Information and Disclaimer
This interpretation letter was issued based on the specific circumstances or situation of a taxpayer or vendor and the law and tax policy in effect at the time the ruling was issued. Specific facts relevant to your situation may change the application of the tax. In accordance with the Freedom of Information and Protection of Privacy Act, all confidential and identifying information has been removed from this interpretation letter. Please be aware that any statute or policy referred to in this letter may have been superseded. Where a letter contains links to a publication, the link is to our current publication on that subject, regardless of the date that the ruling was originally issued, and the current publication may not be reflective of the information originally provided. In no event shall the Government of Ontario be liable for any damages whatsoever arising out of, or in connection with, the use of the information contained herein.
Interpretation Letter AG-0010, August 2001
Thank you for your letter dated July 10, 2001, forwarded to this office July 16, 2001, in which you inquire
about the application of Ontario retail sales tax (RST) on a tractor trailer that will be used for moving farm
crops.
Understanding of Facts
Your letter pertains to a hypothetical situation. The Branch does not provide interpretations concerning
hypothetical situations as the information may not necessarily apply to the transactions of an actual
taxpayer due to possible differences in the taxpayer's situation. However, we are providing you with a
general ruling based solely on the information which you have provided. Please note that this is
not a ruling specific to any one taxpayer.
Should you require a ruling for a specific client please provide us with the name of the client along with
written authorization from the client to deal directly with you.
Legislation and/or Administrative Policy
Persons in the business of farming may purchase farm implements, farm machinery, farm equipment,
agricultural products and repair parts exempt from RST under the provisions of paragraph 7(1)13 of the
Ontario Retail Sales Tax Act.
Trailers such as those used for the transportation of livestock or hay wagons which are exclusively devoted
to farming, qualify as exempt farm equipment. This exemption exists whether or not the trailers or wagons
are licensed.
Specifically excluded from this exemption are automotive trailers. These are general purpose trailers such
as a box, snowmobile or flatbed.
Analysis
Farmers may purchase livestock trailers, or trailers that will be used exclusively in the farming process,
exempt from RST providing they give their supplier a properly completed Purchase Exemption Certificate
(PEC). We refer you to the enclosed Retail Sales Tax Guides # 204 "Purchase Exemption Certificates"
and # 807 "Farmers" for your information.
Trucking companies that transport livestock or farm crops are not farmers and cannot claim any of
the conditional exemptions available to persons engaged in the business of farming.
Conclusion
Trucking companies that transport livestock or farm crops must pay RST on the purchase of
trailers for their own use. A person must qualify as a farmer before they can claim any of the conditional
exemptions available to farmers.
If you have any further questions, please contact our office.
