1. SkipCarDealer
  2. Glossary
  3. Explain the sales tax on vehicle purchases in PE?
Explain the sales tax on vehicle purchases in PE?
Open Your Account
Car Loan Glossary • pe

Explain the sales tax on vehicle purchases in PE?

In Prince Edward Island (PEI), the sales tax on vehicle purchases is the Harmonized Sales Tax (HST), currently set at 15%. This rate combines the federal Goods and Services Tax (GST) and the provincial sales tax into a single, unified tax. The 15% HST applies comprehensively to both new and used vehicles purchased from licensed dealerships. Crucially, unlike some other Canadian provinces, PEI also levies the 15% HST on used vehicles purchased through private sales between individuals, with the tax collected at the time of vehicle registration. This means the sales tax is a significant and unavoidable component of the total cost for nearly all vehicle acquisitions in the province. Consumers must factor this substantial 15% into their overall budget, as it represents a considerable addition to the vehicle's advertised price, whether financing or paying cash. While the HST rate is standard, buyers should always investigate potential provincial or federal rebates for specific vehicle types, such as electric vehicles, which can help offset the total out-of-pocket expense, though these are separate from the sales tax itself.

References:

Related Topics: pe province taxes

Related Financial Terms

Explain an auto loan APR in Canada?

The Annual Percentage Rate (APR) on an auto loan in Canada represents the true, total annu...
Explain the Bank of Canada policy interest rate used for car loans?

The Bank of Canada's policy interest rate, hypothetically at 2.75% as of July 30, 2025, is...
Do I pay sales tax on a car loan?

In Canada, you do not pay sales tax directly on the interest portion of your car loan. Ins...
Do I pay sales tax on a car loan in Canada?

In Canada, you absolutely pay sales tax when purchasing a vehicle, but it's crucial to und...

Need more help?

Explore our full glossary or get in touch with our financing experts.

View Full Glossary
Search Glossary
Type a keyword and hit enter
Browse by Letter
A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
Popular Terms

Ready to get approved?

Skip the dealership hassle and get pre-approved for your car loan today.

Apply Now

With over 50 years of experience in the automotive industry, we know what we're doing when it comes to getting the best deals. We specialize in credit building and rebuilding, and with our expertise, we're sure to find a solution that suits you! Its our Skip Car Dealer Guarantee.

Credit Solutions

Loan Types

Programs

Partners

155-2 King Street West, Unit #107, Hamilton, ON, L8P 4S0 888-270-SKIP (7547)

PARTICIPATING LENDERS MAY VERIFY YOUR SOCIAL INSURANCE NUMBER, DRIVER'S LICENSE NUMBER, PROVINCIAL ID, OR ANY OTHER GOV IDENTIFICATIONS AND REVIEW YOUR INFORMATION AGAINST FEDERAL DATABASES TO INCLUDE BUT NOT LIMITED TO EQUIFAX, TRANSUNION, AND EXPERIAN TO DETERMINE CREDIT WORTHINESS, CREDIT STANDING AND/OR CREDIT CAPACITY. BY SUBMITTING YOUR APPLICATION AND INFORMATION ON THIS WEBSITE, YOU AGREE TO ALLOW ANY AND ALL PARTICIPATING LENDERS TO VERIFY YOUR INFORMATION AND CHECK YOUR CREDIT. SKIP CAR DEALER FOLLOWS BEST PRACTICES OF THE CANADIAN FAIR TRADING ACT OF 1999. ALL FINANCE IS SUBJECT TO EMPLOYMENT STATUS AND INCOME. APPLICANTS MUST BE 18 OR OVER, TERMS AND CONDITIONS APPLY, GUARANTEES AND INDEMNITIES MAY BE REQUIRED. WE CAN INTRODUCE YOU TO A NUMBER OF FINANCE PROVIDERS BASED ON YOUR CREDIT RATING. WRITTEN QUOTATION ON REQUEST.

This site uses cookies so that we can provide you with the best user experience. By continuing to use the site you are consenting for cookies to be used. Further information on cookies and how you can disable them is available on our cookie policy.

Copyright © 2020 Skip Car Dealer All Rights Reserved.

Terms of use | Privacy Policy

Top