Saturday, May 23, 2009

Harmonized Tax - A Wolf in Sheep's Clothing

The plan of the McGuinty Government at Queen's Park to harmonize the provincial sales tax (PST) with the federal Goods and Services Tax (GST) may sound like a good idea when you first hear it. Why not save people a pile of administrative work... not to mention a few trees? In reality, though, citizens of Ontario will be facing a huge increase in their taxes. Not the kind you pay annually, but the kind you pay every single time that you make a purchase, or make use a service. There are many examples why this "Hamonized Sales Tax (HST) is a bad idea, and nothing short of the government clawing even more from the hard working people of Ontario. One example is the purchase of a home, land, or real estate. Following is an article from the Ontario Association of Realtors (OREA):

OREA says harmonized taxes will cost $2,000 per sale. The Ontario Real Estate Association (OREA) says the provincial government’s plan to harmonize the GST and PST will add over $2,000 to the cost of a real estate transaction, hurting the resale home market and prolonging the housing industry’s recovery from the current economic downturn. “Now is not the time to be erecting barriers to homeownership,” says Pauline Aunger, president of OREA. “We need consumers to invest in housing to help get our economy going again.” Under a harmonized sales tax (HST), homebuyers and sellers will have to pay extra tax on a range of services associated with real estate transactions such as legal fees, moving costs, real estate commissions and home inspection fees. Currently, consumers only pay the five per cent Goods and Services Tax (GST) on these services. “These additional taxes could price some homebuyers, especially first-time homebuyers, right out of the market,” says Aunger. “Harmonizing will not help homebuyers in any way.” For a resale house priced at $360,000, a HST could add over $2,000 in new taxes to closing costs. In total, a HST will add $313 million annually in new taxes to resale home transactions. “In the last decade, Ontario’s homeowners have faced a barrage of new costs,” says Aunger. “From municipal land transfer taxes to sky rocketing property taxes, homeowners are being pushed to the brink to accommodate increasing demands from government. A harmonized sales tax is yet another cash grab on Ontario’s already overtaxed homeowners.”

Let's do something about this! Contact your local MPP and let him know that you strongly oppose this tax grab. If we don't do something, and just let this slip by us, we have only ourselves to blame Ontario!

No comments: