Locator Code: 189B

MEMORANDUM
D8-3-11

In Brief

Ottawa, September 11, 1998

SUBJECT

TARIFF ITEM No. 9832.00.00
COFFINS OR CASKETS

This Memorandum is written to reflect the changes resulting from the implementation of the new Customs Tariffeffective January 1, 1998. The relief from customs duties formerly granted by the Coffin or Casket Remission Orderhas been shifted to tariff item No. 9832.00.00. The Order has been amended and continues to relieve the goods and services tax/harmonized sales tax (GST/HST) and any other taxes levied under the Excise Tax Act.

Locator Code: 189B

MEMORANDUM
D8-3-11

Ottawa, September 11, 1998

SUBJECT

TARIFF ITEM No. 9832.00.00
COFFINS OR CASKETS

This Memorandum outlines the conditions under which imported coffins or caskets qualify for duty-free entry under tariff item No. 9832.00.00 of the Customs Tariffand for relief from the goods and services tax/harmonized sales tax (GST/HST) and any other taxes owing under the Excise Tax Act.

TABLE OF CONTENTS

Page

Guidelines and General Information2

Corrections and Re-Determinations 2

Failure to Comply 3

Audit, Examination, or Verification 3

Interest and Penalties 4

Appendix A - Tariff Item No. 9832.00.00

Appendix B - Coffin or Casket Remission Order

GUIDELINES AND GENERAL INFORMATION

1. Tariff item No. 9832.00.00 allows for the duty-free entry of coffins or caskets containing the remains of a person who died outside Canada or, when imported by a funeral director who does not normally reside in Canada or carry on business in Canada, to transport the remains of a non-resident who died in Canada, where the funeral service and burial or cremation will take place outside of Canada (see Appendix A). The Coffin or Casket Remission Orderremits the goods and services tax/harmonized sales tax (GST/HST) and all other excise taxes levied under the Excise Tax Acton these coffins or caskets (see Appendix B).

2. All customs documents relating to goods for which a remission of the GST/HST and any other excise taxes has been claimed are to show the Order in Council number in the "Special Authority" field, in the following format: 83-1250.

Corrections and Re-Determinations

3. In accordance with subsection 32.2(2) of the Customs Act, the importer is obligated to make a correction to declarations of tariff classification, value for duty, and origin within 90 days after the importer has reason to believe that the original declaration is incorrect. For example, if the importer realizes that the coffin imported under tariff item No. 9832.00.00 will be used by a resident of Canada and the funeral service will be held in Canada, the goods are no longer in compliance with a tariff item condition and the importer is obligated to adjust the accounting declaration for the goods.

4. To correct a declaration, Form B2,Canada Customs -Adjustment Request, should be submitted to the appropriate regional customs office and any customs duties and taxes owing paid. A correction shall be treated for the purposes of the Customs Actas if it were a re-determination under paragraph 59(1)(a) of the Customs Act.

5. The obligation to make a correction in respect of imported goods ends four years after the goods are accounted for under subsection 32(1), (3), or (5) of the Customs Act.

6. For more information on the filing of corrections, refer to Memorandum D11-6-6, Self-Adjustments to Declarations of Origin, Tariff Classification, Value for Duty, and Diversion of Goods.

Failure to Comply

7. If the goods no longer qualify under tariff item No. 9832.00.00, they will also fail to comply with the terms of the Coffin or Casket Remission Order.Under subsection 118(1) of the Customs Tariff,within 90 days after the date of failure to comply, the importer must report the failure to comply to a customs officer and pay an amount equal to the amount of duties, in this case the GST/HST, that were relieved. When filing Form B2, the importer must ensure that the "Special Authority" field is left blank.

8. Importers can submit Form B2 under a dual authority, in this case subsection 32.2(2) of the Customs Actand subsection 118(1) of the Customs Tariff.

Audit, Examination, or Verification

9. If as a result of an audit, examination, or verification by the Department, goods are found to have been declared incorrectly, the customs duties payable on the goods will be subject to a re-determination or further re-determination under paragraph 59(1)(a) or (b) of the Customs Act,whichever is applicable.

10. Under subsection 118(1) of the Customs Tariff, where the importer has failed to comply with the terms of the Remission Order, an amount equal to the duties relieved will be owing. In this case, the GST/HST and any other excise taxes normally assessed against coffins or caskets will be owing.

Interest and Penalties

11. In accordance with subsection 33.4(1) of the Customs Act, the importer is liable to pay interest against any outstanding customs duty amount owed to the Department until the amount is paid in full. The interest will be calculated at the specified rate beginning on the first day after the date the importer became liable to pay the customs duties. For example, where it is determined that the goods were imported incorrectly under tariff item No. 9832.00.00 for the reason mentioned in paragraph 3, the importer is obligated to pay interest on the customs duty amount owing from the day following the original date of accounting until the amount owing is paid.

12. Under subsection 123(2) of the Customs Tariff, interest at the specified rate is also owing against any duties owed to the Department for the period beginning on the day that the goods were no longer in compliance with the terms of the Remission Order and ending on the day the amount is paid in full. However, under subsection 123(4), no interest will be incurred if the importer pays the amount owing within 90 days of the date of failure to comply. Continuing the example in paragraph 10, if the GST/HST and any excise taxes owing on coffins or caskets are paid within 90 days, no interest will be charged on that portion of the amount owing. If the GST/HST and any other excise taxes are not paid until after 90 days, interest will be charged as of the date of failure to comply.

13. As per subsection 109.11(2) of the Customs Act,every person who fails to comply with section 32.2 of the Customs Actor subsection 118(1) of the Customs Tariffis liable to pay a penalty of 5% of the duties owing plus an amount equal to 1% of the duties owing multiplied by the number of complete months, not exceeding 12 months, until the amount is paid in full. Continuing with the example in paragraph 11, if the importer submits Form B2 to adjust the accounting declaration for the goods, to pay the customs duty and interest owing and to pay an amount equivalent to the GST/HST and any other excise taxes relieved, within 90 days of the original date of accounting, no penalty will be applied. If the importer does not submit Form B2 until 95 days from the original date of accounting, the importer may be subject to a penalty of 5% of the duties owing plus 1% of the duties owing multiplied by three months.

14. Furthermore, where the importer again fails within three years of the original infraction under subsection 109.11(2) to comply with section 32.2 of the Customs Act, as per subsection 109.11(3) of the Customs Act, the penalty owing will be 10% of the duties owing plus an amount equal to 2% of the duties owing multiplied by the number of complete months, not exceeding 20 months, until the amount is paid in full.

15. Memorandum D11-6-5, Interest and Penalty Provisions: Determinations/Re-Determinations, Appraisals/Re-Appraisals, and Duty Relief, provides additional information on interest and penalty provisions.

APPENDIX A

TARIFF ITEM NO. 9832.00.00

Tariff item No. 9832.00.00 reads as follows:

9832.00.00 Coffins or caskets:

APPENDIX B

COFFIN OR CASKET REMISSION ORDER

ORDER RESPECTING THE REMISSION OF TAXES
IMPOSED UNDER DIVISION III OF PART IX AND
UNDER ANY OTHER PART OF THE EXCISE TAX
ACTON IMPORTED COFFINS OR CASKETS

Short Title

1. This Order may be cited as the Coffin or Casket Remission Order.

Remission

2. Subject to section 3, remission is hereby granted of the taxes paid or payable under Division III of Part IX and under any other Part of the Excise Tax Acton any imported coffin or casket that

Condition

3. Remission is granted under this Order on condition that a claim for remission is made in writing to the Minister of National Revenue, in a form satisfactory to the Minister, within two years after the date of importation.

Coming into force

4. This Order comes into force on January 1, 1998.

REFERENCES

ISSUING OFFICE -

Trade Policy and Interpretation Directorate
Trade Incentives Program

LEGISLATIVE REFERENCES -

Financial Administration Act, subsection 23(2)
Order in Council P.C. 1983-1250, April 28, 1983,
  SI/83-88, as amended by SI/88-18, SI/91-8 and SI/98-9

HEADQUARTERS FILE -

6564-2

SUPERSEDED MEMORANDA "D" -

D8-3-11, April 12, 1991

OTHER REFERENCES -

D11-6-5, D11-6-6

SERVICES PROVIDED BY THE DEPARTMENT ARE AVAILABLE IN BOTH OFFICIAL LANGUAGES.

THIS MEMORANDUM IS ISSUED UNDER THE AUTHORITY OF THE DEPUTY MINISTER OF NATIONAL REVENUE.