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Harmonized Sales Tax

Harmonized Sales Tax: Creating Jobs, Lowering Prices

Leading economists from across the country say the Harmonized Sales Tax is the single most important step British Columbia can take to boost its economy. Harmonizing the GST and PST will save employers $2 billion that can be used to lower prices, increase investment and create jobs.

NEW HST Information Seminars

The Canada Revenue Agency offers a number of informative seminars to help ensure that businesses receive the information they need for the transition to the federal administration of the harmonized sales tax on July 1, 2010.

Click here to register for the free tax seminars.


HST Rebate For Schools, Hospitals and Health Authorities

New provincial rebates proposed for qualifying schools, universities, public colleges and hospital authorities will ensure that, on average, these institutions pay no more tax when HST is implemented on July 1, 2010.

When the HST is implemented, B.C. intends to provide rebates of:

  • 87 per cent of the provincial portion of the HST for eligible schools.
  • 75 per cent of the provincial portion of the HST for eligible universities and public colleges.
  • 58 per cent of the provincial portion of the HST for eligible hospital and health authorities.
  • 58 per cent of the provincial portion of the HST for eligible facility operators and external suppliers.

The rebates are designed to mitigate the impact of the HST while providing certainty for eligible organizations. For more information, click here. 


Rebate Threshold And Transitional Rules For New Housing

Proposed Transition Rules for HST 

The Province is proposing to increase the threshold for the B.C. HST new-housing rebate from $400,000 to $525,000 to ensure that, on average, purchasers of new homes up to $525,000 pay no more tax due to harmonization than is currently embedded as PST.

The Province is also proposing transitional rules for new housing. The provincial portion of the HST would not apply to sales of new homes where ownership or possession is transferred before July 1, 2010. In addition, sales of new homes under written agreements of purchase and sale entered into on or before November 18, 2009, would generally not be subject to the provincial portion of the HST, even if both ownership and possession are transferred on or after July 1, 2010. [Rebate threshold and transitional rules for new housing] [News release]


How HST Works 
 

Currently, PST is applied at every step in the creation of a product. Those multiple PST charges are embedded in the price you pay at the store – even though you can’t see it. And of course, you pay PST on the final purchase price.

Here’s an example of how PST is hidden in the cost of a very simple made-in-B.C. product: a 2x4. Under the current system, taxes are paid at every step in production and passed on to consumers. Under the proposed HST system, those embedded costs are removed and savings can be passed on:

 

Click for Printable HST Graphic 

Under the current PST system, embedded PST results in higher production costs, less investment, fewer jobs and lower wages. The proposed HST will save B.C. businesses about $2 billion and result in more investment, jobs and higher wages.


More Information: 

The following resources are in PDF format, up to 500KB

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