HST Madness
Although it is a provincial issue, I am a bit amazed by the lack of public debate over the move to harmonize the sales tax in Ontario.
I agree, there are many positive reasons to harmonize the provincial and federal sales tax that will only benefit Ontario, but I have been surprised no one has been pointing out the obvious downside of the plan.
Does no one care there will be a SEVEN percent increase to the tax on services? Your cost of your next trip to Maui just got seven percent more expensive. (Mind you, if you're flying to Maui, I think you can afford an extra seven percent!)
A few days ago, I was chatting with a roofing contractor about getting my roof replaced. I asked him what he thought about the new HST. At first, he was shocked to learn that it passed. He didn't think the government would be stupid enough go through with such a thing. And for good reason too.
With the home renovation tax credit, his business has been booming this year. What's more, ALL his customers want to pay the 5 percent GST to keep everything above board to receive the tax credit. Revenue Canada will be shocked by the sudden boost in the returns for this year...
Next year, there will be no tax credit and there will be a whopping 13 percent tax on all home renovation projects. Everyone is going to want to pay cash, which will only grow the underground economy.
But I suspect it will grow by more than seven percent...
I agree, there are many positive reasons to harmonize the provincial and federal sales tax that will only benefit Ontario, but I have been surprised no one has been pointing out the obvious downside of the plan.
Does no one care there will be a SEVEN percent increase to the tax on services? Your cost of your next trip to Maui just got seven percent more expensive. (Mind you, if you're flying to Maui, I think you can afford an extra seven percent!)
A few days ago, I was chatting with a roofing contractor about getting my roof replaced. I asked him what he thought about the new HST. At first, he was shocked to learn that it passed. He didn't think the government would be stupid enough go through with such a thing. And for good reason too.
With the home renovation tax credit, his business has been booming this year. What's more, ALL his customers want to pay the 5 percent GST to keep everything above board to receive the tax credit. Revenue Canada will be shocked by the sudden boost in the returns for this year...
Next year, there will be no tax credit and there will be a whopping 13 percent tax on all home renovation projects. Everyone is going to want to pay cash, which will only grow the underground economy.
But I suspect it will grow by more than seven percent...
posted by Jason at 8:00 AM
6 Comments:
Like you, I am amazed at what I see to be absolute madness in the world of taxation and the potential for underground economy increase.
My work, as a Marine Surveyor, will increase in cost, on every file, by 7%, which is substantial.
Good for the Government coffers, bad for the taxpayer.
We at the National Citizens Coalition have been making people aware of this for a while and plan a major campaign push starting in the fall on this issue. If McGuinty will will reconsider this tax which goes into place June 2010, we will work to do all we can to make sure that he does not win the next election. People have not been paying attention to this tax because the implementation is 10 months away but starting this fall people will be hearing a lot more about it- this story has not been fully written yet and McGuinty will start to feel the heat on this issue
Well, B.C. gets it. There was no dialogue about the HST during the election and people are livid.
didn't the whole HST thing get split up to form PST and give us GST in the first place??? So now this move effectively puts the provincial gov't in charge of managing the GST but not only that they get to add PST back onto every business transaction again effectively distroying the whole point of GST to begin with...
This is being pushed by Harper the hypocrite with money thrown at Mcslippery. Just another reason not to vote for the CINOs.
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