Summary
HST, harmonized sales tax, is a tax that merges both the GST and PST together to create a 12% on goods and services. The government says that it will help create extra costs for businesses and consumers, but many people strongly oppose it. This new tax will not only apply to the goods and services that once applied to GST and PST. For example frozen pizza in a grocery shop does not subject to PST only GST but ion July 1, 2010 it will be subject to HST. Because of this, many people believe that it will make a difference in their day-to-day spending.
Connections
In Accounting 11, we learned that GST and PST are deal differently. PST is a sales tax charged to customers and put into an account called the PST Payable. It then is remit to the provincial government periodically. The GST on the other hand, is similar to the PST but it remit to the federal government. GST affects the GST Recoverable and the GST Payable. As shown above the two taxes are very troublesome having to take care of so many accounts, but in July 1 2010, there will be no longer GST and PST but HST. Wouldn’t taking care of one tax be less time efficient than two?
Reflection
Honestly, I can see the reason why nine out of ten people dislike this tax. Although the government says that, this tax will help the economy to become more competitive but I do not see how it will help. Many items are PST free but when the HST is out people would have to pay the whole 12%. In my perspective, this tax will affect many restaurant businesses because it use to be 7% on the bill but soon it will be 12%, but also keeping in mind that there should be a 10% tip. All this will have a great impact on the business because many consumers may not want to pay so many other fees for one simply meal.
