Tuesday, July 6, 2010

Nova Scotia Harmonized Sales Tax Rate Change


Effective July 1, 2010, the Harmonized Sales Tax (HST) rate in Nova Scotia will increase from 13% to 15%, 5% of which is the federal portion and 10% of which is the provincial portion.

Impact on Imported Goods

Starting July 1, 2010, the CBSA will apply the new HST rate to all non-commercial goods imported into Canada by or for a consumer who is a resident of Nova Scotia. Please note that the HST applies to non-commercial goods destined for Nova Scotia regardless of where the goods enter into Canada.

“Non-commercial goods” means all goods other than goods imported into Canada for sale or for any commercial, industrial, occupational, institutional, or other like use.

Tobacco taxes and provincial alcohol markups will continue to be collected according to the province of entry.

As is the case today, the provincial component of the HST will not generally apply to commercial goods that are imported by an HST registrant for consumption, use, or supply exclusively in the course of the commercial activities of the registrant.

Although the provincial portion of the HST is not payable when commercial goods are imported into Canada and destined for a participating HST province, the goods may be subject to self-assessment rules. For more information about the self-assessment rules, please consult the Canada Revenue Agency (CRA) Website.

Goods Exempted from the Provincial Portion of the Nova Scotia HST

The province of Nova Scotia has expanded its list of goods that will be eligible for a point-of-sale rebate of the provincial portion (10%) of the HST. The list now includes:

• children’s diapers;
• children’s clothing;
• children’s footwear;
• feminine hygiene products; and
• books.

The CBSA will automatically apply the rebate to qualifying goods being imported into Canada and destined for Nova Scotia.

To obtain a complete list of these exemptions, please refer to the exemption table.