A series of rules originally passed by the parliament of British Columbia in February 2020 that imposed Provincial Sales Tax collection requirements on businesses located outside of the province have come into effect as of April 1, 2021. The rules were originally passed with an effective date of July 1, 2020, but the implementation was postponed as part of Covid-19 relief measures. The updated date by which businesses were required to register was announced in September 2020.
The new rules effective April 1, 2021, require businesses located outside of British Columbia but within Canada to register if they meet all of the following requirements:
The above rules do not apply to businesses located outside of Canada. All sellers of vapor products and accessories to BC customers are required to be registered.
Businesses located both inside and outside of Canada are required to register under the new rules if they meet all of the following requirements:
Where a business is located for the application of these rules is determined based on the presence of a company’s place of business, rented or owned real property, employees, agents, or management in either British Columbia or Canada. Wholesalers, businesses making only nontaxable sales, small sellers, and independent sales contractors are not required to register.
Canada and its provinces face the same issues as many other national, state, and provincial governments when it comes to collecting their consumption taxes in an increasingly global digital market. New registration requirements being adopted in Canada and the EU can cause trouble for sellers of software and digital goods. Keeping a handle on the complexities of changing laws across the world is a must as more governments pass legislation imposing taxes on foreign remote sellers. (British Columbia Provincial Sales Tax Bulletin 001, Revised February 18, 2021).