Province Details HST Exemptions
By 250 News
Tuesday, September 01, 2009 02:41 PM
According to the Provincial Minister of Finance, the introduction of the B.C. HST will make British Columbia one of the most competitive jurisdictions in the world for business investment, reducing the effective tax on new business investment by 40 per cent and resulting in significant investment and job growth.
It is estimated the HST will remove approximately $2 billion in costs for job-supporting B.C. businesses, helping enhance competitiveness, increase investment and productivity and promote job growth.
Savings include:
• $880 million for the construction industry.
• $210 million for the transportation industry.
• $140 million for manufacturing.
• $140 million for the forestry sector.
• $80 million for mining and oil and gas.
Collecting, accounting for, remitting and administering PST is a costly and complicated process for both the business owner and the provincial government. The proposed HST eliminates the current duplication of meeting separate requirements for PST and GST. B.C.’s businesses are expected to save $150 million annually in administrative costs under the new streamlined HST tax system.
B.C. will provide point-of-sale rebates, which are similar to PST exemptions, for the provincial portion of the HST on a number of consumer products including: gasoline and diesel fuel for motor vehicles, books, children’s-sized clothing and footwear, children’s car seats and car booster seats, diapers and feminine hygiene products.
The B.C. HST also includes the following measures:
• A partial rebate of the provincial portion of the HST for new housing to ensure that purchasers of new homes up to $400,000 bear no more tax than under the current PST system. Homes above $400,000 will receive a flat rebate of $20,000.
• A rebate for municipalities, charities and qualifying non-profit organizations so that, on average, they pay no more provincial sales tax under the HST than under the current PST.
• A B.C. HST Credit, paid quarterly with the GST and Low Income Climate Action tax credits, to offset the impact of the HST on those with low incomes.
• A temporary delay in the provision of input tax credits for certain purchases by businesses with taxable sales in excess of $10 million.
The provincial government also proposes to provide a provincially-administered HST Exemption for residential energy use.
The federal government will provide British Columbia with $1.6 billion in transitional funding to implement the B.C. HST. The full cost of B.C. HST administration will also be borne by the federal government, saving the Province an estimated $30 million annually in administration costs.
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Posted by: ammonra on September 1 2009 3:02 PM
"On average" means that some charities and non-profits will pay more and some less, but as a whole it will remain the same. I wonder if those charities that are going to pay more will be appreciate that, or whether it will be tha straw that breaks the camel's back for their activities. Many of these kinds of organisations use their finances to the alst penny, and any increase in costs is a disaster.