By Denis Carmel
OTTAWA – On Monday, April 19, Finance Minister Chrystia Freeland will deliver her first federal budget and it is expected it will be implementing changes to ensure the Goods and Services Tax/Harmonized Sales Tax (GST/HST) applies to all ecommerce transactions, including those facilitated by multinational digital giants.
Back in November, the Minister indicated as of July 1, 2021, on-line providers would be required to collect and remit sales taxes, like every other business. That means that Netflix and other so-called web giants (Amazon, Dropbox, Spotify, Disney+, etc.) will be required to collect federal sales tax from Canadians.
It’s expected $1.2 billion over five years will be raised for the federal treasury in this way, from Canadians who, of course, pay the tax.
In British Columbia, as of April 1, 2021, business selling goods and services in the province are required to register to collect and remit PST as announced in the 2020 budget.
In Manitoba, as announced in last week’s provincial budget, online marketplaces will be required to collect and remit sales tax on the sale of taxable goods sold to Manitobans on their electronic platforms by December 1, 2021.
In Saskatchewan, companies such as Netflix and others have been subjected to the same requirements since January 1, 2019.
In Québec, companies also had to collect and pay PST since January 1, 2019. So far 1,011 companies have registered with Revenu Québec. $102 million was collected in 2019 and $159 millionin 2020.
Ontario, New Brunswick, Newfoundland and Labrador, Nova Scotia, and Prince Edward Island have Harmonized Sales Tax so they are likely to be affected by the Federal measure.
Alberta and the Territories are the outliers at this point.
