The appellant bank appealed GST/HST reassessments relating to its credit card and loyalty points programs.
The Tax Court of Canada held that the bank was not entitled to notional input tax credits for redemption payments made to a grocery retailer, as these were made in the course of providing exempt financial services rather than a commercial activity.
The Court also found that credit card processing services provided by third parties were excluded from the definition of financial services and were therefore taxable supplies.
The appeals were allowed in part only to give effect to certain agreed adjustments.
