{"id":14450,"date":"2022-06-21T03:05:02","date_gmt":"2022-06-21T10:05:02","guid":{"rendered":"https:\/\/michaeljbrumm.com\/dcl-v3\/?p=14450"},"modified":"2024-01-30T07:40:19","modified_gmt":"2024-01-30T15:40:19","slug":"international-taxes-difference-between-hst-gst-pst","status":"publish","type":"post","link":"https:\/\/michaeljbrumm.com\/dcl-v3\/blog\/shipping\/international-taxes-difference-between-hst-gst-pst\/","title":{"rendered":"Understanding Canadian Sales Tax\u2014the Difference Between HST, GST, and PST"},"content":{"rendered":"

Shipping to Canada can be confusing when you\u2019re <\/span>new to international markets<\/span><\/a>. Not only does each country have their own set of import fees\u2014<\/span>different taxes, duties, tariffs<\/span><\/a>\u2014they change often depending on shifts in governmental decisions and international relations.\u00a0<\/span>\u00a0<\/span><\/p>\n

Here is a guide to Canadian import taxes and how they are applied.\u00a0<\/span>\u00a0<\/span><\/p>\n

What is GST (Goods and Services Tax) and how is it Calculated?<\/span><\/b>\u00a0<\/span><\/p>\n

GST is a goods and services tax applied at customs. It is a fee added to goods, products, or services as a sales tax at the point of sale. It is calculated as a percentage of the sale cost of the goods or services. This type of tax generates income for the government.<\/span>\u00a0<\/span><\/p>\n

Is There a Difference Between GST and VAT?\u00a0<\/span><\/b>\u00a0<\/span><\/p>\n

Almost all countries have a VAT which stands for value-added tax. VAT and GST are very similar in terms of their implementation but are applied differently based on the country importing into. Only a few countries have GST as well.\u00a0<\/span>\u00a0<\/span><\/p>\n

They get used interchangeably when they often shouldn\u2019t. They often have a different rate of taxation, VAT being typically higher than GST. Whereas the rate of VAT in the UK is 20%, the rate of GST in Australia 10%. <\/span>Canada\u2019s GST is currently 5%<\/span><\/a> which is one of the lowest in the world.\u00a0<\/span>\u00a0<\/span><\/p>\n

Some goods that are exempt from VAT may not be exempt from GST. It’s important to look up the materials that you may be taxed on in each country, because they will differ.\u00a0<\/span>\u00a0<\/span><\/p>\n

The US is one of the few countries that does not have VAT or GST which leads to a lot of US companies assuming that other countries are the same. This assumption can lead to costly implications.<\/span>\u00a0<\/span><\/p>\n

Which Canadian Provinces Collect PST?\u00a0\u00a0<\/span><\/b>\u00a0<\/span><\/p>\n

PST is the Canadian Provincial Sales Tax. It is applied by some Canadian provinces but not all. The PST rate differs depending on which Province your products are sold in. It is handled through the individual revenue agencies of each province in Canada that collects PST separately.<\/span>\u00a0<\/span><\/p>\n

In Quebec, the provincial sales tax is called the Quebec Sales Tax, or QST.\u00a0<\/span>\u00a0<\/span><\/p>\n

Here are the <\/span>2022 Provincial Sales Tax<\/span><\/a> rates:<\/span>\u00a0<\/span><\/p>\n