Archived - The Department of Finance Clarifies GST/HST Rules Following Court Decision

January 17, 2014 – Ottawa, Ontario – Department of Finance

The Department of Finance today released proposed amendments to the Excise Tax Act that reaffirm the policy that a person cannot claim input tax credits in respect of an amount of Goods and Services Tax/Harmonized Sales Tax (GST/HST) that has already been recovered by the person from a supplier.

The ability to claim input tax credits that exceed the amount of tax that was actually paid is not consistent with the fundamental structure of any value-added tax, including the GST/HST. The proposed amendments, which are in response to a recent decision by the Tax Court of Canada, are intended to reduce taxpayer uncertainty and potential revenue losses, as well as clarify that certain importers are not allowed to recover an amount of GST/HST if another person could also recover the same amount.

The proposed amendments will generally apply as of the day the provisions being amended originally came into force. However, the proposed amendments will not affect any case that has already been decided by the courts. Interested parties are invited to provide comments on the draft legislative proposals by February 17, 2014. Please send your comments to or to:

Tax Policy Branch
Department of Finance
140 O’Connor Street
Ottawa, Ontario
K1A 0G5

Marie Prentice
Press Secretary
Office of the Minister of Finance

Jack Aubry
Media Relations
Department of Finance

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