FederalBill C-285First Reading

Bill C-285: Used Car Tax Cut Act

Sponsor: Andrew LawtonIntroduced June 12, 2026Last checked August 30, 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