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Are we supposed to pay $100 Air Tax? Thought Heat Pumps didn't pay this!

Discussion in 'Canada' started by hingisfan, Jan 25, 2015.

  1. hingisfan

    hingisfan hingisfan_Mark_V

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    Just got my final paperwork and it looks good except the Air Tax. Are we supposed to pay this? Thought model S had a heat pump and heat pumps were excluded from this tax?

    Thanks
     
  2. Doug_G

    Doug_G Lead Moderator

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    I hadn't heard about the heat pump thing... do you have a pointer to the law in question?
     
  3. hingisfan

    hingisfan hingisfan_Mark_V

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    No...just read on another thread/forum at some point.
     
  4. jerry33

    jerry33 S85 - VIN:P05130 - 3/2/13

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    A heat pump was mentioned in the early videos. However, HVAC is not entirely based on a heat pump.
     
  5. RiverBrick

    RiverBrick Active Member

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    This got me thinking. Air conditioning taxes are considered "Green Taxes" in the sense that running A/C burns gas (though often less than rolling down the windows, go figure) and traditional A/C systems are packed with green house gases. Logically, the air tax would not apply to many EVs. For example, my LEAF only uses a heat pump for A/C. (Heating is hybrid heat pump/resistance). When Jerry says the Model S HVAC doesn't run entirely on the heat pump, is it the same?

    Anyway, there is a July 2013 memoranda which appears to spare EVs in Canada from the tax, heat pump or not. http://www.cra-arc.gc.ca/E/pub/et/x3-1/x3-1-e.html

    Article 17 would seem to apply.

    Exceptions

    17. The excise tax on air conditioners designed for automobiles, station wagons, vans or trucks applies only to those that are powered by the engines or power trains of the vehicles mentioned. Air conditioners that are powered by separate motors, propane or electricity are not subject to this tax.
     
  6. wayner

    wayner Active Member

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    You make a good point - I would assume that the AC is powered by the batteries of a Tesla, not by the power train or engine. Therefore we should be exempt from this tax.
     
  7. Doug_G

    Doug_G Lead Moderator

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    Interesting.

    One thing I should point out... all air conditioners are heat pumps.

    People only refer to them as heat pumps when they operate in either direction (heating or cooling), but technologically all air conditioners are fundamentally heat pumps.
     
  8. mrElbe

    mrElbe Member

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    That A/C tax is just another tax grab. That is my take on it.
    That Article 17 seems to be cut and dry. I will fire off a letter to the CRA today and try to get a refund. Lets see what happens or what the excuse is.
     
  9. Jaff

    Jaff Active Member

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    I agree with you 100%, this is just another grab by the government...BTW Doug, I am sure we also paid this $100 tax on our Roadster purchases...

     
  10. wayner

    wayner Active Member

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    Anyone have any advice on who to contact at CRA? And wouldn't we need a letter or other form of proof from Tesla explaining that the AC is driven by electricity and not by the drivetrain? And someone should tell Tesla Canada to stop collecting the tax. Has anyone discussed this with Tesla?
     
  11. RiverBrick

    RiverBrick Active Member

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    A Tesla Canada rep told me they were investigating.

    Anyone know how Ottawa collects this tax? At the border for imports, or only after cars are sold?


    It's obvious to us the a/c just draws electricity from the battery, but do we need schematics signed by an engineer with his seal and then notorized to convince a bureaucrat?
     
  12. mrElbe

    mrElbe Member

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    OK, I just fired off a letter to the CRA stating the case and asking for a ruling and where do I apply for the refund.
     
  13. Doug_G

    Doug_G Lead Moderator

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    You're right Jaff, I'd have 2 x $100 coming to me...
     
  14. wayner

    wayner Active Member

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    I am pretty sure that this is collected by Tesla when you buy the car, just like sales tax. But I can't find my purchase agreement, I don't think they put this on My Tesla.
     
  15. mrElbe

    mrElbe Member

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    Your Purchase agreement should be under Documents.
     
  16. wayner

    wayner Active Member

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    The Order Agreement and Delivery Config are there but not the final agreement including all of the charges including taxes, etc.
     
  17. mrElbe

    mrElbe Member

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    Most interesting. Mine has the document.
     
  18. wayner

    wayner Active Member

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    Do we know for sure that the AC is powered by the battery and not by the power train of the vehicle? Could it use a belt coming from the electric motor?
     
  19. mnx

    mnx 2013 P85

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    Yes we know for sure. The electric motor is between the rear wheels and the AC compressor is below the frunk so they are definitely not connected by a belt.

    When we figure this out, I want my $100 back with INTEREST! :)
     
  20. RiverBrick

    RiverBrick Active Member

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    Very true, so the tax isn't all based on heat pumps. However, it does look like we should be exempt.

    - - - Updated - - -

    There are some people who consider the battery is part of an EV's power train, so the CRA might try to claim that. If so, we just have to protest in French since they have "transmission" instead of "power train" on the French page. The equivalent of power train should be "groupe moto propulseur," and by using "transmission" they eliminate any chance of including the battery.

    Anyway, I'm sure there's a diagram of how the HVAC system works somewhere on tmc.
     

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