T-0.1 - Act respecting the Québec sales tax

Section 297.7.2 Disposition versions

1995-12-15

297.7.2. Subject to the second paragraph, where, at any time when an approval granted by the Minister under section 297.1.4 in respect of a distributor of a direct seller is in effect, a particular independent sales contractor of the direct seller, other than a distributor, makes in Québec a particular taxable supply by way of sale, other than a zero-rated supply, of an exclusive product of the direct seller, the following rules apply:

(1)  if the recipient of the particular taxable supply is a person who is an independent sales contractor of the direct seller, other than a distributor, the particular taxable supply is deemed, except for the purposes of section 297.1 and sections 297.7.1 to 297.7.4, not to have been made by the particular contractor and not to have been received by the person; and

(2)  if the recipient of the particular taxable supply is a person other than a distributor or another independent sales contractor of the direct seller,

(a)  the particular taxable supply is deemed, except for the purposes of sections 297.1, 297.7.4 and 297.11, to be a taxable supply made by the distributor, and not by the particular contractor, for consideration equal to the lesser of the actual consideration for the supply and the suggested retail price of the product at the time the particular taxable supply is made,

(b)  any tax in respect of the particular taxable supply that is collected by the particular contractor is deemed to have been collected on behalf of the distributor, and

(c)  tax in respect of the particular taxable supply shall not be included in determining the net tax of the distributor for any reporting period.

This section applies where section 297.7.1 applied in respect of a supply of an exclusive product made at an earlier time by an independent sales contractor of the direct seller or where section 297.7.6 applied at an earlier time in respect of the exclusive product.

1995, c. 63, s. 394.