Marginal note:2000, c. 30, s. 37(1)

• 12. (1) The description of A in clause 184.1(2)(d)(i)(A) of the Act is replaced by the following:

  A

  is

  • (I) if the supply deemed under subparagraph (a)(i) to be made by the surety is made in a participating province, the total of the rate set out in subsection 165(1) and the tax rate for the participating province, and

  • (II) in any other case, the rate set out in subsection 165(1), and

• (2) Subsection (1) applies to a person acting as a surety under a performance bond in respect of a contract for a particular taxable supply of construction services if a contract payment (within the meaning of paragraph 184.1(2)(a) of the Act) becomes due or is paid without having become due to the person on or after July 1, 2006, by reason of the person carrying on the particular construction.

• (3) Despite subsection (2) and for the purpose of determining the total amount of all input tax credits in respect of direct inputs (within the meaning of paragraph 184.1(2)(c) of the Act), where a surety is carrying on a particular construction of real property situated in Canada as full or partial satisfaction of the surety’s obligation under a bond, a contract payment (within the meaning of paragraph 184.1(2)(a) of the Act), other than a contract payment that is not in respect of the particular construction, becomes due or is paid without having become due before July 1, 2006, and another contract payment (within the meaning of paragraph 184.1(2)(a) of the Act), other than a contract payment that is not in respect of the particular construction, becomes due on or after that day, without having been paid before that day, or is paid without having become due on or after that day, clause 184.1(2)(d)(i)(A) of the Act shall be read as follows:

  • (A) the amount determined by the formula

    (A × B) + (C × D)

    where

    A

    is

    • (I) if the supply deemed under subparagraph (a)(i) to be made by the surety is made in a participating province, the total of 7% and the rate of tax for that participating province, and

    • (II) in any other case, 7%,

    B

    is the total of all contract payments (other than contract payments that are not in respect of the particular construction) that become due before July 1, 2006, or are paid, without having become due, to the surety before that day,

    C

    is

    • (I) if the supply deemed under subparagraph (a)(i) to be made by the surety is made in a participating province, the total of 6% and the rate of tax for the participating province, and

    • (II) in any other case, 6%, and

    D

    is the total of all contract payments (other than contract payments that are not in respect of the particular construction) that become due on or after July 1, 2006, without having been paid before that day, or are paid, without having become due, to the surety on or after that day

Marginal note:1997, c. 10, s. 181(1)

• 13. (1) The description of B in paragraph 187(c) of the Act is replaced by the following:

  B

  is

  • (i) if that supply is made in a participating province, the total of 100%, the rate set out in subsection 165(1) and the tax rate for that province, and

  • (ii) in any other case, the total of 100% and the rate set out in subsection 165(1),

• (2) Subsection (1) comes into force, or is deemed to have come into force, on July 1, 2006.

Marginal note:1994, c. 9, s. 12(1)(F)

• 14. (1) Subsection 188(1) of the Act is replaced by the following:

  Marginal note:Prizes

  • 188. (1) If a commercial activity of a registrant (other than a registrant to whom subsection (5) applies) consists of taking bets or conducting games of chance and, in the course of that activity, the registrant pays an amount of money at any time in a reporting period as a prize or winnings to a bettor or a person playing or participating in the games, for the purpose of determining an input tax credit of the registrant, the registrant shall be deemed to have received at that time a taxable supply of a service for use exclusively in the activity and to have paid, at that time, tax in respect of the supply equal to the amount determined by the formula

    (A/B) × C

    where

    A

    is

    • (a) if the supply is made in a participating province, the total of the rate set out in subsection 165(1) and the tax rate for that province, and

    • (b) in any other case, the rate set out in subsection 165(1),

    B

    is the total of 100% and the percentage determined for A, and

    C

    is the amount of money paid as the prize or winnings.

• (2) Subsection (1) is deemed to have come into force on April 1, 1997.

Marginal note:1993, c. 27, s. 57(3)

• 15. (1) The portion of subsection 193(1) of the Act before paragraph (a) is replaced by the following:

  Marginal note:Sale of real property

  • 193. (1) Subject to subsection (2.1), if at a particular time a registrant makes a particular taxable supply of real property by way of sale, other than

• Marginal note:1997, c. 10, s. 183(2)

  (2) The portion of subsection 193(2) of the Act before paragraph (a) is replaced by the following:

  • Marginal note:Sale by public sector bodies

    (2) Subject to subsection (2.1), if at a particular time a registrant that is a public sector body (other than a financial institution) makes a particular taxable supply of real property by way of sale (other than a supply that is deemed under subsection 200(2) or 206(5) to have been made) and, immediately before the time tax becomes payable in respect of the particular taxable supply, the property was not used by the registrant primarily in commercial activities of the registrant, except where subsection (1) applies, the registrant may, despite section 170 and Subdivision d, claim an input tax credit for the reporting period in which tax in respect of the particular taxable supply became payable or is deemed to have been collected, as the case may be, equal to the lesser of

• (3) Section 193 of the Act is amended by adding the following after subsection (2):

  • Marginal note:Limitation

    (2.1) If the particular taxable supply of property referred to in subsection (1) or (2) is made at a particular time by a public sector body to another person with whom the public sector body is not dealing at arm’s length, the value of A in subsection (1) and the input tax credit under subsection (2) shall not exceed the lesser of

    • (a) the basic tax content of the property at the particular time, and

    • (b) the amount determined by the formula

      (A/B) × C

      where

      A

      is the basic tax content of the property at the particular time,

      B

      is the amount that would be the basic tax content of the property at that time if that amount were determined without reference to the description of B in paragraph (a) and the description of K in paragraph (b) of the definition “basic tax content” in subsection 123(1), and

      C

      is the tax that is or would, in the absence of section 167, be payable in respect of the particular taxable supply.

• (4) Subsections (1) to (3) apply to any supply in respect of which tax becomes payable or would have become payable, in the absence of section 167 of the Act, on or after July 1, 2006.

Marginal note:1997, c. 10, s. 184(1)

• 16. (1) The description of A in paragraph 194(a) of the Act is replaced by the following:

  A

  is

  • (i) if tax under subsection 165(2) was payable in respect of the supply, the total of the rate set out in subsection 165(1) and the tax rate for the participating province in which the supply was made, and

  • (ii) in any other case, the rate set out in subsection 165(1),

• (2) Subsection (1) applies to any supply of real property in respect of which ownership and possession under the agreement for the supply are transferred on or after July 1, 2006.

Marginal note:1997, c. 10, s. 192(4)

• 17. (1) The description of A in paragraph 202(4)(b) of the Act is replaced by the following:

  A

  is

  • (i) in the case of an acquisition or importation in respect of which tax is payable only under subsection 165(1) or section 212 or 218, as the case may require, and in the case of an acquisition deemed to have been made under subsection (5) of a vehicle or aircraft in respect of which no tax under subsection 165(2) was payable by the registrant, the amount determined by the formula

    C/D

    where

    C

    is the rate set out in subsection 165(1), and

    D

    is the total of 100% and the percentage determined for C,

  • (ii) in the case of the bringing into a participating province of the vehicle or aircraft from a non-participating prov­ince and in the case of an acquisition in respect of which tax under section 220.06 is payable, the amount determined by the formula

    E/F

    where

    E

    is the tax rate for the participating province, and

    F

    is the total of 100% and the percentage determined for E, and

  • (iii) in any other case, the amount determined by the formula

    G/H

    where

    G

    is the total of the rate set out in subsection 165(1) and the tax rate for a participating province, and

    H

    is the total of 100% and the percentage determined for G, and

• (2) Subsection (1) applies to any taxation year of a registrant that ends on or after July 1, 2006, except that, for the taxation year of the registrant that includes that day, the description of A in paragraph 202(4)(b) of the Act, as amended by subsection (1), shall be read as follows:

  A

  is

  • (i) in the case of an acquisition or importation in respect of which tax is payable only under subsection 165(1) or section 212 or 218, as the case may require, and in the case of an acquisition deemed to have been made under subsection (5) of a vehicle or aircraft in respect of which no tax under subsection 165(2) was payable by the registrant, 6.5/106.5,

  • (ii) in the case of the bringing into a participating province of the vehicle or aircraft from a non-participating prov­ince and in the case of an acquisition in respect of which tax under section 220.06 is payable, 8/108, and

  • (iii) in any other case, 14.5/114.5, and

Marginal note:1993, c. 27, s. 76(4)

• 18. (1) Paragraphs 211(4)(a) and (b) of the Act are replaced by the following:

  • (a) to have made, immediately before that day, a taxable supply of the property by way of sale and to have collected, on that day, tax in respect of the supply equal to the basic tax content of the property on that day; and

  • (b) to have received, on that day, a taxable supply of the property by way of sale and to have paid, on that day, tax in respect of the supply equal to the basic tax content of the property on that day.

• (2) Subsection (1) applies in respect of an election that is revoked and ceases to have effect on or after May 2, 2006.

Marginal note:1997, c. 10, s. 198(1)

• 19. (1) Section 212 of the Act is replaced by the following:

  Marginal note:Imposition of goods and services tax

  212. Subject to this Part, every person who is liable under the Customs Act to pay duty on imported goods, or who would be so liable if the goods were subject to duty, shall pay to Her Majesty in right of Canada tax on the goods calculated at the rate of 6% on the value of the goods.

• (2) Subsection (1) applies to goods imported into Canada, or released (as defined in the Customs Act), on or after July 1, 2006.

Marginal note:1997, c. 10, s. 203(1)

• 20. (1) Section 218 of the Act is replaced by the following:

  Marginal note:Imposition of goods and services tax

  218. Subject to this Part, every recipient of an imported taxable supply shall pay to Her Majesty in right of Canada tax calculated at the rate of 6% on the value of the consideration for the imported taxable supply.

• (2) Subsection (1) applies

  • (a) to any imported taxable supply made on or after July 1, 2006;

  • (b) for the purposes of calculating tax in respect of any imported taxable supply made before July 1, 2006, but only in respect of consideration that becomes due on or after that day without having been paid before that day or that is paid, without having become due, on or after July 1, 2006; and

  • (c) if neither paragraph (a) nor (b) applies, for the purposes of determining or calculating tax that is not payable but would have been payable on or after July 1, 2006, in the absence of certain circumstances described in the Act.

Marginal note:1997, c. 10, s. 208(1)

• 21. (1) The description of E in subsection 225.2(2) of the Act is replaced by the following:

  E

  is the rate set out in subsection 165(1);

• (2) Subsection (1) applies for the purposes of determining the net tax of a selected listed financial institution for a reporting period of the selected listed financial institution that ends on or after July 1, 2006.

Marginal note:2000, c. 30, s. 61(2)

• 22. (1) The description of A in subparagraph 233(2)(a)(i) of the Act is replaced by the following:

  A

  is the total of 100%, the rate set out in subsection 165(1) and the tax rate for that province, and

• Marginal note:2000, c. 30, s. 61(2)

  (2) Subparagraph 233(2)(a)(ii) of the Act is replaced by the following:

  • (ii) the total consideration for all supplies (in this subparagraph referred to as the “non-participating provinces’ supplies”) that are specified supplies to which subsection 165(2) did not apply by the amount determined by the formula

    (100%/A) × B

    where

    A

    is the total of 100% and the rate set out in subsection 165(1),

    B

    is

    • (A) if the particular person has made an election under this subsection that is in effect for that fiscal year, the part of the dividend that is in respect of the non-participating province’s supplies, and

    • (B) in any other case, the amount determined by the formula

      (C/D) × E

      where

      C

      is the portion of the total of the values determined, in computing the specified amount in respect of the dividend, for B and D in subsection (1) that is attributable to supplies made in non-participating provinces,

      D

      is the total referred to in the description of C, and

      E

      is the specified amount in respect of the dividend; and

• (3) Subsections (1) and (2) apply in respect of a patronage dividend that is paid on or after July 1, 2006.

Marginal note:1997, c. 10, s. 220(3)

• 23. (1) The description of A in subsection 253(1) of the Act is replaced by the following:

  A

  is

  • (a) where the tax paid by the individual includes only tax imposed under subsection 165(1) or section 212 or 218, the amount determined by the formula

    D/E

    where

    D

    is the rate set out in subsection 165(1), and

    E

    is the total of 100% and the percent­age determined for D,

  • (b) where the tax paid by the individual does not include any tax imposed under any of those provisions, the amount determined by the formula

    F/G

    where

    F

    is the tax rate for a participating province, and

    G

    is the total of 100% and the percent­age determined for F, and

  • (c) in any other case, the amount determined by the formula

    H/I

    where

    H

    is the total of the rate set out in subsection 165(1) and the tax rate for a participating province, and

    I

    is the total of 100% and the percent­age determined for H,

• Marginal note:1993, c. 27, s. 108(1)

  (2) Subparagraph 253(2)(a)(ii) of the Act is replaced by the following:

  • (ii) paid tax in respect of the instrument equal to the amount determined by the formula

    A × B

    where

    A

    is

    • (A) where the tax paid by the individual includes only tax imposed under subsection 165(1) or section 212 or 218, the amount determined by the formula

      C/D

      where

      C

      is the rate set out in subsection 165(1), and

      D

      is the total of 100% and the percentage determined for C,

    • (B) where the tax paid by the individual does not include any tax imposed under any of those provisions, the amount determined by the formula

      E/F

      where

      E

      is the tax rate for a participating province, and

      F

      is the total of 100% and the percentage determined for E, and

    • (C) in any other case, the amount determined by the formula

      G/H

      where

      G

      is the total of the rate set out in subsection 165(1) and the tax rate for a participating province, and

      H

      is the total of 100% and the percentage determined for G, and

    B

    is the capital cost allowance in respect of that instrument that was deductible under the Income Tax Act in computing the individual’s income from the partnership for that calendar year;

• Marginal note:1993, c. 27, s. 108(1)

  (3) Subparagraph 253(2)(c)(ii) of the Act is replaced by the following:

  • (ii) paid, in that reporting period, tax in respect of that acquisition equal to the amount determined by the formula

    A × B

    where

    A

    is

    • (A) where the tax paid by the individual includes only tax imposed under subsection 165(1) or section 212 or 218, the amount determined by the formula

      C/D

      where

      C

      is the rate set out in subsection 165(1), and

      D

      is the total of 100% and the percentage determined for C,

    • (B) where the tax paid by the individual does not include any tax imposed under any of those provisions, the amount determined by the formula

      E/F

      where

      E

      is the tax rate for a participating province, and

      F

      is the total of 100% and the percentage determined for E, and

    • (C) in any other case, the amount determined by the formula

      G/H

      where

      G

      is the total of the rate set out in subsection 165(1) and the tax rate for a participating province, and

      H

      is the total of 100% and the percentage determined for G, and

    B

    is

    • (A) in the case of property imported by the individual, the amount (not exceeding the total of the value of the property determined under section 215 and the tax calculated on it) in respect of the acquisition and importation of the property by the individual that was deductible under the Income Tax Act in computing the individual’s income from the partnership for that calendar year, and

    • (B) in any other case, the amount in respect of the acquisition of the property or service by the individual that was so deductible in computing that income.

• (4) Subsection (1) applies to any rebate for a calendar year after 2005, except that for the 2006 calendar year the description of A in subsection 253(1) of the Act, as amended by subsection (1), shall be read as follows:

  A

  is

  • (a) where the tax paid by the individual includes only tax imposed under subsection 165(1) or section 212 or 218,6.5/106.5,

  • (b) where the tax paid by the individual does not include any tax imposed under any of those provisions, 8/108, and

  • (c) in any other case, 14.5/114.5,

• (5) Subsections (2) and (3) are deemed to have come into force on April 1, 1997, except that for the purpose of determining a rebate under subsection 253(2) of the Act, as amended by subsections (2) and (3), for the 2006 calendar year, the expression “the rate set out in subsection 165(1)” shall be read as “6.5%”.