Hey Bloggers – The topic today is Harmonized Sales Tax.
In summary, the Province of Ontario plans a major tax reform that will combine both the provincial and federal sales tax on products and services. The current combined tax of 5% GST and 8% Ontario sales tax won’t change the price on most items. But many items that used to be exempt from sales tax will no longer be so. Leading economists from across the country say the Harmonized Sales Tax is the single most important step Ontario can take to boost its economy. They also say Harmonizing the GST and PST will save employers $2 billion that can be used to lower prices to the consumer, increase investment and create jobs. It’s set to begin July 1st, 2010.
How does this relate to you and the real estate industry? The taxes will add a significant amount to the cost of home ownership. OREA (The Ontario Real Estate Association) says the “average” buyer will have to pay an additional $1,449 in new taxes on their next real estate transaction. In a ‘call to action’ the OREA members have sent over 13,000 e-mails to local MPP’s across Ontario asking them to reconsider. BCREA has devoted a web page to the HST. www.bcrea.bc.ca/hst/hstaction.htm
It will be interesting to see how this plays out. As always, any comments you may have can be left here on my Blog.
Want to learn more? Here is another good website: http://www.cbc.ca/money/story/2009/03/27/f-tax-faq.html