Excise Tax Act — E-15 50
hicle or tractor or a part or equipment for an aircraft or ship or other marine vessel (a) has been purchased or imported by a person for a use by that person that renders the purchase or importation exempt from tax imposed under this Part and Part III or either of those Parts, or (b) has been purchased as described in subsection 68.19(1), the following rules apply: (c) if within five years of the time the article was first purchased or, if imported, released under the Customs Act for a use rendering the purchase or release exempt from tax imposed under this Part and Part III or either of those Parts, the article is applied to any use, other than of a casual nature, for which it could not, at the time of such first purchase, have been purchased or released exempt from the tax, the article shall be deemed to have been sold at the time of its first application to that use and tax imposed under this Part and Part III or either of those Parts, shall be imposed, levied and collected at the time of its first application to that use, (i) in the case of an article mentioned in Schedule I having a specific rate of tax set opposite the item, at the lesser of the specific rate applicable at that time, and the specific rate, if any, applicable in the case of the article at the time the article was first purchased or imported for a use rendering the purchase or importation exempt from the tax or taxes, and (ii) in any other case, on the sale price that would have been reasonable in the circumstances if the article had been sold, at the time of its first application to that use, to a person with whom the person so applying the article was dealing at arm’s length, payable by the owner of the article at the time of its first application to the use rendering it subject to tax; and (d) if within five years of the time the article was first purchased or, if imported, released under the Customs Act for a use rendering the purchase or release exempt from tax imposed under this Part and Part III or either of those Parts, the article is sold or leased, the article shall be deemed to have been sold at the time of the sale or lease and tax imposed under this Part and Part III or either of those Parts, shall, if applicable, be imposed, levied and collected at the time of the sale or lease, (i) in the case of an article mentioned in Schedule I having a specific rate of tax set opposite the item, at the lesser of the specific rate applicable at that time, and the specific rate, if any, applicable in the case of the article at the time the article was first purchased or imported for a use rendering the purchase or importation exempt from the tax or taxes, and (ii) in any other case, (A) where the article was sold, on the sale price, or (B) where the article was leased by a person to another person, on the sale price that would have been reasonable in the circumstances if the article had been sold, at the time of the lease, to that other person, payable by the person who sold or leased the article. Diversion of fuel (8) Where fuel that has been purchased or imported for heating or lighting is sold or appropriated by the purchaser or importer for a purpose for which the fuel could not have been purchased or imported exempt from tax under this Part at the time of the purchase or importation, the tax imposed under this Part shall be payable by the purchaser or importer (a) where the fuel is sold, at the time of delivery to the person to whom it is sold, computed at the rate of tax in force at that time (i) in the case of gasoline or diesel fuel, on the volume sold, and (ii) in any other case, on the sale price; and (b) where the fuel is appropriated, at the time of the appropriation, computed at the rate of tax in force at that time (i) in the case of gasoline or diesel fuel, on the volume appropriated, and (ii) in any other case, on the sale price that would have been reasonable in the circumstances if the fuel had been sold, at that time, to a person with w