Ontario passes HST legislation

TORONTO — Ontario legislators on Wednesday passed controversial tax legislation that will result in higher costs on about one in five items beginning July 1.

The 13% harmonized sales tax (HST) is part of a larger budget bill being debated at Queen’s Park. Provincial politicians are currently debating the measure.

Conservative MPP Lisa MacLeod acknowledged her party fought “an uphill battle” against the HST which roughly 75% of people oppose, according to polls.

“We did everything we could to stop this $3-billion tax grab on families and the middle class,” Ms. MacLeod said Wednesday morning in the legislature. “You should be ashamed of yourselves, Liberal party.”

On Tuesday, Ontario native chiefs said they are about to launch a campaign against the HST, including road blockades and traffic disruptions and unspecified legal action.

The HST in Ontario would also eliminate the existing exemption for First Nations from paying the provincial sales tax.

The chiefs say imposing the tax without consulting natives is an attack on their sovereignty and a breach of governments’ legal duty to consult First Nations on matters that impact their rights or title.

Despite the opposition, economists are widely in favour of the move, which they believe will increase jobs and make the province more competitive.

Four other Canadian provinces have implemented their own HST. British Columbia is contemplating a similar move.

The HST will combine the current 8% Provincial Sales Tax with the 5% federal GST. A range of items previously untouched by the PST — vitamins, domestic air travel and Christmas trees, for example — will be taxed. To ease the pain, the province will offer tax cuts, credits and exemptions, plus a one-time $1,000 payment for most families.

It will be up to the federal Conservatives to pass separate legislation triggering a $4.3-billion transfer to Ontario to enable the transition to the tax.

Ottawa Citizen, with a file from Jorge Barrera (Canwest News Service)