GST/HST Technical Information Bulletin B-039, “GST/HST Administrative Policy - Application of the GST/HST to Indians” outlines the Canada Revenue Agency’s (“CRA”) position regarding GST/HST on sales made to, or by, a First Nations individual, a band, or a band-empowered entity, including the conditions for making otherwise taxable supplies on an exempt basis. This document was revised in June 2013 to replace a previous version dated August 2006.
It is important to note that this bulletin does not apply in situations where the First Nations tax (FNT) or First Nations goods and services tax (FNGST) is in effect. It also does not apply to First Nations that have self-government agreements. A number of members of these self-governing First Nations have chosen to opt out of being citizens of such First Nations and, upon providing a certificate to that effect, may still be eligible for tax relief. GST/HST Notice 238, “First Nations Having a Self-Government Agreement Ending Indian Act Tax Relief – Determining Tax Relief for Indian Members Who Are Not Citizens” covers the details of this topic.
This document also discusses:
- the point-of-sale relief on the provincial part of the HST to Ontario First Nations on eligible off-reserve purchases;
- types of supplies (e.g. goods, intangible personal property, services, importations);
- remote stores;
- sales made over the phone or internet; and
- the conditions for granting tax exemptions.
One of the conditions for permitting an exemption to a First Nation individual, band or band-empowered entity is that the services or goods must be provided on, or delivered to, a reserve by the seller or their agent. Corporations, non-Indians on a reserve, and purchasers arranging for their own transportation to a reserve, are all subject to the regular GST/HST rules.
Another condition is the requirement that the vendor maintain suitable documentary evidence that the supply for which no GST/HST was payable was made to an eligible purchaser. GST/HST Notice 264, “Sales Made to Indians and Documentary Evidence – Temporary Confirmation of Registration Document”, provides further details on this requirement.
Other relevant documents related to the above topics include:
- RC4072, “First Nations Tax (FNT)”;
- RC4365, “First Nations Goods and Services Tax (FNGST)”;
- Ontario Ministry of Finance’s Harmonized Sales Tax Guide 80, “Ontario First Nations Point-of-Sale Exemptions”;
- GST/HST Info Sheet GI-106, “Ontario First Nations Point-of-Sale Relief Reporting Requirements for GST/HST Registrant Suppliers”;
- GST/HST Info Sheet GI-127, “Documentary Evidence when Making Tax-Relieved Sales to Indians and Indian Bands over the Telephone, Internet or Other Electronic Means”;
- GST/HST Policy Statement P-230, “Application of the Excise Tax Act (ETA) to Leases, Licences and Similar Arrangements of Tangible Personal Property by Indians, Indian Bands and Band Empowered Entities”; and
- GST/HST Policy Statement P-246, “Remote Stores and Other Off-Reserve Stores with Significant Sales to Indians, Indian Bands and Band-empowered Entities.”