Why tax on WestJet Dollars?
I have noticed that WestJet charges me the full HST on the full price when I use WestJet Dollars - even when I pay the complete "base fare" with WestJet Dollars.
How come? I am actually getting a discount, I do not pay that part of the ticket. Why do I have to pay sales tax on something that is free for me?
My experience with other airline's loyalty programs was that they do not charge similar sales taxes on the free part of the ticket, but that was in other countries. Is there special legislation in Canada? Would Air Canada or Porter charge HST if I used their relevant points for a reward booking?
If not: Why is WestJet different?
(For clarification: I'm not talking about other taxes and fees, just about sales tax on the non-revenue part of the base fare that is "paid" with WestJet Dollars.)