As you review this section, note that the government has taken the feedback it received from the Talking Taxes public engagement process and has announced significant changes to the HST if British Columbians vote to keep it in this summer’s referendum.
The province has committed to lowering the HST rate to 10 per cent over the next three years. The provincial portion of the rate will be lowered by one per cent in 2012 and another per cent in 2014. This means that all items that were subject to the PST+GST and are now subject to the HST will face a lower tax rate by 2012.
There will be an increase in tax for about 20 per cent of total consumer spending in BC. However, instead of paying an additional 7 per cent tax on those items, it will only be 5 per cent For about 54 per cent of total consumer spending there will be no increase in tax because the products are not subject to PST or GST – and therefore no HST either. In fact, the tax on many of the items, about 29 per cent, will be less under the 10 per cent HST than they were under the 12 per cent PST + GST system.
In addition to the future reductions in the rate, there are a few important ways in which the HST may make things less expensive in your daily life today. Parents with babies do not pay the provincial part of the HST on diapers, and actually pay less tax on disposable diapers.
You now pay less tax to rent a car or hotel room. Although not as large as other changes, there are actual reductions in the tax rate for some goods and services.
Returning to PST
- The Government is working to bring back the PST as qickly as we responsibly can.
- An action plan has been established to ensure an effective and orderly transition back.
- The Independent Panel report released in May 2011 estimated it would take 18-24 months to complete the process.
- Senior Citizens
Other taxes and fees that were eliminated or reduced as part of the shift to HST:
- The $5 battery levy. Government will continue to fund the programs to offset the revenue loss and will review the Sustainable Environment Fund budget annually.
- The Passenger Vehicle Rental Tax of $1.50 per day
- The Surtax on Motor Vehicles over $55,000
- Innovative Clean Energy (ICE) Fund levy on energy products
- 8 per cent Hotel Room Tax (net change – a 1 per cent reduction)
- Hotel & Travel
Learn more About HTC to PST
The PST will be reinstated effective April 1, 2013.
Will the PST be re-implemented at 7%?
British Columbia’s provincial sales tax (PST) will be re-implemented effective April 1, 2013 at a general tax rate of seven per cent
Will all permanent PST exemptions return?
The PST will apply to the same goods and services that were subject to PST prior to the implementation of the HST. All permanent PST exemptions will be re-implemented with the new PST.