Bill C-70

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	Used Returnable Containers
	(2) Subsection (1) is deemed to have come into force on April 24, 1996.
1990, c. 45, s. 12(1); 1993, c. 27, s. 41(1)	25. (1) Subsection 176(1) of the Act is replaced by the following:
Acquisition of used returnable containers	176. (1) Subject to this Division, where
	(a) a registrant is the recipient of a supply made in Canada by way of sale of used tangible personal property that is a usual covering or container of a class of coverings or containers in which property (other than property the supply of which is a zero-rated supply) is delivered,
	(b) tax is not payable by the registrant in respect of the supply,
	(c) the property is acquired for the purpose of consumption, use or supply in the course of commercial activities of the registrant, and
	(d) except where the property is a returnable container (within the meaning assigned by section 226) of a class that is not supplied by the registrant when filled and sealed, the registrant pays to the supplier consideration for the supply that is not less than the total of
	(i) the consideration that the registrant charges for supplies by the registrant of used coverings or containers of that class, and
	(ii) tax calculated on that consideration,
	for the purposes of this Part, the registrant is deemed (except where section 167 applies to the supply) to have paid, at the time any amount is paid as consideration for the supply, tax in respect of the supply equal to the tax fraction of that amount.
	(2) Subsections 176(2) and (3) of the Act are repealed, subsection 176(4) of the Act is renumbered as subsection 176(2) and subsection 176(4.1) of the Act is repealed.
	(3) Subsections 176(5) to (7) of the Act are repealed.
	(4) Subsection (1) applies to supplies made after April 23, 1996 other than
	(a) any supply made to a registrant by a person before July 1, 1996 of used tangible personal property that was not accepted by the registrant in full or partial consideration for a supply by the registrant to the person of other tangible personal property; and
	(b) any supply by a person to a registrant of particular used tangible personal property that, under an agreement in writing entered into before July 1, 1996, the registrant accepted in full or partial consideration for a supply by the registrant to the person of other tangible personal property in respect of which the registrant charged or collected tax calculated without reference to the amount credited by the registrant to the person in respect of the particular property.
	(5) Subsection (2) applies to supplies made after April 23, 1996.
	(6) Subsection (3) applies after April 23, 1996.
1993, c. 27, s. 42(1)	26. (1) Subsections 177(1) to (1.4) of the Act are replaced by the following:
Supply on behalf of person not required to collect tax	177. (1) Where
	(a) a person (in this subsection referred to as the ``principal'') makes a supply (other than an exempt or zero-rated supply) of tangible personal property to a recipient (otherwise than by auction),
	(b) the principal is not required to collect tax in respect of the supply except as provided in this subsection, and
	(c) a registrant (in this subsection referred to as the ``agent''), in the course of a commercial activity of the agent, acts as agent in making the supply on behalf of the principal,
	the following rules apply:
	(d) where the principal is a registrant and the property was last used, or acquired for consumption or use, by the principal in an endeavour of the principal, within the meaning of subsection 141.01(1), and the principal and agent jointly elect in writing, the supply of the property to the recipient is deemed to be a taxable supply for the following purposes:
	(i) all purposes of this Part, other than determining whether the principal may claim an input tax credit in respect of property or services acquired or imported by the principal for consumption or use in making the supply to the recipient, and
	(ii) the purpose of determining whether the principal may claim an input tax credit in respect of services supplied by the agent relating to the supply of the property to the recipient, and
	(e) in any other case, the supply of the property to the recipient is deemed, for the purposes of this Part, to be a taxable supply made by the agent and not by the principal and the agent is deemed, for the purposes of this Part other than section 180, not to have made a supply to the principal of services relating to the supply of the property to the recipient.
Election for agent to account for tax	(1.1) Where a registrant, in the course of a commercial activity of the registrant, acts as agent in making a supply (otherwise than by auction) on behalf of a person who is required to collect tax in respect of the supply otherwise than as a consequence of the application of paragraph (1)(d) and the registrant and the person jointly elect in prescribed form containing prescribed information,
	(a) the tax collectible in respect of the supply shall be included in determining the net tax of the registrant and not of the person as if the tax were collectible by the registrant; and
	(b) the registrant and the person are jointly and severally liable for all obligations under this Part that arise upon or as a consequence of the tax becoming collectible or any failure to account for or remit the tax.
Supply by auctioneer	(1.2) Where a registrant (in this subsection referred to as the ``auctioneer''), acting as auctioneer and agent for another person (in this subsection referred to as the ``principal'') in the course of a commercial activity of the auctioneer, makes on behalf of the principal a supply by auction of tangible personal property to a recipient, the supply is deemed, for the purposes of this Part, to be a taxable supply made by the auctioneer and not by the principal and the auctioneer is deemed, for the purposes of this Part other than section 180, not to have made a supply to the principal of services relating to the supply of the property to the recipient.
Exception where election	(1.3) Where
	(a) a registrant (in this subsection referred to as the ``auctioneer''), on a particular day, makes a particular supply by auction of prescribed property on behalf of another registrant (in this subsection referred to as the ``principal'') and, but for subsection (1.2), that supply would be a taxable supply made by the principal,
	(b) the auctioneer and principal jointly elect in prescribed form containing prescribed information in respect of the particular supply, and
	(c) all or substantially all of the consideration for supplies made by auction on the particular day by the auctioneer on behalf of the principal is attributable to supplies of prescribed property in respect of which the auctioneer and principal have elected under this subsection,
	subsection (1.2) does not apply to the particular supply or to any supply made by the auctioneer to the principal of services relating to the particular supply.
	(2) Subsection (1) applies to any supply made after April 23, 1996 by a registrant to a recipient on behalf of another person and to any supply made by the registrant to the other person of services relating to the supply to the recipient except that
	(a) subsection (1) does not apply to a supply of tangible personal property made on or before June 30, 1996 where
	(i) the supply is made by an agent otherwise than by auction on behalf of a principal who would not have been required to collect tax in respect of the supply if the principal had made the supply otherwise than through an agent and
	(A) if the agent disclosed in writing to the recipient of the supply that the agent was making the supply on behalf of another person who was not required to collect tax in respect of the supply, no amount on account of tax in respect of the supply was charged or collected, or
	(B) in any other case, the agent pays to, or credits in favour of, the principal the amount on account of the supply of the property determined by the formula in paragraph 177(1.1)(f) of the Act as it applied to supplies made before April 23, 1996, or
	(ii) the supply is made by auction on behalf of a principal and the auctioneer pays to, or credits in favour of, the principal the amount on account of the supply of the property determined under subsection 177(1.3) of the Act with reference to subsection 177(1.2) of the Act, as those subsections applied to supplies made before April 23, 1996; and
	(b) with respect to supplies by auction of tangible personal property made before April 1997, section 177 of the Act, as amended by subsection (1), shall be read without reference to ``(otherwise than by auction)'' in subsections (1) and (1.1) thereof and without reference to subsections (1.2) and (1.3) thereof.
1990, c. 45, s. 12(1)	27. (1) Section 178 of the Act is repealed.
	(2) Subsection (1) is deemed to have come into force on April 24, 1996.
1993, c. 27, s. 43(1)	28. (1) Subsection 178.3(3) of the Act is replaced by the following:
Adjustment to direct seller's net tax	(3) For the purposes of this Part, where a direct seller has made a supply of an exclusive product of the direct seller in circumstances in which an amount was required under paragraph (1)(d) to be added in determining the net tax of the direct seller and an independent sales contractor of the direct seller subsequently supplies the product to the direct seller in a particular reporting period of the direct seller, the contractor is deemed not to have so supplied the product and the amount may be deducted, in determining the net tax of the direct seller for the particular reporting period or a subsequent reporting period, in a return under Division V filed by the direct seller within four years after the day on or before which the return under Division V for the particular reporting period is required to be filed.


1993, c. 27, s. 43(1)	(2) The portion of subsection 178.3(4) of the Act after paragraph (c) is replaced by the following:

	the direct seller may deduct the amount determined under paragraph (c), in determining the net tax for the particular reporting period of the direct seller in which the payment or credit is given or a subsequent reporting period, in a return under Division V filed by the direct seller within four years after the day on or before which the return under Division V for the particular reporting period is required to be filed.
	(3) Subsections (1) and (2) apply to deductions in respect of supplies of exclusive products made by independent sales contractors after June 1996.
1993, c. 27, s. 43(1)	29. (1) Subsection 178.4(3) of the Act is replaced by the following:
Adjustment to distributor's net tax	(3) For the purposes of this Part, where a distributor of a direct seller has made a supply of an exclusive product of the direct seller in circumstances in which an amount was required under paragraph (1)(d) to be added in determining the net tax of the distributor and another independent sales contractor of the direct seller subsequently supplies the product to the distributor in a particular reporting period of the distributor, the other contractor is deemed not to have so supplied the product and the amount may be deducted, in determining the net tax of the distributor for the particular reporting period or a subsequent reporting period, in a return under Division V filed by the distributor within four years after the day on or before which the return under Division V for the particular reporting period is required to be filed.


1993, c. 27, s. 43(1)	(2) The portion of subsection 178.4(4) of the Act after paragraph (c) is replaced by the following:

	the distributor may deduct the amount determined under paragraph (c), in determining the net tax for the particular reporting period of the distributor in which the payment or credit is given or a subsequent reporting period, in a return under Division V filed by the distributor within four years after the day on or before which the return under Division V for the particular reporting period is required to be filed.
	(3) Subsections (1) and (2) apply to deductions in respect of supplies of exclusive products made by independent sales contractors after June 1996.
1993, c. 27, s. 44(1)	30. (1) Subparagraph 179(1)(a)(i) of the Act is replaced by the following:
	(i) makes a taxable supply in Canada of tangible personal property by way of sale, or a taxable supply in Canada of a service of manufacturing or producing tangible personal property, to the non-resident person, or acquires physical possession of tangible personal property (other than property of a person who is resident in Canada or is registered under Subdivision d of Division V) for the purpose of making a taxable supply of a commercial service in respect of the property to the non-resident person, and
	(2) Subparagraphs 179(1)(c)(i) to (iii) of the Act are replaced by the following:
	(i) where the registrant has caused physical possession of the property to be transferred to a consignee to whom the non-resident person has supplied the property for no consideration, nil, and
	(ii) in any other case, the fair market value of the property at that time, and
1993, c. 27, s. 44(1)	(3) Paragraph 179(1)(d) of the Act is replaced by the following:
	(d) where the registrant made a supply of a service referred to in subparagraph (a)(i) in respect of the property to the non-resident person, except in the case of a supply of a service of storing or shipping the property, the registrant is deemed not to have made that supply of the service.
	(4) Subsection (1) is deemed to have come into force on December 17, 1990.
	(5) Subsections (2) and (3) apply to supplies made after April 23, 1996.
	31. (1) The Act is amended by adding the following after section 180:

Bill C-70

Used Returnable Containers