There has been a lot of discussion surrounding Canada's new luxury tax, which was implemented on September 1, 2022. We get a lot of questions from people asking if any of our inventory is affected by the luxury tax. In short, no.

All vehicles priced under $100,000 CAD are not subject to Canada's luxury tax. This makes up about 98% of our inventory.

We do, however, have a selection of inventory priced over $100,000 CAD, so what about those? Will those be subject to the luxury tax?

According to the Government of Canada, all new vehicles priced over $100,000 CAD are subject to a 20% tax for any amount the sale price exceeds $100,000. But that's only if the vehicle is built after 2018 AND has never been registered in Canada.

What that means is: If a brand new vehicle has never been sold before, it has also never been registered at a Canadian registry. If a car is pre-owned, it has therefore previously been registered in Canada. This means all of our inventory is NOT subject to the luxury tax! Weather you're looking for a Honda or a Lamborghini, when you shop at House of Cars, you don't need to be concerned about the luxury tax.

The only scenario where a car in our inventory would be subject to this tax would be if it was imported from another country, like the United States, and has a list price of $100,000 CAD or more.

Browse our entire inventory here.

The Government of Canada has introduced a new luxury tax on the sale of certain vehicles priced above $100,000. This new luxury tax, proposed as part of Bill C-19, Budget Implementation Act, 2022, No. 1, affects the sale of vehicles manufactured after 2018, which means a lot of used vehicles are unaffected!

What is the luxury tax in Canada?

On August 10, 2021, the Department of Finance Canada published a paper on the design of the proposed luxury tax for public consultation. On March 11, 2022, the Canadian Government also released draft legislative proposals for stakeholder input. The proposed tax was approved on June 23, 2022.

The luxury tax will come into effect on September 1, 2022.

Vehicles subject to the luxury tax:

The luxury tax will apply to vehicles priced or valued above the $100,000 price threshold.

The tax applies to all motor vehicles that meets all of the following conditions:

• it is designed or adapted primarily to carry individuals on highways and streets
• it has a seating capacity of not more than 10 individuals
• it has a gross vehicle weight rating that is 3,856 kg or less
• it has a date of manufacture after 2018
• it is designed to travel with four or more wheels in contact with the ground

Source: Government of Canada

The luxury tax will apply to the sale of vehicles priced above $100,000 and will be payable at the time the sale is completed. A sale is considered completed when possession of the subject vehicle is transferred to the purchaser or when ownership of the subject vehicle is transferred to the purchaser, whichever is earlier.

How does this impact me?

House of Cars carries hundreds of vehicles built in 2018 or earlier, meaning you, the consumer, don't have to pay the luxury tax on those vehicles! This new tax only applies to vehicles built in 2018 or newer, and are sold for $100,000 or more. Any vehicle that is 2018 or newer, but is sold for less than $100,000, is not impacted by the new luxury tax.

Another benefit to buying used comes from being able to take advantage of vehicle depreciation. Brand new vehicles depreciate the moment they are driven off the lot. Typically after 3-4 years, a vehicle could depreciate as much as 40%, meaning that $130,000 vehicle could be priced under $100,000 now!

Browse our inventory of vehicles now and shop with confidence today!