As announced in Saskatchewan’s 2021 budget (see Tax Alert | Saskatchewan Budget 2021), the province has launched the Vapour Products Tax (VPT). Effective September 1, 2021, sales of e-cigarettes, e-substances, and related products in Saskatchewan are subject to a new 20% levy under The Vapour Products Tax Act, but no longer subject to Saskatchewan Provincial Sales Tax (PST).
Vendors of vaping products will be required to obtain a VPT license and collect, report, and remit the new tax using a separate return. Vendors must quote their licence number when purchasing goods for resale exempt from tax. The VPT must be shown as a separate amount on all sales documents.
For additional information on the VPT, please refer to Information Bulletin VPT-1, “Vapour Products Tax.” Information Bulletin PST-2, “Information for Grocery, Convenience, and Drug Stores,” has also been updated to reflect the implementation of the VPT.
In addition, Saskatchewan recently updated Information Bulletin PST-74, “Information for Vendors of Cannabis,” to include details on the new VPT and provide further clarification on the tax status of cannabis and related devices and accessories. The update also confirms that sales made to eligible indigenous peoples on a reserve are not subject to PST or VPT.