Please note that the following document, although correct at the time of issue, may not represent the current position of the Canada Revenue Agency. / Veuillez prendre note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'Agence du revenu du Canada.
GST/HST Rulings Directorate
5th floor, Tower A, Place de Ville
320 Queen Street
Ottawa ON K1A 0L5
[Addressee]
Case Number: 248678
Business Number: […]
Dear [Client]:
Subject: GST/HST interpretation
GST/HST break - catered meals
Thank you for your correspondence of [mm/dd/yyyy], concerning the application of the goods and services tax/harmonized sales tax (GST/HST) to catered meals during the GST/HST break from December 14, 2024 to February 15, 2025.
The HST applies in the participating provinces at the following rates: 13% in Ontario; and 15% in New Brunswick, Newfoundland and Labrador, Nova Scotia, and Prince Edward Island. The GST applies in the rest of Canada at the rate of 5%.
All legislative references are to the Excise Tax Act (ETA) unless otherwise specified.
We understand that […] (Company) is a hotel and event venue located in […][city]. As part of its event venue operations, the Company rents event space with options for catered customizable food and beverage packages. The meals are prepared in the kitchen that services the restaurants located in the hotel. Alcoholic beverage offerings include beer, wine, cider, and pre-mixed alcoholic beverages.
INTERPRETATION REQUESTED
You would like to know whether the GST/HST applies to catered food and beverages offered with event space rentals for the period from December 14, 2024 to February 15, 2025. You would specifically like to know whether beer, wine, cider, and pre-mixed alcoholic beverages are zero-rated from December 14, 2024 to February 15, 2025.
INTERPRETATION GIVEN
General GST/HST concepts
Generally, in accordance with section 165 of the ETA, every recipient of a taxable supply made in Canada is required to pay GST/HST on the value of the consideration for the supply, unless the supply is zero-rated (listed in Schedule VI to the ETA and subject to the GST/HST at the rate of 0%) or exempt (listed in Schedule V to the ETA and not subject to the GST/HST).
Prior to determining the GST/HST status of a transaction, it is necessary to determine whether a single supply or two or more supplies are being made when a transaction contains several elements. The general principles of the GST/HST continue to apply for the period from December 14, 2024 to February 15, 2025 (hereafter referred to as the eligible period). Guidance on making such determinations can be found in GST/HST Policy Statement P-077R2, Single and Multiple Supplies. If it is determined that a transaction constitutes two or more supplies and none are incidental to another, each distinct supply will take on its own GST/HST status. If the nature of any separate supply is a qualifying service, that part of the transaction would be zero-rated during the eligible period.
Ordinary zero-rating of food and beverages
Section 1 of Part III of Schedule VI zero-rates supplies of food or beverages for human consumption (including sweetening agents, seasonings and other ingredients to be mixed with or used in the preparation of such food or beverages) unless an exclusion set out in paragraphs 1(a) through 1(r) applies. Paragraph 1(o.5) excludes from zero-rating, the supply of all food or beverages sold under a contract for, or in conjunction with, catering services.
Temporary zero-rating of food and beverages during the eligible period
On December 12, 2024, a temporary measure to zero-rate certain supplies of food and beverages during the eligible period became law with the addition of Part XI of Schedule VI to the ETA.
Under section 13 of Part XI of Schedule VI, a supply (other than an exempt supply) of providing, preparing and serving food, non-alcoholic beverages and eligible beverages (other than cannabis products), including a catering service qualifies for zero-rated treatment during the eligible period. This zero-rating provision is applicable whether the food or beverages are for consumption at the premises where they are prepared or served or for consumption at another location. In addition, both of the following conditions must be met for zero-rated treatment to apply:
- all of the consideration for the supply is paid during the eligible period; and
- the service is rendered entirely during the eligible period.
Beer, wine and cider (including fortified wine or cider not in excess of 22.9% absolute ethyl alcohol by volume (ABV)), and premixed alcoholic beverages that are 7% ABV or less at the time they are packaged all qualify as eligible beverages for purposes of zero-rating under Part XI of Schedule VI.
For further information on the temporary zero-rating of certain food and beverages during the eligible period, refer to GST/HST Notice 340, Questions and Answers about the GST/HST tax break for all Canadians.
DISCLAIMER
In accordance with the qualifications and guidelines set out in GST/HST Memorandum 1-4, Excise and GST/HST Rulings and Interpretations Service, the interpretation(s) given in this letter, including any additional information, is not a ruling and does not bind the Canada Revenue Agency (CRA) with respect to a particular situation. Future changes to the ETA, regulations, or the CRA’s interpretative policy could affect the interpretation(s) or the additional information provided herein.
If you require clarification with respect to any of the issues discussed in this letter, please call me directly at 778-952-5178.
Should you have additional questions on the interpretation and application of the GST/HST, please contact a GST/HST Rulings officer at 1-800-959-8287.
Sincerely,
Ben Lui
Industry Sector Specialist
Strategic and Emerging Issues Unit
General Operations and Border Issues Division
GST/HST Rulings Directorate
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