- The correspondence discusses the application of GST/HST to trans-border air charters to the USA with a stop of 24 hours or less.
- HST rates are 13 percent in Ontario and 15 percent in New Brunswick, Newfoundland and Labrador, Nova Scotia, and Prince Edward Island. GST is 5 percent in the rest of Canada.
- The Company is a Transport Canada registered air operator based in Province X, registered for GST/HST.
- The Company operates aircraft for passenger transportation into and out of the USA and other Canadian provinces.
- Passenger services are quoted and contracted on a continuous journey basis in two scenarios.
- Scenario A involves a charter flight from Province X to the USA and back on the same day.
- Scenario B involves a charter flight from Province Y to the USA and back, with repositioning from Province X to Province Y.
- The request is to confirm that both scenarios involve a stopover in the USA and are taxable at the GST rate of 5 percent.
- The interpretation involves determining if the Company is supplying a passenger transportation service or another type of service.
- A passenger transportation service involves a mode of conveyance, an independent operator, and an itinerary.
Source: taxinterpretations.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
