permanent resident of Canada, and is assigned to duty from the state he or she represents and is not engaged in another occupation;

             (ii)  gasoline as defined under the Gasoline Tax Act,

                      (i)  which has been taxed under that Act and will not be refunded or rebated,

                     (ii)  used in a vessel or boat registered under the Atlantic Fishery Regulations (Canada) when used by a fisher for the commercial catching of fish in accordance with the fisher's limited species licence,

                    (iii)  used in a vessel or boat employed in the commercial transportation of fish or fishery salt,

                    (iv)  used in motor buses or motor vessels operated by or on behalf of group tours operators, and

                     (v)  used by a farmer in farming;

             (jj)  magazines sold on subscription or distributed free of charge by controlled or qualified circulation by the publisher;

           (kk)  tangible personal property purchased on or after March 28, 1972 for consumption or use in the construction and establishment, and the subsequent operation by the Government of the United States of America or its agents, contractors or subcontractors of a support station at Shoe Cove near St. John's, Newfoundland, for the program of The National Aeronautics and Space Administration designed as "The Skylab Program" under an agreement entered into between the Governments of the United States of America and Canada;

             (ll)  equipment, apparatus and supplies purchased by a commercial fish processor and used directly in the processing of fish and fish products;

         (mm)  children's car safety seats;

          (nn)  residential fire alarms and smoke detectors;

          (oo)  hard‑bound and soft‑covered books excluding

                      (i)  magazines, periodicals, directories, timetables, rate books, reports, fashion books, albums and workbooks or other books of the same general class, and

                     (ii)  books containing advertising solicited by the publishers of them;

          (pp)  capital equipment, machinery and apparatus purchased or acquired by Terra Nova Shoes Limited to be used directly in the manufacture of footwear within the confines of a plant situate in the Town of Harbour Grace;

          (qq)  capital equipment, machinery and apparatus purchased or acquired by CAN‑AM Containers Limited to be used directly in the manufacture of plastic containers within the confines of a plant situate in the Town of Bishops Falls;

            (rr)  equipment and machinery used in the operation of a sawmill by sawmill operators not engaged in the production of pulp, paper or paper products, including planers, saws, motors, debarkers and wood chippers but excluding equipment and machinery not used directly in the manufacturing process;

           (ss)  all materials and fabrics which are designed for use in making or repairing of clothing, including yard goods, wool, zippers, buttons, thread and hooks and eyes;

            (tt)  notwithstanding paragraph (ee), workbooks purchased by or on behalf of students for direct use with textbooks designated by the Department of Education as being required reading for any course of study;

          (uu)  manufacturing equipment to the extent that it is used directly in manufacturing, but where the equipment is also used for a purpose in addition to manufacturing, the amount of the exemption shall be the proportion of the fair value that is the product of the fair value multiplied by the total estimated or actual time used for manufacturing over the total estimated or actual time used for all purposes during a representative period, as estimated by the consumer, subject to approval of the minister;

          (vv)  traps, snares, animal lures, skinning knives, fleshing tools, pelt stretchers and other apparatus when purchased by a person licensed under the Wild Life Regulations for the commercial trapping of fur bearing animals but not including transportation equipment such as boats, canoes and snowmobiles;

         (ww)  crafts produced in Canada;

            (xx)  boats, motors, machinery, equipment, apparatus, electricity and fuel purchased by a bona fide commercial aquaculturalist for use on an aquaculture site solely for the cultivation of aquatic plants or animals, including sea ranching;

          (yy)  dental filling materials, including cavity liners, cements, varnishes, bonding agents and pins;

            (zz)  medical devices;

         (aaa)  prescription drugs;

        (bbb)  food and beverages purchased for immediate consumption by a member of a visiting force or a sponsored guest of the member at an establishment licensed under the Liquor Control Act and operated by the visiting force on behalf of its members;

         (ccc)  custom designed computer program which is acquired by the original consumer for whom it was designed;

        (ddd)  modifications to a program referred to in paragraph (ccc) or modifications to computer programs to meet the requirements of a specific consumer if the consideration for the modifications is separate from and greater than the consideration for the computer program in its unmodified form;

         (eee)  passenger vehicles, motor cycles, motor homes and travel trailers purchased for personal use by a member of a visiting force as defined in the Visiting Forces Act (Canada) who is not a citizen or permanent resident of Canada;

           (fff)  tangible personal property bequested by individuals who resided outside the province to individuals who reside in the province; and

        (ggg)  tangible personal property given by way of gift by a person residing outside the province to an immediate family member in the province provided the property had been owned by the former person for at least 2 years prior to the property entering the province.

             (2)  There shall be excluded from the application of paragraph 15(1)(a) of the Act the following services:

             (a)  repairs and other work done on or in connection with tangible personal property exempted from tax under section 21 of the Act or under this section;

             (b)  services effected under contracts of guarantee or warranty entered into or given at the time of purchase of an article to which a taxed service may be effected when the consideration for the contract forms part of the purchase price of the article;

             (c)  the taxed service known as advertising when it is provided as a public service without charge to an organization that is

                      (i)  a registered charity for the purpose of the Income Tax Act (Canada), or

                     (ii)  considered by the minister to be a non‑profit organization; and

             (d)  medical services performed by veterinarians.

             (3)  Persons undertaking the construction or repair or improvement of real property on a contract basis who are required to process, manufacture or fabricate tangible personal property previously acquired by them for completion of the contract shall be exempt from the cost of processing, manufacturing or fabricating the tangible personal property provided the work is done on the construction site.

             (4)  Subsection (3) shall not apply to the manufacture of crushed aggregate or asphaltic, readi‑mix or another type of concrete.

             (5)  National Sea Products Limited shall be exempted from all taxes imposed by the Act either generally or specifically upon the purchase, consumption or use of machinery, equipment, structure, plants, buildings, wharves, materials, goods, articles and things and all other tangible personal property, other than office furniture and equipment, and motor vehicles not otherwise exempted from the taxes under other provisions of these regulations, comprised in additions to or expansion of a fresh fish plant and a fish meal plant to be purchased by it from Rossfish Limited.

             (6)  Paragraphs (1)(gg) and (2)(a) shall apply with respect to manufacturing equipment only when the repair or replacement cost is a capital expenditure which extends the useful life of the manufacturing equipment by more than one year beyond its originally estimated useful life or materially alters the manner by which that equipment performs its function.

             (7)  Subparagraph (1)(bb)(ii), paragraphs (1)(gg) and (2)(b) do not apply to the exemption for crafts.

             (8)  There shall be exempted from the tax imposed under the Act labour charges to a cablevision operator or public utility for installation, repairs or work done on cables, wires, transformers, amplifiers and other ancillary parts or equipment which are or are to be attached to or installed on utility poles, ducts or conduits, or extending from a utility pole, duct or conduit to a subscriber's premises.

             (9)  Notwithstanding the repeal of the Labrador Railway Act, the exemption from tax under this Act provided under section 22B of the Labrador Railway Act shall continue in force as it read immediately before the repeal of the Labrador Railway Act.

           (10)  Notwithstanding the repeal of the Wabush Lake Railway Act, the exemption from tax under this Act provided under section 32 of the Wabush Lake Railway Act shall continue in force as it read immediately before the repeal of the Wabush Lake Railway Act.

           (11)  The tax imposed under paragraph 15(1)(b) of the Act shall not apply with respect to tangible personal property used in the operation of interprovincial ferries.

49/79 s24; 135/79 s2; 179/79 s1; 138/80 s1; 246/80 s1; 79/82 s1; 282/82 ss2&3; 312/82 s2; 205/83 s1; 298/83 s1; 155/84 ss2‑4; 205/84 ss5‑7; 94/85 s1; 315/85 ss4&5; 122/86 s1; 123/86 s1; 255/86 s1; 61/87 s1; 75/88 s1; 131/88 s1; 234/89 ss2&3; 290/90 s2; 44/92 s2; 210/92 s1; 4/93 s2; 43/93 s1; 143/93 s3; 241/93 s1; 221/94 s1; 226/94 ss2&3; 77/95 s2; 93/95 s1; 51/96 s1

Exemption for farm equipment

     28. The following tangible personal property is exempt from tax when acquired by a farmer for use in farming:

             (a)  automated feeding and watering systems;

             (b)  breeding stock;

             (c)  brooder equipment;

             (d)  carbon dioxide fertilization systems designed solely for use in commercial greenhouses;

             (e)  chick boxes, chick and poultry founts, debeakers and poultry pluckers;

              (f)  commercial feeding tools and carts;

             (g)  cow mats, cattle prods, milk filters, pasteurizers and teat dilators;

             (h)  drugs prescribed by and services provided by a veterinarian with respect to farm livestock;

              (i)  egg room coolers and controls other than household refrigerators;

              (j)  egg collectors, candlers, washers, graders, cartons, baskets and crates;

             (k)  electricity and gasoline, as defined in the Gasoline Tax Act, and furnace fuel, stove oil, kerosene, propane, butane or naphtha grades of gasoline used in farm facilities or farm equipment that is exempt or eligible for tax rebate;

              (l)  farm tractors over 25 horsepower and farm attachments for those tractors;

            (m)  farm‑type feed grinders and feed mixers;

             (n)  farm‑type fertilizer and lime applicators or spreaders;

             (o)  farm‑type refrigerated bulk milk cooler;

             (p)  farm‑type soil mixing machines and potting machines;

             (q)  field sprayers or dusters with a total tank capacity of at least 300 litres;

              (r)  feed, when sold in bulk quantities of at least 20 kilograms or in bags that contain at least 20 kilograms, that is a complete feed, supplement, macro‑premix or micro‑premix, all as defined in the Feeds Regulations (Canada) is labelled in accordance with the Feeds Regulations (Canada) and is designed for a unique species or class of farm livestock, or poultry that are ordinarily raised or kept to produce, or to be used as, food for human consumption or to produce wool;

             (s)  fertilizer supplied in bulk or in a container that contains at least 25 kilograms of fertilizer, where the total quantity of fertilizer supplied at that time to the recipient is at least 500 kilograms;

              (t)  foraging equipment including mower‑conditions, hay balers, hay cubers, bale throwers, hay rakes, hay tedders, hay conditioners, crushers or crimpers, swath turners and wind‑row turners;

             (u)  manure handling equipment and spreaders but excluding modified trucks for disposal of manure from approved pits;

             (v)  mechanical rock or stone pickers;

            (w)  milking systems that consist of a receiver group, vacuum supplier, pulsators and related equipment, unassembled or assembled, that constitute a fully operational milking system;

             (x)  pesticides, including herbicides, insecticides and fungicides, labelled in accordance with the Pest Control Products Regulations (Canada) as having a purpose that includes agricultural use and a product class designation other than "Domestic";

             (y)  pre‑fabricated barn pens, head gates, stalls, stanchions, cattle squeezes and cattle chutes;

             (z)  pre‑fabricated cages or furbearing animals and poultry;

           (aa)  pre‑fabricated farrowing crates;

          (bb)  sawdust and wood chips;

           (cc)  scales designed for weighing livestock;

          (dd)  seeds that produce food for human consumption; and

           (ee)  vegetable grading and packaging equipment.

226/94 s4

Rebate for farm equipment

     29. The minister may rebate tax paid by a farmer on the following tangible personal property used in farming:

             (a)  wire fencing supplies, heating systems, ventilation systems, standby generators and greenhouse polyethylene;

             (b)  a vehicle specifically designed or modified for use in spreading or transporting agricultural liquid and slurry equipped with an enclosed tank and meeting standards;

             (c)  materials for the construction of manure storage units meeting environmental standards;

             (d)  repair or replacement parts for tangible personal property exempted under section 28 or eligible for rebate under this section; and

             (e)  other equipment or supplies used in farming, except trucks, automobiles, snowmobiles and all terrain vehicles.

226/94 s4

Exemption for fishing equipment

     30. The following tangible personal property is exempt from tax when acquired by a fisher for use in fishing:

             (a)  gill nets, together with webbing, leadlines, and floats for gill‑nets and marker buoys;

             (b)  seines, together with webbing, leadlines and floats for seines;

             (c)  fishing traps, together with webbing, leadlines, floats and marker buoys for fishing traps;

             (d)  trawl‑nets, together with doors, webbing, bottom gear and floats for trawl nets;

             (e)  fishing pots, together with framing, webbing, floats and markers for fishing pots;

              (f)  longline trawls, together with sudlines, hooks, swivels and tubs;

             (g)  fishing dredges;

             (h)  fishing gear haulers, including gurdies, crab haulers and power blocks installed on board a fishing vessel;

              (i)  automatic baiters;

              (j)  automatic jiggers; and

             (k)  commercial fishing bait.

226/94 s4

Rebate for fishing equipment

     31. The minister may rebate tax paid by a fisher on the following tangible personal property used in fishing:

             (a)  boats and vessels when registered under the Atlantic Fishery Regulations (Canada);

             (b)  materials and supplies for the construction or repair of vessels described in paragraph (a);

             (c)  equipment designed for use on a boat or vessel, and installed on a vessel described in paragraph (a); and

             (d)  other equipment or supplies used commercially to catch fish.

226/94 s4

Pre‑authorized exemption and rebate

     32. (1) Where the purchase price of an item of tangible personal property eligible for rebate under these regulations is greater than $2,000, the intended purchaser may apply to the minister for a pre‑authorized exemption of tax and the minister may issue a certificate authorizing the purchaser to acquire the tangible personal property specified in the certificate without paying tax.

             (2)  A farmer or fisher may apply for a rebate of tax paid under this Act by filing with the minister, within 3 years from the date of payment, a retail sales tax rebate form verifying purchase and consumption together with other information that the minister may require.

             (3)  The minister shall issue a rebate under this section only where the application, verifications, consumption and other information are reasonable and approved by the minister.

226/94 s4

Productive capital equipment

     33. Productive capital equipment purchased or acquired by Vanguard Paper Box Limited during the period January 1, 1982 to May 27, 1982 and used directly in the manufacture of folding cartons within the confines of a plant situate at Donovans Industrial Park shall be exempt from the tax.

317/82 s1

Insurance exemptions

     34. The following forms of insurance shall be excluded from the application of section 16 of the Act:

             (a)  accident insurance;

             (b)  sickness insurance;

             (c)  life insurance;

             (d)  marine insurance, other than marine insurance on sport watercraft, when the sport watercraft are 20 tons gross or less; and

             (e)  surety, guarantee or fidelity type bonds.

124/87 s2

Parent and subsidiary companies

     35. (1) For the purpose of this section, a company is considered to be a subsidiary of another company if, but only if, it is controlled by that other, and a company is considered to be another's parent company if, but only if, that other is its subsidiary.

             (2)  For the purpose of this section, a company shall be considered to be controlled by another company if, but only if, shares of the first‑mentioned company carrying not less than 95% of the votes for the election of directors are held, otherwise than by way of security only, by or for the benefit of the other company.

             (3)  Where a parent company or a subsidiary company brings into, purchases or otherwise acquires in the province tangible personal property and pays the tax in respect of the consumption or use of the tangible personal property and after that sells at a retail sale or hires out the same property to its subsidiary or parent company, or, if a subsidiary, to another subsidiary of its parent company, no tax shall be payable in respect of the consumption or use of the tangible personal property by the subsidiary or parent company acquiring it under the subsequent retail sale or hiring.

49/79 s26

Tax not owed by second company

     36. Where a company sells or hires tangible personal property to another company and a person owns beneficially at least 95% of the share capital of each company and if the company selling or hiring the tangible personal property paid the tax at the time of purchase, then the second company shall pay no tax on the purchase or hire of the tangible personal property.

135/79 s3

Repeal

      37. The Retail Sales Tax Regulations, 1979, Newfoundland Regulation 49/79, are repealed.