What is the sales tax on vehicle purchases in NL?

In Newfoundland and Labrador, the sales tax on vehicle purchases is generally 15% Harmonized Sales Tax (HST). This rate applies to both new and used vehicles purchased from a licensed dealership, with the HST calculated on the agreed-upon purchase price of the vehicle before any additional fees. For consumers, understanding this 15% is crucial for accurate budgeting, as it significantly impacts the total cost of their vehicle acquisition.

A key provincial nuance in NL involves private sales of used vehicles. While dealerships are required to charge the full 15% HST, when purchasing a used vehicle from a private seller, the buyer is typically responsible for remitting only the provincial portion of the HST, which is 10%, to the provincial government upon registration. The federal 5% GST component is generally not applicable to private sales of used goods in Canada. This distinction can lead to substantial savings for buyers considering private transactions, making it vital to understand the seller type.

Furthermore, if you are trading in a vehicle at a dealership, the HST is usually applied to the net price after the trade-in value has been deducted, effectively reducing the amount of tax payable. It is always advisable for consumers to confirm the exact tax implications with their dealer or Service NL when considering a private sale, to ensure full compliance with Canadian tax regulations and avoid unexpected costs.