Frequently asked questions
The questions and answers below provide information about the Goods and Services (GST) and Harmonized Sales Tax (HST) Incremental Federal Rebate for Municipalities Report.
For more information about the GST/HST, or the GST/HST Incremental Federal Rebate for Municipalities, see our GST/HST webpage.
1. How is a municipality defined for the purpose of the GST/HST Incremental Federal Rebate for Municipalities in the Excise Tax Act?
Municipal entities that are eligible to claim the 100% GST rebate and the federal portion of the HST are defined as follows:
- incorporated municipal bodies, for example cities, towns, villages, and metropolitan authorities;
- entities determined by the Minister of National Revenue to be a municipality, for example transit commissions and public libraries; and
- entities designated by the Minister of National Revenue, in relation to their delivery of municipal services, such as some non-profit social housing corporations or cooperatives.
2. What is a "determined" or "designated" municipality?
Generally, a determined municipality is an entity that is created by a city or town and is either owned or controlled by the city or town, such as a library board, which often falls within this category.
A designated municipality is an entity that delivers tax-exempt municipal services. Certain non-profit social housing corporations fall within this category, as do services such as water hauling. These municipal entities do not have to be created and owned or controlled by the city or town.
3. How can an individual be considered a municipality and therefore eligible for the municipality rebate?
An individual providing an exempt municipal service may be designated to be a municipality and therefore eligible to claim the rebate. For example, water haulers delivering unbottled water are considered to be providing exempt municipal services and, as a result, are eligible to be designated as municipality and can claim the rebate.
4. What does "approved for payment" mean?
Approved for payment means that the Canada Revenue Agency (CRA) reviewed and accepted a rebate claim made by a municipality. This rebate amount could however be subject to adjustments, if selected for audit.
A rebate amount approved for payment may not have been paid to a municipality if there were amounts owing to the CRA, or to Revenu Québec for a Quebec municipality, or if the rebate was intended to be offset on the municipality's GST return.
5. How is the approved for payment amount calculated?
The rebate amount listed is the total dollar amount of the incremental GST rebate of 42.86% and the federal part of the HST, that is, the difference between the 57.14% rebate that municipalities were eligible to claim before the amendment to the Excise Tax Act for the 100% rebate amount.
6. What is the legislative provision that allows the CRA to release this information
Pursuant to subsection 259(13) of the Excise Tax Act, the Minister of National Revenue may release any information necessary to identify a municipality. The first three characters of the postal code represent a geographic area, and this information is required to identify a municipality. The last three characters of a postal code identify part or all of a street, or a group of rural postal offices, and are not required to identify a municipality.
7. How can a municipality claim the GST/HST rebate?
To claim the GST/HST rebate, a municipality has to complete Form GST66, Application for GST/HST Public Service Bodies' Rebate and GST Self-government Refund. Municipalities have up to four years to include an amount in a claim.
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