Budget Implementation Act, 2022, No. 1 (S.C. 2022, c. 10)
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Assented to 2022-06-23
PART 3Amendments to the Excise Act, 2001, the Excise Act and Other Related Texts (continued)
DIVISION 1Excise Act, 2001 and Other Related Texts (Vaping Products) (continued)
2002, c. 22Excise Act, 2001 (continued)
79 The Act is amended by adding the following after section 304.2:
Marginal note:Definition of coordinated vaping duty system
304.3 (1) In this section, coordinated vaping duty system means the system providing for the payment, collection and remittance of duty imposed under any of section 158.58 and subsections 158.6(2) and 158.61(2) and any provisions relating to duty imposed under those provisions or to refunds in respect of any such duty.
Marginal note:Coordinated vaping duty system regulations — transition
(2) The Governor in Council may make regulations, in relation to the joining of a province to the coordinated vaping duty system,
(a) prescribing transitional measures, including
(i) a tax on the inventory of vaping products held by a vaping product licensee or any other person, and
(ii) a duty or tax on vaping products that are delivered prior to the province joining that system; and
(b) generally to effect the implementation of that system in relation to the province.
Marginal note:Coordinated vaping duty system regulations — rate variation
(3) The Governor in Council may make regulations
(a) prescribing rules in respect of whether, how and when a change in the rate of duty for a specified vaping province applies (in this section any such change in the rate of duty is referred to as a “rate variation”), including rules deeming, in specified circumstances and for specified purposes, the status of anything to be different than what it would otherwise be, including when duty is imposed or payable and when duty is required to be reported and accounted for;
(b) if a manner of determining an amount of duty is to be prescribed in relation to the coordinated vaping duty system,
(i) specifying the circumstances or conditions under which a change in the manner applies, and
(ii) prescribing transitional measures in respect of a change in the manner, including
(A) a tax on the inventory of vaping products held by a vaping product licensee or any other person, and
(B) a duty or tax on vaping products that are delivered prior to the change; and
(c) prescribing amounts and rates to be used to determine any refund that relates to, or is affected by, the coordinated vaping duty system, excluding amounts that would otherwise be included in determining any such refund, and specifying circumstances under which any such refund shall not be paid or made.
Marginal note:Coordinated vaping duty system regulations — general
(4) For the purpose of facilitating the implementation, application, administration and enforcement of the coordinated vaping duty system or a rate variation or the joining of a province to the coordinated vaping duty system, the Governor in Council may make regulations
(a) prescribing rules in respect of whether, how and when that system applies and rules in respect of other aspects relating to the application of that system in relation to a specified vaping province, including rules deeming, in specified circumstances and for specified purposes, the status of anything to be different than what it would otherwise be, including when duty is imposed or payable and when duty is required to be reported and accounted for;
(b) prescribing rules related to the movement of vaping products between provinces, including a duty, tax or refund in respect of such movement;
(c) providing for refunds relating to the application of that system in relation to a specified vaping province;
(d) adapting any provision of this Act or of the regulations made under this Act to the coordinated vaping duty system or modifying any provision of this Act or those regulations to adapt it to the coordinated vaping duty system;
(e) defining, for the purposes of this Act or the regulations made under this Act, or any provision of this Act or those regulations, in its application to the coordinated vaping duty system, words or expressions used in this Act or those regulations including words or expressions defined in a provision of this Act or those regulations;
(f) providing that a provision of this Act or of the regulations made under this Act, or a part of such a provision, does not apply to the coordinated vaping duty system;
(g) prescribing compliance measures, including penalties and anti-avoidance rules; and
(h) generally in respect of the application of that system in relation to a province.
Marginal note:Conflict
(5) If a regulation made under this Act in respect of the coordinated vaping duty system states that it applies despite any provision of this Act, in the event of a conflict between the regulation and this Act, the regulation prevails to the extent of the conflict.
80 The Act is amended by adding, after Schedule 7, the Schedule 8 set out in Schedule 1 to this Act.
Related Amendments
R.S., c. C-46Criminal Code
81 (1) Subparagraph (g)(i) of the definition offence in section 183 of the Criminal Code is replaced by the following:
(i) section 214 (unlawful production, sale, etc., of tobacco, alcohol, cannabis or vaping products),
(2) Paragraph (g) of the definition offence in section 183 of the Act is amended by adding the following after subparagraph (iii.1):
(iii.2) section 218.2 (unlawful possession, sale, etc., of unstamped vaping products),
R.S., c. E-15Excise Tax Act
82 The definition excisable goods in subsection 123(1) of the Excise Tax Act is replaced by the following:
- excisable goods
excisable goods means beer or malt liquor (within the meaning assigned by section 4 of the Excise Act) and spirits, wine, tobacco products, cannabis products and vaping products (within the meaning assigned by section 2 of the Excise Act, 2001); (produit soumis à l’accise)
R.S., c. F-8; 1995, c. 17, s. 45(1)Federal-Provincial Fiscal Arrangements Act
83 Subsection 2(1) of the Federal-Provincial Fiscal Arrangements Act is amended by adding the following in alphabetical order:
- coordinated vaping product taxation agreement
coordinated vaping product taxation agreement means an agreement or arrangement entered into by the Minister on behalf of the Government of Canada under Part III.3, including any amendments or variations to the agreement or arrangement made in accordance with that Part; (accord de coordination de la taxation des produits de vapotage)
84 The Act is amended by adding the following after section 8.82:
PART III.3Coordinated Vaping Product Taxation Agreements
Marginal note:Coordinated Vaping Product Taxation Agreement
8.9 (1) The Minister, with the approval of the Governor in Council, may on behalf of the Government of Canada enter into an agreement or arrangement with the government of a province respecting the taxation of vaping products and, without restricting the generality of the foregoing, respecting
(a) the collection, administration and enforcement of taxes on vaping products in respect of the province under a single Act of Parliament;
(b) the provision to the Government of Canada by the government of the province, or to the government of the province by the Government of Canada, of
(i) information acquired in the administration and enforcement of Acts imposing taxes on vaping products and Acts providing for rebates, refunds or reimbursements of taxes on vaping products, paid or payable, or of amounts paid or payable as or on account of the taxation of vaping products, and
(ii) other information related to the regulation of vaping and the distribution of vaping products relevant to the system of taxation of vaping products under a single Act of Parliament;
(c) the accounting for taxes collected in accordance with the agreement;
(d) the implementation of and transition to the system of taxation of vaping products contemplated under the agreement;
(e) payments, and the eligibility for payments, by the Government of Canada to the government of the province in respect of the revenues from the system of taxation contemplated under the agreement and to which the province is entitled under the agreement, the time when such payments will be made, and the remittance by the government of the province to the Government of Canada of any overpayments by the Government of Canada or the right of the Government of Canada to set off any overpayments against other amounts payable by the Government of Canada to the government of the province, whether under the agreement or any other agreement or arrangement or any Act of Parliament;
(f) the payment by the Government of Canada and its agents and subservient bodies, and by the government of the province and its agents and subservient bodies, of the taxes on vaping products payable under the system of taxation of vaping products contemplated under the agreement and the accounting for the taxes on vaping products so paid;
(g) the compliance by the Government of Canada and its agents and subservient bodies, and by the government of the province and its agents and subservient bodies, with the Act of Parliament under which the system of taxation of vaping products is administered and regulations made under that Act; and
(h) other matters that relate to, and that are considered advisable for the purposes of implementing or administering, the system of taxation of vaping products contemplated under the agreement.
Marginal note:Amending agreements
(2) The Minister, with the approval of the Governor in Council, may on behalf of the Government of Canada enter into an agreement with the government of a province amending or varying an agreement or arrangement with the province entered into under subsection (1) or this subsection.
Marginal note:Payments
8.91 If there is a coordinated vaping product taxation agreement with the government of a province, the appropriate minister may pay to the province out of amounts received in a fiscal year under the Act of Parliament referred to in paragraph 8.9(1)(a)
(a) amounts determined in accordance with the agreement as provided, and at such times as are specified, in the agreement; and
(b) subject to the regulations, advances in respect of the amounts referred to in paragraph (a).
Marginal note:Statutory authority to make payments
8.92 Despite any other Act, the payments paid under a coordinated vaping product taxation agreement under the authority of section 8.91 may be made without any other or further appropriation or authority.
85 (1) Paragraph 40(b) of the Act is replaced by the following:
(b) respecting the calculation and payment to a province of advances on account of any amount that may become payable to the province under this Act, an administration agreement, a reciprocal taxation agreement, a sales tax harmonization agreement, a coordinated cannabis taxation agreement or a coordinated vaping product taxation agreement and the adjustment, by way of reduction or set off, of other payments to the province because of those advances;
(2) Paragraph 40(d) of the Act is replaced by the following:
(d) prescribing the time and manner of making any payment under this Act, an administration agreement, a sales tax harmonization agreement, a coordinated cannabis taxation agreement or a coordinated vaping product taxation agreement;
R.S., c. 1 (2nd Supp.)Customs Act
86 Subsection 2(1) of the Customs Act is amended by adding the following in alphabetical order:
- immediate container
immediate container has the same meaning as in section 2 of the Excise Act, 2001; (contenant immédiat)
- vaping device
vaping device has the same meaning as in section 2 of the Excise Act, 2001; (dispositif de vapotage)
- vaping product
vaping product has the same meaning as in section 2 of the Excise Act, 2001; (produit de vapotage)
- vaping product licensee
vaping product licensee has the same meaning as in section 2 of the Excise Act, 2001; (titulaire de licence de produits de vapotage)
- vaping substance
vaping substance has the same meaning as in section 2 of the Excise Act, 2001; (substance de vapotage)
87 Subsection 97.25(3) of the Act is amended by adding the following after paragraph (c):
(c.1) if the good is a vaping product, to a vaping product licensee;
88 Subsection 109.2(2) of the Act is replaced by the following:
Marginal note:Contravention relating to tobacco, cannabis and vaping products and to designated goods
(2) Every person that
(a) removes tobacco products, cannabis products, vaping products or designated goods or causes tobacco products, cannabis products, vaping products or designated goods to be removed from a customs office, sufferance warehouse, bonded warehouse or duty free shop in contravention of this Act or the Customs Tariff or the regulations made under those Acts, or
(b) sells or uses tobacco products or designated goods designated as ships’ stores in contravention of this Act or the Customs Tariff or the regulations made under those Acts,
is liable to a penalty equal to double the total of the duties that would be payable on like tobacco products, cannabis products, vaping products or designated goods released in like condition at the rates of duties applicable to like tobacco products, cannabis products, vaping products or designated goods at the time the penalty is assessed, or to such lesser amount as the Minister may direct.
89 Subsection 117(2) of the Act is replaced by the following:
Marginal note:No return of certain goods
(2) Despite subsection (1), if spirits, wine, specially denatured alcohol, restricted formulations, cannabis, raw leaf tobacco, excise stamps, tobacco products or vaping products are seized under this Act, they shall not be returned to the person from whom they were seized or any other person unless they were seized in error.
90 Subsection 119.1(1.1) of the Act is amended by striking out “and” at the end of paragraph (c) and by adding the following after that paragraph:
(c.1) a vaping product may only be to a vaping product licensee; and
91 The portion of subsection 142(1) of the Act before paragraph (a) is replaced by the following:
Marginal note:Disposal of things abandoned or forfeit
142 (1) Unless the thing is spirits, specially denatured alcohol, a restricted formulation, wine, raw leaf tobacco, an excise stamp, a tobacco product or a vaping product, anything that has been abandoned to Her Majesty in right of Canada under this Act and anything the forfeiture of which is final under this Act shall
92 (1) Subsection 142.1(1) of the Act is replaced by the following:
Marginal note:Dealing with abandoned or forfeited alcohol, etc.
142.1 (1) If spirits, specially denatured alcohol, a restricted formulation, wine, raw leaf tobacco, a tobacco product or a vaping product is abandoned or finally forfeited under this Act, the Minister may sell, destroy or otherwise deal with it.
(2) Subsection 142.1(2) of the Act is amended by striking out “and” at the end of paragraph (c) and by adding the following after that paragraph:
(c.1) a vaping product may only be to a vaping product licensee; and
- Date modified: