This new tax regimen is not getting any coverage in the news paper/television and I am not sure why. It is going to be the biggest tax increase in history. It's like no one wants to inform us of the facts. I have been investigating and I would like to share my findings.
The new tax will be administered by the Federal Government. It will be based on the GST, that means if the tax is currently collected on the Goods and Service Tax at 5% it is going to be increased to 13%, that sounds fine as Ontario 's Provincial Retail Sales Tax is 8%. Add the two together and things seem fine.
One problem, Retail Sales Tax is not collected on everything that Goods and Services Tax is, the key word here is "Services". Retail Sales Tax is not collected on services. What is going to increase?
Here is a small list of services currently only taxed at 5% going up to 13%:
Natural Gas bill
Internet bill/Cable bill/Satellite TV bill
Water bill
Gas at the pumps- That is like 6 cents per L. (that is a tax on top of a tax)
Hair cut
Message therapy
Anything that requires labour around your house- plumber, electrician, painting, grass cutting ext.
Electricity bill- This is a good one. Look at your electricity bill there is a charge on it for debt retirement charge. That is a charge for the huge debt the OPC ran up. Only in Ontario would we pay tax on a debt, and only in Ontario would we increase this tax.
Condo fees- Few things, if any, are charged provincial sales tax on repairs a condo corporation pays on repairs and maintenance of a condo complex. The harmonized sales tax will mean that your condominium's expenses will increase by almost 7%. In turn, your montlhy condo fees will also have to increase in turn. Another issue is your condominiums reserve fund. It will be reduced by a further 7% due for the same reason. My condo board estimates the harmonized sales tax could reduce the reserve fund by almost $150,000.00.
Real Estate fees- Currently sellers pay GST on the fees (commission) they pay to their Real Estate Brokerage when selling their property. The GST is 5% based. With the HST sellers will pay an additional 8%. That means that if you sell your house for $400,000.00 and your realtor is charging a 5% commission, right now you will pay 20,000.00 commission plus GST $1000.00, totalling $21,000.00. With the Harmonized tax you will pay an additional $1680.00. Your total cost to sell will then be $22,680.00.
This is just a small list as there is so much much more.
Let talk about small business for a minute.
Mr. Mcguinty tells us in the budget that this new tax is going to save small businesses 500 million dollars. I do not know how much it costs to fill out a six line tax return monthly, but all small business owners I know do there own. If you are in business you will know about compensation on your Retail Sales Tax return. This is when you get to keep 5% of the tax collected up to $1,500.00 per year to help with your administration costs. That is gone once this tax is combined. Really it only helps large corporations with multiple vendor permit numbers, not small businesses.
Good news, I thought. There were two places where we were going to see an advantage to this tax. First there is no GST on used cars if bought privately and provincial tax on alcohol in between 10% to 12%. That is 2% to 4% higher then our normal Retail Sales Tax. Good old Mcguinty took care of that real quick. He is now saying to make it fair between used car lots, that he will collect the Retail Sales Tax on used cars still. Get ready for this one, he is going to add a levy on alcohol to promote social responsibility. This man is using the words social responsibility at the same time as he is raising our taxes, what he promised not to do.
If you feel this is an important an issue as I do, feel free to copy and paste this and send it by email to people you know, or if you have a blog, feel free to copy and paste it there, too...tell people they can pass it on, too.
I have added a few links at the bottom if you would like to get involved or send an e-mail. The first one is to sign the petition against this tax. The second is to Mcguinty if you would like to talk to him about being socially responsible. There are a few other ones but the bottom one is the best, it is the salary disclosure for 2008. We are paying him $207,000.00 per year to lie to us.
Stand up Ontario and tell your MPP and/or Premier Mcguinty we cannot afford any more. No new taxes!
Please sign the petition below.
Thanks
http://www.ipetitions.com/petition/Stop_HST_Ontario/signatures-10.html -Petition
https://www.premier.gov.on.ca/feedback/feedback.asp - Dalton Mcguinty
https://www.ontario.ca/en/contacts/feedback/index.htm -Any questions to the
Provincial Government
http://www.fin.gov.on.ca/english/about/contactus/feedback.html Dwight Duncan
http://www.ontarioliberal.ca/contact.aspx The Ontario Liberal Party
http://www.ontariopc.com/home20/contactus/contactus.aspx The PC Party of Ontario
http://www.fin.gov.on.ca/english/publications/salarydisclosure/2009/ministries09.html Salary Disclosure
