News and Insights

Department of Finance Canada Releases Draft GST/HST Legislation

Tax Development May 17, 2019

The Department of Finance Canada released a set of legislative proposals in relation to GST/HST. These proposed changes include:

  • An expansion of the definition of “freight transportation services” to include driving services. This will allow for the existing relief that applies to international freight transportation services to also apply to international driving services;
  • An extension in the application of the drop-shipment rules that provide tax relief to non-residents on certain goods and services they purchase in Canada to cover commercially interchangeable or fungible goods;
  • A conclusion that virtual currency (e.g. Bitcoin) will be treated as a financial instrument causing supplies of these currencies to be exempt from GST/HST; and
  • An extension of the GST/HST holding corporation rules to holding partnerships and trusts. In addition, the proposed rules released on July 27, 2018 will be modified to reflect the consultations and deliberations that took place since their release.

 Taxpayers are permitted to provide their comments on these proposals until June 17, 2019.