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HST Lies & Misinformation

Posted 2009.12.16 12.43 in Pointless Blather, Work

So far, it looks like Ontario is still going ahead with this HST nonsense. Mostly, I don’t really care one way or another – it’s a zero-sum change for me. Being an entrepreneur and working in small business, whether the GST is 5% or 13% is largely irrelevant due to the way the tax is managed with the ITCs balancing the taxes collected.

One thing that I really dislike though, is when governments lie and mislead in order to push their agenda through.

Will the move from GST (5%) + PST (8%) to HST (13%) cost the average consumer more money? No. The 13% rate won’t apply to stuff that’s currently PST exempt.

It’ll be a huge pain in the ass for programmers and accountants etc. to get this set up for retailers’ POS systems, but generally speaking the actual tax rate isn’t going to change.

They don’t need to add lies or misinformation to sugar-coat it. What am I talking about? Specifically, this paragraph I keep coming across in the Ontario Ministry of Revenue‘s website:

Right now, provincial sales tax is paid by most businesses at each step in the creation of a consumer product. In other words, though you may not realize it, the PST is charged multiple times during the production of a product before that product reaches the store. So it can be a tax on a tax on a tax, all hidden in the cost of a product until it gets to the consumer. Under the HST, most taxes paid on business inputs will be refunded to the business — savings that can be reinvested and passed on to consumers.

I’ve been working with small businesses for over two decades. I can tell you that the PST is not charged multiple times during the production of a product. This is simply a flat-out lie.

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