The Federal Luxury tax is set to come into effect in September 2022 and will affect cars with a value of $100,000 or more. It is applied before HST and is calculated at 20% of the value above $100k or 10% of the full value of the vehicle, whichever is the lesser. Let's take an example. Let's say you are buying a used Bugatti for $3,000,000 in Yukon. 20% of the value above $100k would be 20% of 2,900,000 which is $580,000. 10% of the whole value is 10% of $3 million which is $300,000. In this case, the calculation is lesser and therefore applies. The HST on the Bugatti would be $150,000. Total car tax would be: $300,000 + $150,000 = $450 000