Goods and Services Tax

Definition

• A value added consumption tax introduced by the Mulroney government in order to replace the Manufacturers' Sales Tax (MST). When initially introduced in 1991, the Goods and Services Tax (GST) was imposed at a rate of 7%; as of 2012, the GST rate is charged at 5%. The GST applies to most consumer purchases with notable exceptions including prescription drugs, and basic groceries. The Goods and Services Tax is applicable in all Canadian provinces, including provinces that use a Harmonized Sales Tax (HST) where the GST is merged with a Provincial Sales Tax (PST).

Website
http://www.cra-arc.gc.ca/tx/bsnss/tpcs/gst-tps/menu-eng.html

Relevant Locations
Canada

Notes
Bank account transaction code.

Synonyms
sales tax, taxe sur les produits et services

Acronyms
GS, GST

Alternate Spellings
general sales tax, GST, TPS

Related Terms and Acronyms

• Direct Tax — Definition,
  • A tax that is paid straight to the government.
• Harmonized Sales Tax (HST) — Acronym, Canada,
  • A sales tax used in some provinces to merge the GST and PST.
  ➥ Canadian consumption tax.
• Indirect Tax — Definition,
  • A tax that is collected by a third party before being transferred to the government.
• Provincial Sales Tax (PST) — Acronym, Canada,
  • A sales tax collected by some Canadian provinces.
• Sales Tax — Definition,
  • Federal and / or provincial taxes that are applied to purchases.
• Tax (TX) — Acronym,
  • A levy paid by an individual or entity that is collected by a government.
  ➥ Bank account transaction code.