Contributing Lawyers

Canada

Cyndee Todgham Cherniak

United States

Susan Kohn Ross

Australia

Andrew Hudson



Saskatchewan, Manitoba and PEI Are Canadian Provinces Not Biting HST Hook

CBCNews.ca is reporting "Flaherty's HST pitch fails to woo holdouts" - see http://www.cbc.ca/canada/saskatchewan/story/2009/08/05/harmonization-reaction.html

Yesterday, Canada's Minister of Finance offered cash to Saskatchewan, Manitoba and Prince Edward Island if they join Ontario and British Columbia in harmonizing their provincial sales taxes with the federal goods and services tax (GST). Quebec harmonized in 1991 creating the Quebec sales tax (QST); however, the QST is imposed under provincial legislation. Nova Scotia, New Brunswick and Newfoundland/Labrador harmonized their sales taxes with the GST as part of the federal Excise Tax Act (Canada) creating the harmonized sales tax (HST).

In march 2009, Ontario announced that it would harmonize the retail sales tax with the GST under the federal Excise Tax Act as of July 1, 2010. As part of the arrangement, Ontario will be paid $4.3 Billion by Ottawa to help grease the wheels when the single tax takes effect July 1, 2010.

In July 2009, British Columbia announced that it would harmonize the social services tax with the GST under the federal Excise Tax Act as of July 1, 2010. British Columbia will receive $1.6 Billion from Ottawa to help grease the wheels when the single tax takes effect July 1, 2010.

On August 4, 2009, Finance Minister Jim Flaherty said Ottawa was willing to offer financial support to provinces choosing to harmonize their provincial sales tax with the federal GST. The remaining provinces are not taking the bait. Then again, there have been no public statements on the size of the bait.

 

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