The Brick ordered to pay uncollected PST
The Brick has been ordered by a B.C. Supreme Court judge to pay $209,473 in provincial service taxes. (FILE PHOTO)
The Brick has been ordered by a B.C. Supreme Court judge to pay $209,473 in provincial service taxes the furniture retailer didn’t collect from administration fees customers paid to enroll in a “don’t pay until” later program.
Now incorporated as Quinco Financial Inc., the company offered three packages for customers to sign up for its “Brick Card.” They cost between $29.95 and $69.95 and allowed customers to defer payments for 13 months or more.
The company argued the fees charged through its financing program — $2.4 million — from March 1996 to October 2000, should be exempt from the PST since it was an additional option that wasn’t part of the product sold.
It also argued The Brick wasn’t providing the financing, but rather, connecting the customer to two other companies that handled financing through the card.
“The petitioner then goes on to say that although the charge was for a service, it was for a service in relation to financing, not in relation to tangible personal property,” wrote Justice J. Keith Bracken in his decision.
The then-B.C. Ministry of Provincial Revenue determined $169,488 in taxes was unpaid and issued the penalty. The judge agreed this was the correct determination in his Wednesday decision.
“Just because a customer could buy an item without using a Brick Card does not change
the fact that the fee is part of the purchase price for those who did use one.”