No Sales Tax on Funerals, One-Stop Reporting

Summary#

This bill would make funeral services zero-rated under the federal GST/HST (taxed at 0% while allowing businesses to claim input tax credits). It would also direct Employment and Social Development Canada (ESDC) to set up a one‑stop service so a death can be reported once and then shared with partner entities to reduce paperwork for families.

• Zero-rates funeral services, including a coffin, headstone, and other property related to a funeral, burial, or cremation when supplied under a funeral arrangement (Bill: Excise Tax Act, Schedule VI, Part II.2).
• Repeals sections 344 and 360 of the Excise Tax Act (Bill: ETA ss. 344, 360 repealed).
• Requires ESDC to establish a one‑stop death reporting service and share relevant information with partner entities (Bill: DESDA s. 5.1(1)(b.1)).
• The bill does not set a delayed start; changes would take effect when it becomes law (Bill text: no coming‑into‑force clause).

What it means for you#

• Households

  • Funeral invoices would no longer include GST/HST on qualifying funeral services and related items provided under a funeral arrangement. The savings would match the applicable GST/HST rate where you live (Bill: Schedule VI, Part II.2).
  • Provincial taxes that are separate from the GST/HST are not changed by this bill. Those may still apply where provincial law taxes these items. Data unavailable.
  • No application is needed. The tax change applies at the point of sale once the bill becomes law (Bill: Schedule VI, Part II.2).

• Workers and service users handling estates

  • You would be able to report a death once to ESDC. ESDC would then share the information with partner entities to reduce duplicate reporting. The bill does not list which entities are included (Bill: DESDA s. 5.1(1)(b.1)).
  • Until the one‑stop service is built and partner agreements are in place, you may still need to notify some programs separately. Timeline not provided in the bill. Data unavailable.

• Businesses (funeral homes, cemeteries, crematoriums)

  • You would charge 0% GST/HST on qualifying funeral services and related items supplied under a funeral arrangement, and you could claim input tax credits on related business inputs (Bill: Schedule VI, Part II.2).
  • You would need to update billing systems, price lists, and tax compliance processes to reflect zero‑rating and to document which items qualify “relating to the funeral, burial or cremation” under an arrangement (Bill: Schedule VI, Part II.2).
  • Mixed supplies (e.g., receptions, flowers, or other items) may require careful invoicing to show what qualifies. The bill does not define these boundaries beyond the quoted wording. Data unavailable.

• Provincial/territorial and local governments

  • In provinces that use the HST, zero‑rating under the Excise Tax Act applies to the full HST rate; this would reduce both federal and provincial HST revenue on qualifying funeral services. Amounts not provided in the bill. Data unavailable.
  • Governments and agencies that become “partner entities” would need data‑sharing agreements and system changes to receive death notifications from ESDC. Timeline and costs not provided. Data unavailable.

Expenses#

Estimated net cost: Data unavailable.

• No federal fiscal note or costing is provided in the bill text. It contains no direct appropriation language. Data unavailable.

Proponents' View#

• Reduces funeral costs for families by removing GST/HST from funeral services and related items supplied under a funeral arrangement (Bill: Schedule VI, Part II.2).
• Uses zero‑rating rather than exemption, so funeral providers can claim input tax credits, limiting embedded tax in prices and helping the full tax relief reach consumers (Bill: Schedule VI, Part II.2).
• Simplifies a stressful process: one report of a death to ESDC triggers notifications to partner entities, reducing paperwork and repeated calls or applications (Bill: DESDA s. 5.1(1)(b.1)).
• Could reduce government overpayments by speeding up death notifications to programs that stop or adjust benefits after death. Magnitude not provided. Data unavailable.
• Aligns the tax treatment of funerals with other necessities that are zero‑rated under Schedule VI (Bill: Schedule VI).

Opponents' View#

• Reduces tax revenue with no offset identified; the bill provides no costing or funding source for lost GST/HST or for building the one‑stop service (Bill text; Data unavailable).
• Benefit is not targeted; all estates receive the tax break regardless of need, which may reduce funds available for other programs. Data unavailable.
• Wording covers “any other property relating to the funeral, burial or cremation” under an arrangement, which may create boundary and compliance disputes over what qualifies, increasing audit and administration burdens (Bill: Schedule VI, Part II.2).
• In HST provinces, zero‑rating applies to the full HST, reducing provincial as well as federal revenue; implementing without clear intergovernmental agreements could create friction. Amounts and agreements are not specified (Bill: Schedule VI, Part II.2; Data unavailable).
• The one‑stop data‑sharing model raises privacy and accuracy risks; an erroneous death report could stop benefits incorrectly. The bill does not specify safeguards, timelines, or partner lists (Bill: DESDA s. 5.1(1)(b.1)).