Disclaimer: This guide is
intended to provide information respecting retail vendors under the Gasoline and Motive Fuel Tax Act
(the Act). This guide should not be regarded as a replacement of the
laws, regulations or administrative documents to which it refers.
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Table of Contents |
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Who Must Obtain a
Gasoline & Motive Fuel Retailer's Licence? |
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What
is Gasoline and Motive Fuel Tax
The Gasoline
and Motive Fuel Tax is a provincial tax on the purchase or consumption of
gasoline and motive fuel and is administered by the Revenue and Taxation
Division of the Department of Finance. All gasoline and motive fuel purchased
or consumed in New Brunswick is subject to tax unless there is a specific
exemption in the legislation.
The current
tax rates are:
- Gasoline
tax – 13.6 cents per litre,
- Motive
fuel (e.g. diesel) tax – 19.2 cents per litre,
- Propane
tax – 6.7 cents per litre,
- Aviation
fuel tax – 2.5 cents per litre, and
- Locomotive
fuel tax – 4.3 cents per litre.
How
Gasoline and Motive Fuel Tax is Collected
The Gasoline and Motive Fuel Tax Act
places the responsibility to pay the tax on the consumer. For simplicity in
administration, the tax is collected at the wholesale level. This means that in
most cases licensed wholesalers collect an amount equal to the tax on or before
delivery of the product to retailers and therefore this tax is included in the
price at the pumps. This process allows for the transfer of the payment of tax
to the consumer.
Exception:
Retailers
who sell taxed propane collect the tax at time of sale and therefore must remit
the tax to the Province (see Reporting).
Who
Must Obtain a Gasoline and Motive Fuel Retailer's Licence?
Any person
(which includes individuals, partnerships or corporations) who wishes to
purchase gasoline and/or motive fuel in the province for the purpose of resale
to consumers must obtain a Gasoline and Motive Fuel Retailer's Licence. This
includes persons wishing to sell from fixed locations as well as from
tank-trucks.
Applications
for gasoline and motive fuel retailers' licences may be obtained at any Service
New Brunswick (SNB) office or by contacting the Revenue and Taxation Division
of the Department of Finance at:
Department of Finance
Revenue and Taxation Division
Tax Program Administration Section
P.O. Box 3000
Fredericton, New Brunswick
E3B 5G5
Telephone: (506) 453-2404
Fax: (506) 457-7335
The fee for
the retail vendor's licence is $20.00 per dispensing nozzle for persons selling
from either fixed pumps or tank trucks and this licence does not require
renewal each year. However, licences are location specific and any vendor
operating multiple locations will require separate licences for each location.
Bonding may
be required for retailers who sell taxed propane.
- The
Revenue and Taxation Division must be notified of any changes in regards
to the address, contact persons or officers of the licencee;
- A
gasoline and motive fuel retailer's licence is not transferable from one
location to another;
- A
gasoline and motive fuel retailer's licence cannot be transferred from one
person to another; and
- Gasoline
and motive fuel storage facilities must have a valid NB Petroleum Storage
Site licence (available from the Department of Environment and Local
Government).
The Minister
may refuse to issue any licence if the Minister has reasonable or probable
grounds to believe that the applicant has:
- failed
to deposit satisfactory security as required;
- been
convicted of a violation of a provision of the Gasoline and Motive Fuel Tax
Act or any provision relating to gasoline or motive fuel in any
other Act;
- failed
to comply with any term or condition imposed on a licence previously
issued; or
- had
a licence previously issued revoked during the previous five years.
The Minister
may suspend a licence for a period of time established by regulation if the
Minister has reasonable and probable grounds to believe that the licence holder
has violated or is failing to comply with the Act or Regulations or with
any term or condition of the licence.
Suspensions
will be for one calendar month for first time violators. For each subsequent
suspension, the suspension will be double the number of months for which that
licence or permit was suspended in the previous suspension.
The Minister
may revoke any licence if the Minister has reasonable and probable grounds to
believe that the licence holder has violated or is failing to comply with the Act
or Regulations or with any term or condition of the licence. This is an
involuntary cancellation of a licence and in order to sell gasoline or motive
fuel again the applicant must reapply and meet all licensing conditions.
Cancellation
of a licence occurs as a result of a voluntary closure or sale of a business.
Cancellation must be done in writing.
The licence
holder must also notify the Department of Finance when the gasoline and motive
fuel retailer's business is sold because the previous owner's gasoline and
motive fuel licence must be cancelled before a new licence can be issued to the
new proprietor.
The Minister
may reinstate any licence and may impose any combination of conditions and
terms established in accordance with the regulations. For example, the Minister
may request that an audit be conducted prior to reinstatement. (A new
application must be submitted and the fee must be paid.)
Purchase
Rule:
- To
ensure that the gasoline and motive fuel tax is paid on gasoline and
motive fuel sold at retail, retailers are permitted to purchase only from
wholesalers licensed in New Brunswick.
Note: A list
of all licensed wholesalers in the province is sent with the applicant's
gasoline and motive fuel retailer's licence. The wholesaler's licence can also
be verified with the Revenue and Taxation Division at (506) 453-2404.
Sales
Rules:
- No
retailer shall sell or keep for sale gasoline or motive fuel at any outlet
unless he is the holder of a retailer's licence for that outlet;
- No
person shall sell, or keep for sale, tax exempt motive fuel unless
authorized to do so by a retailer's licence;
- No
retailer shall sell gasoline and motive fuel to other resellers (retailers
or wholesalers); and
- No
retailer shall sell tax exempt motive fuel to anyone not authorised to
purchase tax exempt motive fuel.
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All retailers are required to issue sales invoices which indicate the type of fuel purchased,
the amount, the tax, if applicable, and the price.
Note: Failure to issue accurate
invoices/receipts may result in fines and penalties for the retailer. Continued
failure to correct the issue may also lead to suspension and/or revocation of the
gasoline and motive fuel retailes' licence.
Effective
April 1, 1998 New Brunswick introduced a marking program for tax exempt diesel
fuel, stove oil and furnace oil so as to distinguish it from taxed motive fuel.
In order to ensure proper distribution of the tax exempt products, retailers
must continue to maintain separate storage facilities for exempt (dyed) motive
fuel.
It is the
responsibility of the retailer to ensure that each person purchasing tax exempt
motive fuel is properly authorized to do so. Purchases made by individuals who
fall into the following classes will be entitled to purchase tax exempt motive
fuel provided that the specified conditions are met:
- Aquaculturists
/ Farmers / Fishers / Silviculturists / Wood Producers / Forest Workers /
Manufacturers / Persons engaged in Mining and Quarrying
Individuals
who fall within these classes may purchase tax exempt motive fuel, provided
they present a valid purchaser's permit issued by the Department of Finance and
provide the expiry date of the permit.
Where
a retailer makes a tax exempt sale to any of the above purchasers, the retailer
must ensure that both the Purchaser's Permit number and the expiry date of the
permit are recorded on the sales invoice.
- Operation
of Vessels
Persons
engaged in the operation of vessels may purchase tax exempt motive fuel,
provided they present a signed certification that the fuel is to be used in the
operation of a registered vessel within the meaning of the Canada
Shipping Act, exceeding two hundred tons gross tonnage but not for use
in the operation of a registered vessel that is used for dredging purposes.
Example:
I/we
hereby certify that the motive fuel purchased herein is to be used in the
operation of a registered vessel within the meaning of the Canada
Shipping Act pursuant to paragraph 6(6)(d) of the Act.
Signature
___________________________
Position ____________________________
Date _______________________________
- Production
of Electricity
Persons
engaged in the production of electricity may purchase tax exempt motive fuel,
provided they present a signed certification that the fuel is to be used in the
operation of a generator used to produce electricity for sale.
Example:
I/we
hereby certify that the motive fuel purchased herein is to be used in the
operation of a generator used to produce electricity for sale pursuant to
paragraph 6(6)(j.1) of the Act.
Signature
___________________________
Position ____________________________
Date _______________________________
- Preparation
of Food, Lighting and Heating of Premises or Heating of Domestic Hot Water
Persons
engaged in the preparation of food, lighting and heating of premises or heating
of domestic hot water may purchase tax exempt motive fuel, provided that it can
be verified that the fuel storage tanks are connected to or would be reasonably
expected to be connected to equipment or apparatus used in the preparation of
food, the lighting and heating of premises, or for the heating of domestic hot
water. This use must be recorded in the sales records for the customer.
Note: When the tax exempt
motive fuel is picked up at the retail outlet, the fuel usage must be recorded
on the sales record (i.e. fuel used to heat a camp, etc.) and a signed
certification stating that the fuel is to be used solely and directly in the
preparation of food, lighting, heating of premises or heating of domestic hot
water must be obtained from the customer.
Example:
I/we
hereby certify that the fuel purchased herein is to be used solely and directly
in the preparation of food, lighting, heating of premises or for heating of
domestic hot water pursuant to paragraphs 6(6)(i.1) and (j) of the Act.
Signature
___________________________
Position ____________________________
Date _______________________________
Every
retailer who sells gasoline and motive fuel shall keep and maintain the
following:
- Records
showing the retailer's inventories of gasoline and motive fuel, including:
- daily beginning and ending metre readings for each
pump from which gasoline or motive fuel is dispensed, and
- daily stock on hand (number of litres) for each type
of gasoline or motive fuel on hand at the beginning of each day.
- Records
to substantiate all purchases of gasoline and motive fuel, including:
- name and address of the wholesaler from whom the
products are purchased,
- dates of the purchases, and
- number of litres of each type of gasoline and motive
fuel purchased.
- Records
to substantiate all sales of tax exempt gasoline and motive fuel by the
retailer, including:
- the name and address of each person to whom the
retailer sold tax exempt gasoline and motive fuel,
- date of each sale,
- the number of litres of each type of tax exempt
gasoline or motive fuel sold in each sale,
- the location to which each sale was delivered, and
- a record of each purchaser's authorization to purchase
tax exempt fuel including any applicable licence, permit numbers or
signed certification.
- Copies
of the purchase invoices for every purchase of gasoline or motive fuel
from a wholesaler.
Records must
be maintained in easily readable paper or electronic format for six years
or until such time that authorization is received in writing from the
Provincial Tax Commissioner.
Records
shall be made available for inspection by an inspector or an auditor or any
person designated by the Commissioner upon request at any reasonable time.
Retailers
are not required to collect and report tax on sales of gasoline and motive fuel
as the applicable tax is paid directly to the wholesaler upon purchase. However,
retailers licensed to sell propane are required to collect the tax (see What is Gasoline and Motive Fuel Tax) when the propane
is being purchased by individuals for uses other than for cooking (i.e.
barbecues), or heating. Examples: propane used for heating tar for roofing, for
operating a zamboni, etc.
Propane tax
must be reported monthly through fuel tax returns and schedules. Propane
reports are to be submitted by the 25th of each month reporting for the
previous month (e.g. Report for January must be submitted by February 25th).
For
information on propane reporting, contact the Revenue and Taxation Division of
the Department of Finance at:
Department of Finance
Revenue and Taxation Division
Tax Program Administration Section
P.O. Box 3000
Fredericton, New Brunswick
E3B 5G5
Telephone: (506) 453-2404
Fax: (506) 457-7335
Under
subsection 30(1) of the Gasoline
and Motive Fuel Tax Act and sections 28 and 29 of the Revenue Administration Act,
any appointed officer, auditor, inspector or any other person with the written
authority of the Minister or the Commissioner may enter upon the premises of
any person in which any business involving the sale, use or consumption of
aviation fuel, gasoline or motive fuel is carried on in order to:
- Ascertain
the amount of tax payable, or the money remissible by any person;
- Inspect
or examine books, records, documents, engines, machinery and premises to
ascertain the quantities of aviation fuel, gasoline or motive fuel bought
or sold by the retailer during any period to which reference is made in a
return required to be made under the Gasoline and Motive Fuel Tax
Act;
- Ascertain
whether the person has had in his possession tax exempt motive fuel, or
gasoline or motive fuel in respect of which the tax is payable, and to
make tests or take samples thereof;
- Require
the owner or manager of the property or business and any other person on
the premises or place to give him/her all reasonable assistance with the
audit or examination and to answer all proper questions relating to such
audit or examination;
- Seize
any books of account, records, documents or other papers which is
discovered during an audit or examination which the inspector or auditor
believes on reasonable ground may provide evidence of the commission of an
offence under a revenue Act.
The owner,
occupier or person in possession or in charge of the premises so entered shall
answer all questions relating to any of the matters stated above, and shall
produce for inspection such books, records, documents, barrels, tanks or
receptacles as required.
Any
retailer found in violation of the Act may be subject to:
- An
official warning
- Tax
assessment
- Fines
- Penalties
- Seizure
of gasoline and motive fuel
- Suspension
of licence
- Revocation
of licence
Retailers
wishing to dispute the liability for the amount assessed against them, may file
a Notice of Objection with the Commissioner setting out the reasons for
the objection and all relevant facts. The notice must be filed within 30 days
after paying the tax or the date of the service or mailing of a Notice of
Assessment, whichever is sooner.
Upon receipt
of a Notice of Objection, the Commissioner shall within 60 days
reconsider the assessment and vacate, confirm or vary the assessment or
reassess, and the Commissioner shall thereupon notify the retailer of the
action by personal service or by ordinary or registered mail.
Retailers
dissatisfied with the decision of the Commissioner may, within 30 days after
being notified of such decision, file a Notice of Appeal with the
Minister of Finance. The Minister shall within 30 days after the receipt of a Notice
of Appeal, fix a date to consider the appeal and shall give a notice of
such hearing to the appellant and the Commissioner. Upon any such appeal, the
Minister may affirm, vary or reverse the decision of the Commissioner and shall
give a written notice of his decision to the appellant by personal service or
by ordinary or registered mail.
Appeal
to The Court of Queen's Bench
Appellants
dissatisfied with the decision of the Minister may, within 30 days after the
date of service or mailing of the notice explaining the Minister's decision,
appeal from such decision to a judge of The Court of Queen's Bench of New
Brunswick.
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Aviation Fuel |
Any gas or liquid that is sold to
be used or is used to create power to propel an aircraft and includes any
product that is designated to be aviation fuel by the regulations. |
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Commissioner |
The Provincial Tax Commissioner
provided for under the Revenue
Administration Act and includes those persons designated by the
Minister of Finance to act on behalf of the Provincial Tax Commissioner. |
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Consumer |
A person who, within the Province,
purchases, receives delivery of or otherwise acquires possession of aviation
fuel, gasoline or motive fuel for personal use or for the use of another
person at the other person's expense or who uses or consumes aviation fuel,
gasoline or motive fuel in any manner and includes a purchaser. |
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Gasoline |
Any petroleum product containing
any derivative of petroleum, natural gas or coal having a specific gravity of
0.8017 or under at a temperature of 60 degrees Fahrenheit (15.6 degrees
Celsius); including benzol and any benzol mixture, but not including manufactured
gas, natural gas, bunker fuel, crude oil or propane. |
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Gasoline or Motive Fuel Pump |
A tank or receptacle of not less
than fifty (50) gallon or two hundred and twenty-seven (227) litre capacity
that is used or intended to be used for the storage of gasoline or motive
fuel and is equipped with a pump for dispensing the gasoline or motive fuel. |
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Locomotive Fuel |
Motive fuel used for the operation
of railway locomotives and equipment attached directly to the same fuel
supply system that services the railway locomotive. This motive fuel is taxed
at a reduced rate. |
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Marked Motive Fuel |
Tax exempt diesel fuel, stove oil
or furnace oil to which a dye has been added in accordance with the
regulations. Cocktail mix means concentrated dye properly diluted with stove
oil or kerosene. |
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Minister |
The Minister of Finance and
includes the Commissioner and those persons designated by the Minister of
Finance to act on behalf of the Minister of Finance or on behalf of the
Commissioner. |
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Motive Fuel |
Any gas fuel or liquid fuel that
is not gasoline and that can be used for moving or operating any internal
combustion engine or for heating. Some examples of motive fuel are: kerosene, propane, natural gas, crude oil, furnace oil, stove oil, diesel distillite, and other motor fuel but does not include manufactured gas that is used as a fuel. |
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Purchaser's Permit |
A permit that is issued under the Gasoline and Motive Fuel Tax Act
and that has not expired or been suspended, cancelled or revoked. |
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Retailer |
A person who keeps for sale or
sells to a consumer, gasoline or motive fuel. |
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Wholesaler |
A person who sells or keeps for
sale, gasoline or motive fuel, to a person other than a consumer. |
All
inquiries should be directed to:
Department of Finance
Revenue and Taxation Division
Tax Program Administration Section
P.O. Box 3000
Fredericton, New Brunswick
E3B 5G5
Telephone: (506) 453-2404
Fax: (506) 457-7335
E-mail: wwwfin@gnb.ca
Web Site: www.gnb.ca/0024/index-e.asp
Legislation:
New Brunswick Acts and Regulations may be accessed on the Department of Justice web site (www.gnb.ca/justice/asrlste.htm) or copies can be purchased from the Queen's Printer.