Inquiry Regarding GST Calculation on Bill Credits

The following is clearly illogical and dishonest. I ask for a billing correction on my Mobility bill. I was charged $14.00 for the "service". GST is added to that amount so the amount owing is $14.70. Telus corrects my bill. However, instead of crediting me the $14.00, they credit me $13.33. The GST add-on brings the credit to $14.00. I was charged $14.70 but credited only $14.00. Why did I end up having to pay $0.70? It should have zeroed out.

Rebates: The Timing of the Tax Adjustment is Key
Rebates, which can be offered by either the manufacturer or the retailer, represent a refund to the customer after the initial purchase. The GST/HST treatment depends on whether the rebate is provided at the point of sale (instant rebate) or after the fact (mail-in rebate).
Specific Requirements and GST/HST Application:
* Instant Rebates: When a rebate is provided at the time of purchase, it is treated as a reduction in the price before calculating the GST/HST, similar to a retailer's promotional incentive.
* Mail-in Rebates and Section 181.1: For mail-in rebates, particularly those from a manufacturer, the initial sale is treated as being for the full price, and GST/HST is collected on that amount. The subsequent rebate is governed by Section 181.1 of the Excise Tax Act.
This section allows a registrant (e.g., a manufacturer) who pays a rebate to a customer to claim an input tax credit for the "tax fraction" of the rebate amount, provided they give the customer written notice that the rebate includes the GST/HST.
Example:
A customer buys a taxable item for $100 plus 13% HST, paying a total of $113. The manufacturer offers a $10 mail-in rebate.
* Initial Sale: The customer pays $113 to the retailer. The retailer remits the $13 HST to the government.
* Rebate: The customer mails in the rebate form and receives $10 from the manufacturer. If the manufacturer provides written notice that the rebate is tax-inclusive, they can claim an ITC for the tax portion of that rebate (13/113 of $10). The customer, if a GST/HST registrant who claimed an ITC on the initial purchase, may have to make an adjustment to their net tax.

Promotional Incentives: Tax on the Actual Price Paid
Promotional incentives offered by a retailer, such as "buy one, get one free" (BOGO) or percentage-off discounts, are treated differently from manufacturer coupons because the retailer is not reimbursed by a third party. These are considered non-reimbursable price reductions.
Specific Requirements and GST/HST Application:
For promotional incentives, the GST/HST is calculated on the net consideration paid by the customer.
* "Buy One, Get One Free" (BOGO): The CRA considers a BOGO offer as a single supply for a single price. Therefore, GST/HST is calculated on the total amount the customer actually pays.
Example:
A store offers a "buy one, get one free" promotion on a shirt that normally sells for $30. The customer gets two shirts but only pays for one.
* Total Consideration Paid: $30.00
* HST (13% of $30.00): $3.90
* Total Paid by Customer: $33.90
* Loyalty Programs and Points: When customers redeem loyalty points for goods or services, GST/HST is generally not applied to the redemption. The rationale is that the tax was implicitly collected on the original purchases that earned the points. However, if points are purchased or if they are redeemed for cash, the tax implications can change.

Manufacturer Coupons: A Reduction in Tax Payable for the Consumer
A key characteristic of a manufacturer's coupon is that it is a reimbursable coupon. This means the retailer who accepts the coupon from a customer is entitled to be reimbursed for the coupon's value by the manufacturer or another third party.
Specific Requirements and GST/HST Application:
Under Section 181 of the Excise Tax Act, when a retailer accepts a reimbursable coupon for a taxable supply (other than a zero-rated supply), the GST/HST is calculated on the full price of the item before the coupon is applied. The coupon is then treated as a partial payment towards the total, inclusive of tax.
Example:
A customer in Ontario (where the HST rate is 13%) purchases a product for $20.00 and presents a $2.00 manufacturer's coupon.
* Selling Price: $20.00
* HST (13% of $20.00): $2.60
* Total Payable: $22.60
* Less Manufacturer's Coupon: -$2.00
* Amount Paid by Customer: $20.60
In this scenario, the retailer collects $2.60 in HST from the customer and the coupon. The retailer can then claim an input tax credit (ITC) for the tax fraction of the coupon value they were reimbursed by the manufacturer. The "tax fraction" is calculated as the HST rate divided by (100% + the HST rate). In this case, it would be 13/113 of the $2.00 coupon value.

Please, don't respond.


This will require multiple post-Presentation of a CRA Bulletin that is about establishment of location of service is deceptive. Regardless, CRA Bulletins are not the Excise Tax and hold no legal authority. While your change in application is one of two methods the Excise Tax affords. Your presentation for the change in method is intentionally deceptive and self serving. Second their is not a seperate 'Telecommunications' Excise Tax  The Excise Tax (the actual law for GST states the provides the following (for clarity):

For businesses and consumers alike, understanding the application of the Goods and Services Tax/Harmonized Sales Tax (GST/HST) to various discounts and incentives can be a complex affair. The Canadian Excise Tax Act lays out specific requirements for how service amounts are treated for tax purposes, with significant distinctions between manufacturer coupons, promotional incentives, and rebates. These differences hinge on who is offering the discount, how it is redeemed, and the flow of funds between the parties involved.
At the heart of the matter lies the concept of "consideration," which the Canada Revenue Agency (CRA) defines as the total amount payable for a supply of property or a service. The application of GST/HST is directly tied to this value. Here’s a detailed breakdown of how each type of price reduction interacts with this principle.