As is the case with most Federal Budgets, proposals have been made regarding sales and excise tax with a focus on health measures - as well as cannabis in light of new products being introduced to the Canadian market.
Currently, human sperm is zero-rated, but human ova and in vitro embryos are not. To assist single individuals, same-sex couples and families experiencing infertility, the 2019 Federal Budget proposes to change this, providing GST/HST relief for individuals and families as well as imports and supplies of human ova and imports of in vitro embryos.
While medical and assistive devices are zero-rated for individuals with a disability or impairment, some are only zero-rated if they are supplied by written order of a physician, nurse, physiotherapist or occupational therapist, including foot care devices.
The 2019 Federal Budget proposes to expand the list of practitioners who can provide written order of such foot care devices to licensed podiatrists and chiropodists, who are often the preferred practitioners for foot related issues by individuals.
Currently, multidisciplinary health services who offer an array of services, such as a rehabilitation program offered by a team of practitioners (i.e. a physician, occupational therapist and physiotherapist) are not exempt from GST/HST, even though the individual services, if supplied separately, would be exempt.
The budget proposes to expand the GST/HST exemption to these multidisciplinary health services so long as all, or practically all, of the services are within the professional scope of the individual providing them.
With the introduction of additional cannabis products coming into play this year, including edibles, extract and topicals, additional classes will be added to the list of products currently permitted for legal sale.
The budget also proposes to improve the approach used to apply duty to these products, as well as cannabis oils, one of the previously introduce classes of cannabis products. The approach will apply duty to these categories of products at a flat rate based on the quantity of THC at the time of packaging, to become payable when the product is delivered to provincial wholesalers, retails, individuals and other non-cannabis licensees. These changes came into effect on May 1.
The application of duty and associated rates will remain unchanged for dried cannabis, seeds and seedlings.
For more information of the changes made to sales and excise tax and how it will affect you and/or your business, contact us today.