No tax if fuel is in gas tank (con't)
But you must declare it.
No surprise there either, right?
But the surprise is, even if you put gas in your car in the U.S. you don’t have to pay tax on it.
“It’s the travellers’ responsibility to declare all items that they purchased or received, that’s our first point,” said Canada Border Services Agency spokeswoman Sue Oswald.
That includes the liquid you’ve put in your fuel tank.
“If it’s in the vehicle being consumed by the vehicle ... we just expect a declaration” but no payment of tax, Oswald said.
That’s because the purchased good is being used or consumed.
“It’s already in the vehicle and it’s already being consumed in the vehicle at the time” of declaration, she said.
This is a different situation compared to buying gasoline and filling external canisters, such as for your snowmobile, lawn mower or boat.
“If you’re having extra canisters and things that are going to be in the vehicle (containing) gas those things are taxable,” Oswald said.
In that case the fuel is subject to 13 per cent HST plus 0.1 per cent excise tax per litre.
For example, if you bought 10 litres or approximately $20 of U.S. gas stored in containers, you would have to pay $3.69 Canadian for the applicable taxes.
Returning travellers to Canada usually don’t get asked if they’ve purchased fuel but the question can arise.
“It’s not a standard question but it’s not a question that we have not asked in the past,” Oswald said.