GST or HST is part of the cost of merchandise.
GST (Goods and Services Tax) and HST (Harmonized Sales Tax) are forms of consumption taxes that are imposed by the government on the sale of goods and services. The tax amount is typically included in the price of merchandise, and consumers pay it when they purchase the goods or services.
To determine the cost of merchandise, including the GST or HST, you can follow these steps:
1. Identify the tax rate: First, determine the applicable tax rate for the merchandise. In Canada, the GST rate is 5% in most provinces, while some provinces have implemented the HST, which combines the GST and provincial sales tax into a single rate (ranging from 13% to 15%).
2. Calculate the tax amount: Multiply the tax rate by the price of the merchandise. For example, if the price of an item is $50 and the tax rate is 5%, the tax amount would be $50 * 0.05 = $2.50.
3. Determine the total cost: Add the tax amount to the price of the merchandise to get the total cost. In our example, the total cost would be $50 + $2.50 = $52.50.
So, when purchasing merchandise, you should factor in the GST or HST as part of the cost, as it is included in the price you pay.