HST PASSED

[BUSTER]

[JohnF]

Lotsa good and bad in this legislation. Business and commerce is going to love it but the average consumer is going to feel the pain.

 

JF

[Dara]

I see no good in it...you gotta show me that...other than a few bookkeepers with an easier job.

 

All I see is a great big lie from the government

Edited December 9, 2009 by Dara

[ketchenany]

but the average consumer is going to feel the pain.

 

JF

 

 

and good, right where it hurts . . .

[jimmer]

They have yet to show me how this is going to be beneficial to anyone but themselves.

If I don't get a raise next year, which I won't, I will have to cut back on something in order to keep my family income the same as it is now. AND, no their little reimbursement (election ploy) won't cut it.

[cranks bait]

I can tell you right now that I am not a business that is happy to see this. It's going to makes things go from bad to worse really fast.

[bigugli]

Don't see how a lot of businesses benefit when the consumer has less to spend. Thankfully there is an underground economy.

[JohnF]

Don't see how a lot of businesses benefit when the consumer has less to spend. Thankfully there is an underground economy.

 

Despite all the talk to the contrary the big businesses are excited, among other things that I probably can't begin to understand, about having the 8% pst backed out of their prices so they can keep the high prices and save the 8%. It's more profit margin for them. I argued this with the minister and one of his people a week or so ago but they insist that commerce will be honest. Now I don't for a second believe that today's politicians are that naive so I guess honest is interpreted differently depending on whose eyes it's being filtered thru.

 

I suspect the provincial pols had little choice in this though. The feds wanted it and they have the big hammer (transfer payments and who knows what else) to hold over the provincial guys' heads. This was a done deal long before it went to a vote. In fact I was told it was a done deal by the minister two weeks ago and no amount of arguing or negotiating was gonna change that. The very best we could hope for were some concessions. The real estate industry in Ontario has gone to bat big time over it to no avail although our guys are still looking for some kind of break for home owners. It's not that the tax hits us directly. It's the massive effect it has on our clients and customers. Buyers and sellers are now going to have a huge added tax burden on commissions, lawyer fees, home inspections, surveys, and title insurance to name a few taxable things. The government may even be in the process of trying to mandate energy audits before a house can be sold. The cost of the audit will of course be taxable, but that'll be a drop in the bucket compared to the effect it's going to have on folks owning older inefficient homes, but that's a whole nuther story. If you're thinking of selling and it sounds like they're gonna get the regs created soon you might want to think about selling sooner than later. If you want to know what it means in terms of dollars look around your house and calculate how much it could cost to bring your windows, doors, furnace etc up to modern standards. That's how much you're probably going to be burned for once it's enacted.

 

It's another round of bend over and spread 'em folks. Our elected representatives are into foreplay mode again. Sorry if I sound cynical and I say this as one with a lot of respect for our minister of revenue.

 

I won't even go into some of the industry specific crap we're having to deal with cuz nobody but realtors cares about our problems.

 

JF

[irishfield]

The only business that it helps John are those that weren't buying wholesale in the first place with a PST exempt #. The only ones it may help are the small shop that was cheating and going into Walmart to by 2 litre pop at $1.00 and then putting it back on their shelves for $2.39. Now they can claim back the PST portion thru the HST rebate program... that they couldn't claim back before thru the pricks in Oshawa.

 

Anyone else it's gonna hurt. Labour bills just went up by 8% to the end user. All the labour work I do rebuilding airplanes only has GST on it. Parts have both taxes.. so now everyone is going to pay the extra 8% on everything. I don't see a benefit to the whole HST period.. at any point other than goverment collection end.

 

They already got rid of Ontario Corporate tax returns ( and now it's just a Federal T2) and now HST gets rid of the PST department in Oshawa as well I guess.

 

They think the "bartering system" is hard to police now... wait 'till July !

[JohnF]

The only business that it helps John are those that weren't buying wholesale in the first place with a PST exempt #. The only ones it may help are the small shop that was cheating and going into Walmart to by 2 litre pop at $1.00 and then putting it back on their shelves for $2.39. Now they can claim back the PST portion thru the HST rebate program... that they couldn't claim back before thru the pricks in Oshawa.

 

Anyone else it's gonna hurt. Labour bills just went up by 8% to the end user. All the labour work I do rebuilding airplanes only has GST on it. Parts have both taxes.. so now everyone is going to pay the extra 8% on everything. I don't see a benefit to the whole HST period.. at any point other than goverment collection end.

 

They already got rid of Ontario Corporate tax returns ( and now it's just a Federal T2) and now HST gets rid of the PST department in Oshawa as well I guess.

 

They think the "bartering system" is hard to police now... wait 'till July !

 

I think it's the retailers who will leave the 8% in their retail price, not passing the savings on to the consumer. I'm also told by people much smarter than me that there are other advantages for business in there somewhere and I would need to sit down with some of them to be able to explain it in any kind of detail. Suffice it to say these are very successful businessmen for whom I have a world of respect (at least for their business acumen & success). I won't try to explain it here, mainly because I can't.

 

JF

[HTHM]

I am with Wayne on this one, my pricing just went up 8 points and I see none of it.

[irishfield]

not passing the savings on to the consumer

 

What "savings". All the wholesale manufacturers are PST exempt to start with and while we have to charge GST in each step of sale through to the last manufacturer... everone gets it back after the fact... so the only one at the end of it all that has to pay out of pocket for the HST is the end retail buyer. I only see it as an added expense to business... now instead of sending the goverment 5% in advance (before the person I sold it to pays their invoice) I have to send the government 13%. So bank costs for any business running a line of credit just went up to cover the "prepaying" of the next wholesalers HST in advance of them actually paying the guy they bought it from. I don't know whom your "very successful businessmen" are.. or how they see a gain in all of this, but I sure don't and I dont' consider myself some smuck that just builds airplanes. Our plastics plant is still running through all of this ecomomic depression and we've done 10+ a year in sales... for over 24 years.

Edited December 10, 2009 by irishfield

[JohnF]

What "savings". All the wholesale manufacturers are PST exempt to start with and while we have to charge PST in each step of sale through to the last manufacturer... everone gets it back after the fact... so the only one at the end of it all that has to pay out of pocket for the HST is the end retail buyer. I only see it as an added expense to business... now instead of sending the goverment 5% in advance (before the person I sold it to pays their invoice) I have to send the government 13%. So bank costs for any business running a line of credit just went up to cover the "prepaying" of the next wholesalers HST in advance of them actually paying the guy they bought it from. I don't know whom your "very successful businessmen" are.. or how they see a gain in all of this, but I sure don't and I dont' consider myself some smuck that just builds airplanes. Our plastics plant is still running through all of this ecomomic depression and we've done 10+ a year in sales... for over 24 years.

 

But right now it's factored into the retail pricing structure. Do you think most retailers are gonna reduce their prices by that 8%. I doubt it. They'll leave it in and collect it on the consumer end.

 

JF

[JohnF]

I am with Wayne on this one, my pricing just went up 8 points and I see none of it.

 

Don't you clsim yer ITCs? I've been assured they'll still be a claim.

 

JF

[solopaddler]

John being a real estate guy are you worried about the housing market, especially for first time buyers?

Won't closing costs be escalated now?

[irishfield]

Do you think most retailers are gonna reduce their prices by that 8%. I doubt it. They'll leave it in and collect it on the consumer end.

 

JF

 

 

You're losing me there John... they don't pay the 8% in the first place so why would they be reducing their prices by 8%? They are PST exempt when they buy from the wholesaler. The only one paying the 8% PST right now is the end consumer along with 5% gst.... and the store remits it to the government after you've bought the item.

 

So now the fact that they will have to pay the wholesaler 13% HST and claim it back on their HST return.. the end user is still paying the same taxes as they leave the store.. the store still has to remit the same 13% they did previously to the government.. just to one place now and not two. There is no savings for the store....other than doing one HST return vs a GST return and a PST return. If anything there is an added expense of having to pay the HST 13% (vs the 5% gst only) to the wholesaler in advance of the sales from the retail store and then wait to get it back on their next periods HST return to the government... so if anything, IMHO, that just adds to the overhead and if nothing else the before tax prices of items just went up.

 

Then there are all the items that never had PST charged on them in the first place! In the grand scheme of things I think they're just trying to put an end to X province shopping to save PST and trying to get every province on board!

[JohnF]

John being a real estate guy are you worried about the housing market, especially for first time buyers?

Won't closing costs be escalated now?

 

Absolutely. Our business is taking it in the groin. It's not the direct hit that will hurt us, rather the effect on the consumer, specifically the home seller. They're going to pay an extra 8% at every turn, and that will in turn make our job tougher and almost certainly hit us in the pocketbook at the end of the day. That's why the Ontario Real Estate Association has been lobbying their butts off for a break for consumers. We've been told all along the way that the deal is already cut and it's gonna happen no matter what we say. I got that directly from John Wilkinson a few weeks ago and from one of his people during a discussion we had last week. I don't like the results of the tax but I tend to believe John (Wilkinson) when he says there are benefits for business (and I'm a PC supporter if anything) in the long run, mainly because I've also been told this by some very bright, very successful businessmen whose opinion I totally respect.

 

I'm nowhere near smart enough to explain how it can benefit business generally but I'm convinced it will given the proponents of the program I do know and respect. I was actually supposed to have another conversation with someone from the ministry this week but he hasn't called yet. Maybe tomorrow. I guess something I said to John made enough sense that he told the other guy to call me. All I want is to get a better deal for home sellers and therefore a better deal for me and my salespeople in the long run.

 

The whole thing is very complicated and perhaps the benefits will take years to surface for all of us but there's just too much conviction being shown for me to believe this is just another example of the usual partisan chicanery.

 

http://www2.canada.com/harbourcitystar/new...b7-c2cff0ccf6fe

http://www.collingwoodconnection.com/article/147037

http://www.ottawacitizen.com/news/good+pol...5214/story.html

 

Above are some links to explanations that seem to support that the benefits are there, however obscure. I'm doing my best to keep an open mind, and that ain't easy when I know it's gonna be tough for my salespeople and all of the home sellers in the province.

 

I'm not normally inclined to give politicians any leeway but John impressed me with his conviction.

 

JF

[JohnF]

You're losing me there John... they don't pay the 8% in the first place so why would they be reducing their prices by 8%? They are PST exempt when they buy from the wholesaler. The only one paying the 8% PST right now is the end consumer along with 5% gst.... and the store remits it to the government after you've bought the item.

 

So now the fact that they will have to pay the wholesaler 13% HST and claim it back on their HST return.. the end user is still paying the same taxes as they leave the store.. the store still has to remit the same 13% they did previously to the government.. just to one place now and not two. There is no savings for the store....other than doing one HST return vs a GST return and a PST return. If anything there is an added expense of having to pay the HST 13% (vs the 5% gst only) to the wholesaler in advance of the sales from the retail store and then wait to get it back on their next periods HST return to the government... so if anything, IMHO, that just adds to the overhead and if nothing else the before tax prices of items just went up.

 

Then there are all the items that never had PST charged on them in the first place! In the grand scheme of things I think they're just trying to put an end to X province shopping to save PST and trying to get every province on board!

 

I'm not armed for this battle with anything but a good impression of John Wilkinson and the comments of some businessmen I really respect. I'm gonna have to beg yer indulgence till I've had a chance to dig further into this. In the meantime see the links in the response to Solo.

 

I promise I'm still digging into this and will bring back whatever I can learn. I may have a phone conversation tomorrow with a ministry guy and can perhaps get some facts from him. I really want to understand this better for my own sake. I'll share what I learn.

 

JF

[workwear]

goverment= THE BIGGEST MAFIA IN THE WORLD!!

 

i dont see how this is goin to be good for a service related industry or for any industry for that matter

 

 

how can i being in the service industry add another 8k to a 100k contract and expect the consumer to pay for it......they ( he mafia)will force more service related industry to go underground.....i know my industry will be that way its enevitable......as it is now i most often get asked ...can i pay cash???......to save on the 5 points that i charge for the gst ....i can imagine how much more i will be asked "can i pay cash" when this hst comes into effect.......dont get me wrong i love cash deals...... but not all deals can be

 

 

what i have a delemma with is all my competitors that will work cash as i refuse to do bisiness all in cash....if i do deal in cash then ill have to foot the bill....

 

what is a small business man to do

[JohnF]

goverment= THE BIGGEST MAFIA IN THE WORLD!!

 

i dont see how this is goin to be good for a service related industry or for any industry for that matter

 

 

how can i being in the service industry add another 8k to a 100k contract and expect the consumer to pay for it......they ( he mafia)will force more service related industry to go underground.....i know my industry will be that way its enevitable......as it is now i most often get asked ...can i pay cash???......to save on the 5 points that i charge for the gst ....i can imagine how much more i will be asked "can i pay cash" when this hst comes into effect.......dont get me wrong i love cash deals...... but not all deals can be

 

 

what i have a delemma with is all my competitors that will work cash as i refuse to do bisiness all in cash....if i do deal in cash then ill have to foot the bill....

 

Don't you think the revenooers won't be particularly scrupulous about their audits with exactly this in mind. It's pretty much a given that small business operators are going to be pressured to do cash (read tax free) business but I'd resist the temptation cuz I'll bet there are gonna be some serious casualties to the taxman's ire. Stay the course. Eat the tax if you have to do anything. The reward will be when your cash dealing competition goes down for tax evasion and leaves you an open field.

 

JF

[workwear]

Don't you think the revenooers won't be particularly scrupulous about their audits with exactly this in mind. It's pretty much a given that small business operators are going to be pressured to do cash (read tax free) business but I'd resist the temptation cuz I'll bet there are gonna be some serious casualties to the taxman's ire. Stay the course. Eat the tax if you have to do anything. The reward will be when your cash dealing competition goes down for tax evasion and leaves you an open field.

 

JF

 

 

thats all fine and dandy john in a perfect world i agree with you...but it could take months or even years to weed out these types of biusnesses who deal under the table....what does a small guy do then....sit and wait???

 

 

or fight tooth and nail to try to keep with everday life..

 

i guess time will tell

[JohnF]

thats all fine and dandy john in a perfect world i agree with you...but it could take months or even years to weed out these types of biusnesses who deal under the table....what does a small guy do then....sit and wait???

 

 

or fight tooth and nail to try to keep with everday life..

 

i guess time will tell

 

Bomb the buggers, or find a middle road to survive on and hold out for a few years till the corner cutters get weeded out. There have always been problems in dealing with the competition for a lot of different reasons and most of them have involved pricing of services. Take comfort from the fact that as your competitors succumb to the temptation to cut tax corners, they're almost certainly also cutting quality corners cuz they think they can get away with that too. You take the high road, tax wise and quality-wise, and hopefully you'll be rewarded.

 

It's not like you've got a lot of choices anyway. You can either join the lawbreakers and cut corners and taxes, or tough it out on the high road. It's surprising how often the public twigs to the fact that they are better off paying a little more.

 

JF

[workwear]

Bomb the buggers, or find a middle road to survive on and hold out for a few years till the corner cutters get weeded out. There have always been problems in dealing with the competition for a lot of different reasons and most of them have involved pricing of services. Take comfort from the fact that as your competitors succumb to the temptation to cut tax corners, they're almost certainly also cutting quality corners cuz they think they can get away with that too. You take the high road, tax wise and quality-wise, and hopefully you'll be rewarded.

 

It's not like you've got a lot of choices anyway. You can either join the lawbreakers and cut corners and taxes, or tough it out on the high road. It's surprising how often the public twigs to the fact that they are better off paying a little more.

 

JF

 

 

with all do repect you preach a great sermon....

 

 

but now do tell us ....or me for that matter ...how in the world is this tax benficial.....to a small buisness....

 

it isnt!!!

 

no tax grab is benficial to a buisness...... there is a fine line where the public agree's to pay for taxes and expects to get services out of it....but when the consensus is nothing more of a tax grab....it will drive small biz underground....its been proven before and its gonna happen again....and the honest dude is gonna get crushed...ive seen it in the jewlery biz...they get taxed something like 20 points or more.....they have been doin biz under the table for over 20 years that i know of....and you know what most of them are still in biz.....cmon lets wake up here a little ....this is a bad tax!!!....any more tax is bad period.....convice me how this can and might be good for me......i dont think you can.....or any politician for that matter.....it sucks .....huge ones!!!!

[backbay]

I'm the membership director at my squash club. 8% hit to everybody next fall when annual dues are paid.

My girlfriend runs a club, and is in charge of special events. I haven't looked closely at the bill, but I think there's going to be a lot of people wanting to schedule their weddings before the end of June.

 

Our "benign" inflation level has just jumped large: I wonder if the HST will be omitted from the CPI?

[Cookslav]

There is no benefit what so ever unless your part of the government.

Regardless of how you slice it we the consumer pay more money to the government....

 

Its dumb.

We're already taxed to death, and our cost of living is about to take another hit.

 

Here's a dead simple reason why I think its dumb

 

More money to the Government = less money in my pocket = less money to spend in the economy = deeper recession

 

Big business or little business alike will see a hit when we stop spending an extra 5-8%/year

If You want to see us spend our way out of recession...LOWER taxes

 

But this whole HST crap has nothing to do with the economy anyway....its all about paying some of the debt the liberals have dug into before they call the next election(just trying to minimize the dammage IMO)

Edited December 10, 2009 by Cookslav