Tax & Trade Blog

"Reverse and rebill" situations are very common in the Oil, Gas and Petrochem industry, especially in situations where goods are delivered in one reporting period but invoiced (or reversed and rebilled) in another reporting period because of formula-based pricing. There are a number of other situations where it is also necessary to "true-up" commercial invoice previously issued, and the GST/HST reporting and remittance requirements in these situations are counterintuitive.

Unwary businesses often face subsequent CRA assessments for taxes not collected, with the CRA taking the position that taxes were required to be collected on the issuance of both invoices unless proper credit note steps are taken.

With the new Canadian fuel charge provided for in the Greenhouse Gas Pollution Pricing Act (the “GGPPA”), many Canadian and non-resident oil and gas companies doing business in Canada with fossil fuel products have now successfully registered. 

Now comes the unexpectedly difficult part: monthly reporting.

General Reporting Requirement

In general, the GGPPA imposes timely reporting requirements including monthly returns for most businesses that are not “road carriers”.  Most returns are due the last day of the calendar month (1) following a registrant’s reporting period OR (2) following the reporting period in which a charge became payable for non-registrants.

As a firm specializing in International Trade and related regulatory issues, we have noticed a marked increase in recent inquiries regarding the new regulatory requirements for Nicotine Pouches.  This uptick coincides with Health Canada’s recent announcement effectively restricting the sale of Nicotine Replacement Therapies (“NRTs”), including Nicotine Pouches, to pharmacies – and the need to understand how comprehensive these apply to current business, and what options there are for moving forward.

As we wrote in a previous blog post, the federal government amended subsections 256.2(3.1) and (3.2) of the Excise Tax Act (the “ETA”) to introduce an enhanced GST/HST residential rental property rebate applicable to new purpose-built rentals (the “Enhanced Rebate”), which took effect on September 14, 2023.

On July 17, 2024, the Real Property (GST/HST) Regulations (the “Regulations”) were published in the Canada Gazette, providing guidance on the implementation of the Enhanced Rebate, including the prescribed conditions and definitions of eligible properties.

The United States, Mexico and Canada have enjoyed near-complete free trade since the inception of the North American Free Trade Agreement (“NAFTA”) in 1994.  In fact, Canada and the US have enjoyed “free trade” even longer than that, since the inception of the first Canada-US Free Trade Agreement in 1989.  Unfortunately, free trade amongst the “three amigos” is not guaranteed!

In this blog we explore the mandatory Review and Term Extension Rules in the US-Mexico-Canada Agreement (“USMCA” – also known in Canada as the “CUSMA”), and what it is going to take in order to keep our vibrant North American trade relationship going!