The changes announced in the 2017 Saskatchewan Provincial budget that affect the oil and gas industry is predominantly with respect to the capital equipment by way of the remission order being revoked on Permanently Mounted Equipment ("PME") used in the exploration and development of the resources, and on taxing most services to real property as of April 1, 2017 onwards. Both changes will have a significant impact to this industry.
In addition, the PST rate changed from 5% to 6% as of March 23, 2017 onwards. There are a number of transition issues that need to be considered for both the rate change and the change in the tax status of many of the goods and services being supplied.
As a result of the changes, most businesses in this industry are required to hold a valid PST license number, provide many supplies on a retail basis, and begin paying a lot more PST on purchases than they have in the past. The tax has become much more complex than in the past.
Overview Excerpt
Excerpt from the Overview of Saskatchewan Provincial Sales Tax: Changes to Oil & Gas Industry Explained.