PlayStation Store Purchases Will No Longer be Tax Free in Canada Starting Next Year

[cris3f]

4 hours ago, ladynadiad said:

 

And I'm betting what country an importer is in along with the country of origin makes a difference.  I know one of my european friends has commented on having to pay customs nearly every time they import games.  For me, I've used FedEx and DHL as well and also had no customs fees like when using the slower services, and it costs less and FedEx was faster.  I've only imported from Japan and Europe and never paid any customs myself

 

7 hours ago, peffsi said:

 

Just to share my Canadian experience.. I have imported thousands of dollars of Japanese CDs & games over the years. Usually each package is $100-$200, and I find that getting customs charges depends on luck and the shipping service. When I chose the cheaper & slower "standard mail" option, delivered by Canada Post, I got charged for customs only a handful of times. But Fedex/DHL would ALWAYS charge me. It suuuucks to have the delivery person show up and say "hey you gotta give me $50 before you can have your package"

 

 

On 12/11/2020 at 2:28 PM, diskdocx said:

 

 

Importing is a mixed bag. Theoretically you should get charged duty, but often small purchases are not taxed - $50-100 is 'typical' safe. But shipping to Canada is often very expensive.

 

As an example, I wanted to grab the Super Neptunia RPG limited edition from the iffy store which is in the States. It was on sale for $35 US. While US shipping was free, it was going to be $40US to ship to Canada. That would not ever be a cheaper option than paying the sales tax here. (although the game isn't available here, but still, general principle applies - importing to save taxes would rarely be financially viable when you factor in shipping from another country)

 

Canada has a 20$ CAD limit for tax exempt purchases when importing. There's usually some liberty from Canadian customs, but doesn't always happen.

 

All couriers worldwide (mainly FedEx, UPS and DHL which have the lion share of the business) have special agreements with the taxation entities of the countries they're operating on. These agreements mean they will charge on ALL inbound shipments from outside trade free origins, and yes they can and even charge in the cases that they would not have to (for instance items below 22€ in value entering a EU country). There's no exception, if the taxman finds out there had been they could close their operation.

 

US has the most lax and import friendly rules in the world that I know of. Anything below 800US$ will not pay any duties. Australia comes close with 1000 AUD. Canada was 20 CAD as I said, all EU countries should be 22€ (at least that's the EU rules for everyone) and Switzerland is 65 CHF (these don't play nicely, 1 cent above 65 and it's taxed).

 

But things will end shortly everywhere. Starting Jan 1 2021, US and Canada will only accept any packages coming from outside the country that were electronically declared for customs before being sent. All packages will have to be tracked and besides the address email and / or phone of the recipient is required. Of course this will mean that the tax man will be able to do everything in advance and due to how things are everywhere you can expect that fewer items will slip custom taxes.

In EU it was supposed to follow on the same date, but seems (no assurance yet) that due to Covid related delays there's a 6 months delay. But will be a lot worse as from that date on no package coming from outside the EU whatever value it's declared will pay at least VAT (and usually postal companies and taxman fees). Even if it's only 1€.

 

This was obviously going to happen. China has a 3rd world country status in UPU (Universal Postal Union) so they can send packages all over the world for peanuts, with the destination country having to pay most of the real costs of delivery. Any China company can ship a package in international tracked first class mail cheaper than anyone in the EU, US, Canada, Australia or wherever will pay to ship the same package within their own country, let alone internationally. Now you all know why the Alibaba (Aliexpress) guy is a billionaire. We all pay so that China can profit more.

At least for EU gamers, importing anything outside the EU will cost a ton of money so be careful what you do.

 

As for buying from the US, US Posts prices have sky rocketed over the past few years, and surely will continue to rise. They're technically bankrupt, and they can't technically have government funds so they'll have to find a way make a ton of money fast. UPS and FedEx will probably take advantage of that and raise their prices and profits too, we know how this works.

 

On 12/11/2020 at 10:01 PM, ladynadiad said:

 

 

Overall sounds like about the only way Canadians can catch a break would be to get a US account with an address in a state that doesn't charge sales tax, which there are a few that do, and buy digital, but that has the drawback of being unable to resell.  Personally I agree that physical is better because outside of fire and thieves, your games can't be taken away and you can take measures to protect yourself from such losses (security systems, insurance, etc.)  Digital doesn't have the same assurance and no protections from potential losses of your whole account or future inability to access your purchases due to company whims, or account loss due to forgotten password/account theft.  That alone should be more than enough reason to buy physical when possible or at least to buy physical for the games you really like.  But so many also don't even bother to keep old consoles and wouldn't play those older games unless newer consoles are backwards compatible, so it's not a huge surprise.

 

Having accounts in all regions and where there's less taxes is the way to go unfortunately. It's digital anyway, it's a ticking time bomb and everything you bought will disappear one day.

 

Edited December 18, 2020 by cris3f

[Elvick_]

Good thing I am already put off digital on PS because the store is utter shit and the fact they are willing to just remove half the shit on there doesn’t fill me with confidence for the future of digital on PlayStation. 

 

and that I’m moving back to the US whenever that becomes possible. Taxes are insane. And I’m tired of people claiming things are free when it’s paid for by taxes. 

On 2020-12-17 at 3:35 PM, starcrunch061 said:

Well anyway, getting back to taxes, I think all online purchases should be taxed. I won’t say what’s right for Canada, but so many state dollars are being lost because of their archaic systems of taxation.

Oh no, how will they spend money on things nobody wants without taxing our digital goods? 

Edited December 21, 2020 by Elvick_

[Joker-Kun890]

20 minutes ago, Elvick_ said:

Good thing I am already put off digital on PS because the store is utter shit and the fact they are willing to just remove half the shit on there doesn’t fill me with confidence for the future of digital on PlayStation. 

 

and that I’m moving back to the US whenever that becomes possible. Taxes are insane. And I’m tired of people claiming things are free when it’s paid for by taxes. 

 

+1.

[RevengeancePrime]

I don't mind since I was already planning to make the switch to PC next year. 

[Zaros-QC]

I think this apply for all canada except quebec because i live in quebec province and since last year i've been paying taxes when i buy digital games.

[Yuber6969]

Very late to the party but I just found out about this today. The loophole was nice while it lasted.

 

I personally never cared for the digital vs physical wars, but I'll probably start buying physical more often now.

[Guest]

California, USA still tax free for ps store but probably only a matter of time. I never liked the idea of paying taxes on digital materials, or when ebay said there will be taxes on used games. I think im just stupid but I just don't understand it. When an item is sold over and over from one hand to the next, tax already paid for that item, why are we paying it over and over when there is only 1 of that item?

[fyiByas]

On 12/4/2020 at 1:12 PM, sepheroithisgod said:

Luckily, Florida still doesn't tax on PSN.

Shhhhh delet dis nao

[TJ_Solo]

1 hour ago, NERVergoproxy said:

California, USA still tax free for ps store but probably only a matter of time. I never liked the idea of paying taxes on digital materials, or when ebay said there will be taxes on used games. I think im just stupid but I just don't understand it. When an item is sold over and over from one hand to the next, tax already paid for that item, why are we paying it over and over when there is only 1 of that item?

 

You do know that there are taxes on used cars and homes, right? Whenever a new sale is made then tax is paid. 
As far as digital products goes and your logic, when was the intial tax paid for a digital item so that you shouldn't be charged tax? 
 

[agorazUHD]

I think the tax addition finally kicked in July 1st. For the longest time, no tax was being taken off my purchases and a few days ago, I bought Crystal Defenders on the PS3 console store. Sure enough, they added like a good $1 and change on it.

 

Didn't seem a lot for the purchase, but tax was definitely being added to the final amount.

[visighost]

Has anyone noticed that taxes are charged before discounts on the PSN? Meaning if I am purchasing for $100 but with a $80 discount, they are adding 5% (so $5) to $20 for a total of $25, instead of taxing the discounted price (5% of $20 = $1) as they should?

 

EDIT: Why oh why did I think contacting customer service was going to be helpful.

Me: "I'm paying taxes on the pre-discount amount, which is not legal"

Them: "No, that's how it's supposed to be"

Me: "So if you go to a store and buy a $1000 item discounted to $100, you pay taxes on $1000?"

Them: "That's how it's supposed to be"

Me: "Bye"

Edited July 16, 2021 by visighost

[iriihutoR84]

26 minutes ago, visighost said:

Has anyone noticed that taxes are charged before discounts on the PSN? Meaning if I am purchasing for $100 but with a $80 discount, they are adding 5% (so $5) to $20 for a total of $25, instead of taxing the discounted price (5% of $20 = $1) as they should?

 

I can't imagine that's true but it can depend on the type of "discount". If the item costs $100 and you got it down to $20 by using an $80 gift card then you should be taxed for the full $100. That's not really a discount though. 

 

Do you have an example screenshot or a receipt? If what you say is true then it's a glitch or error and you should contact Sony about it.

Edited July 16, 2021 by iriihutoR84

[visighost]

I can't take a screenshot but here's my cart at the moment:

Subtotal $160.45

Tax $7.57

Discount $102.27

Total (5 items) $65.75

 

So I'm paying the 5% tax on the pre-discount price. Try it out by adding items to your cart, you'll see.

That's not how it should be as per the CRA's Volume Discount policy: https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/gst-hst-businesses/charge-collect-special-cases.html

[DaivRules]

3 minutes ago, visighost said:

Discount $102.27

What do these discounts entail?

 

 

[visighost]

Just now, DaivRules said:

What do these discounts entail?

 

Not sure what you mean by entail, but the discounts vary based on the individual games.

 

Doing the individual breakdown, the total applies to the net prices, not the net prices + taxes.

 

They should either calculate the individual discounts on the net prices of each game + tax OR add tax to the total discounted price.

 

 

Spoiler

 

$39.99 -65% = $13.99

$33.49 -50% = $16.74

$19.99 -70% = $5.99

$53.49 -75% = $13.37

$13.49 -40% = $8.09

 

 

 

 

[iGGTheEnd]

On 12/4/2020 at 9:53 AM, BeautifulTorment said:

They haven't been tax free for me in the last 6 months, in Canada, what gives?

Depends on your province.

[Lord_Raiden]

Don’t live in Canada, but it seems like something that should have happened a long time ago. 
 

the state I’m in just figured this out about a year ago and started charging tax on digital purchases 

[DaivRules]

2 minutes ago, visighost said:

 

Not sure what you mean by entail, but the discounts vary based on the individual games.

 

Doing the individual breakdown, the total applies to the net prices, not the net prices + taxes.

 

They should either calculate the individual discounts on the net prices of each game + tax OR add tax to the total discounted price.

 

 

  Hide contents

 

$39.99 -65% = $13.99

$33.49 -50% = $16.74

$19.99 -70% = $5.99

$53.49 -75% = $13.37

$13.49 -40% = $8.09

 

 

 

 

 

 

 

 

So the discounts are just standard price reductions?

[iriihutoR84]

What exactly are the items in the cart? I'm in Canada and can test out how much I am taxed. Edit: or it seems the post following this one figured it out. You are not supposed to pay 5% tax but 13%. In Quebec we pay even more. 

Edited July 16, 2021 by iriihutoR84

[Golden Devil Gamer]

11 minutes ago, visighost said:

I can't take a screenshot but here's my cart at the moment:

Subtotal $160.45

Tax $7.57

Discount $102.27

Total (5 items) $65.75

 

So I'm paying the 5% tax on the pre-discount price. Try it out by adding items to your cart, you'll see.

That's not how it should be as per the CRA's Volume Discount policy: https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/gst-hst-businesses/charge-collect-special-cases.html

Aren't taxes 13% in Canada? For your cart, your 5 items have a subtotal of $58.18 and 13% taxes are $7.57, so the total is $65.75. Not sure if you live in a province where you're supposed to be getting 5% taxes on games. Here in Ontario, games have a 13% tax.

[visighost]

1 minute ago, DaivRules said:

 

So the discounts are just standard price reductions?

 

They are.

 

1 minute ago, Golden Devil Gamer said:

Aren't taxes 13% in Canada? For your cart, your 5 items have a subtotal of $58.18 and 13% taxes are $7.57, so the total is $65.75. Not sure if you live in a province where you're supposed to be getting 5% taxes on games. Here in Ontario, games have a 13% tax.

 

Depends on the province. I'm in Quebec but my Paypal is in Ontario. I did not pay any taxes up to now, and the tax that was implemented on July 1st is the 5% GST. Did Ontario also start implementing a tax on digital goods on July 1st? That might explain it...

 

1 minute ago, iriihutoR84 said:

What exactly are the items in the cart? I'm in Canada and can test out how much I am taxed. 

 

Game Tengoku Cruisinmix Special

Gods Will Fall

Luckslinger

Senko no Ronde 2

Totally Reliable Delivery Service

(thanks for checking!)

[DaivRules]

Mine appears to be calculating correctly:

 

Added Dreams and The Disney Afternoon Collection:

 

Quote

Subtotal $39.98

Tax $0.90

Discount $25.00

Total (2 items) $15.88

 

In my case $39.98-$25.00 = 6% of $14.98 is (rounded up from 89.88 cents to) $.90

[iriihutoR84]

I think it calculates tax based on the residential address of your PSN account.

 

If you're in Quebec then it should be roughly 10% QST +  5% GST = 15%.

 

If you're in Ontario it should be 8% PST + 5% GST = 13%.

 

Not sure why you think you would only pay GST. You pay PST/QST on everything you buy in physical stores too.

Edited July 16, 2021 by iriihutoR84

[visighost]

I totally agree we should be paying taxes, I simply want them to be calculated properly. My beef was that they were not charged on the proper amount.
 

Up to now, I was not paying anything at all, and was only aware of the GST being implemented on July 1, so I was expecting 5%, not 13%. Turns out maybe there was a “good” bug in the system?

[Caesar Clown]

Ontario has harmonized sales tax. The provincial tax is fused with the GST.