Gravel pit owners and dump truck operators

It is common for a contractor who has been hired to build a road to own a gravel pit and to supply the gravel needed to build the road from its pit. Given the volume of gravel required to build the road, the contractor will often subcontract with a dump truck operator to transport the gravel to the road construction site.

The interline provisions do not apply in the case described above. In these circumstances, the gravel pit owner (contractor) would be considered to be the shipper of the goods, not the carrier. For the interline provisions to apply, there must be at least two carriers. In this case, the dump truck operator is the only carrier. As such, the zero-rating provisions do not apply, and the GST/HST applies to the supply.

Forms and publications

• Booklet RC4080, GST/HST Information for Freight Carriers
• GST/HST Memoranda Series Chapter 28-2, Freight Transportation Services