RETAIL SALES TAX MEASURES (RST)

RST Late Filing Penalties
Retroactive to July 1, 2000, the late filing penalty for late RST payments will be waived where the taxpayer has had no previous late-filed returns over the last 4 years. As the province removed the $1,000 cap on such penalties last July, this change should be well received by the business community. The removal of the cap meant that penalties were imposed for 10% of the amount of the late-filed tax even if the return was filed one day late.

RST Application on Software
In recent months the RST application on sales of computer software has been a source of substantial taxpayer confusion. As part of Ministry of Finance's simplification initiatives, it will consult with taxpayers and other interested groups regarding measures which would result in a simpler RST.

RST Application on Trucks and Buses Used in Multiple Jurisdictions
Ontario has become a member of the International Registration Plan (IRP) to improve the competitive position of Ontario's truck and bus industries. The government is proposing to implement a modified RST system for multi-jurisdictional vehicles effective October 1, 2001.

This new sales tax system will provide for payment of prorated sales taxes, which are to be paid each year when registering trucks and buses used in multiple jurisdictions. As a result of this measure, owners of multi-jurisdictional vehicles will no longer have to pay RST on the full purchase value of the vehicles and cost of repair parts, trailers and labour services. The tax will now be calculated based on these costs, the year the vehicle was acquired, and the proportionate distance traveled in Ontario.

RST Rebates for Alternative Fuel Vehicles
Electric hybrid cars delivered after May 9, 2001 will qualify for the alternative fuel vehicle RST rebate of up to $1,000. The Ministry of Finance is continuing to solicit input from industry; however, electric hybrid cars are typically defined as combining an electric traction motor with another power unit such as a conventional gas or diesel engine.

RST Exemption on Audio Books for the Blind
The government is proposing to exempt from RST audio books purchased by people who are legally blind. This measure will be effective on proclamation after the government has consulted with the Canadian National Institute for the Blind on implementation details.

RST Rulings
RST rulings with general applicability to a wide audience will be made available via the internet. Reference will be further facilitated through the incorp-oration of search engines.