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A few thoughts on the HST
Just a few thoughts on the HST:
The HST is now a flow-through tax, just like the GST ( Value Added Tax). The feds collect it, but have to remit the 8 % to the Province. The PST was an add-on manufacturing tax. In my case, when I was in business, anything like purchases for re-sale could be deducted when you remitted the PST collected from end-users. You could also get exemption for a few other items, but it was a cumbersome method. The GST and now the HST does not affect business purchases, except, of course the work of collecting and remitting ( business all ready report the GST, so there is little incremental work here). When you remit, you deduct all paid taxes. With the computer programmes these days, it is as easy as 1,2,3,. So, we, the end user, are paying the tax, as before, except we now pay it on services and other previous exempt items such as books ( which hit me right in the book --pocket book, that is). The other negative is that it encourages the underground economy.My neighbour got his roof done, for cash, no tax at all. Thus, both levels of government lose. Also, the tax rebates we get ($ 700.00, hurrah !) is an one-time sop to the consumer. The winners here, of course, are businesses of all kinds, but especially manufacturers who buy input items. Whether they will eventually pass on the savings is a moot question; my feeling is that there might be some price pressures in highly competitive situations such as manufacturers of consumer goods. Groceries are also still exempt, thank goodness.