BC carsharing and car rentals over 8 hours subject to PVRT
On April 1st, 2013, Modo members saw a new tax applied to some of their bookings. Information systems director Karen New explains.
Taxes on carsharing went down when the British Columbia PST ended in 2010—and with the return to PST in April 2013, carsharing became one of the few industries whose taxes increased.
BC PVRT translated for Modo members
Modo bookings are subject to a 12% sales tax – 5% GST and 7% PST. However, bookings of more than 8 hours are also subject to a third tax, the British Columbia Passenger Vehicle Rental Tax, or PVRT.
“More than 8 hours” is important. Bookings of 8 hours or less are exempt from the PVRT, and they comprise about six out of every seven Modo bookings. But one booking in seven lasts longer than eight hours, and carries the new tax.
So how much does the PVRT actually cost?
PVRT is not a percentage of your booking cost, but a fixed rate based on the length of your booking: $1.50 for every 24-hours of your booking (or portion). So if you book a car for anywhere from 8 hours and 15 minutes to 24 hours, the tax is $1.50; book a car for 24 hours and 15 minutes to 48 hours, the tax is $3.00, and so on.
Example: An 24 hour booking from 10am on December 4th to 10am on December 5th, would cost $1.50 PVRT.
Modo Time Trivia
If the booking were from 10am on November 5th to 10am on November 6th, 2016, however, it would be subject to $3.00 PVRT – that’s the night we set our clocks back, so your booking actually lasts 25 hours (but that’s not common, so no need to calculate every trip).
Tax on a tax
Most sales taxes get added to the base price of the thing you’re buying. They’re not subject to further taxes of their own.
The PVRT is an exception. After the provincial government adds $1.50 per day in PVRT, the federal government charges 5% GST on the total—that’s an extra 7.5 cents per day.
Example: A two-day booking (48 hours) would cost $3.00 in PVRT. The rental tax itself would cost another $0.15 in GST. In total, your taxes will go up by $3.15.
No PVRT on bookings longer than 28 days
Surprisingly, there is also no PVRT for bookings of 28 days or less. Since the PVRT on a 28-day booking is $42.00 (and the GST on that is another $2.10), this means that you could save some money by extending your booking into another 15 minutes! Of course, even your summer vacation probably won’t run into this exemption—we’ve had fewer than a dozen bookings that long in the last 10 years.
Example: A booking from 1pm on September 1 to 11:30pm on September 28 would cost $42.00 in PVRT and an extra $2.10 in GST because it spans 28 days. But extending the booking by 15 minutes would remove both the PVRT and the extra GST.
PVRT in application
The PVRT applies to the final length of your booking. If you book a car for 9 hours but return it an hour early, you’re left with an 8-hour booking and no PVRT.
The PVRT applies at every carsharing co-op in British Columbia—Modo, Nanaimo CarShare Co-op, Coast Car Co-op, Kootenay Carshare Co-op, and OGO Okanagan Car Share Co-op—as well at non-co-op carshares operating in BC, like Avis/Zipcar and Daimler/Car2Go.
* Updated on December 21, 2016 to reflect revisions to PVRT definition in August 2016