Buyers and sellers of sweetened carbonated beverages, tech products and services, and vapour products should take note of tax changes coming into effect at the end of this month.
The B.C. government announced today (March 5) that two provincial sales tax (PST) changes (originally announced on February 18, 2020, as part of Budget 2020) that were postponed because of the pandemic are now scheduled to take effect on April 1 (as previously announced on September 2).
One change regards carbonated beverages but only those that contain sugar, natural sweeteners, or artificial sweeteners, as these drinks have been exempt from the PST.
As of April 1, PST will be charged on these beverages, which include those dispensed through soda fountains, soda guns, or other equipment, as well beverages sold in vending machines. (Vending machines that dispense beverages other than sweetened carbonated beverages, such as coffee or water, remain exempt.)
Soft drinks have come under increasing scrutiny in recent decades for contributing to health issues, including obesity and dental decay.
The B.C. government states that this change is “a move that is supported by health professionals due to the health costs and impacts of sweetened drinks”.
The other area of change is for all e-commerce businesses located outside of B.C. that sell digital software and telecommunication services.
These sellers must now collect PST on sales to B.C. customers if they have B.C. revenues of over $10,000.
As part of this change, all Canadian businesses selling vapour products in B.C. will also be required to register to collect PST on all online and mail-order sales.
In the next few weeks, the provincial government will be opening applications for two tax businesses to support B.C. businesses.
One of the benefits is a temporary PST rebate on specific machinery and equipment, which is a program intended to help companies recover from the financial impact of the pandemic. For more details, visit the B.C. government’s website for taxes.
The other benefit is a refundable tax credit for employers, which is designed as an incentive top create new jobs for B.C. workers or increase payroll for existing low- or medium-income employees. More information is available at the B.C. government website.