On July 1, 2010 Ontario and BC will join Nova Scotia, New Brunswick and Newfoundland as participating provinces which charge Harmonized Sales Tax on taxable supplies.

All participating provinces will charge 13% HST with the exception of BC at 12%.  The other provinces charge the 5% GST on taxable supplies and the applicable provincial tax in the province, with the exception of Alberta which does not have provincial sales tax.  Due to different tax rates and rules in different provinces, it is important to understand which province’s rules apply to a transaction.

Generally, a sale of tangible personal property is regarded as made in the province:

• in which the property is delivered or made available to the purchaser
• to which the goods are shipped by the supplier

Where a registrant purchases property in a non-participating province and only GST was charged, and later imports the property to a participating province, the provincial portion of HST may be required to be self assessed at the time it is imported.

Over the counter sales are usually straight forward, but vendors shipping goods to customers in different provinces need to be aware of the requirement to charge HST for goods shipped to participating provinces.