Toronto, Ontario, May 22, 2002 - Despite numerous objections sent to the Canada Customs and Revenue Agency, the GST (Excise tax) of 7% on Interchange will be levied effective July 1, 2002. While the Government considers Surcharge revenue exempt from taxation due to its inclusion in a financial transaction, it does not believe that Interchange falls within this category. Under the revised guidelines, the Excise tax will be levied on multiple tiers - Interchange will be taxed at 1) The Financial Institution level, 2) The Processor Level, 3) The ISO/Channel level, and again at 4) The Merchant level.
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Mischa Weisz, President and CEO of TNS Smart Network, has been fighting this decision with the Federal Government for several weeks. "My belief is that the Government has misinterpreted the purpose and place of the Interchange Fee, and that Interchange, like Surcharges, should be exempt from any taxation", explained Weisz. "It would not surprise me if there was a rise in the surcharge rate at ATMs to compensate for the additional cost and inconvenience of the GST. Ultimately the consumer will pay more for access to funds from their own banking accounts".
TNS, working with the support of its ISO base, plans to continue to fight the ruling handed down by the Canadian Government, in the hopes of protecting the consumer from further taxation.
TNS Smart Network Inc. is Canada's largest privately owned transaction processor for ATMs.
For more information visit www.tns-smart.net/mandates.asp http://www.tns-smart.net/mandates.asp
