Authorized On-Reserve Gasoline Retailers: E-Service and Tax-Exempt Sales of Gasoline

Published: January 2017
Content last reviewed: January 2017

  • This page provides information on the Electronic Service for Authorized On‑Reserve Gasoline Retailers.
  • This page provides information on the electronic voucher service and the treatment of tax‑exempt sales of gasoline to First Nations bands and individuals on a reserve.
  • This page provides general information. It is not exhaustive and should not be considered as a substitute for the Gasoline Tax Act and its regulations.

Rate of tax and exemption

Ontario legislation applies gasoline tax at a rate of 14.7 cents per litre of gasoline. Qualified First Nations bands and individuals are exempt from paying this tax if they buy gasoline on a reserve for their exclusive use from an authorized on‑reserve gasoline retailer.

Who qualifies for the exemption?

First Nations bands and individuals registered under the Indian Act as Status Indians are entitled to purchase gasoline on a reserve for their exclusive use exempt from tax in the circumstances prescribed by the Gasoline Tax Act and described on this page.

Who can sell tax‑exempt gasoline?

Only those on‑reserve gasoline retailers that are authorized by the Ministry of Finance may sell tax‑exempt gasoline to qualified First Nations bands and individuals. For the purposes of this page, retailer means an authorized on‑reserve gasoline retailer.

Role of the Ministry of Finance

The ministry is committed to ensuring that qualified First Nations bands and individuals can purchase tax‑exempt gasoline according to the provisions of the Gasoline Tax Act. The ministry must also ensure that compliance measures are in place, so that an exemption from payment of Ontario's gasoline tax is granted only to persons who are entitled.

Gas card

Upon application, the ministry provides each eligible First Nations band or individual with a Certificate of Exemption, commonly referred to as a gas card.

Tax‑exempt sales of gasoline to First Nations individuals on a reserve

What qualifies as a tax‑exempt sale?

All of the following conditions must be met for gasoline to be sold tax‑exempt to First Nations bands and individuals. The gasoline must be:

  • purchased by the holder of a valid gas card
  • for the exclusive use of the purchaser and not for resale
  • dispensed from the pump on a reserve of an authorized on‑reserve gasoline retailer; or delivered to the storage facility of a qualified First Nations band or individual on the reserve by an authorized bulk distributor.

E‑service for retailers

E‑service introduction

The Ministry of Finance has introduced an optional electronic service (e‑service) that accepts electronic vouchers from retailers for gasoline tax refunds of tax‑exempt sales to First Nations bands and individuals.

Selection of service provider

  • The retailer may select a service provider (or act as its own service provider) that meets ministry specifications to participate in the e‑service for retailers.
  • The retailer will enter into an agreement with the service provider, at the retailer's expense.
  • The service provider must be authorized by the retailer to submit electronic refund claims for that retailer.
  • To provide this authorization, the retailer must submit a completed Authorizing or Cancelling a Representative form. A copy of the form is available on the ministry website at: ontario.ca/finance or by contacting the ministry directly.

The retailer and service provider will arrange for the equipment needed by the retailer to electronically transfer refund claims to the ministry. The equipment is provided to the retailer at the retailer's expense.

Procedures for selling tax‑exempt gasoline ‑ e‑service

The procedures described below are to be followed for every purchase of tax‑exempt gasoline by a First Nations band or individual from a retailer using electronic vouchers.

Action by purchaser

  • At the time of the sale, the purchaser will present his or her gas card to the retailer so that the card may be processed through e‑service.
  • The retailer will key the gas card number and the quantity of gasoline sold into the point‑of‑sale device to create an electronic voucher.
  • The purchaser must sign a copy of the sales slip and return it to the retailer.
  • The retailer will provide the purchaser with a duplicate copy of the sales slip.
  • If the gas card cannot be validated by e‑service, please see the section below entitled Some transactions cannot be processed by e‑service.
  • If the purchaser is a First Nations individual residing in Ontario, his or her Ontario gas card must be used to purchase tax‑exempt gasoline.

Action by retailer

  • Upon presentation of the gas card, the retailer will key the gas card number and quantity of gas sold into the point‑of‑sale device to create an electronic voucher.
  • The vehicle licence plate information is not required.
  • The point‑of‑sale device will indicate whether the gas card number is valid. If it is not validated, please see the section below entitled Some transactions cannot be processed by e‑service.
  • The point‑of‑sale device will print a duplicate slip which must be signed by the purchaser.
  • The copy of the slip must be given to the purchaser and the original, signed slip must be retained by the retailer.
  • The ministry does not require the retailer to retain proof of cancelled or invalid e‑service transactions.

Procedures for recovering the tax

Refund claims filed with Ministry

  • Data to create the electronic vouchers is keyed into the point‑of‑sale device.
  • The details of the information reported to the service provider are dependent on the arrangement with the service provider.
  • The service provider will transmit the electronic refund claim to the ministry. Electronic refund claims cannot be submitted to the bulk fuel supplier for a credit.
  • The retailer is required to submit receipted gasoline purchase invoices in support of refund claims. These are to be submitted to the ministry on the 15th and 30th of every month by mail, courier or fax.
  • The ministry will validate each electronic refund claim before payment. If a claim cannot be validated, it will be manually reviewed and processed.
  • The ministry will notify the retailer and the service provider if there is a problem with a refund claim to allow either party to provide further information in support of the claim.
  • The ministry will transmit the refund to the service provider or the retailer, as determined by the parties' arrangement.

Some transactions cannot be processed by e‑service

Gas card not validated

If the gas card cannot be validated by e‑service, the purchaser will not receive tax‑exempt gasoline at the point of sale. The retailer should:

  • continue to process the sale but do not allow the gasoline tax exemption
  • provide the purchaser with a gasoline sales receipt showing tax was paid, gas card number was declined and litres purchased, and
  • supply the purchaser with First Nations Gasoline Users: Tax‑Exempt Purchase of Gasoline on a Reserve and the page will advise the purchaser how to obtain a new gas card as well as provide ministry contact information should the purchaser have any questions about obtaining a refund of the gasoline tax paid on the purchase.

Other purchases

Purchases of aviation fuel or propane cannot be processed using e‑service. Paper vouchers must continue to be used for these purchases. For further information, please refer to Authorized On‑Reserve Gasoline Retailers: Paper Voucher Service and Tax‑Exempt Sales of Gasoline.

Record keeping requirements

Records kept for 7 years

Every retailer, wholesaler, collector or agent must keep, at its principal place of business, records and books of account. This information is to be kept for a period of seven years following the end of the fiscal year to which the records relate.

Failure to keep records

If a retailer, wholesaler, collector or agent fails to keep adequate records and books of account for the required length of time, the person is guilty of an offence, and on conviction is liable to a fine of $50 for each day that the default occurs or continues.

Purchases of large volumes of gasoline

Verification

In some circumstances, it may be necessary for ministry staff to contact the gas card holder to verify whether a large purchase of gasoline was made.

Contact information

If the quantity of gasoline purchased is greater than an amount that could reasonably fill a car or truck, or, if a gas card is used to purchase large volumes of gasoline over a short time period through a number of separate purchases, the purchaser will be asked by the retailer to provide his or her phone number in order to verify these purchases.

On‑going purchases

If a purchaser intends to purchase high volumes of gasoline on a regular basis, please contact the ministry for further information.

Verification of claims

Retailers' responsibility

Authorized on‑reserve gasoline retailers are responsible for completing all forms accurately, and, as determined by voucher type, support each claim with copies of the vouchers issued for the claim period. For gasoline tax refund claims filed electronically, all supporting documentation, including electronic vouchers, are sent electronically to the ministry through the third party service provider. Copies of paper vouchers are still required for manually submitted gasoline tax refund claims. For further information, please refer to Authorized On‑Reserve Gasoline Retailers: Paper Voucher Service and Tax‑Exempt Sales of Gasoline.

Claim discrepancy

The ministry will verify each authorized on‑reserve gasoline retailer's claim. If a discrepancy is noted, the ministry will contact the claimant before rejecting the claim to allow the claimant to provide additional information. If a satisfactory explanation is not provided, the claimant will be issued a Statement of Disallowance and the refund, or part refund, will be denied.

Ministry verification

During the verification process, ministry staff will review claims and vouchers for duplicate transactions and large or unusual volume purchases based on vehicle type.

The ministry may contact authorized on‑reserve gasoline retailers, purchasers, suppliers, service providers and authorized representatives for additional information.

Additional information

If this page does not completely address your particular situation, refer to the Gasoline Tax Act and related regulations, visit our website at ontario.ca/finance or contact:

Ministry of Finance
33 King Street West
Oshawa ON L1H 8H9

  • 1‑866‑ONT‑TAXS (1‑866‑668‑8297)
  • Fax: 905‑433‑5680
  • 1‑800‑263‑7776 for teletypewriter (TTY)
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