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NEW BC GOVERNMENT TO SCRAP PST EXPANSION?

CONSERVATIVE CAMPAIGN PROMISED TO CANCEL PAUSED EXPANSION

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In February, we blogged that, effective October 1, 2026, British Columbia (“BC”) would extend its Provincial Sales Tax (“PST”) to a range of professional services including accounting and bookkeeping, architectural, engineering and geoscience services, non-residential real estate services, and security and private investigation services.

That expansion did not happen. On September 18, 2026, the Province announced that it was pausing the expansion – and four days later, Premier Eby called a snap provincial election. On October 24, the BC Conservatives won a majority government – and they have promised to cancel the expansion permanently.

In this update, we review the pause, the regulation implementing it, and what the election result means for the expansion’s fate.

From “No Plans to Stop” to Pause

In August, a legislative committee made up of members of all parties – including members of the governing NDP – recommended that the expansion be repealed outright. At the time, the Finance Minister responded that the government had “no plans to stop these changes.” A month later, the Province paused it, citing “ongoing international trade disruptions and economic uncertainty” and estimating savings of about $260 million in 2026-27 for people, local governments and businesses.

No date was ever set for the expansion’s return, and service providers who already registered were told to cancel their PST accounts. The pause applies only to professional services: the other October 1 changes went ahead, and PST now applies to basic cable, residential landline and toll-free telephone services, services to clothing and footwear, and clothing patterns and materials.

The Election Result

The two main parties disagreed on the expansion. At an October 13 Greater Vancouver Board of Trade event, BC Conservative interim leader Lorne Doerkson committed to cancelling it permanently, a promise that also appears in the BC Conservative platform.

Outgoing Premier David Eby had more generally said that if he formed another government, the PST would not return until the ongoing trade friction with the US had settled down.

Assuming the Conservative government stays true to its promise, it is not clear how long it will take to officially scrap the PST expansion. The pause was done by regulation, but the provisions enabling the expansion in the Provincial Sales Tax Act are still in force. Cancelling the expansion for good will require amending the legislation, and no timing has yet been announced.

As we noted in September, BC’s recent PST changes also appear to be moving the province back toward the harmonized sales tax (“HST”) it abandoned in 2013. The conservative platform does not mention re-harmonization, but if BC re-harmonizes, professional services would become taxable under the HST anyway – so cancelling the PST expansion may not be the last word.

Takeaways

BC’s PST expansion to professional services is on hold but not yet officially cancelled. The new Conservative government has promised to cancel it, but until it does, the tax can still be revived by regulation – so affected service providers should keep monitoring developments.

Experienced Tax Counsel can help businesses understand their BC PST obligations and prepare for potential future PST obligations.

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