If you run a clinic in Ontario, your clients have been paying 13% HST on every massage while the physiotherapist down the hall charged none. Massage therapy has been regulated in multiple provinces for years, but it was never on the federal list of exempt health services. Most RMTs have had to explain that gap to a confused client at the front desk at least once.

The federal budget tabled on November 5 proposes to close it. Before you reprint your price list, though, there are three things to understand: what qualifies, why it isn’t law yet, and what the change costs you on the other side of the ledger.

What Budget 2026 actually proposes

The measure sits in the budget’s tax measures supplementary information, under GST/HST Health Measures. The government’s reasoning is simple. Practitioners regulated in at least five provinces, like physiotherapists and chiropractors, already get exempt treatment. Massage therapy now meets that test, so qualifying massage therapists are being added to the list.

Qualifying services are ones supplied by someone who practices massage therapy and meets one of two conditions:

  • In a province that requires a licence, the therapist holds that licence.
  • In a province that doesn’t, the therapist has qualifications equivalent to what another province requires for licensing.

The proposal applies to qualifying services supplied after Budget Day, which means from November 6, 2026. The government costs it at $199 million over five years, so this isn’t a rounding error for the profession. CP24’s budget coverage put it more bluntly, saying therapists will no longer be required to charge GST/HST.

Proposed is not the same as passed

That last line is where clinics could get burned. A budget proposal isn’t law until Parliament passes the legislation behind it. The budget describes the measure as a proposal, and at the time of writing we couldn’t find any CRA guidance on how to handle treatments in the gap between Budget Day and the law taking effect.

So don’t flip the tax setting on your own. Book a short call with your accountant and ask them three things:

  1. Should we keep charging GST/HST until the legislation passes, or stop now?
  2. If we keep charging and the exemption applies back to November 6, what do we owe clients for tax collected in between?
  3. Once all our treatment revenue is exempt, do we still need to stay registered?

That third question matters most for solo therapists. If treatments are your only revenue, being registered may stop making sense. If you also sell retail products, it probably still does.

Alberta and other unregulated provinces

Alberta has no provincial college for massage therapists, and neither do several other provinces. That’s what the equivalency condition is for. Therapists there can qualify if their training matches what a regulated province would require for a licence.

What the CRA will accept as proof of equivalent qualifications hasn’t been defined yet. Until it is, the practical step is to collect each therapist’s diploma, transcript showing training hours, and association membership into one file. If you employ or contract therapists with mixed backgrounds, don’t assume all of them qualify.

The catch: exempt is not zero-rated

This is the part most headlines skip. Exempt doesn’t mean tax-free all the way down. The budget document spells out the difference: suppliers of exempt health services don’t charge GST/HST, but they also can’t claim input tax credits to recover the GST/HST they pay on inputs. The CRA’s page on types of supply says the same about exempt supplies in general.

For a clinic, that means the GST/HST on rent, linens, oil, equipment and software used to deliver treatments likely becomes a cost you can’t recover. If you also sell retail, those sales stay taxable and the related credits survive, so you’ll need to split shared costs between the two. Your clients get a cheaper massage. Your expenses go up a little.

Decide what happens to your prices

Here’s the decision every owner will face. Take a $120 treatment in Ontario. Today the client pays $135.60 with HST. Once the exemption is in force you can:

  • Keep the $120 price. The client pays $15.60 less per visit and sees the savings right away.
  • Move toward the old total. You raise the base price to cover the input tax credits you’re losing, and the client’s total barely changes.

Neither choice is wrong. But if your local competitors drop their totals and you don’t, clients will notice. We’ve written before about holding your prices against low-cost chains, and the same rule applies: if you hold the higher number, explain why.

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Check your receipts and gift cards

When the exemption takes effect, receipts for treatments shouldn’t show GST/HST, while receipts for retail items still should. Check that your receipt template, price list and website all match the date your accountant gives you. Insurers look closely at receipts, and a tax line that doesn’t add up invites questions. Our guide to what Canadian clinic software needs to handle covers what a compliant receipt includes.

Gift cards and prepaid packages sold before the change are a grey area. Ask your accountant how to treat a package bought in October and used in December.

The smaller items in the budget

Two other measures will touch self-employed therapists, just not this year:

  • Fewer tax instalments. The instalment threshold rises from $3,000 to $7,500 starting with the 2028 tax year, and self-employed owners could make a single payment of two-thirds of their tax owing by December 31. That’s a real cash flow help for seasonal practices.
  • One filing deadline. May 15 becomes the single due date for filing and paying, including for self-employed people, starting with the 2027 tax year.

Both are in Chapter 6 of the budget.

Worth the wait, if you handle it well

Putting massage therapy on the same list as physiotherapy is federal recognition that RMTs deliver health care. Plenty of owners have been arguing that point at the front desk for years. Clients will hear about this on the news and ask you about it, probably this week. Have your accountant’s answer and your pricing decision ready before they do. If your books need tidying before that conversation, start with our bookkeeping guide for massage clinics.

This article is general information, not tax advice. The exemption is a budget proposal and may change before it becomes law.

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