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Getting ready for the GST
Businesses are now able to register to collect provincial sales tax (PST) in anticipation of the removal of the harmonized sales tax (HST) on April 1.
While local businesses don’t have all the details, they don’t appear to be too worried.
“I found it fairly easy last time,” said Pacific Brimm co-owner Renate Child of the introduction of the HST in July 2010, but they haven’t received any paperwork or details about the switch back, so she doesn’t know what it will entail.
She said assuming the returned PST has the same exemptions, they will not be charging it, meaning a possible seven per cent reduction in the taxes they collect.
Several local businesses told The NEWS they are not ready for the switch and have received at most a letter saying more details are coming, but they didn’t want to go on the record and are optimistic the details will be worked out.
Kim Burden, executive director of the Parksville and District Chamber of Commerce, said he hasn’t received any feedback from the business community.
He agreed that the transition to the HST “was a bit of work, but it was not onerous,” and he expects the switch back to be similar.
“There will be a bit more paperwork,” he said, since businesses will have to remit two sets of paperwork again for the two taxes as they did before the HST.
“But it will also be a benefit to some businesses,” he said pointing to those in food services who will be collecting less tax.
Others are less optimistic for the consumer. “What happens to the end user? Who always pays? The consumer always pays for it in the end,” said Blue Door Audio Visual sales associate Tony DeMederios speaking on his own behalf.
“As soon as there’s a new system things go up and nothing goes back down when things change again, the consumer pays,” he said.
The province agreed to drop the 12 per cent HST after a referendum in August 2011. The province will return to the five percent GST and seven percent PST.
Finance Minister Kevin Falcon recently said the PST would be “improved” but will include all previous exemptions.
“It is dramatically improved, simplified, administratively more clear,” he told the CBC. “It’s not like the old piece of whatever you want to call it which was in place before, which was enormously frustrating for a lot of our small business community in particular.”
“There will be no PST on purchases like food, restaurant meals, bicycles, gym memberships, movie tickets or for personal services like haircuts, just as it was previously,” Falcon said.
There will also be changes in how businesses track and remit PST with a more convenient online system. Details to come.