Effective January 1, 2008, the GST rate and the federal component of the HST rate was reduced from 6% to 5%. The provincial component of the HST will remain at 8%. This means that the rate of HST is reduced from 14% to 13%. The HST applies to purchases made in or imported into New Brunswick, Nova Scotia, and Newfoundland and Labrador (the participating provinces). The GST does not apply to basic groceries, most medical services and devices, prescription drugs, residential rents and exports. (Canada Revenue Agency, Notice 226 – Proposed GST/HST Rate Reduction in 2008)