A Conveyance or Cargo Container
Please note that the following Policy Statement, although correct at the time of issue, may not have been updated to reflect any subsequent legislative changes.
GST/HST policy statement P-067R
Date of Issue
July 6, 1993
Revised: April 30, 1999
Meaning of "a conveyance or cargo container"
The following are all to the Excise Tax Act:
Section 6 of Part V of Schedule VI
Para. 6.2(a) of Part V of Schedule VI
Definition of "stopover" of Part VII of Schedule VI
Definition of "leg" of Part VI of Schedule IX
Section 3 of Part VI of Schedule IX
Section 2 of Part I of Schedule X
Para. 3(f) of the Non-Taxable Imported Goods (GST) Regulations
National Coding System File Number(s)
January 1, 1991 for GST
April 1, 1997 for HST.
Issue and Decision
The words "conveyance" or "cargo container" are not defined in the Excise Tax Act (the "Act"), or in the Interpretation Act. The Department understands that it is necessary to give these words their common, ordinary meaning. For purposes of the legislative provisions identified above, the Department understands the meaning of the words "conveyance" and "cargo container" to be as follows:
A "conveyance" is a means of transporting or carrying. A conveyance will include a vehicle such as a bus, ship, airplane, truck, train or automobile.
A "cargo container" is anything that contains or can contain the lading or freight of a ship, airplane, train or other vehicle. It is generally portable, and is usually a metal compartment in which freight is placed for convenience of movement.
Statement of Facts
1. Log Company provides the following services to log boom owners: when log booms break up in transit or storage resulting in logs becoming loose and a hazard to users of the waterway, Log Company dispatches salvors to recover any loose logs, return them to the booms and make any necessary repairs to the booms involved.
2. The logs are being transported exclusively on a Canadian waterway.
1. The salvors invoice Log Company for their services, and Log Company in turn invoices American Corp., a non-resident company, for services related to two log booms owned by American Corp.
2. American Corp. did not pay the GST/HST charged on the invoice, claiming that it is not liable to pay the GST/HST.
The supply of the log spill recovery services for log booms breaking up in transit made by Log Company to American Corp., a non-resident, is zero-rated under section 6 of Part V of Schedule VI to the Act, to the extent that the supply is for emergency repair services. Supplies for the repair of the log booms in a non-emergency situation and for the recovery of any loose logs are not zero-rated under section 6 of Part V of Schedule VI.
Section 6 of Part V of Schedule VI to the Act zero-rates a supply made by a person to a non-resident recipient of an emergency repair service and of any tangible personal property supplied in conjunction with such a service, in respect of a conveyance or cargo container that is being used by that person in the course of a business of transporting passengers or property.
GST Memorandum Series "Exports - Services and Intellectual Property" states in paragraph 13 that the Department will generally consider an "emergency" to be an unforeseen event or combination of events that calls for immediate action. The conveyance or cargo container may contain passengers or property that are transported by any mode of transportation including road, rail, air, and sea.
Further, in interpreting the phrase "conveyance or cargo container", the Department will adopt the commonly understood meaning of the words "conveyance" and "cargo container".
It is our view that the phrase conveyance or cargo container is sufficiently broad to include log booms where the booms are pulled by a boat or a ship or are left to float down a river while surrounding and containing the logs. However, log booms affixed to land in order to direct logs to a specific destination or used for the temporary storage of logs do not correspond to the Department's interpretation of a "conveyance or cargo container".
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