Bluff Revealed

Government of Ontario has ignored its moral and fiduciary duties of explaining to Ontarians the impact of “Single Tax” legislation (Harmonization).

We can argue whether it was by design or not, but with the process of pushing this measure down our collective throats almost complete, an average person still does not know what impact it will have on  her/ his wallet.
Most of our elected representatives have let us down too. I do not remember receiving any communication from my liberal MP in Richmond Hill on the subject of harmonization.
Try to ask 10 of your friends or colleagues whether they know what impact single tax will have on their budget. You will find out that most of them can not answer this question.

Here is what your government does not tell you:

• Single tax will increase the tax burden for an average middle-class family by approx 1,000 to 1,500 annually (this web site will help you find out exact figure for your situation)
• If implemented, tax increase is here to stay. You will pay more tax every year in perpetuity. The so-called “Transition Help” is a one-time payment. This bone that government throws you will be here in the 1st year only.
• The only permanent tax reduction that comes with “Single tax” legislation will apply to lowest bracket of up to $ 36,848 of income and will not offset the tax increase for most middle – class families. For example, according to my calculation, 2-person family with 2 cars and 2 kids will pay around $ 1,800 more sales tax annually while income tax reduction will amount only to $ 668 , for the net effect of 1,161 in additional tax.
• The tax increase that hurts consumer can not be good for business.
• The tax increase will reduce the government tax base by pushing many business transactions underground. Right now, if you pay your home improvement contractor or car mechanic “under the table”, you save 5% in GST. 
  Consumers will have way more incentive for “under the table” payment if they can save 13 % (new “Single tax” rate) vs. 5%. This will have ripple effect – (a) governments will not receive 13% of HST and (b) income tax from transaction will not be paid because it will not be reported on contractor’s side.
• Any increase of tax provides disincentive for people to work. The current marginal tax rate for anybody making more than 81K a year is 43 % !! Isn’t it insane ? You pay 43 cents of every dollar earned above that amount to the government ! That is just the income tax. Now they also want to add 8% tax to many goods and services that you purchase, such as gas, utilities and services. At some point, people will stop working and being productive when they know that all money they make goes to the government.