What will be the tax treatment of coupons under the harmonized sales tax?
A. • The tax treatment of coupons under the harmonized sales tax will be the same as under the GST with one modification. To facilitate the introduction of tax-inclusive pricing, additional flexibility will be introduced for percentage discount coupons where the coupon is issued and redeemed by the vendor. Vendors are currently required to treat this type of coupon as reducing the price payable by the recipient before applicable taxes are applied. To simplify the usage of tax-inclusive pricing, all vendors will now have the option to treat this type of coupon as one that reduces the total amount payable, including taxes, which means that the coupon is treated as including tax. Issuers of this type of coupon are eligible to claim an input tax credit equal to the tax fraction of the coupon value. Federal and Provincial Government Entities and Industries Under Federal and Provincial Jurisdiction Q. • Why have the participating governments required federal and provincial government entitie