British Columbia (“BC”) has released two new bulletins: PST 211, “Exemptions for Hydroelectric Power Generation” and PST 306, “Goods Brought into BC by New Residents”. These new documents cover further details on the application of tax and exemptions available for each respective topic.
Hydroelectric power generating companies, if they qualify as manufacturers, are eligible for the production machinery and equipment (PM&E) exemption from PST. This document highlights other specific exemptions that may be available to these businesses. As long as a storage project (where the penstock and power plant are located within the structure of the dam) is within the qualifying part of a manufacturing site, the exemption will apply. The exemption will also apply to qualifying machinery, equipment and apparatus, as listed in this bulletin, as well as any related services or parts for this M&E.
However, the ministry has clarified that these exemptions are not applicable before the hydroelectric water plant is validly licensed.
To claim the exemption, the purchaser must provide the vendor with their PST registration number, or if not registered, with a duly completed Certificate of Exemption – General (FIN 490).
While this exemption mainly pertains to individuals, a section in this bulletin addresses goods brought into BC for business use (generally, PST is payable on these goods). Subject to certain conditions, the exemption may be available for personal goods brought into BC, and later used for business purposes.