Would you like a tax with those fries?

Here in Ontario, the provincial government is introducing the HST (Harmonized Sales Tax) in July. Needless to say, the knives have come out on both sides of the argument. But, we’re certainly not alone: there are a lot of other provinces that already have it (British Columbia, New Brunswick, Newfoundland and Labrador and Nova Scotia). Not everything will fall under the tax umbrella. Although, I have to admit that there aren’t too many items that aren’t now taxed. At one time, any shoes costing less than $10 (sneakers, for instance) weren’t taxed. Food as a basic necessity isn’t taxed, but purchased prepared food at a restaurant or grocery store will be taxed. This is the crux of the problem for restauranteurs. They’re worried that a tax increase will put undue and detrimental pressures on their businesses. Perhaps it’s my practically non-existent math abilities, but a harmonized sales tax really shouldn’t increase the price of anything.

The way I understand it, it should really be just a change in how those taxes appear on the receipt. Right? Regardless of where you stand on the HST issue, it seems as if the real issue at question is what the purpose of taxation actually is. Ideologically, the taxes we pay really should be pumped back into society for the betterment of all. The HST should, then, reduce our income tax and lower the tax burden on low income earners. We’ll wait and see. Perhaps the problem is that we feel we’re not getting back anything close to what we put in. In France, taxes on alcohol and restaurant food were reduced by more than 70%. The result was that the loss in taxes was recouped by increased sales and jobs.

Will the HST keep you from going out to restaurants?