Harmonized Sales Tax (HST)
- Harmonized Sales Tax (HST) will be implemented in Ontario and British Columbia beginning July 1, 2010.
- HST will replace PST and GST
- Businesses already registered for GST will automatically be registered for HST
- Registrants would report their HST according to their current GST filing frequency
Breakdown |
Ontario |
British Columbia |
Provincial Part Current PST |
8% |
7% |
Federal Part Current GST |
5% |
5% |
Combined HST Rate July 1, 2010 |
13% |
12% |
Benefits for small - medium sized businesses and consumers:
Lower cost of doing business:
- The proposed HST will reduce costs for Ontario and B.C.’s small and medium sized businesses by eliminating the PST on business costs, generating approximately $2 Billion plus in savings from all businesses which can be passed on to consumers.
- Currently businesses pay PST on most of their “inputs” that go into producing or selling their products and services. Under the proposed HST, all businesses will no longer pay tax on these input costs.
- These savings will reduce business costs, attract investment, and create jobs and overall result in lower prices for consumers.
Lower Compliance Costs:
- Collecting, accounting, and reminding PST is a costly and complicated process for business owners. The proposed HST eliminates the current duplication and businesses are expected to save $150 million annually in compliance costs under the new streamlined HST tax system.