Close X
Saturday, January 11, 2025
ADVT 
National

GST break would cost Ottawa $2.7B if provinces with HST asked for compensation

Darpan News Desk The Canadian Press, 09 Dec, 2024 01:11 PM
  • GST break would cost Ottawa $2.7B if provinces with HST asked for compensation

The federal government's GST holiday would cost as much as $2.7 billion if provinces with a harmonized sales tax asked for compensation, the parliamentary budget officer said on Monday. 

But the decision from some provinces with an HST not to demand compensation for their portion of lost revenue lessens the cost on Ottawa significantly. 

The Liberal government intends to lift the federal sales tax on a slew of items between Dec. 14 and Feb. 15, saying it's aimed at helping people struggling with affordability.

All Canadians will save at least the five per cent goods and services tax on purchases like children's clothing, video games and restaurant meals. 

But in Ontario and the Atlantic provinces, the provincial and federal sales taxes are blended together into a harmonized sales tax, which means people in those jurisdictions will get a larger break of between 13 and 15 per cent.

The PBO estimates the tax break will cost the federal government $1.5 billion, in line with the Liberals' own estimate of $1.6 billion.

However, the budget watchdog notes that if provinces with a harmonized sales tax don't waive the compensation requirement in their agreements with Ottawa, it would cost $2.7 billion.

Ontario, which stands to lose the most HST revenue, says it will not seek compensation from Ottawa. 

Colin Blachar, a spokesman for Ontario Finance Minister Peter Bethlenfalvy, says the move will provide "nearly $1 billion in additional relief for Ontario families."

A spokeswoman for Finance Minister Chrystia Freeland encouraged all provinces to waive their sales tax following the PBO report. 

"We hope all provinces will join us and provide their share of tax relief for their residents over the holidays, as Ontario, P.E.I., and Newfoundland and Labrador have done. This tax break will help all Canadians in every province," said Katherine Cuplinskas in a statement.

Saskatchewan Premier Scott Moe has said his province would not match Ottawa's GST holiday. 

He said some of the provincial sales tax goes toward municipalities and that his government has implemented other measures to reduce costs, including reducing personal income taxes and removing the carbon levy from home heating.

MORE National ARTICLES

B.C. RCMP say multiple victims injured in single vehicle crash

B.C. RCMP say multiple victims injured in single vehicle crash
Mounties on Vancouver Island say they are investigating a single-vehicle crash that left "multiple" people injured.  Sidney North Saanich RCMP say officers were called to a shopping plaza in Sidney at about 2:30 p.m. 

B.C. RCMP say multiple victims injured in single vehicle crash

More medical, law enforcement testimony expected in human smuggling trial

More medical, law enforcement testimony expected in human smuggling trial
The prosecution is expecting to wrap up its case today in the trial of two men accused of human smuggling at the border between Manitoba and Minnesota. Steve Shand and Harshkumar Patel have pleaded not guilty to charges stemming from several border crossings in 2021 and 2022.

More medical, law enforcement testimony expected in human smuggling trial

Surrey RCMP rolling out body cameras

Surrey RCMP rolling out body cameras
Surrey R-C-M-P says they will announce the rollout of body-worn cameras today.  The rollout will be the largest deployment in the province with more than three-thousand cameras expected. 

Surrey RCMP rolling out body cameras

Parole board 'working' to have Bernardo victims' families attend hearing in-person

Parole board 'working' to have Bernardo victims' families attend hearing in-person
A lawyer representing the families of two teenage girls murdered by notorious killer and serial rapist Paul Bernardo said they had been denied the right to deliver their statements in person at Bernardo's upcoming parole hearing. The issue was raised by Conservative Leader Pierre Poilievre during question period in the House of Commons Wednesday.

Parole board 'working' to have Bernardo victims' families attend hearing in-person

B.C. Conservative leader names shadow cabinet, gives job to controversial member

B.C. Conservative leader names shadow cabinet, gives job to controversial member
B.C. Conservative Leader John Rustad has assigned jobs to 41 of his 44-member caucus, including giving a critic's position to MLA Brent Chapman, who faced calls to step down during the campaign over controversial social media remarks. Several groups called on Rustad during last month's election to remove Chapman as his party's candidate over the posts, including one in which he called Palestinian children "inbred walking, talking, breathing time bombs."

B.C. Conservative leader names shadow cabinet, gives job to controversial member

Former PM Stephen Harper appointed to oversee Alberta's $160B AIMCo fund manager

Former PM Stephen Harper appointed to oversee Alberta's $160B AIMCo fund manager
Former prime minister Stephen Harper is the new chairman of the Alberta Investment Management Corp., which oversees more than $160 billion in funds, including pension funds and the Heritage Savings Trust Fund. The move comes almost two weeks after the province's finance minister fired the Crown agency's entire board, along with a number of executives, citing ballooning costs and substandard returns.

Former PM Stephen Harper appointed to oversee Alberta's $160B AIMCo fund manager