HST Squeezes the Poor

McGuinty makes his move:

Ontario's Liberal government has introduced legislation to harmonize the province's eight per cent sales tax with the five per cent GST.

The bill, tabled Monday afternoon at Queen's Park, creates a single, 13 per cent sales tax that will take effect next July. The bill also includes a series of cuts to income, small business and corporate taxes that would take effect in January.

The province needs to make businesses more competitive so they can hire more people and lower prices for consumers, Finance Minister Dwight Duncan said. The tax package is about creating jobs and rebuilding Ontario's economy as it emerges from the recession, he said.

The bill provides for tax rebate cheques of up to $1,000 for families to help offset the impact of the HST in the first year.

The opposition parties call the HST a blatant tax grab that will add eight per cent to many items now exempt from the provincial sales tax, including gasoline, home heating fuel and hydro bills.

Ontario's New Democrats said the Liberal government is kicking people when they're down.

The Premier reacted to NDP concerns by accusing that party of living in the past and viewing all corporations as evil. It's an arrogant slap in the face to anxious Ontarians who had been hoping the government might address their concerns rather than those of the Liberals' largest campaign donors. In his condescending way, McGuinty dismisses those who worry that the government is placing the interests of Big Business ahead of those struggling to get by in these tough economic times, by characterizing them as blinded by old-fashioned leftist ideology. One might be forgiven for thinking that after capitalism's 2008 meltdown, a new approach was called for. But in the halls of power, neoliberalism is still king, and according to McGuinty, the people should shut up and make sacrifices so as to make Ontario businesses more "competitive".

Under the current tax system in Ontario, certain essential consumer goods are exempted from the GST, introduced by Brian Mulroney in 1991 in a bid to make Canadian exports more competitive. Some of these exempt items include basic groceries, prescription drugs, inward/outbound transportation and medical devices. Under the new Harmonized Sales Tax, the GST and PST will be combined to establish a basic tax rate of 13% on all consumer goods. As the opposition parties have suggested, this will dramatically raise the price of many basic survival items and impose a higher burden on the middle and working classes, particularly the poor and those who are currently unemployed.

The Liberals' decision to protect corporate interests rather than working families is a clear sign that they know which side their campaign bread is buttered on. It is essential that Ontarians see through McGuinty's gauze-covered lies and demand that their representatives support the struggling people who elected them. The votes on this bill may have been counted already, but it's not too late to organize a broad working-class movement that will counter the pernicious influence of Big Business on the Ontario legislature.