Sydney Mines Firemen's Club v. The Queen, [2011] GSTC 126, 2011 TCC 403 -- summary under Commercial Activity

The Appellant was a non-profit society which purchased and held title to all equipment used by the local fire department (a distinct entity consisting of volunteer firefighters). The Appellant claimed input tax credits ("ITCs") on its purchase of one such item of equipment (a boat) on the basis that some of the funding for the boat purchase came from the Nova Scotia government, and that such funding should be viewed as the consideration for a taxable supply of the boat to the government. The Minister denied the ITC claim on the basis that the boat instead was used in making exempt supplies for no consideration under Sched. V, Part VI, s. 10. In rejecting the Appellant's ITC claim, Campbell J found (at para. 37) that the Appellant had failed to adduce sufficient evidence to establish a "direct link" between the government funding and the purchase of the boat.