At a time when many Ontarians are already stretched thin the province moved one step closer to enacting its controversial harmonized sales tax, or HST, Monday.
The McGuinty government introduced a bill to implement the blended eight per cent sales tax and five per cent GST. It’s expected to take effect next July.
Finance Minister Dwight Duncan claims the blended tax will create jobs and boost the province’s economy during the recession. His claims are backed up by a recent study released by tax expert Jack Mintz, which suggests the HST, combined with corporate and income tax cuts, will create nearly 600,000 new jobs over the next decade.
Opposition MPPs and the National Citizen’s Coalition claim the HST is an obvious cash grab.
On Friday Duncan tried to put a more positive spin on the new tax by announcing prepared foods under $4 are exempt from the HST. The 13 per cent levy won’t apply to newspapers and convenience foods like coffee and doughnuts.
On Monday the finance minister said his government has nothing to hide about its plans for the HST.
"We introduced the principle way back in March, there's been quite a bit of public debate, there's been an election in Ontario since then, they'll have ample opportunity to look at the specifics of the bill itself, you'll see that it reflects what we've been talking about since last March," Duncan explained.
Children’s clothing and footwear, diapers, books, car and booster seats and feminine hygiene products are also exempt, but critics of the measure are quick to point out that things like hydro bills, home heating fuel, gasoline and even funerals are not.
The National Citizen's Coalition estimates the HST will cost the average taxpayer about an extra $1,000 a year. The group offers an HST calculator on its website. Click here to try it.
The HST bill also includes a rebate of up to $1,000 to help offset the increased costs for Ontario families the first year the tax goes into effect.