Tax Cuts in Toll-Free Telephone Services
This material is from the February 1997 Information Bulletin of the Retail Sales Tax Branch of the provincial Ministry of Finance.
In the 1996 Ontario Budget, the Minister of Finance announced that 1-800 and 1-888 toll-free telephone services will be exempt from provincial Retail Sales Tax (RST) effective July 1, 1996 except when purchased for domestic of family purposes. The toll-free telephone services can be bought exempt by any commercial, industrial, institutional, vocational, occupational or other organizations for business use. All charges for services provided exclusively with the toll-free services are exempt from RST.
Charges for additional services or options that are not provided exclusively with the 1-800 and 1-888 services, such as the monthly charge for a basic telephone service, are taxable. Subscribers who qualify for exemption must provide a properly completed Purchase Exemption Certificate to the provider of the toll-free telephone service when claiming an exemption from RST. The provider must charge RST to those subscribers who do not provide this certificate.
A refund may be claimed from the Branch by qualifying subscribers if RST was charged on toll-free telephone services provided on or after July 1, 1996. The provider is not authorized to refund the RST to the subscriber.
For more specific information, please consult the Retail Sales Tax Act or call your local Retail Sales Tax Office listed in the blue pages of your phone directory.
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