GST vs. HST vs. PST vs. QST: Canada's Sales Tax System

Canada doesn't run one sales tax system. It runs a patchwork of them, and the rules that apply depend on what a business is selling and where that sale is considered to take place. Most explanations either flatten this into something too simple or bury it in government-speak. Here's the actual shape of it.

The Federal Starting Point: 5%

For most taxable supplies, the federal GST rate is 5%. In provinces that haven't harmonized their provincial tax with the federal system, that's the GST rate you'll see charged separately. In the five HST provinces, that federal portion is rolled together with the provincial portion into one combined HST rate instead.

The Five Provinces That Combined Everything Into HST

Ontario, Nova Scotia, New Brunswick, Newfoundland and Labrador, and Prince Edward Island folded their provincial sales tax and the federal GST into a single combined rate called HST: 13% in Ontario, 14% in Nova Scotia, and 15% in New Brunswick, Newfoundland and Labrador, and PEI. One tax, one rate, one return. For the business collecting it, that's generally simpler than running GST and a separate provincial tax side by side.

The Three Provinces Running Two Separate Systems

British Columbia, Saskatchewan, and Manitoba have the 5% GST plus a separate provincial sales tax system. Manitoba's version is called RST (Retail Sales Tax) rather than PST. All three provinces run a provincial sales tax separately from GST, but the rules aren't interchangeable — each province decides for itself what's taxable, who has to register, and how the tax is reported. This is where it gets messy: two registration processes, two sets of rules, and often two separate returns to file.

Quebec Has Its Own Provincial System

Quebec's provincial sales tax is QST, with a general rate of 9.975%. It's administered by Revenu Québec, with its own registration and reporting rules. Revenu Québec also administers GST/HST for many Quebec businesses, so it's not automatically two separate governments to deal with — but Quebec has its own registration rules that can apply to certain suppliers outside the province, so selling into Quebec deserves its own check rather than being treated like an HST sale.

The Four Places With No Provincial Sales Tax at All

Alberta, Yukon, Northwest Territories, and Nunavut skip the provincial layer entirely — just the federal 5% GST, nothing added on top.

The Cross-Canada Picture

Why Selling Across Provinces Gets Complicated

Selling outside your home province can create two separate questions.

First, what GST/HST rate applies? CRA's place-of-supply rules determine which province a sale is considered to be made in for GST/HST purposes. In plain language, those rules tell you whether to charge 5% GST or the HST rate of a particular province. The answer can depend on what you're selling and where it's delivered or supplied — it isn't simply based on where your business is located.

Second, does a separate provincial sales tax apply? BC PST, Saskatchewan PST, Manitoba RST, and Quebec QST have their own rules about registration and collection. A business outside the province can sometimes still be required to register. Those obligations have to be checked under the rules of the province involved, separately from the GST/HST question.

Getting either one wrong creates a real problem in both directions: charging tax that wasn't actually owed, or missing tax that was.

Registration Is a Separate Question

Knowing which tax system exists in a province doesn't automatically mean your business has to register for it. GST/HST has its own federal registration rules, while BC PST, Saskatchewan PST, Manitoba RST, and Quebec QST each have their own requirements. That's why "I sell to customers there" isn't enough information by itself to answer "Do I need a sales tax account there?"

RSB's GST/HST quiz walks through the federal registration threshold specifically. The provincial layer on top depends on exactly where a business is based and where its customers actually are — which is exactly the kind of thing a system built around one specific business's real situation handles better than a general explanation ever could.

FAQ

Does a business need to register for sales tax in every province it sells into?
No. Selling to a customer in another province doesn't automatically mean you need a separate sales tax account there. Registration depends on the rules of the tax involved, what you're selling, and how you're doing business in that province. Don't assume either "I need to register everywhere" or "my home province is the only one that matters."

Is HST basically just GST and PST added together?
Functionally similar in effect, but administratively a different animal — HST is one combined tax with one return, while a GST-plus-PST province means running two separate systems side by side.

Does Quebec's QST work the same way as HST or the GST-plus-PST provinces?
No — it's genuinely its own thing, with its own rate, its own registration rules, and provisions for certain out-of-province suppliers that don't exist elsewhere in the country.

What happens if the wrong tax gets charged to a customer in another province?
It's a problem either direction. Undercharge, and the business may owe the shortfall out of its own pocket. Overcharge, and now there's a correction and possibly a refund owed to the customer. Getting it right before charging beats fixing it after the fact, every time.

Follow the system. File with confidence.