Excise Tax Act — E-15 153
ferred to in paragraph (5)(a), if (a) a supply by way of sale of property is made to a lessee on the exercise by the lessee of an option to purchase the property provided for in an original leaseback agreement entered into by the lessee in respect of the property, or in a subsequent lease in respect of that agreement, to which subsection (4.1) applied, and (b) immediately before the earliest time at which consideration for the supply becomes due or is paid without having become due, there is an unused total purchase credit in respect of the property, the following rules apply: (c) the value of the consideration for the supply is deemed to be equal to the amount determined by the formula A - B where A is the value of that consideration as otherwise determined under this Part, and B is that unused total purchase credit, and (d) subsection (4.1) does not apply to any consideration that, after that earliest time, becomes due or is paid without having become due for any supply by way of lease of the property that was made under the original leaseback agreement or under a subsequent lease in respect of that agreement. Non-arm’s length supplies (4.6) For the purposes of subsection (4.1), if a person makes a supply by way of sale of property to a recipient with whom the person is not dealing at arm’s length and the consideration for the supply exceeds the fair market value of the property at the time ownership of the property is transferred to the recipient, the consideration for the supply is deemed to be equal to that fair market value. Exception (5) Subsections (4) and (4.1) do not apply (a) for the purpose of determining, for the purposes of any provision of this Part or any Schedule to this Act other than Schedules I to IV, whether the value of consideration for a supply of property equals, exceeds or is less than another amount specified in the provision; (b) for the purposes of section 148 or 249; or (c) if the supply of the trade-in, or the supply by way of sale referred to in paragraph (4.1)(a), as the case may be, is (i) a zero-rated supply, (ii) a supply made outside Canada, or (iii) a supply in respect of which no tax is payable because of subsection 156(2) or paragraph 167(1.1)(a). Exchange of natural gas liquids for make-up gas (6) For the purposes of this Part, if (a) natural gas is transported by pipeline to a straddle plant at which natural gas liquids or ethane (each of which is, in this subsection, referred to as “natural gas liquids”) is recovered from the natural gas, (b) the residue gas is returned to the pipeline after the recovery along with other natural gas (in this subsection referred to as “make-up gas”) that is supplied solely to make up for the loss of energy content due to the recovery, and (c) the consideration or a part of the consideration for any supply of the natural gas liquids (or the right to recover the liquids) or any supply of the make-up gas is (i) in the case of a supply of the natural gas liquids or the right to recover the liquids, the make-up gas, and (ii) in the case of a supply of the make-up gas, the natural gas liquids or the right to recover the liquids, the value of that consideration or part, as the case may be, is deemed to be nil. [NOTE: Application provisions are not included in the consolidated text; see relevant amending Acts and regulations.] 1990, c. 45, s. 12; 1997, c. 10, s. 13; 2000, c. 30, s. 23