The start of 2012 will be marked by the second one-percent increase in the QST rate, bringing it to 9.5%. The effective QST rate will be 9.975%, because the QST is levied on a GST-included amount.
The transition to the new rate will be carried out under the exact same rules that applied last year when the rate was raised to 8.5%. Here is a brief reminder:
Several mathematical factors used to calculate the QST will be affected by this rise in the QST rate. The specified factor under the simplified method of calculating rebates regarding an expense account will be 9/109 for small and medium-sized businesses, and the specified percentage for large businesses will be 5% (taxable supplies exceeding $10 million).
The same will apply for the simplified method that certain small businesses can use (revenues from taxable supplies of $219,000 or less including tax in 2012): rates will be increased to 3.4% for vendors of corporeal movable property and 6.6% for other businesses.
Jean Lanoue, FCA
Member of the Committee for CAs in Taxation and Commodity Taxes
Michel Ducharme, CGA
5, Place Ville Marie, bureau 800
Montréal (Québec) H3B 2G2 T. 514 288.3256 1 800 363.4688
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