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Carbon Emission Allowances—Purchasers to Remit GST/HST

Carbon Emission Allowances—Purchasers to Remit GST/HST

Many businesses that purchase carbon emission allowances now have new GST obligations.


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Finance recently announced that businesses that purchase qualifying taxable carbon emission allowances will now be required to self-assess GST/HST on such purchases and remit those taxes to the CRA starting June 27, 2018. Previously, sellers of these allowances were responsible for collecting the GST/HST from the purchasers and remitting these taxes. Finance's proposed legislation, which was released on June 27, 2018, does not otherwise change the tax status of these allowances.

Finance is accepting comments on the proposed amendments, including related transitional rules, until July 27, 2018. Quebec also announced that it will incorporate QST changes with the same effective date in its legislation to reflect the proposed new GST/HST rules.

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