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What people are saying about the HST

(Queen's Park Report - December 8, 2009) The debate over Dalton McGuinty’s $3 billion HST tax grab heated up last week, especially at the Standing Committee on Finance and Economic Affairs.  Some have dubbed McGuinty’s new levy as the ‘hated sales tax,’ and if you listened to the public presentations at committee you would certainly think it was true.  Here’s what people have been saying.

Sue VanderBent of the Ontario Home Care Association told the committee that her group predicts the HST will place an additional $260 to $350 annual cost burden on individuals using home care.

Frank Giannone of the Ontario Home Builders’ Association presented figures that give you an idea about how the new tax will grow the underground economy.  He estimated that the HST will add significant “leakages” in government revenue because people will avoid paying the new tax in the construction sector amounting to $298 million in lost sales tax revenue, up to $1.6 billion in lost income tax revenue and $767 million from lost CPP, WSIB, EI, and Employer Health Tax premiums.

Sue Cannon of the Bowling Proprietors’ Association of Ontario came to Queen’s Park to tell legislators how bowling proprietors in Newfoundland experienced an immediate 15% loss in revenues when the HST was implemented in that province.  Ms. Cannon commented, “We’re expecting no less here.”

Also hurt by this tax are condominiums.  Chris Antipas of the Association of Condominium Managers of Ontario told the committee, “It is estimated that condominium owners are going to see their fees increase on average by 6.8% due to the HST before any other required increases are put in place in the operating budgets.”  His colleague, Armand Conant, said, “The HST impact on expenses from reserve funds over the next three years will be in the range of $120 million. That simply was not budgeted into our corporations’ plans, and that’s going to hurt condo owners in a way it does not impact other homeowners.”

Fitness club owners even came to the Legislature.  Andy Soumbos, a Curves franchisee, represented over 250 Curves franchises to disapprove of the HST being charged on health club memberships and services.  He said, “The government has stated that the new HST will save money for businesses. In the fitness business, we do not see any cost-cutting benefits by imposing the HST. Therefore, there are no cost-savings to pass on to our customers. This will make it harder to stay in business.”

Mike Chopowick of the Federation of Rental-Housing Providers of Ontario stepped up to the microphone to tell the committee that his organization expects the HST will see landlords costs rise by about 6.5%.  He says that amounts to about $400 per rental unit in the province and called it “a huge impact” that “has serious consequences.”

Other presenters included the Canada Resort Development Association, the Investment Industry Association, the National Golf Course Owners Association and many others.  All expressed serious concerns about the destructive consequences of the HST.

No matter how Dalton McGuinty tries to spin it, the HST is a massive $3 billion tax grab on middle-class families in the grip of a recession.  If the latest public presentations on the matter are any indication, this is certainly a ‘hated sales tax.’

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