On May 23, 2023, British Columbia enacted regulatory changes under B.C. Reg. 128/2023. These changes involve updates to the Carbon Tax Regulation and the Provincial Sales Tax Regulation, as well as amendments to the Provincial Sales Tax Exemption and Refund Regulation. These revisions aim to enhance tax administration and compliance, particularly focusing on the operations of online marketplaces.

The updates to the Carbon Tax Regulation, B.C. Reg. 125/2008, specifically alter section 13.1 (1). Previously, this section referenced only section 8.1 (1) of the Carbon Tax Act, but now it also includes section 8.2 (1). This broadens the scope of the regulation, which may affect how carbon taxes are calculated or reported. The inclusion of section 8.2 (1) could impact businesses and their carbon tax obligations.

Several changes were made to the Provincial Sales Tax Regulation, B.C. Reg. 96/2013: Section 88.3: The regulation now requires online marketplace facilitators, who act as collectors of sales tax, to maintain detailed records for each seller they assist. This includes the seller’s name, address, contact details, business number (if applicable), and information on payments and taxes collected. This enhancement aims to improve transparency and accountability in how online sales taxes are managed. Section 88.4: This section requires facilitators to keep comprehensive records of the total amount received from each sale or lease facilitated. This applies whether the transactions are taxable or exempt, which helps ensure accurate tracking of all transactions conducted through online platforms. Section 93.1: The regulations now specify that the information returns submitted by online marketplace facilitators must include detailed data about each seller, including their business and tax identification numbers, as well as the total payments and taxes handled. These changes are designed to streamline tax reporting and enforcement, making it easier to ensure compliance with tax laws.

The Provincial Sales Tax Exemption and Refund Regulation, B.C. Reg. 97/2013, was revised to include a new section, Division 5.1, which addresses online marketplace services. Section 88.3: This new provision provides a tax exemption for online marketplace facilitators when they purchase services from related corporations. The exemption applies if the services are related to the facilitator’s role in managing online transactions and if the purchasing corporation is considered related under the regulation’s definitions. This change is intended to reduce the cost burden on online marketplace facilitators and support their operational efficiency.

These regulatory updates are designed to improve the administration of carbon and sales taxes in British Columbia. They introduce stricter record-keeping and reporting requirements for online marketplaces and provide specific exemptions to facilitate their operations. 

Source: British Columbia 128/2023 May 23, 2023