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What is Canadian Sales Tax?

Canadian Sales Tax refers to the combination of federal and provincial sales taxes that are imposed on the sale or purchase in Canada of most goods and services.  Canadian sales Tax includes federal goods and services tax (GST), Harmonized Sales Tax (HST) and Provincial Sales Tax (PST or sometimes, “RST”).

The rates of tax will vary depending on the place of supply of the goods or services.  At the time of writing, the rates of Canadian Sales Tax were as follows:

  • GST: 5%

“Goods and services tax” is charged in every province as it is a federal tax. This amount can be shown alone or as a part of the HST. This tax is a consumption tax placed on taxable goods and services.

  • HST: 13-15%

“Harmonized sales tax” is another consumption tax typically paid by local consumers and businesses. There are currently five Canadian provinces that use HST. This tax is a combination of a few taxes hence the word “harmonized.”

  • PST: 5-9.975%

“Provincial sales tax” is on consumer goods and some services. This tax may be integrated with HST of being separated.

For details on the rates per province and territory, please see our post HERE.