New GST/HST on Cross-border Digital Products and Services
03 December, 2020 -
By Luisa Almazan
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New GST/HST on Cross-border Digital Products and Services (Effective: July 1, 2020)
On December 2, the Deputy Prime Minister and Finance Minister, the Honourable Chrystia Freeland, introduced Bill C-14, an Act to implement certain provisions of the economic statement tabled in Parliament on November 30, 2020, and other measures.
Proposed Sales Tax Measures:
- Temporary GST/HST zero-rating of certain face masks and face shields. This applies to articles manufactured after 6 December 2020.
- Various new GST / HST measures to ensure that foreign suppliers supplying digital products and services (including traditional services) to consumers in Canada or goods through fulfillment warehouses in Canada are subject to the GST / HST.
- A new GST / HST measure to ensure short-term accommodation in Canada, facilitated by a digital platform, is subject to GST / HST (e.g. Airbnb rental).
- The government proposes to introduce a tax on companies that provide digital services in Canada from 1 January 2022, which would remain in place until an acceptable common approach is developed (not yet implemented) by the OECD. (Effective July 1, 2020)
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