News and Insights

British Columbia PST and Oil and Gas – Exploration, Discovery and Development 

Tax Development Dec 18, 2013

British Columbia has recently published Bulletin PST 114, “Oil and Gas Industry – Exploration, Discovery and Development”.  This is the second in a series of three bulletins that are being released to assist businesses in the oil and gas industry understand how the new provincial sales tax (“PST”) will impact their businesses.  Organizations involved in the exploration, discovery and development of oil and gas will be particularly interested in this bulletin, as it provides specific information on how PST applies to their businesses.  The impact of the PST to oil and gas producers and processors is addressed in Bulletin PST 113; however, oil and gas industry service providers and contractors will have to wait for a separate bulletin that explains the impact of the PST to their operations.

Included in this bulletin are details on the production machinery and equipment (“PM&E”) exemption as it relates to:

  • geophysical surveying; 
  • exploration, discovery and development of petroleum and natural gas; 
  • software used to operate, control or monitor exempt PM&E; and 
  • parts, materials and services for PM&E.

Additional sections included in this bulletin cover other available exemptions such as goods incorporated into other goods for resale; containers, labels and packaging materials; and safety equipment and protective clothing. 

British Columbia has also provided industry specific details on: 

  • taxable goods; 
  • equipment brought into BC; and 
  • improvements to real property.

Similar to Bulletin PST 113, appendices that are intended to show detailed listings of relevant exempt and taxable items are incorporated into the bulletin; however, the examples are not yet available.