Communication of Zero-Rating, HST Point of Sale Rebates and HST on Sales Receipts is Problematic
Retailers are having difficulty communicating information to consumers on a single invoice. Both large and small retailers are having to communicate a single blended HST charge and, at the same time, communicate when goods are zero-rated (HST is charged at 0%), exempt (no HST) and when they are offering an HST point of sale rebate (charging GST at 5%).
The retailers have to segregate the information for consumers on the single piece of paper they provide at the time of sale (the sales receipt). As a result, different lines of information may be shown on a sales receipt that may be confusing. To a consumer that does not bring along a calculator, it may appear that the retailer is charging 13% + 5% tax or undercharged the 13% HST (in Ontario).
The more important problem is for the small retailers who may not be charging the HST correctly and may not be communicating the information correctly. The smaller retailers may not have realized the extent of the systems changes that were required to implement HST.
Small retailers should know that some of the large retailers have been struggling with this issue --- you are not alone. However, both are expected to get it right. Auditors will visit small retailers too.
Cyndee Todgham Cherniak is counsel to and in affiliation with the International Trade Law and the Tax Law (Commodity Tax
