FederalBill C-285First Reading
Bill C-285: Used Car Tax Cut Act
Sponsor: Andrew LawtonIntroduced June 12, 2026Last checked August 28, 2026
Read the official text on parl.caOfficial version — LEGISinfo, Parliament of Canada
What this bill does
This bill amends the Excise Tax Act to make used motor vehicles zero-rated supplies, meaning no GST/HST would be collected on their sale, on the basis that sales tax was already paid when the vehicle was first purchased new.
Plain-language summary by Legisail.
Business impact
TaxCompliance
This bill directly affects used car dealers, private vehicle resellers, and auto auction businesses operating across Canada. If you run a used car lot or buy and sell pre-owned vehicles as a business, you would no longer be required to collect or remit GST/HST on those sales. This also touches dealerships that carry both new and used inventory — the zero-rating would apply only to the used side of the business. The change benefits buyers too, lowering the out-of-pocket cost of purchasing a second-hand vehicle, which could increase sales volume for dealers of all sizes, from solo independent lots to larger multi-location operations.
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Where this bill is
First ReadingJune 12, 2026
Next: Second Reading debate
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