Which statement about sales taxes is correct?
A)Businesses can recover the PST paid on all of their purchases.
B)Goods purchased for resale are exempt from PST.
C)Businesses remit only the GST collected on sales transactions.
D)The same products that are exempt from HST are exempt from PST.

Question

Quizplus · Accepted Answer

Goods purchased for resale are typically exempt from sales taxes such as PST (provincial sales tax) or HST (harmonized sales tax). This allows the tax burden to be passed on to the final consumer rather than the business that is simply reselling the product. The other statements are incorrect. Businesses cannot recover all of the PST paid on their purchases, they must remit both GST and PST (or HST), and not all products exempt from HST are also exempt from PST.

Which Statement About Sales Taxes Is Correct