No shortage of HST doubters, says McGuinty
WINDSOR, Ont. - There may be some doubters in the Liberal ranks about tax harmonization, but that shouldn't stop Ontario from forging ahead with the controversial plan, Premier Dalton McGuinty said Saturday.
Even his own mother has a name for it: "Holy sales tax!"
But party members must be honest with the public about every obstacle his government faces, from the eHealth scandal over untendered contracts to Ontario's looming $24.7-billion deficit -- the largest in the province's history, McGuinty said.
"We need to talk about these things, we shouldn't run away from them," he said. "We're moving ahead with the HST because at heart, we think it's the right thing to do."
He also advised party members during a closed-door session to offer a mea culpa to voters angry about the province's botched, $1-billion effort to create electronic health records.
"I said one of the things that I would like to have as a characteristic widely perceived of our government is that we are honest," McGuinty said.
"I just said, 'You know, we came up short, and if you're asked about it, you need to say that. You need to admit to that.' We made a mistake. We're making some changes to make sure it doesn't happen again."
McGuinty seemed determined to tackle the doubters head-on during a speech Friday night, which made pointed references to the HST and his decision to move ahead with a $1.5-billion-a-year program to provide full-day kindergarten for four- and five-year-olds despite the huge deficit.
There are "difficult choices" ahead, but the government won't "hack and slash" to balance the books, he told the crowd.
The world has changed and the question the party now faces isn't "what do voters want," but what can it do to make sure the province grows stronger, which includes the HST, McGuinty said.
"It's been said that ships are safe in habour," he told the crowd. "But that's not why we build ships. We build ships to sail the open seas.
"So this government could seek sanctuary in some safe harbour. But that's not what we were commissioned to do."
Opposition parties have labelled tax harmonization a massive tax grab because it will increase the cost of many items currently exempt from the provincial levy with few exceptions.
It's only "natural" for skittish Liberals to ask questions about eHealth and his government's plan to merge the eight per cent provincial sales tax with the five per cent federal GST next July, McGuinty said.
And it's his job to speak to reassure them, he added.
But it was Revenue Minister John Wilkinson who ended up responding to HST questions that came up during a question-and-answer session with the Liberal caucus on Friday night.
One woman from Mississauga, west of Toronto, who spoke up at the meeting asked whether her condo fees would go up.
"I'm wondering, since we're living in such economic hard times, why this is a good time to implement the HST?" said the woman.
"And also, how are we getting a message out to all the negative comments that are in the paper and what we're going to do to promote this HST if it's such a good thing?"
A woman from the eastern Ontario city of Kingston also got up to seek assurances that the new tax scheme wouldn't hurt non-profit charities, such as the seniors' association she works for.
People "aren't always believing" her when she tells them that the HST will be revenue-neutral, she said.
"I have to tell you that we've been hard hit by the recession," she said. "And our association is terrified that the harmonized sales tax is going to put us over the tipping point."
Condo fees won't be subject to the harmonized tax, but some of the costs that make up the fees will, Wilkinson said. As for charities, the province has set up a series of HST rebates to ensure that those organizations won't be punished by the new tax, he said.
Federal Liberal Leader Michael Ignatieff turned up Friday night in a show of party solidarity and praised McGuinty's decision to go ahead with full-day kindergarten.
"When I see a Dalton McGuinty get up in the teeth of a recession, in the teeth of a deficit, and commit to full-day kindergarten, I am proud to be a Liberal," he told the crowd.