British Columbia applies two separate consumption taxes on most purchases: the 5% federal Goods and Services Tax (GST) administered by the Canada Revenue Agency (CRA), and the 7% BC Provincial Sales Tax (PST) administered by the BC Ministry of Finance. Together these total 12% on taxable goods and services, but the taxes operate under completely separate rules with different exemption lists, different registration requirements, and different remittance timelines.
BC did not harmonize. Between 2010 and 2013, BC operated an HST at 12%, but a referendum reversed the harmonization and BC returned to a separate GST+PST regime on April 1, 2013, under the Provincial Sales Tax Act (PSTA).
Quick Answer
On a taxable purchase in BC, you pay 5% GST plus 7% PST for a combined rate of 12%. On a $400 item, GST is $20, PST is $28, and the total is $448. The two taxes appear as separate line items on BC receipts because they are collected under different legislation.
How BC GST and PST Work
GST applies first at 5% on the pre-tax selling price. PST applies independently at 7% also on the pre-tax selling price. Neither tax is calculated on the other (no “tax on tax”). Both taxes apply to the same base amount: the purchase price before either tax.
Formula: Total = Price x (1 + 0.05 + 0.07) = Price x 1.12 for fully taxable goods. However, many goods and services are exempt from PST even when they are subject to GST, so the combined rate is not always 12%.
BC PST Exemptions
BC PST has its own exemption list, distinct from the GST zero-rated list. Key BC PST exemptions include:
- Children’s clothing and footwear sized for children age 14 and under
- Basic groceries and most food products (aligned with GST zero-rating)
- Prescription drugs and qualifying medical devices
- Bicycles
- Residential electricity and natural gas
- Seeds, fertilizers, and farm equipment
- Legal services and most professional services (GST still applies)
Software as a Service (SaaS) became PST-taxable in BC effective April 1, 2013, and digital streaming services and online marketplace sales became PST-taxable in subsequent amendments. BC PST applies to purchases of goods for use in BC even if bought out of province.
Luxury Surtax on Vehicles
BC levies additional PST on passenger vehicles based on purchase price. As of 2026, the rates are: 7% on vehicles up to $55,000; 10% on vehicles $55,001-$55,999; 15% on vehicles $56,000-$124,999; and 20% on vehicles $125,000 and over. This surtax is collected through ICBC at vehicle registration and is separate from the standard 7% PST and 5% GST.
BC PST Registration
Businesses that sell taxable goods or services in BC must register to collect PST, regardless of revenue level (unlike GST, there is no small-supplier exemption for PST). Registration is through eTaxBC at the BC Ministry of Finance, not CRA. Remittance frequency depends on average monthly PST collected.
Worked Example
A Surrey resident buys a new laptop priced at $1,200. GST: $1,200 x 5% = $60. PST: $1,200 x 7% = $84. Total taxes: $144. Final price: $1,344. The retailer collects $60 GST and remits it to CRA on the GST/HST return. The retailer separately collects $84 PST and remits it to BC Ministry of Finance on the PST return.
BC GST+PST vs Ontario HST
| Feature | BC (GST+PST) | Ontario (HST) |
|---|---|---|
| Combined rate | 12% | 13% |
| Administered by | CRA (GST) + BC MoF (PST) | CRA only |
| Input tax credits | GST ITCs only; no PST ITCs for most businesses | Full ITCs on HST |
| Legal services | GST only (5%); no PST | HST 13% |
| Children’s clothing | GST only (5%); no PST | HST 13% |
| SaaS/software | PST taxable since 2013 | HST taxable |
Edge Cases and Rules
- Businesses cannot claim PST credits on most inputs (PST is a “cascading” tax on goods); only specific exemptions apply, such as goods purchased for resale or for use in manufacturing.
- A BC resident buying goods online from an out-of-province seller owes PST on the goods if they are brought into or used in BC, even if PST was not charged at point of sale.
- Real estate commissions and legal fees for real property transfers are exempt from BC PST (GST still applies).
- Accommodation (hotels, Airbnb) is subject to GST plus an 8% Provincial Sales Tax on accommodation, with a separate 3% Municipal and Regional District Tax (MRDT) in many areas.
Frequently asked questions
- What are the GST and PST rates in BC?
- BC charges 5% GST (federal) and 7% PST (provincial), for a combined rate of 12% on most taxable goods and services. The two taxes are collected separately under different legislation.
- Did BC have HST?
- Yes. BC harmonized with the federal GST from July 1, 2010 to March 31, 2013, operating a 12% HST. A 2011 referendum rejected the HST, and BC returned to separate GST and PST on April 1, 2013.
- How do I calculate GST and PST in BC?
- Multiply the pre-tax price by 0.05 for GST and by 0.07 for PST. Add both to the price. Example: $300 item: GST = $15, PST = $21, total = $336. The combined multiplier for fully taxable goods is 1.12.
- Are children's clothes exempt from PST in BC?
- Yes. Children's clothing and footwear sized for children age 14 and under are exempt from BC PST. GST (5%) still applies. This differs from Ontario, where HST applies to children's clothing at 13%.
- Is there a small supplier exemption for BC PST?
- No. All businesses selling taxable goods or services in BC must register to collect PST regardless of annual revenue. This differs from GST/HST, where businesses below $30,000 in annual taxable sales are exempt.
- Can businesses claim BC PST back on their inputs?
- Generally no. BC PST is a final-stage consumption tax with no broad input tax credit mechanism. Specific exemptions exist for goods purchased for resale or goods incorporated into manufactured products, but most business inputs bear the full 7% PST cost.
- Who administers BC PST?
- BC PST is administered by the BC Ministry of Finance through the eTaxBC system. GST is administered separately by the Canada Revenue Agency. Businesses operating in BC register with both, file separate returns, and remit to separate governments.
- Does PST apply to services in BC?
- BC PST primarily applies to goods, not services. Most professional and legal services are exempt from PST (though GST applies). Specific service categories are taxable: telecommunication services, short-term accommodation, and legal services related to vehicles.
- Is SaaS subject to BC PST?
- Yes. Software as a Service, cloud software subscriptions, and digital streaming services became PST-taxable in BC under successive PSTA amendments. Businesses selling these services into BC must register and collect PST.
- What is the PST rate on luxury vehicles in BC?
- BC applies a luxury surtax on passenger vehicles: 7% up to $55,000; 10% from $55,001 to $55,999; 15% from $56,000 to $124,999; and 20% on vehicles $125,000 and over. This replaces the standard 7% PST rate for vehicles in those price bands.
- Do I pay PST on goods bought outside BC?
- Yes, if you bring taxable goods into BC for use in the province. BC PST applies on a destination basis. If an out-of-province seller did not charge PST, you are required to self-assess and remit PST to the BC Ministry of Finance.