Quebec RV Dealers Denounce Retroactive Ontario Sales Tax Imposition and Demand Immediate Government Action

Quebec City, Quebec--(Newsfile Corp. - November 27, 2024) - The Association des commerçants de véhicules récréatifs du Québec commerçants de véhicules récréatifs du Québec (ACVRQ) and the Recreational Vehicle Dealers Association (RVDA) of Canada are denouncing an unjustifiable retroactive tax burden imposed on Quebec recreational vehicle (RV) dealers. This problematic situation, created and overlooked by the Department of Finance (Canada) and now being enforced by the Canada Revenue Agency (CRA), directly threatens the survival of these businesses, which are key pillars of Quebec's economy and communities.

On the basis of an ambiguous provision of the GST/HST legislation, the CRA is retroactively charging Ontario's Harmonized Sales Tax (HST) at a rate of 13% on RVs and RV parts purchased by Quebec businesses from the United States. The CRA's view is that Ontario HST applies to these purchases by Quebec businesses because the RVs crossed into Ontario on their way to their place of delivery in Quebec.

Multiple RV dealers across Quebec have received retroactive invoices capturing the 8% difference between the HST and the federal GST. Some of these invoices amount to over $3,800,000 with respect to RVs and parts purchased more than a decade ago. These charges make a mockery of Quebec's conscious decision not to cede jurisdiction to the federal government and participate in the HST system and disregard the fact that the U.S. products in question are exclusively destined for Quebec customers.

"This is a scandalous abuse of the federal government's taxation power," said Steve Lapierre, Executive Director of the ACVRQ. "How can the federal government justify applying an Ontario tax to goods imported by businesses operating entirely in Quebec? This is not just a tax issue-it is a fundamental attack on interprovincial fairness and the ability of Quebec businesses to engage in cross-border trade."

The consequences could be dire. Quebec RV dealers were already grappling with rising inventory costs, declining sales, and an uncertain economic environment. These retroactive claims are forcing some businesses to consider layoffs or reducing investments to generate the liquidity demanded by the CRA.

"This decision could destroy our businesses," said Josée Bédard, owner of Roulottes Chaudière, a Quebec RV dealership that received a retroactive tax bill of over $900,000. "We have been creating jobs in our communities for decades, and now we are being punished because of taxes that should never have been assessed. If this problem goes unresolved, we will have no choice but to scale back our operations, putting dozens of good-paying jobs at risk."