C'mon Uber: Sales Taxes on Uber Rides Are Not a "Tax on Innovation" - Michael Geist
Yesterday's federal budget included plans to amend the law to ensure that GST/HST is applicable to ride sharing services such as Uber. The budget states that the government will: Amend the definition of a taxi business under the Excise Tax Act to level the playing field and ensure that ride-sharing businesses are subject to the same GST/HST rules as taxis. This change should not be particularly controversial. No one likes paying taxes, but equal application of sales taxes ensures appropriate revenue collection and a level-playing field for all businesses in the sector. As I noted in an earlier post, I expect that this is a first step toward extending requirements to collect and remit sales taxes on foreign digital services such as Netflix and Spotify. Applying sales taxes to all foreign digital services is complicated - there needs to be thresholds implemented to ensure that administrative costs do not outweigh revenues collected - but Uber is well established in Canada with many local jurisdictions establishing a regulatory framework for the service.