MUSH Sector Rebates
A registrant/non-registrant for GST/HST purposes which makes exempt supplies will not be entitled to claim input tax credits (unless the entity also makes taxable supplies). Some entities are not entitled to claim any rebates of the GST/HST paid on business inputs. The MUSH sector may or may not be entitled to claim a rebate depending on the province in which the entity is located.
I have promised to share my MUSH sector rebate chart.
| MUSH Sector Entities | GST Portion Rebate | HST Portion Rebate - Ontario | HST Portion Rebate - BC | HST Portion Rebate - NS | HST Portion Rebate - NB | HST Portion Rebate - Nfld |
| Municipalities | 100% | 78% | 75% | 57.14% | 57.14% | No rebate |
| Hospitals | 83% | 87% | 58% | 83% | No rebate | No rebate |
| School Authorities | 68% | 93% | 87% | 68% | No rebate | No rebate |
| Universities & Colleges | 67% | 78% | 75% | 67% | No rebate | No rebate |
| Charities | 50% | 82% | 57% | 50% | 50% | 50% |
| Qualifying Not-for-Profits | 50% | 82% | 57% | 50% | 50% | 50% |
This chart highlights many important problems for the MUSH sector.
1. The lack of significant rebates for hospitals in British Columbia, Newfoundland/Labrador and New Brunswick will put a strain on provincial budgets due to the unrecoverable health care costs.
2. The lack of significant rebates for school authorities and universities and colleges in Newfoundland/Labrador and New Brunswick will put a strain on provincial budgets due to the unrecoverable education costs.
3. Nova Scotia was able to relieve some of its budget pressures when it signed a CITCA.
4. For Ontario, the effective unrecoverable GST/HST rates (what the entity will not be able to recover by way of a rebate) in respect of purchases for use in exempt activities are:
| MUSH Sector Entity | Effective GST/HST Rate after Rebate |
| Municipalities | 1.76% |
| Hospitals | 1.89% |
| School Authorities | 2.16% |
| Universities and Colleges | 3.41% |
| Charities | 3.94% |
| Qualifying Not-For-Profits | 3.94% |
4. For British Columbia, the effective unrecoverable GST/HST rates (what the entity will not be able to recover by way of a rebate) in respect of purchases for use in exempt activities are:
| MUSH Sector Entity | Effective GST/HST Rate after Rebate |
| Municipalities | 1.75% |
| Hospitals | 3.79% |
| School Authorities | 2.51% |
| Universities and Colleges | 3.40% |
| Charities | 5.51% |
| Qualifying Not-For-Profits | 5.51% |
Cyndee Todgham Cherniak is counsel to and in affiliation with the International Trade Law and the Tax Law (Commodity Tax
Great Blog! Budjets are useful.