British Columbia adds tax to soda and sugary drinks

By Rachel Arthur

- Last updated on GMT

The Provincial Sales Tax Act will now cover sugar and diet drinks
The Provincial Sales Tax Act will now cover sugar and diet drinks

Related tags Soda tax sugar tax Canada

Carbonated beverages sweetened with sugar, natural or artificial sweeteners will be taxed in British Columbia under the Provincial Sales Tax Act as of July this year.

The western Canadian province had previously granted carbonated beverages an exemption to the Provincial Sales Tax Act, deeming it a ‘food product for human consumption’. As of July 1, however, carbonated beverages sweetened with sugar – but also those using artificial sweeteners or even natural sweeteners – will now be subject to the 7% tax.

For administrative ease, provincial sales tax will also apply to all beverages that are dispensed through soda fountains, soda guns or similar equipment, as well as beverages dispensed through vending machines (except those dedicated solely to coffee or water or similar).

The tax on carbonated beverages was announced in British Columbia’s Budget 2020 this week. BC will begin charging PST on sweetened carbonated drinks to help address the health and economic costs of these beverages,”​ said Finance Minister Carole James.

“Research shows that teens between the ages of 14 and 18 are the top consumers of pop. This is a step that health professionals and an all-party committee have long supported.

“Because this is about keeping young people healthy while taking in a bit of revenue to continue to pay for enhanced health care services for everyone.”

The measure is expected to make $27m ($20m USD) in its first year and $37m ($28m USD) in 2021-2022.

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