Prince Edward Island charges the Harmonized Sales Tax (HST) at 15%, combining the 5% federal GST with a 10% provincial component. PEI harmonized with federal GST in 2013, joining other Atlantic provinces. HST applies to most goods and services, generating significant provincial revenue while simplifying tax compliance for businesses operating across harmonized provinces. Municipalities generally don't pay HST on purchases for municipal purposes. PEI's HST rate is consistent with other Atlantic provinces. Sales tax policy affects cost of living, tourism competitiveness, and business operations across Canada's smallest province.