New Budget Tweaks Indirect Tax Rules

BUDGET 2025 HARD TO CELEBRATE BUT PROPOSES SOME GOOD INDIRECT TAX CHANGES

Canada's Budget 2025 was launched on November 4^th with the energy of a lead balloon. Despite the doom and gloom focus on the continuing deficit financing by the Liberal Government – off-loading our current woes on the backs of our children and grandchildren – there were some (largely) positive changes from an Indirect Tax perspective.

The highlights, in our view, are as follows.

Reverse-Charge (Purchaser Self Account) Rules to Deal with Fraud - Some industries (like telecommunications) have been susceptible to GST fraud (e.g., vendors charging GST/HST, collecting GST/HST from unsuspecting purchasers, and going missing with the money). Budget 2025 proposes rules that will create a self-reporting non-collection regime (often called the "reverse-charge" in the European VAT context) specifically for telecommunications. This is a welcomed change, and one called for by us in our Recent