Canada has no separate digital sales tax today. Taxable digital products and SaaS are subject to GST/HST at the rate set by the place-of-supply rules (5%, 13%, 14% or 15%; zero-rated supplies are taxed at 0%), and some provinces also apply PST or QST to supplies taxable under their own rules. The separate 3% Digital Services Tax on large tech companies was rescinded in 2025 and its Act repealed in 2026.
What counts as a digital product or service?
A digital product or service is a supply of intangible personal property or a service made online rather than a physical good — for example, downloaded software, apps, music or games, or a website subscription. Each still has to be classified as a taxable supply under the normal GST/HST rules below — “digital” is not a separate tax category.
Start with the supply and customer
Document what the customer receives, who contracts with the customer, and the information used to establish location. The applicable rate depends on the type of supply and where it is made. Ordinary taxable supplies made in Ontario generally use 13% HST; Nova Scotia uses 14% for supplies subject to the rate from April 1, 2025; other participating provinces generally use 15%. Under the simplified digital-economy regime, indicators such as the customer’s billing address, home address and the IP address of the device used help determine the customer’s usual place of residence, per CRA’s digital-economy guidance; under the normal regime, the place of supply depends on the type of supply — see place-of-supply rules.
Canadian seller or non-resident vendor?
A business under the ordinary GST/HST regime uses normal registration rules. A non-resident digital-economy business that is not carrying on business in Canada and is not normally registered may have a simplified-regime question. The supplier, recipient, platform arrangement and supplies decide the route.
Do I need to charge Canadian GST on SaaS?
A seller registered under the normal GST/HST regime charges GST/HST on a taxable SaaS or digital-product supply made in Canada, the same as any other taxable supply; the rate follows the place-of-supply rules, not simply the customer’s province. A sale to a customer outside Canada is handled separately — see GST/HST and US clients. A non-resident vendor selling digital products into Canada follows its own registration path — see non-resident GST/HST registration.
Digital sales tax rates by province
There is no separate digital sales tax rate. A digital sale uses the GST/HST rate for the province or territory where the supply is made under the place-of-supply rules, and in some provinces an additional provincial sales tax applies to software or digital services on top of the 5% GST. See the full table at GST/HST rates by province and the provincial breakdown at provincial PST, RST and QST overview.
| Customer province/territory | Tax on a digital sale |
|---|---|
| AB, and the territories (NT, NU, YT) | 5% GST only |
| BC | 5% GST + 7% PST (software, including SaaS, is taxable under BC’s PST) |
| SK | 5% GST + 6% PST (applies to taxable computer services and electronic distribution, including SaaS; exempt goods and services such as qualifying books and tuition stay exempt) |
| MB | 5% GST + 7% RST (online sales-platform and streaming rules apply) |
| QC | 5% GST + 9.975% QST (suppliers outside Québec may have to register under the specified QST system if they meet its conditions) |
| ON | 13% HST |
| NS | 14% HST (from April 1, 2025) |
| NB, NL, PE | 15% HST |
What was Canada’s Digital Services Tax?
The Digital Services Tax (DST) was a separate 3% federal tax on certain Canadian-source digital services revenue of large groups. It applied only to a taxpayer (or its consolidated group) with total revenue of at least €750 million in a fiscal year ending in the preceding calendar year and Canadian in-scope digital revenue greater than C$20 million in the calendar year; revenue covered online marketplace services, online targeted advertising, social media services, and the sale or licensing of user data. The DST took effect in 2024 with retroactive application to 2022 and 2023 for groups meeting the thresholds in those years. On June 29, 2025, the government announced it would rescind the DST to advance trade negotiations with the United States, halting collection before the first payments were due. Legislation formally repealing the Digital Services Tax Act received Royal Assent on March 26, 2026; the CRA says the tax and all related obligations no longer apply, and it will refund DST payments already received, with interest. That repeal does not remove ordinary GST/HST obligations for taxable digital supplies — the two were always separate regimes.
| Digital Services Tax (repealed) | GST/HST on digital supplies | |
|---|---|---|
| Who paid/pays | Large groups with at least €750M global revenue and more than C$20M Canadian in-scope revenue | The customer; collected and remitted by the seller or platform |
| Rate | 3% of taxable Canadian digital services revenue (in-scope revenue minus a C$20M deduction, shared within a group) | 5% GST, or 13%, 14% or 15% HST, by province |
| Applied to | Online marketplace services, targeted advertising, social media services, sale or licensing of user data | Taxable digital supplies such as SaaS, downloads and streaming |
| Status | Rescinded in 2025; Act repealed March 26, 2026 per CRA | In force |
Sources: CRA digital-economy GST/HST guidance; CRA rates and place of supply; CRA Digital Services Tax status; Finance Canada: Digital Services Tax Act explanatory notes; Finance Canada: DST rescission announcement; BC PST on software; Saskatchewan PST; Manitoba RST Bulletin 064, online sales platforms; Revenu Québec: collecting the QST.