Provinces to raise tax revenue by bringing more services into net

In a significant development, the provinces have agreed to expand the scope of sales tax to include a wide range of services from the next fiscal year. This action is in line with the International Monetary Fund (IMF) requirements under the Staff-Level Agreement reached for a new $7 billion credit line. All four provinces have made a written commitment to transition the services from a positive to a negative list approach, which implies that all things that are not explicitly exempt will be taxed. At the provincial level, sales tax is applied to specific services known as the positive list, which are subject to different tax rates, while all other services are exempt. On the other hand, the federal sales tax applies to all goods unless they are specifically mentioned in the 6th Schedule to the Sales Tax Act 1990 or exempted under section 13 of the same act.