6% PST now being added to insurance premiums in Saskatchewan

The province currently charges 3% on insurance premiums, leading to a new total tax of 9%

The Saskatchewan government’s new policy of adding the 6% provincial sales tax to insurance premiums kicks in today.

The additional charge applies to both new and existing policies.

Terry Brownell of Advocis, the Financial Advisors Association of Canada, says insurance premiums are already taxed at 3%, so the added PST means premiums will now be taxed at 9%.

The NDP says Saskatchewan will now be the only province in Canada to add a tax on insurance premiums.

From the archives: Sask. Unveils Changes to Insurance Legislation

It fears the tax will discourage people from getting insurance in the first place, and hurt the province’s most vulnerable.

But the government is standing by its decision.

“It was necessary to raise and expand the provincial sales tax to ensure our finances are stable and we are in a position to provide the services expected by the people of Saskatchewan,” the government says in a statement provided to CTV Regina.

“Those changes were accompanied by a reduction in the personal income tax rate…and a reduction in the corporate income tax rate.”

– With files from CTV Regina

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