A taxing issue for the next election

Jordan Press
Kingston Whig Standard

After he walked into the upstairs dining room at Portsmouth Olympic Harbour yesterday, the leader of the province’s official opposition smiled.

Progressive Conservative leader Tim Hudak moved from table to table, shaking hands and drumming up support he says has been rising since the party’s leadership campaign earlier this year.

The visit did not happen by chance. Hudak has taken an interest in this riding, which has been held by Liberals for years, because of the backing he received from local members during his leadership campaign, but also because he believes it is one the Tories can pry away from John Gerretsen in the next election.

“This is a riding to contend with come the next election,” said Bill Giguere, president of the Kingston and the Islands riding association.

The visit, Giguere said, indicates Hudak’s interest in the riding, interest that has emboldened the local association to the point where he started talking tough.

“It’s time we had true representation in this riding,” Giguere said.

Giguere said the association is looking for a candidate to run in 2011. Having Hudak’s backing, he said, will make people not feel like they are being trotted out as a token candidate.

Hudak’s visit yesterday was about one issue the party will likely carry into the election: the planned combination of the GST and PST into one blended tax.

Hudak said the Liberal’s plan to create a harmonized sale tax is a “massive tax grab” that won’t help Ontario’s struggling economy. Yesterday, he highlighted the fact the new tax, which will add the 8% provincial sales tax to previously untaxed items, will add up to $1,300 to the cost of buying the average home in Kingston.

He suggested that could put several families off of buying a new home, especially first-time buyers.

With the automotive sector drowning in red ink and private industries having a rough time, the province needs the housing and construction sector “to be firing on all cylinders” to drive the economy, he said.

“A tax hike at any time is bad economics. A tax hike in bad economic times will kill jobs and hurt families,” Hudak said.

“During these tough economic times, I can’t believe our current government would contemplate bringing in a massive tax hike.”

The new tax comes into effect next July 1. The province says combining the two taxes will make Ontario more competitive when it exports goods, and could save businesses $3 billion annually from the costs of some goods from which they can’t deduct the PST.

The Tories want harmonization stopped in its tracks.

“We’re going to fight it tooth and nail and we need the public’s help,” said Lisa MacLeod, the party’s critic for revenue and government accountability.

Hudak and MacLeod spoke to a luncheon crowd of more that 60 people at Portsmouth Olympic Harbour yesterday, a crowd comprised of party members, realtors and home builders opposed to the harmonized sales tax.

During the meeting, which had a town hall feel, Hudak urged those present to spread the word about the effect the harmonized sales tax will have on the average Ontarian.

“When people start to see the sheer number of dollars being handed over to Mr. McGuinty as a tax grab, they get scared … and angry,” said MacLeod, who represents the eastern Ontario riding of Nepean-Carleton.

The Tories say that the cost of everyday items will go up. A drink at the local coffee shop, the morning bagel and even the cost of the newspaper will rise by 8% once the harmonized sales tax is in place. Home heating bills, Internet costs, gym memberships and children’s sports fees will also climb by 8% under the new tax, Hudak said.

Hudak said the harmonized sales tax would also remove the point-of-sale exemption farmers currently enjoy, Hudak said.

Gasoline costs will go up as well, MacLeod said. The Tories have estimated that for the average driver, fuel expenses will rise by about $200 a year.

Giguere said local party members plan to highlight the harmonized sales tax as an election issue, calling it “a huge nightmare.”

Another issue that has arisen is the idea of adding a second ferry to Wolfe Island during the summer tourism season, similar to what happens at Glenora, Giguere said. A second ferry could alleviate some of the long lines islanders find at this year, he said.

After speaking to the crowd, Hudak took questions which, he said, would be used to formulate the party’s platform for the next election, set for 2011.

One question Hudak didn’t directly answer was the gulf between the provincial party and the federal Tories. The Conservatives in Ottawa support a harmonized sales tax in Ontario.

Hudak said the province will receive $4 billion from Ottawa to help cover some of the increased costs associated with the new tax. Instead of using the money to lower taxes in other areas, Hudak said, the Liberals are giving payouts to businesses.

“Those cheques dry out after the next provincial election,” Hudak said.

“This tax is radioactive. Consumers know they’re the ones that are going to end up footing the bill.”