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Retail Council applauds Ontario’s tax harmonization


March 27, 2009
By Retail Council of Canada

March 27, 2009 – Retail Council of Canada (RCC) applauds the Ontario Government for
taking the bold step in today's budget announcement to harmonize the
provincial sales tax (PST) with the federal Goods and Services tax
(GST).

Retail Council of Canada (RCC) applauds the Ontario Government for
taking the bold step in today's budget announcement to harmonize the
provincial sales tax (PST) with the federal Goods and Services tax
(GST). RCC believes that tax harmonization will decrease the
administrative burden on retailers, allowing them to be more
competitive.

"Harmonization will result in a simpler and more efficient tax system
for Ontario businesses," said Gary Rygus, Director of Government
Relations, Retail Council of Canada. "This will help small retailers in
particular, who find administering two separate tax systems difficult
and costly."

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Retail Council of Canada is also encouraged that the government has
used offsets to reduce the burden on consumers by introducing a sales
tax credit and base exemptions – in particular those relating to
children's clothing, books and others.

"It is crucial for retailers that they continue to have the freedom to
show the tax at the point of sale," Rygus added. "This will allow
Ontario retailers to remain price-competitive with their counterparts
in Manitoba, Quebec, the United States and elsewhere. We will be
working with the Ontario and Federal governments to ensure this
happens."

For many years, Ontario has had a spending problem, not a revenue problem, and this budget does nothing to counter this trend.

The provincial labour minister's recent wrong-headed decisions have
also contradicted the government's overall claim that it is "Open for
Business." For instance, the budget confirmed that the government is
moving ahead with minimum wage increases, which will be particularly
negative in the current economic climate. And the plan to proceed with
mandatory WSIB coverage for owners of construction companies is nothing
more than an annual 500 million dollar tax grab.

So, although the tax and regulatory burden reductions will be well
received by Ontario SMEs, many negative factors still remain in
Ontario's approach to the sector that provides the jobs and wealth
creation in difficult times.


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