The Canadian province on British Columbia has introduced from 1 April 2021 the obligation to charge Provincial Sales Tax (PST) on income earned by non-resident providers of digital services. Check Avalara’ global VAT on digital services tracker. BC’s PST is 7%.
The federal state plans to implement 5% Canadian GST on digital services from 1 July 2021.
This new BC tax applies to sales of software and telecommunications services. Only businesses with annual sales in BC above C$10,000 will be liable to register and charge PST
The measure was to be introduced on 1 July 2020, but was delayed due to the COVID-19 pandemic. The new implementation date is to be confirmed.
Currently, non-resident businesses providing digital services in British Columbia do not have to charge PST on their sales. However, in an effort to remove the unfair advantage this gives non-resident companies over resident providers, the Canadian Revenue Agency has confirmed PST will be applied on these types of supplies at a rate of 7%.
