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| Harmonized Sales Tax (HST) |
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Harmonized Sales Tax includes:
Scroll down to find the information
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| What it means to BC homeowners and homebuyers |
On July 23, 2009, Finance Minister Colin Hansen announced that, effective July 1, 2010, BC will adopt a Harmonized Sales Tax (HST). BC's HST would combine the seven per cent Provincial Sales Tax (PST) with the five per cent federal Goods and Services Tax (GST) for a single sales tax rate of 12 per cent.
The introduction of the HST will significantly increase costs of purchasing new and/or pre-owned homes, as well as the operating, repairing or renovating of BC homes.
BC Government website for 'Frequently Asked Questions' on HST
The HST agreement in principle will not be signed until September 30, 2009 and full details will not be completely understood until after that time. With this in mind, Consumer Advocacy and Support for Homeowners (CASH) Society has provided its understanding of the additional costs HST will bear on BC homeowners and homebuyers.
New homes up to $525,000*:
According to the provincial government, on average 2% PST would be paid by the builder on materials and factored into the purchase price. Under the HST, the builder would recover any taxes paid and would not have to pass any taxes onto the consumer. The provincial government therefore argues at 7%, only 5% would be additional taxes. To ensure no increased costs for new homes up to $525,000.00, it will provide a 5% rebate for a maximum $26,250.00 rebate.
| New homes over $525,000*: |
A 7% increase on the amount over $525,000.
Note: New home property owners will receive a flat rebate of $26,250.00 (5% rebate for the first $525,000 paid).
* On November 19, 2009, the Province announced a proposal to increase the new housing rebate threshold from $400,000 to $525,000.
| Increased costs to real estate transactions |
Costs which were previously PST exempt such as labour and services will be subject to the HST as of July 1, 2010. These services include:
- Home Inspections
- Real Estate Appraisals
- Survey Certificates
- Real Estate Commissions
- Legal Fees
Increased costs of moving
7% increased costs for:
- The labour component of moving costs
- Utility connection fees
- Change of address costs
| Increased costs of operating a home |
7% increased costs for:
- Gas
- Electricity
- Telephone
Increased costs of home repairs and renovations
7% increased costs for:
- Delivery of goods
- Appliances
- Labour costs of renovations
- Material costs (minus the embedded PST) on fixed price contracts
| WARNING |
Paying cash without a contract or receipt of payment to avoid paying GST or the upcoming HST could put homeowners at risk of work being unfinished or not even started, shoddy construction, and liable for costs of injured workers not registered with Workers Compensation Board. Should something go wrong, there may be little or no recourse available to recover from losses without proof of payment or written contract.
| Links/events/emails to 'Protest the HST' |
Facebook Petition: http://www.facebook.com/pages/Petition-against-HST-in-BC/123656940961
The Citizen's Initiative to "Fight the HST": www.fighthst.com
BC NDP: http://www.bcndp.ca/hstpetition
Premier, Gordon Campbell's email : premier@gov.bc.ca
Minister of Finance, Colin Hansen's email: colin.hansen.mla@leg.bc.ca
