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Definitions for the digital economy

The following definitions apply for purposes of the proposed digital economy measures.

Accommodation platform

Accommodation platform means a digital platform through which a person facilitates the making of supplies of short-term accommodation situated in Canada by another person that is not registered under the normal GST/HST.

Accommodation platform operator

Accommodation platform operator, in respect of a supply of short-term accommodation made through an accommodation platform, means a person (other than the supplier or an excluded operator in respect of the supply) that

  • controls or sets the essential elements of the transaction between the supplier and the recipient;
  • if the above does not apply to any person, is involved, directly or through arrangements with third parties, in collecting, receiving or charging the consideration for the supply and transmitting all or part of the consideration to the supplier; or
  • is a prescribed person (no person is currently prescribed).

Canadian accommodation related supply

Canadian accommodation related supply means a taxable supply of a service

  • made to a person in connection with a supply of short-term accommodation situated in Canada made to the person; and
  • the consideration for which represents a booking fee, administration fee or other similar charge.

Digital platform

Digital platform includes a website, an electronic portal, gateway, store or distribution platform or any other similar electronic interface but does not include:

  • an electronic interface that solely processes payments
  • a prescribed platform or interface (no platform or interface is currently prescribed)

Distribution platform operator

Distribution platform operator, in respect of a supply of property or a service made through a specified distribution platform, means a person (other than the supplier or an excluded operator in respect of the supply) that

  • controls or sets the essential elements of the transaction between the supplier and the recipient
  • if the above does not apply to any person, is involved, directly or through arrangements with third parties, in collecting, receiving or charging the consideration for the supply and transmitting all or part of the consideration to the supplier;
  • is a prescribed person (no person is currently prescribed).

Electronic filing

Electronic filing means a person using electronic media in a manner specified by the Minister.

Excluded operator

Excluded operator means a person that, in respect of a supply of property or a service,

  • meets all of the following conditions:
    • the person does not set, directly or indirectly, any of the terms and conditions under which the supply is made,
    • the person is not involved, directly or indirectly, in authorizing the charge to the recipient of the supply in respect of the payment of the consideration for the supply, and
    • the person is not involved, directly or indirectly, in the ordering or delivery of the property or in the ordering or rendering of the service;
  • solely provides for the listing or advertising of the property or service or for the redirecting or transferring to a digital platform on which the property or service is offered;
  • is solely a payment processor; or
  • is a prescribed person (no person is currently prescribed).

False statement

False statement includes a statement that is misleading because of an omission from the statement.

Indicators of information in respect of the usual place of residence

Indicators of information in respect of the usual place of residence of your customers would be as follows:

  • the home address of the customer;
  • the business address of the customer;
  • the billing address of the customer;
  • the Internet Protocol address of the device used by the customer or similar data obtained through a geolocation method;
  • payment-related information of the customer or other information used by the payment system;
  • the information from a subscriber identity module, or other similar module, used by the customer;
  • the place at which a landline communication service is supplied to the customer; and
  • any other relevant information that the Minister may specify.

Indicators of location - Canada and Province

Indicators of location in respect of your customers would be as follows:

  • A Canadian indicator in respect of your customer is an indicator obtained in connection with the supply that reasonably supports the conclusion that the usual place of residence of your customer is situated in Canada.
  • A foreign indicator in respect of your customer is an indicator obtained in connection with the supply that reasonably supports the conclusion that the usual place of residence of your customer is situated outside Canada.
  • A participating province indicator in respect of your customer is an indicator obtained in connection with the supply that reasonably supports the conclusion that the usual place of residence of your customer is situated in a participating province.
  • A non-participating province indicator in respect of your customer is an indicator obtained in connection with the supply that reasonably supports the conclusion that the usual place of residence of your customer is situated in a non-participating province.

Populations of participating provinces

The populations of the participating provinces are approximately:
Province Population
Ontario 14,733,119
Nova Scotia 979,115
New Brunswick 781,315
Prince Edward Island 159,713
Newfoundland and Labrador 520,998
Source: Statistics Canada  

Qualifying foreign currency

Qualifying foreign currency means the U.S. dollar, the euro or another foreign currency that the Minister may specify (currently there is no other foreign currency that has been specified by the Minister).

Qualifying tangible personal property supply

Qualifying tangible personal property supply means a supply made by way of sale of tangible personal property that is, under the agreement for the supply, to be delivered or made available to the recipient in Canada other than

  • an exempt or zero-rated supply;
  • a supply of tangible personal property to be sent by mail or courier to the recipient at an address in Canada from an address outside Canada by the supplier or by another person acting on behalf of the supplier, if the supplier maintains evidence satisfactory to the Minister that the property was so sent; or
  • a prescribed supply (no supply is currently prescribed).

Recipient

Recipient of a supply of property or a service means:

  • where consideration for the supply is payable under an agreement for the supply, the person who is liable under the agreement to pay that consideration;
  • where bullet (a) does not apply and consideration is payable for the supply, the person who is liable to pay that consideration
  • where no consideration is payable for the supply:
    • in the case of a supply of property by way of sale, the person to whom the property is delivered or made available
    • in the case of a supply of property otherwise than by way of sale, the person to whom possession or use of the property is given or made available
    • in the case of a supply of a service, the person to whom the service is rendered

And any reference to a person to whom a supply is made shall be read as a reference to the recipient of the supply.

Short-term accommodation

A short-term accommodation means the rental of an accommodation unit in Canada as a place of lodging for an individual who will occupy it continuously for a period of less than one month and that costs more than $20 per night. For example, overnight or weeklong accommodation in any of the following would usually be considered short-term accommodation:

  • hotels and motels
  • resorts and lodges
  • bed-and-breakfast establishments

Short-term accommodation includes any type of overnight shelter (such as a tent) that is part of a tour package that also includes food and the services of a guide.

Short-term accommodation does not include the following:

  • shelter on a train, trailer, boat, or other structure that is, or could be, self-propelled (for example, cruise-ship cabins, train berths, houseboats, travel trailers, and all recreational vehicles)
  • an accommodation unit supplied under a timeshare arrangement

Specified Canadian recipient

Specified Canadian recipient means a recipient of a supply in respect of which the following conditions are met:

  • the recipient has not provided to the supplier, or to a distribution platform operator in respect of the supply, evidence satisfactory to the Minister that the recipient is registered under the normal registration regime; and
  • the usual place of residence of the recipient is situated in Canada.

Specified distribution platform

Specified distribution platform means a digital platform through which a person facilitates the making of specified supplies by another person that is a specified non-resident supplier or the making of qualifying tangible personal property supplies by another person that is not registered under the normal registration regime.

Specified non-resident supplier

Specified non-resident supplier means a non-resident person that does not make supplies in the course of a business carried on in Canada and that is not registered under the normal registration regime.

Specified recipient

Specified recipient in respect of a supply means a person that is the recipient of the supply and that is not registered under the normal registration regime, other than a non-resident person that is not a consumer of the property.

Specified supply

Specified supply means a taxable supply of intangible personal property or a service other than

  • a supply of intangible personal property that
    • may not be used in Canada,
    • relates to real property situated outside Canada, or
    • relates to tangible personal property ordinarily situated outside Canada;
  • a supply of a service that
    • may only be consumed or used outside Canada,
    • is in relation to real property situated outside Canada, or
    • is rendered in connection with criminal, civil or administrative litigation (other than a service rendered before the commencement of such litigation) that is under the jurisdiction of a court or other tribunal established under the laws of a country other than Canada, or in the nature of an appeal from a decision of a court or other tribunal established under the laws of a country other than Canada;
  • a supply of a service
    • made to a person in connection with a supply of short-term accommodation made to the person, and
    • the consideration for which represents a booking fee, administration fee or other similar charge; and
  • a prescribed supply (no supply is currently prescribed).

Threshold amount

The threshold amount of a particular person for a period is the total of all amounts each of which is an amount that is, or that could reasonably be expected to be, the value of the consideration for a supply that is, or that could reasonably be expected to be,

  • a specified supply made during that period by the particular person to a specified Canadian recipient (other than a supply that is deemed to have been made by the particular person as a platform operator);
  • a Canadian accommodation related supply made during that period by the particular person to another person that is not registered under the normal registration regime;
  • if the particular person is a distribution platform operator in respect of a specified supply made during that period through a specified distribution platform by a specified non-resident supplier to a specified Canadian recipient, a specified supply that is made during that period through the specified distribution platform by a specified non-resident supplier to a specified Canadian recipient and in respect of which any person is a distribution platform operator; or
  • if the particular person is an accommodation platform operator in respect of an accommodation supply - being a taxable supply of short-term accommodation situated in Canada made by any person that is not registered under the normal registration regime to a recipient that is not registered under that regime - that is made during that period through an accommodation platform, an accommodation supply that is made during that period through the accommodation platform and in respect of which any person is an accommodation platform operator.

Usual place of residence - Canada

The usual place of residence of the customer will be considered to be situated in Canada if you, as the supplier or a distribution platform operator in respect of the supply:

  • In the ordinary course of your operations, have obtained two or more Canadian indicators in respect of the customer and have not obtained more than one foreign indicator in respect of the customer.
  • In the ordinary course of your operations, have obtained two or more Canadian indicators in respect of the customer and two or more foreign indicators in respect of the customer but the Canadian indicators are, in the circumstances, reasonably considered to be more reliable in determining a place of residence.
  • If the two circumstances above do not apply, have determined that the usual place of residence of the customer is situated in Canada based on any method that the Minister may allow.

Usual place of residence - Participating provinces

Rule 1 - Usual place of residence - Participating province

If the usual place of residence of the customer is situated in Canada and if you, as the supplier or the distribution platform operator in respect of the supply, have obtained in the ordinary course of your operations one or more addresses that are a home or business address of the customer in a participating province, and have not obtained in the ordinary course of your operations the same number or a greater number of addresses that are a home or business address of the customer in a non-participating province, the usual place of residence of the customer is situated in the following participating province:

Rule 2 - Usual place of residence - Participating province

A second rule applies If the usual place of residence of the customer is situated in Canada but is not determined under the previous rule to be in a participating province and if you:

  • have obtained in the ordinary course of your operations one or more participating province indicators in respect of the customer, and
  • have not obtained in the ordinary course of your operations the same number or a greater number of non-participating province indicators in respect of the customer that could reasonably be considered to be as reliable in determining a place of residence as those participating province indicators.

In this case, the usual place of residence of the customer is situated in the following participating province:

  • if those participating province indicators are in respect of the same participating province, that participating province;
  • if those participating province indicators are in respect of two or more participating provinces and the participating province indicators in respect of one of those participating provinces are, in the circumstances, reasonably considered to be more reliable in determining a place of residence, that participating province;
  • if the usual place of residence of the customer is not determined in the previous two circumstances and if you have determined that the usual place of residence of the customer is situated in one of the participating provinces based on any method that the Minister may allow, that participating province; or
  • if the usual place of residence of the customer is not determined in any of the previous circumstances and if those participating province indicators are in respect of two or more participating provinces, the participating province among those participating provinces for which the tax rate is the lowest or, if the tax rates for those participating provinces are the same, the participating province among those participating provinces that has the largest population.

Rule 3 - Usual place of residence - Participating province

If the usual place of residence of the customer is situated in Canada but is not determined under the previous two rules to be in a participating province and you have determined that the usual place of residence of the customer is situated in a participating province based on any method that the Minister may allow, the usual place of residence of the customer is situated in that participating province.

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