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British Columbia 2024 Budget – Indirect Tax Highlights


On February 22, 2024, the British Columbia (“BC”) Finance Minister Katrine Conroy tabled the 2024 provincial budget, which includes various indirect tax measures. A brief summary of the most notable indirect tax amendments are set out below.

Key Takeaways

Provincial Sales Tax (“PST”)

  • In response to the decision of the Supreme Court of British Columbia in Hootsuite on March 10, 2023[1], the definition of “software” in the Provincial Sales Tax Act (British Columbia) is expanded, to include “software as a service” (SaaS) and “infrastructure as a service” (IaaS). Both terms are defined as follows:

"software as a service" includes software or the right to use software when possession of the software is maintained by the provider of the software or another person other than the person to whom the software is being provided

"infrastructure as a service" includes access to computational services or the right to access computational services, including computing or processing capacity and electronic storage.[2]

The definition is amended retroactively to April 1, 2013 to effectively overturn the decision of the court in Hootsuite, with the result that cloud computing services (which were found to be exempt from PST in Hootsuite) were always subject to PST, thereby retroactively supporting how BC administered PST prior to the court decision.

  • Effective July 1, 2024, a person who acquires goods in BC and pays PST to the seller will no longer be entitled to claim a refund of the PST paid where the person acquired the goods for export and resale outside BC. In such cases, the person will now need to provide its PST registration number or, if the person is not registered, a valid purchase exemption certificate to the seller prior or at the time of purchase in order to avoid paying unrecoverable PST.
  • The Provincial Sales Tax Exemption and Refund Regulation were amended to expressly provide that effective February 23, 2024, projects that use sunlight, wind, tides, air, or water to manufacture clean energy qualify for the production machinery and equipment exemption.
  • Effective on Royal Assent of Bill 3 – 2024: Budget Measures Implementation Act, 2024 (currently in second reading at the time of writing), a PST refund from the Ministry of Finance will be available to a person who self-assessed and remitted PST on the purchase of tangible personal property from a seller who did not collect PST (g., from a person other than a collector) in situations where the purchaser subsequently returns the goods to the seller for a refund. Since the PST was not paid to the seller, the amendment ensures that the person is able to recover the PST self-assessed and remitted to the Minister.

Property Transfer Tax (“PTT”)

  • Effective April 1, 2024, the first time home buyers’ exemption threshold available for eligible purchasers will be increased from a fair market value (“FMV”) of $500,000 to $835,000, such that the first $500,000 of the value of a home with a total FMV of up to $835,000 is fully exempt from PTT. However, the portion of the value between $500,000 and $835,000 will be subject to PTT. The exemption received on the initial $500,000 will be gradually phased out on homes with a FMV above $835,000 with the first time home buyers’ PTT exemption fully eliminated on homes valued over $860,000.[3] As a result, PTT will be fully payable on homes with a FMV of $860,000 or above.
  • Effective April 1, 2024, the amount fully exempt from PTT under the newly built home exemption for qualifying purchasers of a principal residence will be increased from $750,000 to $1,100,000. A partial exemption will be available for qualifying newly built homes with a FMV between $1,100,000 and $1,150,000, which will reduce but not eliminate the PTT payable. The PTT exemption will not apply to homes valued at or above $1,150,000.
  • Purchases of new qualifying purpose-built rental buildings between January 1, 2025 and December 31, 2030, will be exempt from the general PTT. Generally, purpose-built rental buildings are those that are non-stratified and held as rentals, on a monthly basis or longer, for at least 10 years. The residential portion of the building must be entirely used for rental purposes and have at least four apartments. The amendments are intended to apply to purpose built rental housing that qualify for the recently introduced enhanced GST rebate. Our Insights can provide you with information on the enhanced GST rebate.
  • For more information on the several measures targeting the real estate sector in British Columbia, please see the Insights from our real estate team.

Speculation and Vacancy Tax (“SVT”)

  • Effective, January 1, 2024, the definition of “registered occupier” under the Speculation and Vacancy Tax Act was amended such that a tenant who has registered its lease of residential property in the Land Titles Office will be treated as the “registered occupier” of the property and liable for payment of the tax. The tenant will also be required to make a declaration and be responsible for ensuring that the property is occupied. Registered tenants who are not already required to report in 2024 will be liable to declare for the first time in 2025, based on the use of the property in the year 2024.

We’re Here to Help

McCarthy Tétrault has a leading indirect tax team with robust industry knowledge that offers business-focused advice. Please contact any of the authors if you have any questions with respect to the foregoing.


[1]Hootsuite Inc. v. British Columbia (Finance), 2023 BCSC 358.

[2] The term software is also expanded to include an application programming interface and coded instructions, or a right to use coded instructions, whether exercised or not, designed to cause an electronic device to perform a task.

[3] For example, if a qualifying property has a FMV of $800,000, the first $500,000 is fully exempt from PTT, resulting in savings of $8,000. Conversely, if a qualifying property has a FMV of $847,500, only the first $250,000 is fully exempt from PTT, resulting in savings of $3,000 (the full exemption on the $500,000 being gradually reduced).




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