The Vancouver restaurant tax comes in two layers: a 5% federal Goods and Services Tax on everything you order, and a 10% provincial sales tax that applies only to alcoholic drinks. Food and most non-alcoholic beverages are exempt from PST entirely, so a meal without alcohol carries just the single 5% charge on top of menu prices. Sweetened carbonated drinks are the one wrinkle, taxed at 7% PST.
The 5% GST Applies to Everything
Canada’s Goods and Services Tax is a flat 5% on the pre-tax subtotal of your order. A $60 dinner generates $3.00 in GST whether you ordered steak, sushi, or coffee and dessert. It appears as a separate line labeled “GST” on your receipt, and restaurants collect it on behalf of the Canada Revenue Agency.1Justice Laws Website. Excise Tax Act RSC 1985 c E-15
PST Depends on What You Order
British Columbia’s Provincial Sales Tax works differently from GST because it exempts most restaurant food outright. Prepared meals, snacks, coffee, tea, juice, and non-alcoholic beverages generally carry no PST at all.2Province of British Columbia. PST Exemptions If your whole order is food and standard non-alcoholic drinks, zero provincial tax gets added.
Order a glass of wine, a beer, or a cocktail and that changes. Alcoholic beverages served in restaurants are taxed at 10% PST, applied only to the alcohol portion of your bill.3CanLII. Provincial Sales Tax Act SBC 2012 c 35 A $15 cocktail adds $1.50 in PST on top of $0.75 in GST, so a single drink actually costs $17.25. Your receipt splits the PST calculation between exempt food and taxable alcohol, which is why the PST line often looks small next to the total.
Sweetened Carbonated Drinks
One category catches visitors off guard. Since April 2021, British Columbia has charged 7% PST on sodas, sparkling juices, sweetened kombucha, carbonated energy drinks, and similar fizzy sweetened beverages.4Province of British Columbia. Notice to Sellers of Soda Beverages Plain sparkling water and unsweetened carbonated drinks stay exempt. The trigger is the combination of carbonation and sweetener, whether that sweetener is sugar, honey, fruit juice, or an artificial substitute.
The Rates at a Glance
- Food and non-carbonated, non-alcoholic drinks: 5% GST only
- Sweetened carbonated beverages: 5% GST plus 7% PST, so 12% total
- Alcoholic beverages: 5% GST plus 10% PST, so 15% total
Restaurant point-of-sale systems split your order into these categories automatically. The tax line on your receipt reflects a blend of the rates, weighted by what you ordered.
Tips and Mandatory Service Charges
A voluntary tip is not part of the price of your meal and carries no GST or PST. The Canada Revenue Agency treats freely given gratuities as outside the tax because no one required you to pay them. That holds whether you tip in cash, add it to your card, or press a suggested percentage on the payment terminal.
Mandatory service charges are different. When a restaurant automatically adds a service fee, that charge becomes part of the price of the meal and is subject to 5% GST. If a restaurant adds an 18% service charge to a $200 food bill, the GST is calculated on the combined $236, not just the $200. That works out to an extra $1.80 in federal tax most diners don’t expect.
Check whether your receipt already includes an automatic service charge before adding your own tip. Doubling up is the most common overpayment mistake, especially at restaurants that auto-gratuity large groups.
What Can Legally Be Added to a Bill
Amendments to the Competition Act that took effect in 2024 prohibit “drip pricing,” so an advertised price has to include all mandatory fees the business itself controls.5Justice Laws Website. Competition Act RSC 1985 c C-34 – Section 74.01 The only charges a restaurant can add on top of the menu price are government taxes like GST and PST. A restaurant cannot advertise a $25 entrée and then add a $3 “kitchen surcharge” or “service recovery fee” at the register; any such mandatory fee has to be built into the listed price. Optional add-ons like premium ingredient upgrades are still fine as long as they are genuinely optional. For diners, the menu price plus government tax is your real cost, and anything else on the bill should raise a question.
A Sample Bill
Here is a realistic breakdown for two people sharing dinner with a bottle of wine:
- Two entrées: $70.00
- One appetizer: $18.00
- Two soft drinks (non-carbonated iced teas): $12.00
- One bottle of wine: $65.00
The food and iced teas total $100.00 and are PST-exempt. The wine is $65.00. GST at 5% applies to everything, so 5% of $165.00 is $8.25. PST at 10% applies only to the wine, so 10% of $65.00 is $6.50. The total before tip is $179.75, meaning taxes added about 9% to menu prices overall.
If those soft drinks had been Cokes instead of iced tea, the $12.00 would pick up 7% PST ($0.84), bringing the total to $180.59.4Province of British Columbia. Notice to Sellers of Soda Beverages A small difference on two drinks, but it shows how the soda rule plays out.
Notes for Visitors from the U.S.
Your bill arrives in Canadian dollars, and the exchange rate is only part of the picture. Most U.S. credit cards charge a foreign transaction fee between 1% and 3% on each purchase. Some cards waive it entirely, and picking one of those before your trip removes a hidden surcharge on every meal. If you use a card with the fee, add roughly another 2% to your restaurant total when budgeting.
Vancouver’s tipping culture closely mirrors that of major U.S. cities. Most diners leave 15% to 20% on the pre-tax subtotal, and payment terminals typically start their suggested percentages at 18%. Servers in British Columbia earn the full provincial minimum wage with no tip credit, so norms are slightly more flexible than in U.S. states where tipping fills the gap to minimum wage. Fifteen percent is still widely considered the baseline for table service.