The Nova Scotia government has announced plans to reduce the province’s harmonized sales tax (HST) rate to 14% (from 15%) as of April 1, 2025.
The HST rate in Nova Scotia combines the provincial value-added tax with the federal goods and services tax (GST). The GST rate will remain at the current 5%. However, Nova Scotia’s provincial portion will decrease to 9% (from 10%) if enacted.
The new combined sales tax rate of 14% in Nova Scotia will then differ from other provinces with HST. Specifically, Nova Scotia’s rate will differ from HST in Newfoundland and Labrador, New Brunswick, Prince Edward Island (15%), as well as Ontario (13%) .
How will this change affect your business?
Although the province didn’t announce any changes in how the HST is applied, businesses will need to ensure that their systems are prepared to correctly account for the adjusted rate as of April 1, 2025, for supplies in Nova Scotia.
At this time, no transitional rules have been announced with respect to the proposed rate change.
Takeaway
Our experienced sales tax professionals can help you determine in advance how this proposed change could affect you and your organization. Stay tuned for more updates as new details become available. Contact your local advisor or reach out to us here.
Disclaimer
The information contained herein is general in nature and is based on proposals that are subject to change. It is not, and should not be construed as, accounting, legal or tax advice or an opinion provided by Doane Grant Thornton LLP to the reader. This material may not be applicable to, or suitable for, specific circumstances or needs and may require consideration of other factors not described herein.
