I don’t see a lot of value in discussing the HST because:
- It’s boring for most people to discuss taxes, and
- There’s nothing anyone can do — decision’s been made.
Bottom line, here’s what’s happening. First, they’re changing all of the provincial tax rules that they’ve wanted to for ages. The HST project is too complicated for special interests to understand and complain about. This isn’t a straight combination of the provincial and federal systems, the government is increasing its cut.
Housing taxes are going to increase — the market is still hot so the brakes are going on, at least for new home sales.
Investment returns are going to drop. The government is pissed that returns have turned out to be largely fictitious so they’re rolling brokerage fees into the HST, thus decreasing net effective rates of return. This’ll make it harder for losing or break-even fund managers and brokers to ride along on the backs of unwitting clients.
Last, employment is taking a hit. The provincial ministry alone is shedding 500 jobs because they’re no longer collecting PST. The government is hoping that increased collection efficiency will decrease frictional costs to business and allow them to hire more: Trickle-down Reganomics, 80s-style.