I'm still not too sure what this means for us. But in Ontario the GST (5%) and the PST (8%) is going to be harmonized into ONE tax of 13%. Apparently this will create more jobs over the next 10 years, however it will also create more tax on somethings such as gas, funerals, haircuts, home heating fuel, and cable. This will take effect July 1, 2010.
For those of you from BC, you are also going to merge your PST and GST starting July 1st.
Things only subject to 5% GST include books, kid's clothes, footwear, diapers, kid's car seats/booster seats, and feminine hygiene products.
People that buy newly built homes under $400,000 will not be subject to extra tax. Buyers of new homes between $400,000 and $500,000 could claim a proportional rebate.
PST on hotel rooms is going to be 8% (instead of 5%) and is going toward marketing tourism in Ontario tourism regions.
Businesses will be given some credit from the government if they have to change their accounting systems.
As part of the proposed sales tax reform, cash payments would be provided to Ontario tax filers, in each of June and December 2010, and June 2011.
- Eligible families with income of less than $160,000 would receive 3 payments totalling $1,000.
- Eligible individuals who earn less than $80,000 would get 3 payments totalling $300.
- To qualify for the 2 payments in 2010, a 2009 tax return would have to be filed.
- To qualify for the 2011 payment, a 2010 tax return would have to be filed.
I'm not sure whether I like it yet or not, I just don't know enough about it. It seems fairly similar for things, 13% either way on most things.
Good news, it doesn't apply to coffee and donuts. Woohoo!