Tax Tip, Retail Sales Tax
March 2009
ISBN: 978-1-4249-9477-9 (Print), 978-1-4249-9479-3 (PDF), 978-1-4249-9478-6 (HTML)
Minimal Sale Exemption
Sales of taxable goods in Ontario are subject to Retail Sales Tax (RST) unless the total charge for all taxable goods sold as part of the same transaction is less than 21 cents.
Calculation of Tax
Plastic bags are subject to RST if the total amount of the taxable goods, including the bags, is 21 cents or more. For example, a customer buys the following:
| chocolate bar | 1.00 | (taxable) |
|---|---|---|
| bananas | 1.50 | (exempt) |
| apples | 2.00 | (exempt) |
| 2 plastic bags | 0.10 | (taxable) |
| Total | 4.60 |
RST applies to the total amount of the taxable goods rounded to the nearest cent ($1.10 × 8 per cent = 9 cents).
Plastic bags are not subject to RST if the total amount of the taxable goods, including the bags, is less than 21 cents. For example, a customer buys the following:
| 1 sour ball candy | 0.10 | (taxable) |
|---|---|---|
| 1 carton of milk | 3.99 | (exempt) |
| 1 plastic bag | 0.05 | (taxable) |
| Total | 4.14 |
No RST applies since the total amount of the taxable goods is less than 21 cents.
More Information
If you need more information on this topic please contact us.
Telephone
- 1 866 ONT-TAXS (1 866 668-8297)
- 1 800 263-7776 for teletypewriter (TTY)
Written Interpretation
To obtain a written interpretation on a specific situation not addressed in this publication, please send your request in writing to:
Ministry of Revenue
Tax Advisory Services Branch
Retail Sales Tax Section
33 King Street West, 3rd Floor
Oshawa ON L1H 8H5
