In a move that will surprise many, Ontario consumers will get a taste of the province's new Harmonized Sales Tax (HST) beginning tomorrow, two full months before it is fully implemented.t
The early start applies to all products and services to be consumed after the 13% tax's official start on July 1. Airline tickets for fall travel, for example, will be subject to the new blended HST, as will gym memberships, theatre tickets and a range of other goods and services.
"I think this takes people by surprise," says David Docherty, a political-science professor at Wilfrid Laurier University.
Provincial Revenue Minister John Wilkinson yesterday defended his decision not to publicize the early transitional start. He said rules have been posted on a government web-site since October. He blamed businesses for failing to inform the public about the changes.
"The decision of businesses as to whether or not they marketed -- that is up to them," he told reporters. "But this information has been available broadly to the public since [October]."
Satinder Chera, director of provincial affairs at the Canadian Federation of Independent Business, blasted Mr. Wilkinson for that response.
"That's quite frankly a little rich," Mr. Chera said. "This is their tax. This is their time-line.... And they're trying to take a back seat on this."
The HST, which blends the 5% GST with the 8% retail sales tax, is designed to shift the tax burden from business to consumers. The change could boost competitiveness in the province, adding jobs and increasing output, most economists say.
But it is deeply unpopular with consumers, who will pay 8% more on about one in five items previously exempt from the retail sales tax, including haircuts, gym memberships, home heating bills and gas at the pump.
Many small-and medium-sized businesses are also against the tax, Mr. Chera says.
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