Vol. 132, No. 14 — July 8, 1998

Registration
SOR/98-354 26 June, 1998

EXCISE ACT

Departmental Regulations Amending the Manufacturers in Bond Departmental Regulations

The Minister of National Revenue, pursuant to subsection 32(2) (see footnote a) and sections 127.1 (see footnote b) and 186 of the Excise Act hereby makes the annexed Departmental Regulations Amending the Manufacturers in Bond Departmental Regulations.

Ottawa, June 25, 1998

Herb Dhaliwal
Minister of National Revenue

DEPARTMENTAL REGULATIONS AMENDING THE MANUFACTURERS IN BOND DEPARTMENTAL REGULATIONS

AMENDMENTS

1. The heading before section 7 of the Manufacturers in Bond Departmental Regulations (see footnote 1) is replaced by the following:

RETURNS AND INVENTORY

2. (1) The portion of subsection 7(1) of the Regulations before paragraph (a) is replaced by the following:

7. (1) Every bonded manufacturer shall complete and submit to the collector a monthly return showing for that month

(2) Subsection 7(1) of the Regulations is amended by striking out the word "and" at the end of paragraph (c) and by adding the following after paragraph (d):

(e) the quantity of spirits otherwise disposed of;

(f) the quantity of imported spirits received at the bonded manufactory;

(g) the quantity of spirits reclaimed;

(h) the quantity representing inventory overage or shortage; and

(i) the closing inventory of spirits.

(3) The portion of subsection 7(2) of the Regulations before paragraph (a) is replaced by the following:

(2) Where annual stock-taking is done in accordance with section 32 of the Excise Act, the inventory shall show

COMING INTO FORCE

3. These Regulations come into force on June 26, 1998.

REGULATORY IMPACT
ANALYSIS STATEMENT

(This statement is not part of the Regulations.)

Description

The Manufacturers in Bond Departmental Regulations require bonded manufacturers licensed under the Excise Act to file monthly returns which account for spirits used in manufacturing products or in fortifying wine. They are also required to file an annual return presenting aggregates of the monthly information. In addition, the results of annual stocktaking are required to be reflected on the return for the month in which the stocktaking took place.

This amendment will bring the Regulations into line with the current administrative practice and ensure the continued provision of information required to protect revenue. Specifically, these changes will incorporate into regulation the requirement for bonded manufacturers to provide data on the monthly return concerning any surplus inventory of spirits and the quantity of any spirits disposed of. It will also enable the Department to track imported alcohol and treat importations in the same manner as domestically manufactured alcohol. In addition, this amendment will clarify that there is no longer a requirement for the provision of an annual statement of inventory, and that adjustments are to be reflected in the monthly statements by bonded manufacturers.

Alternatives

There is no alternative but to require specific information on monthly returns. The Department's shift from intrusive control mechanisms, such as direct supervision, together with the implementation of international agreements such as NAFTA requires that domestic and imported products be tracked in the same manner.

Benefits and Costs

The industry is already complying with the Department's request for this information, so there will be no additional costs for industry or government.

Consultation

Early notice of this amendment was provided in the 1996 Federal Regulatory Plan, proposal no. RC/94-21-L. Consultation other than prepublication in the Canada Gazette Part I is deemed unnecessary as the industry is currently providing this information to the Department.

Compliance

These amendments do not pose a compliance problem. The requirements for record keeping will continue to be monitored by the Department and penalties for non-compliance are provided in the Excise Act.

Contact

Bill Anderson
Excise Duties and Taxes Directorate
Revenue Canada
Vanier Towers, Tower "C"
7th Floor
Ottawa, Ontario
K1A 0L5
Tel.: (613) 957-7593
FAX: (613) 954-2226

Footnote a

S.C. 1993, c. 25, s. 33

Footnote b

S.C. 1993, c. 25, s. 39

Footnote 1

C.R.C., c. 576

NOTICE:
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