Frequently Asked Questions about penalties and offences — Fuel Tax and Gasoline Tax
Are there penalties and offences under the Gasoline Tax Act for failure to collect tax or failure to file a tax return or excess unverifiable losses?
Ontario's enforcement program includes a range of audit, investigation and inspection activities.
The Gasoline Tax Act (the Act) provides for numerous fines and penalties for persons who are involved in gasoline activities without authorization. Here are some examples.
Failure to Collect
A collector, importer, wholesaler, or retailer who fails to collect the required tax may be assessed a penalty equal to 110 per cent of the tax not collected.
Further, the Act provides that any collector, importer, wholesaler, or retailer who fails to collect the tax required, is liable upon conviction, to pay a fine equal to three times the tax not collected.
Failure to File
Returns not filed, filed late or with less than the required amount of tax, may result in assessed penalties of 10 per cent of the tax collectable and five per cent of the tax payable.
Excess Unverifiable Losses
The Act provides for the assessment of a penalty where product loss by a collector is found to be in excess of a prescribed threshold. The penalty, if assessed, will be equal to the amount of tax that would have been collectable if the excess unverifiable product loss had been product sold to a consumer in Ontario.
Over a 36 month period, tax collectors are required to reconcile the volume of products in opening inventories, received, or manufactured, with the volume of product, which can be accounted for by way of taxable sales, tax exempt sales, exports, closing inventories and losses from known causes (theft, fire, contamination, reported spillage). Unverifiable losses result when product cannot be accounted for in the reconciliation.