Definition
HST, or Harmonized Sales Tax, is a single combined federal and provincial sales tax used in five Canadian provinces. It folds the 5% federal Goods and Services Tax into one harmonized rate (13% in Ontario, 14% in Nova Scotia, 15% in New Brunswick, Newfoundland and Labrador, and Prince Edward Island) that is administered federally by the Canada Revenue Agency on the same GST/HST return.
What HST means in practice
For a bookkeeper, HST simplifies the Canadian indirect-tax workload in the provinces that use it. Instead of two separate taxes (federal GST and a provincial sales tax), there is one. One return, one rate per province, one input tax credit pool. A business in Ontario charges 13% HST on its sales and reclaims 13% HST on its taxable purchases. The net is paid or refunded on the same GST/HST return as a business in Alberta would file for the federal 5% GST.
The complication is keeping the rate by province straight, particularly for businesses that ship into multiple provinces. The place-of-supply rules determine which province’s HST applies, and they are not the supplier’s province by default. For goods, it is generally the destination province. For services, it is generally the customer’s location. For real property, it is the location of the property. The CRA’s place-of-supply guide is the authoritative reference and is updated frequently.
A practical example: an Ontario consultancy invoices a client in Quebec for CAD 10,000 of consulting services. Quebec is GST plus QST territory, so the bookkeeper charges 5% GST (CAD 500) and 9.975% QST (CAD 997.50), not 13% Ontario HST. The 5% GST goes on the federal return; the QST goes on a separate Revenu Quebec return.
How HST works by country
Canada
HST applies in five provinces and is administered federally by the CRA on the same return as GST. Current rates as of 1 April 2026:
| Province | Rate | Federal component | Provincial component |
|---|---|---|---|
| Ontario | 13% | 5% | 8% |
| Nova Scotia | 14% | 5% | 9% |
| New Brunswick | 15% | 5% | 10% |
| Newfoundland and Labrador | 15% | 5% | 10% |
| Prince Edward Island | 15% | 5% | 10% |
Nova Scotia reduced its rate from 15% to 14% on 1 April 2025, the only HST rate change in recent years. The other HST provinces have held steady since 2010 when the harmonized regime took its current shape.
The other provinces and territories operate differently. Alberta, the Northwest Territories, Nunavut, and Yukon have 5% GST only. British Columbia (7% PST), Saskatchewan (6% PST), and Manitoba (7% RST) stack a separate provincial sales tax on top of the federal 5% GST. Quebec stacks 9.975% QST on top of the 5% GST and administers QST itself through Revenu Quebec.
The administrative consequence is significant. In HST provinces, every dollar of HST you pay on a business purchase is an input tax credit. In GST plus PST provinces, only the GST portion is recoverable; the PST portion is a real cost. A retailer in BC pays 12% on inputs (5% GST + 7% PST) and only reclaims 5%. The same retailer in Ontario pays 13% HST and reclaims all 13%.
United Kingdom
The United Kingdom does not have HST. The equivalent indirect tax is VAT at 20% standard rate, administered by HMRC. Making Tax Digital applies to all VAT-registered businesses regardless of turnover.
Australia
Australia does not have HST. The equivalent is GST at a flat 10% rate, reported on the BAS.
New Zealand
New Zealand does not have HST. The equivalent is GST at 15%, with no reduced rate and a relatively low registration threshold (NZD 60,000).
Singapore
Singapore does not have HST. The equivalent is GST at 9% (raised from 8% on 1 January 2024).
Related terms
HST is one node in the wider sales-tax cluster:
- GST is the federal 5% component that sits inside HST in the harmonized provinces and applies on its own elsewhere.
- VAT is the UK equivalent.
- HST netfile is the CRA online service for filing the combined GST/HST return.
- An input tax credit is the amount of GST/HST you reclaim on business purchases.
- The GST/HST credit is a separate quarterly rebate paid to low-income individuals.
- A tax invoice is the document required to support input tax recovery; the CRA documentation thresholds are CAD 100 and CAD 500.
See also
For the full Canadian regime including PST and QST, see the Canadian GST and HST guide.
FAQ
See the answered questions above for the 2026 HST rates by province, the difference between HST and GST plus PST, and input tax credit recovery.