After the disruptive legislative antics of the Ontario Tories, the environmentally-unfriendly stunts of the Ontario NDP and the 'me-too' whining of Jack Layton and the federal NDP, it's nice to see that some facts are finally emerging about Ontario's plan to merger the provincial sales tax with Canada's GST and have one Harmonized Sales Tax (HST).
"No tax grab here The Canadian Centre for Policy Alternatives – a progressive think tank – has provided a useful antidote to the toxic criticisms of Ontario's new harmonized sales tax (HST). In a report released yesterday, the centre says that, far from being a "tax grab," as the critics claim, the HST will be revenue neutral for the vast majority of Ontarians and those with lower incomes will actually be better off. Only the relatively affluent (those with six figure incomes) will be worse off. That's because the impact of the HST will be offset by increases in the provincial property and sales tax credits and a cut in the lowest bracket of the provincial income tax. Unfortunately, says the report, "almost no one paid any attention to these supportive measures."
link: No tax grab here - thestar.com
There may have been some temporary benefit for the opposition parties to take advantage of the public's "ignorance" and spread false information about the HST and the concurrent offsetting revisions to other taxes. It always seems good politics to oppose "new taxes" even when these taxes replace older and less fair taxes. At least in the short-run.
But is is bad politics when it shows the opposition parties are unprepared to provide leadership and for government. In Ontario, the new Conservative leader wants to appeal to suburban and urban voters in an attempt to regain power. But he allowed his party to be hi-jacked by a yokel who, for three days, commandeered the media with stories of the bumpkin sleeping in his underwear in the lobby of the Legislature. Hardly the stories that are going to garner new votes.
Likewise, the NDP wasn't appealing even to its core vote when it wasted tons of paper and thousands of trees to print a fork-lift-full of identical and redundant motions to table in the Legislature just so it could stage a photo-op on the front steps of the building. The party might better have used its resources to research the tax and how it will benefit Ontarians. Then it might have conveyed an image of offering a viable alternative to the current government. As for Jack, well whenever a camera is present, he can be counted-on to jump up and down, get red in the face and proclaim the end of the human race.
The facts are the HST is anything but a tax grab and will help Ontario recover from the recession by ultimately lowering the costs of doing business in the province and increasing employment.
For those who don't believe the Centre for Policy Alternatives, there is this from the Certified General Accountants of Ontario;
"CGA Ontario publicly supports HST.
HST offers many advantages to business and consumers ranging from simplifying tax compliance for businesses that will save an estimated $500 million annually in reduced administrative costs, to the elimination of approximately $5 billion in embedded PST that businesses absorb annually, reducing the pre-tax retail price to individuals.
It is anticipated that 80 per cent of business savings will flow through to consumers within one year."1
"The savings will flow through to consumers" PLUS there will be significant income tax reductions.
As the HST legislation moved through the Ontario Legislature and the House of Commons, much was made of "dilemma" facing the federal Liberals; support their provincial cousins and the bill and face the public's wrath, or defeat the federal legislation and risk an election. This was, of course, ridiculous. What should have been the story was what would be the affect of the Liberal Official Opposition blocking a request from a provincial legislature to modernize its tax regime. It would have been absurd if the LIberals had voted against the federal bill when they knew full-well that the Ontario Legislature would approve its bill be a huge majority within a few days. Those few Liberal MPs who opposed the legitimate requests from Ontario and British Columbia deserved to be whipped and shame on those who failed to appear to vote for whatever contrived excuses they offered.
Dalton McGuinty and the Ontario Liberal are showing what is true leadership. Stating Jan 1, 2010, the income taxes of almost all Ontarians will be reduced and we will become eligible for grants to offset the HST on previously PST exempt goods and services when it comes into affect in July. New jobs will be created as a result. These will be good days for Ontario.
- Harmonized Sales Tax Information Booklet Ontario Edition Published by the Certified General Accountants of Ontario Authored by Rod Butcher, CGA and Diane Gaudon, CGA↩
