What Is GST/HST in Canada? A Complete Plain-English Guide (2026)
Canada's sales tax system confuses a lot of people — and for good reason. Depending on which province you're in, you might pay GST, HST, or a combination of GST and PST. This guide cuts through the confusion and explains exactly how Canadian sales taxes work in 2026.
The Three Types of Canadian Sales Tax
Canada has three types of consumption taxes that can apply to goods and services:
- GST (Goods and Services Tax) — a 5% federal tax that applies across Canada
- HST (Harmonized Sales Tax) — a combined federal + provincial tax used in some provinces, replacing separate GST and PST
- PST (Provincial Sales Tax) — a provincial-only tax charged separately from GST in BC, Saskatchewan, and Manitoba; Quebec calls theirs QST
Sales Tax Rates by Province (2026)
| Province/Territory | Tax Type | Rate |
|---|---|---|
| Ontario | HST | 13% |
| British Columbia | GST + PST | 5% + 7% = 12% |
| Alberta | GST only | 5% |
| Quebec | GST + QST | 5% + 9.975% = 14.975% |
| Nova Scotia | HST | 15% |
| New Brunswick | HST | 15% |
| PEI | HST | 15% |
| Newfoundland & Labrador | HST | 15% |
| Manitoba | GST + RST | 5% + 7% = 12% |
| Saskatchewan | GST + PST | 5% + 6% = 11% |
| Yukon / NWT / Nunavut | GST only | 5% |
Alberta is the only province with no provincial sales tax, making it the cheapest for major purchases like electronics and vehicles.
What Is HST and Why Do Some Provinces Use It?
In HST provinces (Ontario, Nova Scotia, New Brunswick, PEI, and Newfoundland), the provincial and federal taxes were combined into a single tax. This simplifies collection for businesses — they only remit one tax instead of two.
Ontario moved to HST in 2010, combining the previous 8% PST with the 5% GST into a 13% HST. This was controversial at the time but is now standard.
What Is Tax-Exempt vs Zero-Rated?
Not everything is taxed. GST/HST rules divide goods and services into three categories:
- Taxable — most goods and services, taxed at the full provincial rate
- Zero-rated — taxed at 0% (businesses can still claim input tax credits). Includes most groceries, prescription drugs, and exports
- Exempt — no tax charged and no input tax credits. Includes most healthcare, educational services, financial services, and long-term residential rent
Key difference: Zero-rated businesses collect 0% tax but can recover the GST/HST they paid on their inputs. Exempt businesses cannot recover input tax credits at all.
GST/HST for Small Businesses
You must register for GST/HST once your business revenue exceeds $30,000 over four consecutive calendar quarters. Below that threshold, registration is optional.
When registered, you collect GST/HST from customers and remit the net amount (collected minus input tax credits) to the CRA. You file returns either monthly, quarterly, or annually depending on your revenue.
Frequently Asked Questions
Do you pay GST on used cars in Canada?
Private vehicle sales between individuals are generally not subject to GST — but you will pay PST or QST when you register the vehicle. Dealership sales are fully taxable at your provincial rate.
Is there GST on rent in Canada?
Long-term residential rent (leases of one month or more) is generally exempt from GST/HST. Short-term rentals under one month (like Airbnb) are taxable.
How do I calculate GST from a total that already includes tax?
To extract GST from a tax-included total: divide the total by 1.05. For example, if you paid $105 including GST, the GST is $105 ÷ 1.05 = $100 base price, so GST = $5.
Can I get a GST rebate as a tourist visiting Canada?
The Visitor Rebate Program for non-residents was eliminated in 2007. Tourists can no longer claim GST/HST refunds on goods purchased in Canada.
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