Whether equipment acquired by the taxpayer constituted qualified property for the purposes of claiming the Atlantic investment tax credit (AITC) turned, in part, on whether it constituted depreciable property referred to in Reg 4600(2). This, in turn, appeared to turn largely on whether its use in the production or processing of fuel could be considered to be the manufacturing or processing of goods for sale in the context of the description of a Class 29 property, and as also required by the definition of “qualified property” in s. 127(9).
After referring to the meaning accorded to “processing” in Tenneco and Repsol, CRA stated that “in our view the production or processing of a fuel could be considered to be the manufacturing or processing of a good for sale for purposes of the AITC depending on the particular circumstances.”