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driving concerns

The 2020 Subaru Crosstrek Hybrid.

I’m interested in a Subaru Crosstrek PHEV [plug-in hybrid electric vehicle] but there is a limited number of these vehicles available and most are in Quebec. If I can find a Subaru dealer in Quebec willing to sell me one, what are the tax and insurance implications of driving the vehicle to Ontario and registering it here? – Rakesh, Kingston, Ont.

There are no provincial or federal regulations against dealerships selling to out-of-province buyers, but as one industry expert said, that doesn’t mean dealers want to sell to them.

“With these higher-tech vehicles, there’s an ample waiting list for people in their home province, so why would a dealer sell to somebody [from another province]?” said Viraf Baliwalla, a car broker in Toronto. ”It’s a lot more work for them and they don’t necessarily want to put in that work if they don’t have to. They’d prefer to sell it locally, because then the buyer will come back for service.”

Related: A dealer is trying to charge me thousands more than the advertised price of an SUV. Is that legal?

The issue of low inventory – a result of a computer chip shortage – is widespread, affecting EVs and gas-powered cars too. With demand outstripping supply, dealers are implementing policies such as forced financing – where buyers have to finance through the dealer instead of paying cash or arranging their own financing – or making buyers pay for extras like a service package or an extended warranty, he said.

But when it comes to the in-demand electrified cars, provincial regulations to encourage auto makers to sell a greater proportion of zero-emission vehicles mean that dealers in some provinces receive a much greater share of the manufacturers’ available inventory.

As a result, buyers seeking EVs and PHEVs may look to British Columbia and Quebec.

Those two provinces have the highest EV and PHEV sales, followed by Ontario. According to S&P Global Mobility, an auto industry analyst, British Columbia accounted for 17.5 per cent of all new zero-emissions vehicles registered in Canada in the third quarter of 2022, followed by 12.7 per cent in Quebec and 6.5 per cent in Ontario.

In a statement, Subaru Canada said it launched the Crosstrek PHEV exclusively in Quebec because of “demand and availability” and later made some available in the Ottawa area. It did not say whether it will expand sales to other provinces.

“We are no longer accepting new orders for the 2023 Crosstrek PHEV,” it said.

But the company said its Solterra EV launched nationally and each dealer will decide whether to offer it.

Taxes

If you are able to buy a car from a dealer in another province, you may have to pay the provincial sales tax twice – at least initially – if you buy from a dealership.

While rules vary by province, if you’re having a car shipped between provinces, you typically only pay tax for the destination province, Baliwalla said.

But if you’re picking it up yourself at the dealership, some provinces will make you pay their provincial tax on the spot – although you can get a refund later, as long as you don’t register the car there.

Then, when you get home and register the car, you’d have to pay your province’s sales tax.

But if you’re buying at a dealership in Quebec and not from a private seller, Quebec allows you to wait to pay sales tax until you register the vehicle, said the Société de l’assurance automobile du Québec (SAAQ), which handles vehicle registration in the province.

Registration and insurance

As for driving the car home, you can’t use your existing plates and insurance to get the car home, SAAQ said.

But in every province, you can get temporary registration that will let you drive to another province.

For example, in Quebec you can buy a temporary registration certificate that you display in your rear window, the SAAQ said.

While British Columbia’s temporary registration includes insurance coverage, in most provinces you’ll have to show proof of insurance to get a temporary registration.

If you have an existing policy, let the company know you will be buying an out-of-province vehicle and they will update your policy, said Neil Warren, senior corporate underwriting adviser for Desjardins General Insurance Group. You will also need to let the company know when you get home and register the car.

Have a driving question? Send it to globedrive@globeandmail.com and put ‘Driving Concerns’ in your subject line. Emails without the correct subject line may not be answered. Canada’s a big place, so let us know where you are so we can find the answer for your city and province.