Many online marketplace facilitators will have to collect British Columbia’s 7% provincial sales tax (PST) starting July 1, 2022. Under this change, which was announced in British Columbia’s 2022 budget, online marketplace facilitators must register and collect PST on many of the taxable sales facilitated through their marketplaces. In addition, affected facilitators and certain other entities will also have to collect PST on certain online marketplace services starting July 1, 2022. 

As a result of these changes, online marketplace facilitators and other affected entities that are subject to the new PST rules must identify all affected sales and ensure their systems are updated to collect and remit the sales tax as required.

Marketplace facilitators — Start collecting British Columbia’s PST

• In general, online marketplace facilitators must register and collect British Columbia’s PST starting July 1, 2022 under the new PST rules where they facilitate online marketplace sellers’ retail sales of:
• Goods that are located within Canada at the time the goods are sold, provided or leased to a person in British Columbia
• Software for use on, or with, an electronic device ordinarily situated in British Columbia
• Accommodation in British Columbia
• Taxable services, other than legal services, to a person in British Columbia.

Marketplace facilitators that facilitate only a small amount of taxable sales may not be required to register under these new rules. This relief is generally available for marketplace facilitators where the gross value of such retail sales, provision and leases of goods, software and taxable services that they make or facilitate is $10,000 or less in the preceding 12 months. A number of conditions and rules apply under this exception.

There are also additional rules that apply where an online marketplace is operated, owned or controlled by more than one online marketplace facilitator. 

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