Leave a commentThe 8% Ontario sales tax and the 5% GST are being combined into a single 13% value-added sales tax that will be federally administered, starting July 1, 2010.
Consumers will now have to pay 13% HST on all goods and services on which they previously paid 5% GST, except for several items which are currently RST exempt and will not be subject to the provincial portion of the HST. The following are some made-in-Ontario components:
- Books, children’s clothing and footwear, diapers, children’s car seats and car booster seats, and feminine hygiene products would be exempt from the 8% provincial portion of the tax.
- Purchasers of newly constructed homes under $400,000 will not be subject to an additional tax burden. Buyers of new homes valued between $400,000 and $500,000 can claim a proportional rebate.
- New rental housing rebate, similar to the enhanced new housing rebate, for new residential rental properties.
- Up to $400 million in one-time sales tax credits will be provided to help small businesses make changes to point-of-sale and accounting systems.
- Provincial portion of the tax rate on transient accommodation, such as hotel rooms, will rise from 5% to 8%. Approximately $40 million a year will be allocated to support destination marketing in Ontario tourism regions once these are established.
- Additional point-of-sale exemptions announced November 12, 2009:
- Print newspapers
- Qualifying prepared food and beverages that are ready for immediate consumption and are sold for a total price of not more than $4.00
- Used vehicles purchased privately (not from an HST registrant) will still be subject to a retail sales tax of 8%.
The Ontario Ministry of Revenue has a page titled “What’s Taxable Under the HST and What’s Not?“. The tables on this page show in detail which items will be subject to a higher tax under the HST, and which ones will not.
For more information, please visit TaxTips.ca/Ontario HST .