Mr. Speaker, Motion No. 1 in Group No. 1 pertains to clause 26 of Bill C-70. It enacts new subsections 177(1.2) and (1.3) of the Excise Tax Act which sets out the sales tax treatment of goods sold by auction. Subsection 177(l.2) provides that the tax on such goods must be collected and remitted by the auctioneer.
In response to concerns raised by some registrants that frequently sell goods by auction in large lots, typically at the wholesale level, the Standing Committee on Finance passed an amendment to add new subsection 177(1.3). This subsection allows an auctioneer and a registered principal to jointly elect to have the auctioneer instead pass back the tax to the principal that would be required to report and remit it.
This election could be made where all or substantially all of the proceeds from the sale of goods on behalf of the principal at the particular auction were attributable to prescribed goods that are often wholesaled in this manner, such as motor vehicles, certain construction equipment, horses and flowers.
The purpose of the motion before the House now is to correct a deficiency in new subsection 177(1.3). The correction adds that the election applies only with respect to sales by auction in respect of which the principal would otherwise be required to collect the tax. That only seems a fair and appropriate correction.
As a result, the general rules that apply to sales by auction continue to apply, for example, to personal use property of the registrant sold by auction.
That concludes what I have to say with respect to Motion No. 1. However, I need some guidance from the Chair as to whether we would be debating Motion No. 1 or whether I could make some comments on Motion No. 2 as well at this time.