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191 Provincial Sales Tax (PST) In Ontario there is an 8% retail sales tax on most goods and services. To collect retail sales tax you are required to obtain a vendor permit from the Ontario Government's Retail Sales Tax Branch and remit tax on a regular basis.
- Who is exempt from paying PST?To be exempt from paying retail sales tax on business expenses, you must have a vendor permit. Otherwise, you will have to pay retail sales tax on your purchases. Generally businesses that manufacture, sell, or import goods or services are eligible for a vendor permit and should collect and remit retail sales tax.
If you sell goods that are not taxable or if you only sell taxable goods occasionally, you will normally not require a vendor permit. Goods and services that are not taxable include the sale of fresh fruit, dry cleaning services, and generally the sale of goods and services by religious, charitable and non-profit organizations.
- Different rates of PSTSome goods are taxed at a different rate of retail sales tax. For less than one month of accommodation in hotels, camps or clubs, the rate is usually 5%. For admission to amusement places or for alcoholic beverages sold at a licensed establishment, the rate is usually 10%. For liquor, beer, and wine sold through retail stores, the rate is 12%.
To apply for a vendor permit and for more information on how to collect and remit retail sales tax you can contact the Retail Sales Branch in your area. This office is listed in the Blue pages of your telephone book.
INVESTIGATIONS: CANADA REVENUE AGENCY