They Tax WATER Up Here in Canada, eh!

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There is GST/HST tax added on all product Sales of Water in Canada. Canada Revenue Agency has published an “Info Sheet” to clarify how the Goods and Services Tax or Harmonized Sales Tax applies to sales of water.

* Taxable: Is 6% GST or 14% HST added to the sale price (“tax added”)
* Zero-Rated Tax: Is 0% GST or 0% HST added to the sale price (“no tax added”)
* Exempt Tax: No GST/HST is added to the sale price (“non-taxable”)

In General …

* The supply of basic groceries, which includes most food and beverages marketed for human consumption, is zero-rated. However, certain categories of food products such as candies and confectionery and carbonated beverages are taxable… These are described as “Basic Groceries”

* Products that are consumed for their therapeutic or beneficial effects, are not basic groceries and consequently sales of these products are taxable … These are described as “Dietary Supplements”

Bottled Non-Carbonated and Non-Fruit Flavoured

* Less than 600 ml = Taxable
* 600 ml or more = Zero-Rated (unless sold through a vending machine)
* Any size, package of 2 or more = Zero-Rated

Carbonated Bottled or UnBottled

* Any Size, Naturally or Artificially flavored = Taxable

Fruit Flavoured Bottled or Unbottled

* Any Size = Taxable

Unbottled Non-Carbonated Non-Fruit Flavoured

* Less than 600 ml = Taxable
* 600 ml or more, to a Consumer from a vending machine or permanent establishment = Zero-Rated


* For human consumption = Zero-Rated
* Dry-Ice, salted, non-potable = Taxable

Source: Canada Revenue Agency

Heads up from: Deloitte Daily Tax Highlights

The Canada Revenue Agency (CRA) has published a GST/HST Info Sheet on the application of the goods and services tax/harmonized sales tax (GST/HST) to sales of water. The Info Sheet concerns water for human consumption that is not a dietary supplement, divided into four categories: bottled water; carbonated water; fruit-flavoured water; and unbottled water. Information on ice made from potable and non-potable water and dry ice is also included.


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