Don’t Forget to Collect HST on the Sale of Illegal Drugs

Here’s something different!

One of the issues, in a judgment issued by the the Tax Court of Canada [Bailey v. The Queen, 2011 TCC 233, (April 28, 2011),],  had to do with whether or not the illegal sale of  cannabis and cocaine are taxable supplies or zero-rated supplies for the purpose of collecting the GST.

Turns out that not only are illegal drug sales taxable transactions for income tax purposes, they are also  taxable supplies subject to GST.   

… I wonder if they could claim an exemption as a small supplier in the first year of operation or apply to use the Quick Method of Accounting for the GST/HST?

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