P.E.I. HST Rebate for Charities Increased

Summary#

These are final federal regulations called Regulations Amending Various GST/HST Regulations, No. 12: SOR/2023-161. They put into law Prince Edward Island’s increase in the partial provincial HST rebate for charities and qualifying non-profits and make related bookkeeping and anti‑avoidance changes. They also add the charity Twice Upon a Time/Il était deux fois to the federal printed book rebate list.

What it does#

• Amends the Public Service Body Rebate (GST/HST) Regulations to change the P.E.I. partial provincial rebate for charities and qualifying non-profit organizations from 35% to 50%, effective retroactively to January 1, 2023.
• Updates the Streamlined Accounting (GST/HST) Regulations so the quick‑method remittance rates match the higher rebate, also effective January 1, 2023.
• Adds a transitional anti-avoidance rule in the New Harmonized Value-added Tax System Regulations to limit rebate claims in some sale-and-reacquisition situations; parts of that rule are treated as in force as of February 24, 2022.
• Amends the New Harmonized Value-added Tax System Regulations, No. 2 to align regulatory wording with recent changes to the Excise Tax Act about the printed book rebate; that change generally applies to tax paid or payable after July 27, 2018.
• Changes the Federal Book Rebate (GST/HST) Regulations to add the charity Twice Upon a Time/Il était deux fois to the list of organizations eligible for a 100% federal printed book rebate. That listing is deemed to have come into force four years before publication in the Canada Gazette.

Who's affected#

• Charities and qualifying non-profit organizations in Prince Edward Island — they will see a larger partial provincial HST rebate.
• Organizations and small registrants using the quick‑method or special quick‑method of accounting — their remittance rates change because the rebate level changed.
• The charity Twice Upon a Time/Il était deux fois, which is now listed for the federal printed book rebate.
• Tax professionals and the Canada Revenue Agency, which will administer and apply the amended rules.
• If you are unsure whether a specific transaction is caught by the anti‑avoidance rule (for example, a sale and buy‑back arranged around the rebate change), the source documents say those cases are covered but do not give exhaustive examples.

Why it matters#

• Charities and qualifying non-profits in P.E.I. should pay less net HST on eligible purchases going forward because the provincial component rebate increased to 50% as of January 1, 2023.
• Organizations that use streamlined accounting will need to use updated remittance rates for reporting periods ending after 2022.
• The anti-avoidance rule means some transactions designed mainly to grab the higher rebate (for example, selling and quickly re-buying property) may no longer produce the expected rebate. That can affect decisions around timing of sales and acquisitions.
• Adding Twice Upon a Time/Il était deux fois to the printed book rebate list gives that charity clearer access to HST relief on printed books, which can lower its costs and support literacy activities.
• Several of the changes are retroactive to dates in 2022 or earlier, so past filings or tax positions could be affected; if in doubt, affected organizations or their accountants should review the detailed regulations or consult the Canada Revenue Agency.