What is the sales tax on vehicle purchases in SK?

In Saskatchewan, the sales tax on vehicle purchases is a combination of the federal Goods and Services Tax (GST) and the provincial Provincial Sales Tax (PST), totaling 11% for most transactions. Specifically, the GST is 5% nationwide, while Saskatchewan's PST is 6%.

For new vehicles purchased from a dealership, both the 5% GST and 6% PST apply. Similarly, used vehicles bought from a licensed dealer are subject to both taxes. However, a significant distinction exists for used vehicles purchased through a private sale in Saskatchewan: only the 6% PST is typically applicable, as GST is generally not charged on private sales between individuals who are not GST registrants.

This tax structure is crucial for consumers to understand, as it directly impacts the total cost of ownership and the amount needing to be financed. For instance, a $30,000 vehicle purchase from a dealer would incur an additional $3,300 in taxes, significantly affecting the overall budget and monthly payments. Furthermore, when trading in a vehicle at a dealership, PST is only calculated on the net difference between the purchase price of the new vehicle and the trade-in value, offering a potential tax saving. It is always advisable to confirm the exact tax implications with the dealership or Saskatchewan Government Insurance (SGI) for private sales to ensure accurate budgeting and avoid unexpected costs.