Taxable Sales or Supplies

The supply of a good or service (including zero-rated supplies) is said to be a taxable supply or sale if it is subject to the GST and QST and is made in the course of commercial activities.

You must collect the GST at the rate of 5% and the QST at the rate of 9.975% when you make such a supply, unless it is exempt or zero-rated (meaning taxable at 0%).

If you acquire taxable goods or services in the course of your commercial activities, you may be entitled to an input tax credit (ITC) or an input tax refund (ITR).

Supplies that are subject to 5% GST and 9.975% QST include the following:

  • tools sold to a business specialized in the repair of small motors, as well as lawnmowers sold by the business
  • moulds sold to a bakery, as well as chocolates sold by the bakery
  • computers sold to a law firm, as well as legal services provided by the firm
  • sales of new residential complexes
  • sales and rentals of commercial buildings
  • retail automobile sales and automobile rentals
  • sales of gasoline and automobile repair services
  • sales of soft drinks, candy and potato chips
  • sales of clothing and footwear
  • the rental of hotel accommodations for a night
  • the provision of barber and hairstylist services
  • sales of printed books that have an International Standard Book Number (ISBN), in the GST system only

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