Nova Scotia: New HST Rate Announced

October 31, 2024

On October 23, 2024, Nova Scotia Premier Tim Houston announced the province’s plan to reduce the provincial portion of the Harmonized Sales Tax (HST) from 10% to 9%. This reduction will lower the combined HST rate from 15% to 14%, effective April 1, 2025. This marks the first change to the HST rate in Nova Scotia since its last increase from 13% to 15% on July 1, 2010.

With this adjustment, Nova Scotia’s HST rate will differ from that of other provinces using the HST system. While Nova Scotia will adopt a combined rate of 14%, Newfoundland and Labrador, New Brunswick, and Prince Edward Island will continue with an HST rate of 15%, and Ontario at 13%.

The new HST rate will significantly impact the province’s revenues since HST is its second-largest source of income after personal income tax. It is estimated that the rate reduction will decrease the revenues by approximately:

$260.8 million in the 2025–26 fiscal year
$265.5 million in 2026–27
$272.4 million in 2027–28

The government will proceed with the legislative processes necessary to implement the rate change as planned. Businesses and consumers are advised to prepare for the adjustment and consider consulting tax professionals to understand its implications.