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  • Kate McInturff Fellowship in Gender Justice September 19, 2018
    The CCPA is pleased to announce the creation of the Kate McInturff Fellowship in Gender Justice.This Fellowship is created to honour the legacy of senior researcher Kate McInturff who passed away in July 2018. Kate was a feminist trailblazer in public policy and gender-based research and achieved national acclaim for researching, writing, and producing CCPA’s […]
    Canadian Centre for Policy Alternatives
  • The buck-a-beer challenge Ontario deserves September 6, 2018
    Ricardo Tranjan proposes an alternate plan to Doug Ford's buck-a-beer challenge in the Toronto Star.
    Canadian Centre for Policy Alternatives
  • Growing number of professionals face job insecurity, study finds September 6, 2018
    The Toronto Star's Sara Mojtehedzadeh discusses the findings of the CCPA Ontario's report, No Safe Harbour and gathers firsthand accounts from precariously employed professionals who live and work in Ontario.
    Canadian Centre for Policy Alternatives
  • Our Schools/Our Selves: The view from West Virginia September 4, 2018
    Our latests publication, Lesson Here, digs in to the West Viriginia teachers' strike.  Read the firsthand accounts of the work stoppage here.
    Canadian Centre for Policy Alternatives
  • What do the two largest mining disasters in Canada's and Brazil's history have in common? August 20, 2018
    Tailings dam spills at Mount Polley and Mariana: Chronicles of disasters foretold  explores the many parallels between the tailings dam spills at the Mount Polley mine in British Columbia, Canada, and the Samarco mine in Mariana, Minas Gerais, Brazil. The Mount Polley disaster took place in August 2014, when the dam holding toxic waste from […]
    Canadian Centre for Policy Alternatives
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The Progressive Economics Forum

HST Without Harmonization

A recent letter from economists nicely summarized the two main theoretical arguments in favour of the HST: “Businesses, large and small, will face lower administrative costs from complying with one sales tax system instead of two. Lower business costs, especially on capital equipment, will encourage investment and economic activity.”

Both arguments make sense in a stylized model of replacing retail sales taxes with a value-added tax on the GST base. But as I have noted before, the provincial portion of Ontario’s HST exempts some products that are subject to GST and applies to other products that are GST-exempt.

Not surprisingly, the BC government is also “rebating” the provincial portion of its HST on certain items. Indeed, yesterday’s Globe and Mail contained an interesting catalogue of the differences between the HSTs in Ontario and BC. So, businesses are still complying with as many sales-tax systems as before: the federal GST, the provincial portion of Ontario’s HST, and the provincial portion of BC’s HST.

The second pro-HST argument overlooks the exemptions for capital equipment in the former provincial sales taxes. Businesses were already benefiting from sales-tax breaks on major investments.

I made that point repeatedly on this blog and about a year ago in The Globe and Mail. My colleague Kim Pollock did so more recently with specific reference to BC’s forest industry.

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