Ontario Chamber of Commerce Supports HST - Says Orazietti

SooNews Wire for SooNews.ca
Thursday, November 19, 2009, 10:15AM

ONTARIO CHAMBER OF COMMERCE SUPPORTS HARMONIZED SALES TAX

Ontario Business: HST Means Reduced Costs for Business, Lower Prices for Consumers and New Jobs for Ontarians



Queen's Park - Contrary to claims made in an article appearing in November 18, 2009 Sault Star, the Ontario Chamber of Commerce supports the Harmonized Sales Tax (HST) stating that it will save Ontario Businesses up to $4.5 billion in taxes while reducing their administrative costs by $500 million.



"It is unfortunate that the article appearing in the Sault Star mistakenly suggested HST would cost Ontario businesses $1.6 billion when in fact the opposite is true and at no time has the Ontario Chamber of Commerce suggested that HST will raise business costs," said Len Crispino, President of the Ontario Chamber of Commerce. "Companies would instead see their taxes lowered by up to $4.5 billion and save a further $500 million in administration and red tape. These savings will ultimately benefit consumers while helping businesses of all sizes create jobs for Ontario families."



Currently, businesses in Ontario cannot deduct the PST from the cost of materials and other products purchased; instead, they pass the cost along to consumers. The removal of these embedded taxes under the HST will allow businesses to claim tax credits for those purchases.



The experience of moving to a single sales tax in other jurisdictions has helped businesses reinvest while improving the economy overall. In more than 140 countries and four other provinces, a value-added sales tax like the HST is in place. B.C. has recently announced it is adopting the HST. No jurisdiction that has moved in this direction has reversed their tax policy because it adds costs to have two systems and reduces a jurisdictions' competitiveness.



It is important to note that the single sales tax is just one part of a comprehensive tax reform package that includes $10.6 billion in temporary and permanent tax relief. Other permanent tax reform benefits include:



Lowering tax on the first $37,106 paid from 6.05% to 5.05% saving an estimated $370 a year

Increasing the Senior Homeowners Property Tax Grant from $250 to $500 a year

New refundable sales tax credit of up to $260 for low and middle income Ontarians

Increasing the amount seniors can unlock from Ontario life income funds from 25% to 50%

Increasing the Ontario child benefit payment from $50 to $92 per month



Individuals and families will also receive one-time transition payments. Every eligible family with an income below $160,000 would receive three payments from the province, totaling $1,000, while individuals with an income of less than $80,000 would receive three payments totaling $300. The first payment would arrive in June 2010, the second in December 2010 and the third in June 2011.



A recent TD Bank report estimates that the majority of items Ontarians purchase - 80 percent - will see no tax change at all. Some examples includes municipal transit fees, rent, mortgage interest costs, prescription and over the counter drugs, basic groceries, university and college tuition, home phone service, home TV service, mechanics fees, meals under $4, newspapers and books, children's clothing and other children's products, feminine hygiene products, and tailoring.

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