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This category includes interjurisdictional air carriers and interjurisdictional mariner carriers, referred to collectively as “interjurisdictional carriers.” Registered air carriers and registered marine carriers, or “registered carriers”, could register as a specified air carrier or specified marine carrier, referred to as “registered specified carriers.”
This grouping targets both the fuel used in operating the carriers and the distributing fuel using the carriers. For example, an air carrier’s aircraft, ground vehicles and other related equipment will all have the fuel charge accounted for separately under the same registration (e.g.; diesel, propane, aviation fuel, etc.) The federal fuel charge is applied to fuel used in their operations in federally regulated provinces. Unless the carrier is a specified carrier, the fuel charge is being accounted for by the registered distributor.
Two key terms need to be defined when discussing interjurisdictional carriers:
Registration as a carrier is required for any business performing one or more excluded journeys in the course of average business. Businesses operating in a single province are not required to register. Any air or marine transport business operating in more than one province — and at least one province is a federally regulated province — is required to register.
Once a business identifies itself as an interjurisdictional carrier, the business should also determine whether it needs to register as a specified carrier. A registered specified carrier is a business who uses more fuel in their aircrafts or vessels in excluded journeys than covered journeys.
For example, if a local airline uses 25 percent of its fuel as part of a passenger and freight transportation service for trips solely within the listed provinces, and 75 percent of their fuel is used to journey between a listed province and another province, they are going to be considered as a registered specified air carrier. Registration was first available April 1, 2019.
Voluntary registration is not yet available for these registration types. However, if the registered carrier meets the conditions of a specified carrier, they can choose to be a registered specified carrier or remain as a registered carrier. This is based on the condition of more than 50 percent of their previous year’s fuel consumption is for excluded journeys.
Other Types of Registration
A person applying for registration as an interjurisdictional carrier may also qualify as:
Review these registration types to see if they apply to you.
A registered carrier cannot issue an exemption certificate to its supplier, nor can it accept an exemption certificate. This results in the fuel charge being embedded in the price it pays on the qualifying aviation fuel or qualifying marine fuel.
A registered specified carrier, on the other hand, can issue an exemption certificate to its supplier. This results in providing the fuel without an embedded fuel charge. The registered carrier is responsible for remitting the applicable fuel charge, but also able to accept exemption certificates (e.g.; supplying to another registered specified carrier). The benefit of the exemption certificate can be the timing of the fuel charge remittance and calculation applicable.
Fuel Charge of a Registered Specified Carrier
A registered specified carrier pays the fuel charge on the use of the types of fuel in a federally regulated province where they have the obligation to pay the fuel charge (e.g.; acquire the type of fuel exempt by issuing an exemption certificate to the registered distributor).
This calculation is not applicable to a registered air carrier or a registered marine carrier, unless they import fuel into a listed province. The fuel charge is embedded in the price charged to it by its registered distributor otherwise.
Fuel Charge Calculation of a Registered Carrier
Many air or marine carriers also provide services such as rail or road. The calculation encompasses the different methods and fuel types.
The fuel charge is straight forward, but there needs to be a separate fuel charge calculation for each type of fuel.
The calculation is A - B, where:
A = quantity of fuel, where the charge becomes payable during the reporting period
B = the total of all quantities of fuel (by fuel type and each calculated separately) of the fuel type transferred into a supply tank of the aircraft, vessel, locomotive or specified commercial vehicle of the person at a location in the federally-regulated province during the reporting period.
Example: The registered specified air carrier bought 10,000 litres of aviation turbo fuel at the origination of the journey in Alberta. 8,000 litres were used to get to their first destination in Thunder Bay, Ontario, a federally regulated province. The second destination is Ottawa, Ontario and the aircraft used the remaining 2,000 litres. No fuel was transferred from a supply tank (e.g.; none was diverted).
A = 2,000 litres of fuel is used on the covered air journey
B = 0
Result: 2,000 litres is subject to the fuel charge
The rate for aviation turbo fuel for 2019 is $0.0516 per litre. Therefore, the fuel charge is $103.20. NOTE: A separate calculation is needed for each federally regulated province.
The person transporting someone else’s fuel is not responsible for the user’s fuel charge. The fuel transporter only has to consider if they need to be a registered carrier themselves (road, rail, air or marine).
*Federally regulated provinces refer to Manitoba, New Brunswick, Ontario, Saskatchewan, Yukon and Nunavut as they are provinces that fall under the federal carbon tax because they do not have a provincial carbon tax. Alberta will fall under this program beginning January 1, 2020.
Related Topics:Carbon Tax
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