McGuinty family welcomes HST and fuel price increase
TORONTO - While scores of Ontario drivers were scrambling to fill up their gas tanks before the new harmonized sales tax kicked in on Canada Day, there was at least one who avoided the pumps.
Premier Dalton McGuinty says he's such a believer in the HST, his family waited until July 1 to gas up.
Instead of taking advantage of cheaper gas prices the night before, McGuinty says his wife filled up on Thursday when prices jumped eight per cent.
"I think that Terri waited the next day," he said with a laugh. "I don't think she rushed off to the pumps."
The new HST combines the five per cent Goods and Services Tax with the eight per cent provincial Retail Sales Tax into a 13 per cent harmonized sales tax, and gives businesses a break from the provincial tax they pay on all supplies and inputs.
B.C. has also imposed its own 12 per cent HST, but will not add any more taxes to gasoline or other fuels since the province already charges a carbon tax on fuels -- a levy Ontario does not have.
For consumers, the new blended tax in Ontario will be applied to about 17 per cent of purchases previously exempt from the provincial sales tax.
Critics of the proposal say it's a tax grab by the Liberal government in Canada's most populous province.
The biggest impact for most consumers will be on energy costs, with electricity, gasoline and diesel fuel -- along with home heating oil and natural gas -- all subjected to an extra eight per cent in sales taxes.
McGuinty said it's not an easy thing to ask people who've been "working so hard and so well" to pay more, but Ontario needs the HST to make it more competitive.
"We're not out of the woods completely yet, but the fact is the economy is going in the right direction," he added.
"And together we're going to do everything that is necessary to ensure that there continues to be economic growth, that there are jobs for us and our kids and that we've got the prosperity we need to support our schools and our health care."