The short answer is: it depends!
First, a bit of background on GST as it applies to commercial vs. personal goods:
Goods imported for commercial purposes (i.e. by a business) are taxed at the 5% rate for GST whether the importer is registered for GST/HST or not.
Goods imported as personal use (items by an individual) are also taxed at 5% but may have provincial sales tax (PST) or harmonized sales tax (HST), which is 5% + the provincial rate. The PST/HST is assessed by CBSA at the time of import based on the address of the importer.
Now, the question of whether GST is refunded depends on a couple of factors, including whether or not the importer is registered to collect GST on behalf of the government.
If a GST-registered importer corrects or adjusts the import declaration, resulting in a downward adjustment to the value, the CBSA will not refund the GST.
Instead, the importer recovers the full value of the GST, when they file their periodic GST/HST return.
So, you get back any extra tax paid, but not from the CBSA.
If an importer who isn’t registered for GST—usually a consumer, or unregistered non-resident importer—makes a claim for a refund as described above, the CBSA will refund the GST and/or HST.
This is largely because the importer won’t be able to claim an Input Tax Credit on a GST return. In certain instances, the importer may have to file a separate rebate application to recapture the GST/HST.
So, while the GST is payable at the time of import, there are a number of ways that the tax ultimately washes out of the supply chain.
Think you need to register for GST/HST? Talk to your Customs broker to chat through the benefits, drawbacks, and the process.
We’ve been in the customs brokerage business for more than half a century. We’re ready to help.