What are the Transitional Rules from British Columbia HST to GST / PST as a result of the Referendum?

What are the Transitional Rules from British Columbia HST to GST / PST as a result of the Referendum?

British Columbia will be removing the 12% HST, which had been implemented on July 1, 2010, and moving back to the previously existing GST / PST system which existed prior to July 1, 2010. This change is due to the referendum which was held during the summer of 2010. Referendum results were announced on August 26, 2011.

Transitional rules relating to the conversion from the harmonized sales tax ("HST") to the goods and services tax ("GST") and provincial sales tax ("PST") sytems have NOT yet announced as of August 26, 2011 by either the federal or the BC provincial governments.

Since no province has ever moved from the HST to GST/PST, we cannot look at prior situations to see how the transition rules could possibly work. However, reviewing the transitional rules for the conversion from GST/PST to HST for Ontario and British Columbia on July 1, 2010 may provide some ideas of the issues that will need to be considered by the governments and the areas that may be focussed upon.

This article is intended to inform readers of developments as of the date of publication on August 27, 2011 and is neither a definitive analysis of the law, proposed law, administrative positions, interpretations, court cases etc. nor a substitute for professional advice. Readers should discuss with appropriate professional tax advisors, financial advisors, legal counsel and/or other advisors regarding how the information may apply to their specific situations. This post will NOT be updated for changes in legislation, court cases, interpretations or other matters after publication. E.&O.E.

What are the Transitional Rules from British Columbia HST to GST / PST as a result of the Referendum?