Ontario will be joining several other provinces in implementing the new Harmonized Sales Tax (HST). Nova Scotia, New Brunswick and Quebec, already follow the HST. Ontario and British Columbia are both set to introduce HST on Thursday, July 1, 2010. The tax will be collected by Canada Revenue Agency (CRA). Residents in Ontario and B.C. will be taxed on almost everything from home electricity to gasoline to Mutual Fund Management fees. Canada Revenue Agency (CRA) will be collecting the Harmonized Sales Tax.
HST and Ontario Families
A huge backlash has erupted in both Ontario and British Columbia. Canadians in both provinces, feel that the 13% tax will severely hurt families. As the tax burden starts to shift from businesses to consumers, families will be forced to pay taxes on items for which they currently do not. Consumers will begin to pay levies on a range of goods and services; this means big budgeting changes for families in Ontario. Even though most items will have an increase in taxation, several items will be unaffacted by the Harmonized Sales Tax.
Examples of Popular Items That Will not be Affected by HST
- Prescription Drugs
- Child Care
- Residential Rent
- Legal Aid
- Municipal Public Transportation
- Auto. Insurance
- Basic Groceries
- Certain Medical Devices
- Mortgage Interest Costs
- Most Health Care Services
- Pharmacist dispensing fees
- Most Educational Service
HST will affect many different aspects of Canadian Business and Family Living. For Businesses in the Construction industry or Real Estate for example, it can be a very daunting thought. It is threatening to hurt sales and there is still very little information available to answer some of the questions that are beginning to arise. Currently, there is no sales tax or GST on resale homes and as far as information released explains.
Change for Ontario
Due to the continuing recession, the timing could not be worse for Ontario families. However, many experts are now speculating that harmonizing the taxes could benefit lower and middle-income families the most. One-time relief cheques, new credits and income tax breaks will help offset the impact of HST but families will still be feeling the financial strain.
Unfortunately, change precipitated by the Harmonized Sales Tax is right around the corner. The best thing to do at this point is to get educated by taking a look at other provinces that have incorporated it. For example, Nova Scotia or New Brunswick. Ontarians definitely need to start getting smart about financial decisions in the months to come, or this transition may not be a smooth one for families.
