Précis: The taxpayer produced, inter alia, dental products including approximately 20 local anesthetic solutions, 95% of which contained epinephrine. Prior to 2005 it sold these as taxable supplies but changed this when it learned that a competitor was selling them as non-taxable supplies. CRA assessed the supplies as taxable and assessed the taxpayer for $1,111,930.52 for unremitted GST (most of which related to the local anesthetic solutions) plus interest and penalties. The sole question on this appeal was whether the Tax Court erred in finding that the supplies of local anesthetic were taxable. It was common ground that epinephrine on its own could be used to relieve life-threatening situations. The Federal Court of Appeal found that solutions were used for pain control and not to deal with life-threatening situations; as a result they were taxable supplies. Thus the taxpayer’s appeal from the Tax Court decision was dismissed with costs.
Patterson Dental Canada v. R. – FCA: Local anesthetic solutions not zero-rated – appeal dismissed with costsREAD MORE »