BC Government Announces PST Exemptions For the New LNG Facility
November 15, 2018 aadolphLNG
It’s not every day the government provides a blanket exemption from sales tax for a particular company or a certain activity. All that changed on October 2, after LNG Canada announced it would build a $40 billion LNG terminal at Prince Rupert. Shortly thereafter, the BC Government announced promised PST exemptions for goods to be used during the construction of the project.
Not only is this great news for Prince Rupert, it also means anybody involved in building the project can get a PST refund or exemption for goods purchased for use in the project.
What Goods Are Exempted?
Goods that are primarily used for the purposes of the project can be obtained PST exempt. Primary is defined as 50% or more. The goods acquired do NOT need to be used on the site. As long as the goods are to be used for the primary purposes of the project, they will qualify for the exemption.
What Project Activities are Included?
The project consists of:
- Building the LNG facility
- Equipping the LNG facility for operation
- Building anchorages, berthing facilities and navigational aids for the tankers
- Constructing the adjacent wharf, known as the Terminal A extension
- Environmental measures to mitigate effects on fish and wildlife habitats.
- The pipeline itself, except for the portion that is used for loading the gas for shipment or transmitting LNG for re-gasification.
- A pig trap.
The exemptions available are retroactive to October 2, 2018. They will run until October 2, 2025, or the date when at least two of the liquefaction trains are running, whichever is later.
How it Works
Anybody involved in the project can obtain goods PST exempt when they are for the primary purposes of the project. Bulletin212 provides several examples of the primary-use test.
You do not need to have a PST number to qualify for an exemption.
There are two ways to receive the exemption:
- From your supplier: you must provide your supplier with a Certificate of Exemption, Form FIN 495, which you can download here.If you are making repeated purchases of goods to be used on the project, you can have a standing exemption on file with that supplier as long as all other conditions are satisfied
- By filing a refund claim: if you paid PST to your supplier but qualify for the exemption, and for some reason your supplier can’t refund you within six months of the purchase, you can file are fund claim with the provincial government using form FIN 355 which you can find here.
This information has been condensed and does not deal with all aspects of the program. For more information about this and to see if you qualify, please call us at 604.240.6173. We’d be happy to speak to you!
Andrew Adolph is a CPA and former CRA auditor with 25 Years of experience. He helps businesses to not par any more in sales taxs than the law says they must and acts as an advocate for you if you are being audited, so you can fous on your business.