The HST (Harmonized Sales Tax) Bill has now been presented to Parliament in Ontario. This is going to be a 13% tax (5% GST and 8% PST combined) levied on pretty much everything in our lives. Apparently Dalton McGinty and his Gang seem to think this is going to help reduce corporate taxes and paperwork and create half a million jobs.
Now anyone can correct me if I’m wrong, but from what I understand and have read it goes something like this:
Manufacturers are charged all kinds of taxes throughout the manufacturing and delivery process – known as “Embedded Costs”. These costs are presently being charged at the rate of 7% each and apparently can add up before the actual product gets to the retailers and consumers. The HST will eliminate these 7% charges along the way, bringing that rate down to 0%, and then only charge a full 13% to the end user. I believe that is why this 13% rate will apply to practically everything except food and certain other exempted items.
The British Columbia government actually has a pretty good web site explaining all of this – but then again, it has to – it’s got a fight on its hands too, with British Columbians.
Now, in theory, this sounds pretty good and fair. The manufacturers should be able to maintain their “actual” manufacturing costs and when that product reaches the retailers you would think that the product would be around the same price as it is now, or perhaps in some cases a little cheaper. With the manufacturers not having to pay that 7% tax at their end, and not having to remit tax form after tax form to the government, their costs should be cheaper and the consumer should benefit to a certain degree.
“In theory” are the operative words here!!! We all know any savings these corporations get will probably NOT be passed on to the consumers and will probably increase certain corporate wages and bonuses. Don’t get me wrong, I’m all for creating new jobs, but why are WE paying to do that?? I thought the whole idea of the “trickle down theory” was to create wealth at the top and have it trickle down to the little guys!! This seems to me to be the “trickle UP theory“, only it’s via new taxes on the little guy. Oh, I suppose you could say we’re creating wealth by cutting corporate taxes, but again, that’s being done BY US. Why can’t the Ontario Liberals just cut their corporate tax rates? I really wish someone in charge or an economics professor could explain this one to me!!!
I’m not too sure how foreign imports will be affected by these taxes, and I’m sure those foreign countries must have to pay some sort of import taxes – but are they going to be reduced or eliminated too, or will they get rebates? Will these foreign countries pass this savings along to us? I’m especially thinking of the United States. I’m not too sure how much of actual manufactured American goods reach Canadian shores, but these past few years have shown that the U.S. is harbouring a few greedy CEOs, corporate executives and investment bankers that think being greedy is a good thing. Yes, I’ll even admit to Canada harbouring a few of these guys, but so far the Canadian Government has failed to flush them out!
With bad economic times looming around us, the Ontario Government also seems to think this is a good time to introduce the HST. What!!!!!!!! I thought we were trying to ‘stimulate’ the economy, not rob it by going through the back door. Again, will someone explain this to me!!
The HST is going to be seen on your utility bills, hair cuts, new real estate purchases, and a whole slew of other little items, including funerals. Yes, I said Funerals – you’re going to have to pay a tax before you leave this world!!!! So Dalton gets his final last laugh!!!!
It’s been nice that the food lobby/industry has been able to stop the Liberals from putting the HST on any food item under $4.00 – so at least now you can get that cup of coffee and possibly a muffin HST free!! How nice for them!!! We’ll all be able to drive down the road to get a cup of coffee (of which I hate) but we’ll struggle to pay to heat our homes, light our rooms, get hair cuts or even pay for the gas to put in the car to drive us down the road to get that cup of coffee!!!
So if Dalton gets his way we’ll all be doing laundry 3:00 o’clock in the morning (because of those Smart Meters), line the pockets of corporations, give a sizeable payment to Government coffers before we die and hope like hell a job is created somewhere for someone who will then get a job so they can pay their fair share of the HST and the whole vicious cycle starts over again.
Now in order to ease this extra burden, dear Dalton has decided to give everyone some sort of rebate. Naturally the higher income earners ($160,000.00) will get 3 payments equalling $1,000.00, the single income earners will get 3 payments equalling $300.00 each and the lower earners will get an even lesser amount provided they’ve filed a tax return. Does he really think this is going to help? Does he really believe that these payments are going to be there next year in all of our bank accounts to help pay that utility bill that’s going to be increased by 8%? Plus what happens the year after, and the year after that when wages, salaries and other manufacturing costs start to increase again once the economic recovery is fully over with??
I truly wish Dalton McGinty and the Ontario Liberals would come to grips with reality. Clean up the EHealth mess and the Ontario Lottery Corporation guffaws and maybe then they could recoup a whole whack of money by greedy executives, stop the flow of cold hard cash from going to some off-shore tax haven and leave us poor schmucks alone. GM is about to reduce my husband’s pension in January because of their short-comings (literally and physically!!!) and now we’re going to be burdened with more taxes by the Ontario Government. Where and when is this all going to end. We can only take so much!!
I say we all stop going for hair cuts, turn down the heat, turn off the lights, stay at home bundled under a mound of blankets, and hibernate for the winter. Maybe this will turn out to be a really bad nightmare. Oh, I forgot, this HST thing is going to take effect in June, so that kills the hibernation theory. Oh well, maybe we can all get together, take whatever money we’ve got left in our bank accounts along with Dalton’s first installment of that $1,000.00 gift (joke, joke), hire a whack of tour buses (getting a huge group discount) and head down south. The U.S. economy is still flailing, the CDN dollar is pretty good right now, and I hear the California economy needs a huge economic boost!!!! How could we loose??? OH, we could also head out to Alberta – the last bastion of a relatively tax-free zone!!!