Vol. 150, No. 8 — April 20, 2016

Registration

SOR/2016-60 March 29, 2016

EXCISE TAX ACT

Regulations Amending the Artists’ Representatives (GST/HST) Regulations

P.C. 2016-159 March 24, 2016

His Excellency the Governor General in Council, on the recommendation of the Minister of Finance, pursuant to section 277 (see footnote a) of the Excise Tax Act (see footnote b), makes the annexed Regulations Amending the Artists’ Representatives (GST/HST) Regulations.

Regulations Amending the Artists’ Representatives (GST/HST) Regulations

Amendment

1 The schedule to the Artists’ Representatives (GST/HST) Regulations (see footnote 1) is amended by adding the following in alphabetical order:

Coming Into Force

2 These Regulations come into force on the day on which they are published in the Canada Gazette.

REGULATORY IMPACT ANALYSIS STATEMENT

(This statement is not part of the Regulations.)

Issues

Under Part IX of the Excise Tax Act, special rules apply in respect of supplies of intangible personal property (such as the right to broadcast a recording of an artist) made by artists’ representatives (generally collective societies) prescribed by regulations on behalf of an author, performing artist, painter, sculptor, or other artist. These rules ease compliance with the Goods and Services Tax/Harmonized Sales Tax (GST/HST). The Artists’ Representatives (GST/HST) Regulations (the Regulations) list the collective societies that are eligible to use these GST/HST simplification rules.

Under the special rules, if a GST/HST registrant that is a prescribed collective society makes a supply of intangible personal property on behalf of an artist who is a member of the collective society, that supply is deemed to be made by the collective society and not the artist. The special rules further provide that no tax is charged when the collective society passes on the royalties collected to the artist. As a result of these simplifying rules, it is the collective society that is responsible for collecting and accounting for the GST/HST on these supplies of intangible personal property.

Musicians’ Rights Organization Canada has requested that it be added to the list of prescribed registrants in the Regulations.

Objectives

Description

The amendment to the Regulations adds, as of the date of publication in Part II of the Canada Gazette, the Musicians’ Rights Organization Canada to the list of artists’ representatives that are eligible to use the GST/HST simplification rules.

“One-for-One” Rule

It is expected that the amendment will decrease administrative burden for the Musicians’ Right Organization Canada and the artists they represent. As the Regulations relate to tax or tax administration, the amendment is carved out from the “One-for-One” Rule.

Small business lens

The small business lens does not apply to the amendment, as there are no additional costs imposed on business.

Rationale

Eligible artists’ representatives that are prescribed by the Regulations are entitled to use special simplification rules that ease compliance with the GST/HST. The amendment to the Regulations enables Musicians’ Rights Organization Canada and the artists it represents to use the special rules.

Contacts

François Beaulieu
Sales Tax Division
Department of Finance Canada
90 Elgin Street
Ottawa, Ontario
K1A 0G5
Telephone: 613-369-3789

Patrick McKinnon
General Operations and Border Issues
Excise and GST/HST Rulings Directorate
Canada Revenue Agency
Place de Ville, Tower A, 16th Floor
320 Queen Street
Ottawa, Ontario
K1A 0L5
Telephone: 613-954-7959