With the growth of the digital economy, many jurisdictions have changed their rules in recent years to require non-resident businesses selling taxable goods or services in their territory to register for sales tax. Like Quebec in 2019, the provinces of Saskatchewan and British Columbia have changed their rules.
SETTING THE SCENE
The provinces of Manitoba, Saskatchewan and British Columbia use a retail sales tax system. The final consumer bears the cost of the tax. This tax generally applies to tangible goods and certain services.
SASKATCHEWAN
In May 2018, Saskatchewan amended its provincial sales tax legislation. The obligation was then extended to registration for non-resident vendors who do not operate a business in the province. These new rules apply retroactively to April1, 2017.
Businesses located outside Saskatchewan that sell taxable goods are required to register if they accept purchase orders and deliver goods in Saskatchewan. The requirement for solicitation by advertising or other means has been eliminated.
In its latest budget, the province requires e-commerce platforms ( Amazon and AirBNB, for example) to register for the provincial tax from January1, 2020. In addition, people who sell through a platform registered with the provincial tax will not need to register.
BRITISH COLUMBIA
In its 2020 budget, British Columbia amended its provincial sales tax legislation to extend the registration requirement to non-resident vendors who do not operate a business in the province. These new rules apply from April1, 2021.
Canadian companies selling and delivering tangible goods in British Columbia are required to register for provincial sales tax. All companies (Canadian or non-resident) selling software for use in British Columbia are required to register for provincial sales tax.
Finally, the province has introduced a small supplier concept. A company is not required to register if its sales are less than $10,000 over the past 12 months.
