Hudak bashes HST

Jordan Press
Ottawa Sun

Combining the GST and PST into one tax will make home ownership unaffordable for young families in Ontario, says the leader of the province’s official opposition party.

Progressive Conservative leader Tim Hudak said the Liberal plan to create a harmonized sale tax is a “massive tax grab” that won’t help Ontario’s struggling economy.

The Tories say that 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.

That could put several families off of buying a new home, especially first-time buyers, Hudak said.

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 July 1, 2010. 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 that they can’t deduct the PST from.

The Tories want harmonization stopped in its tracks.

“We’re trying to stop this tax,” said Lisa MacLeod, the party’s critic for revenue and government accountability.

“We’re going to fight it tooth and nail and we need the public’s help.”

That was partly what the two did yesterday.

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

During the lunchtime meeting, which also had a town hall-type feel to it, Hudak urged those present to spread the word around Kingston about the effects 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.

“They can’t afford Dalton McGuinty.”

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 all climb by 8% under the new tax, Hudak said.

Hudak said the harmonized sales tax would also affect local farmers. The tax would 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.

MacLeod said seniors could be hit the worst under the new tax.

“For people on fixed incomes this is going to be devastating,” she said.

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

Hudak said increasing taxes would become an obstacle to innovation and growth. He also said the province needs to remove red tape that prevents businesses from moving and emerging in Ontario.

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

Hudak said the province 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.”