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

Canadian game prices can sometimes be a bit hard to swallow, with new titles now costing $80 to $90, but at least there was a small silver lining for PS4 and PS5 owners, who haven’t had to pay any sales tax on games purchased digitally via the PlayStation Store. Considering sales taxes go as high as 15 percent in Canada, or nearly $14 on a $90 next-gen game, that’s a fairly significant deal. Well, fellow Canucks, it’s time to say goodbye to those savings.

The PlayStation Store not charging sales tax in Canada was due to a loophole in laws that stated only companies with a physical presence in Canada had to charge sales tax. So, Microsoft and Nintendo, which do have official Canadian branches, charge tax on digital games. Sony, which doesn’t, hasn’t had to. Well, according to Federal Finance Minister Chrystia Freeland, that exemption is going away. Starting next year everyone selling digital goods in Canada, including previously-exempt companies like PlayStation and Netflix, will have to start charging sales tax. Again, depending on which province you happen to live in, that will range from 5 to 15 percent on every digital purchase or subscription.

Having to pay sales tax is always kind of a drag, but if it makes you feel better, the extra money raised, which could amount to as much as $1 billion over five years, is being earmarked to fund a new Canada-wide childcare system. Anyone with young kids knows the childcare system is sorely lacking in this country, so I’m more than happy to pay a few extra bucks on my PS5 downloads and Netflix subscription in order to make things better for families in need.

The digital sales tax changes are schedule to go into effect on June 1, 2021, so enjoy those cheaper PlayStation games while you can.