The licensed funding specialists at Synergy Merchants have discussed numerous options with their clients concerning…
Happy Canada Day everyone! Or is it? Today, in Ontario and British Columbia, the dreaded Harmonized Sales Tax officially took effect. As of midnight last night, HST became law in both provinces. As Antonella Artuso reports on The Toronto Sun‘s website, HST will now combine the former Provincial Sales Tax (PST) and Goods and Services Tax (GST), meaning that services and utilities that were previously exempt from provincial sales tax will be up 8 per cent starting today.
What a way to celebrate the nation’s birthday, eh? Of course, many people are worried about having the cost of living increase significantly. In an attempt to avert Ontarians from worry, the provincial government sent out mini-booklets in the mail last week to serve as information packages about the new HST.
In the booklet, it reminds citizens that they already pay 13 per cent tax on most items as GST was 5 per cent and PST was 8 per cent previously. On things that required no PST or GST – groceries, prescription drugs and public transit, as examples – there will still be no sales tax.
As well, products like books and children’s clothing will still only be taxed 5 per cent under HST. However, legal fees, gas and home heating will all be subject to an 8 per cent tax increase under the new Harmonized Sales Tax implementation.
Artuso reports that to assist citizens with this change, “the government has cut personal income taxes, mailed HST rebate cheques and ushered in a seniors property tax cut beginning Canada Day.”
Revenue Minister John Wilkinson attempts to explain the benefits of HST to Ontarians: “It will take some time for the tax cuts to work their way through the system…We have to stop in this province having two governments tripping over themselves trying to tax every transaction twice when once will do.”
Wilkinson also believes that HST will help repair the damage done to Ontario by the loss of a quarter million jobs in 2009. A more “efficient and competitive business environment” is expected to be an inevitable result of introducing HST in the province.
Artuso also mentions that “British Columbia is harmonizing its sales taxes on the same day, and the furious response from its citizens far outstrips any reaction in Ontario.” B.C. residents have significantly been more vocal about the changes to their taxes that start today. Apparently, they are not convinced that HST will create improvements of any kind. Instead, it will cost the average family a lot more money to live. Happy Canada Day indeed.