New taxes on essential services: Understanding the impact and what comes next
Budget 2026 expands the Provincial Sales Tax (PST) to professional services for the first time, including things like accounting, security and engineering. These are services almost every business in BC uses. The government’s rationale is that BC’s economy has shifted toward services, many of which have never had provincial tax applied.
While the Surrey & White Rock Board of Trade has strongly opposed the expansion of the PST and called on the provincial government to reverse this decision, it’s important that businesses and organizations are prepared. Here are the need-to-know details.
What is Changing
Starting October 1, 2026, a 7% PST will apply to services that were previously not taxed:
- Accounting and bookkeeping (7% on the full fee)
- Architectural services (7% applied to 30% of the fee)
- Engineering and geoscience services (7% applied to 30% of the fee)
- Security and private investigation services (7% on the full fee)
- Rental property and strata management (7% on the full fee)
- Non-residential real estate commissions (7% on the full fee)
What This Looks Like on the Ground
Every business is different, but here are a few examples of how these changes could show up:
- You own a retail shop. You pay a bookkeeper to manage your accounts and a security company to protect your store. Starting October 1, both of those services carry a 7% PST charge. You can’t claim it back. It’s a straight cost increase, and it adds up.
- You manage commercial property. Property management and strata services are now taxed. Whether you pass that cost to tenants or absorb it yourself, your bottom line looks different after October 1.
- You run a development company. Engineering and architectural services are now taxed, even if at a partial rate. Across a major project with significant professional service fees, that compounds quickly.
- You are an accountant or engineer. You are now required to register for PST, charge it to your clients, and remit it to the province. That means new administrative obligations regardless of your business size.
What it Means for Your Business
- It’s a cost you can’t recover. BC’s PST is non-refundable. Unlike GST and HST systems in other provinces, businesses can’t claim it back. The tax piles up at every stage rather than being paid once by the end consumer. This is what people mean when they call it a “tax on a tax.”
- A hit to competitiveness. In Alberta, there is no provincial sales tax at all. In provinces using HST, businesses can recover what they pay. BC’s PST is already the least competitive sales tax structure in Canada, and this expansion compounds that disadvantage.
- New administrative obligations. Businesses that provide newly taxed services must register for PST, charge it to clients, and remit it to the province. New filing requirements and compliance costs apply regardless of business size.
What to do Next
- If you provide newly taxable services: Register online to collect PST.
- Review your contracts: PST applies based on when services are performed, not necessarily when invoiced. Timing matters.
- Model the cost impact: Estimate what the new costs mean for your bottom line before October 1. For businesses relying heavily on accounting, engineering, or security services, the annual impact can add up quickly.
- Make your voice heard: The Surrey & White Rock Board of Trade is your channel. Share how this affects your business. Member voices shape SWRBOT’s advocacy and ongoing engagement with government on this issue.
Make your voice heard. Contact: Aman Parmar | Policy & Media Advisor
aman@swrbot.com | 604.634.0345
