The August Long Weekend and the HST It’s the most popular weekend for summer travel, and if you’re getting ready to go on vacation—whether you plan to camp, stay at a hotel or something in between—you’re probably wondering if it’s going to cost you more this year because of the HST. The HST should not hold you back.  Read more.

Why the HST?

Dozens of experts support the HST because it creates jobs, increases wages, lowers prices and will help BC businesses compete with companies across Canada and around the world.  Find out more.

Is it going to cost more to air condition my home this summer? HST will not increase your costs for oil, electricity, natural gas, or propane used to heat, cool or power your home. Find out about the Residential  Energy Credit.

220,000 Seniors Will Receive the B.C. HST Credit Under the HST system, there are a number of tax credits, rebates and exemptions that are particularly relevant to seniors.

More Jobs & Higher Wages The HST is expected to create 113,000 jobs in British Columbia. With reduced costs for employers, they can expand their business and pay higher wages.

Savings Passed on to Consumers The HST will remove hidden PST that is paid and compounded at every stage of a manufactured product.

Rebates for Families, Businesses & Individuals 1.1 million British Columbians will receive the B.C. HST Credit, businesses will save more than $2 billion and many items will be exempt.

It’s the most popular weekend for summer travel, and if you’re getting ready to go on vacation—whether you plan to camp, stay at a hotel or something in between—you’re probably wondering if it’s going to cost you more this year because of the HST.

The HST should not hold you back.  Here’s why:

You probably know by now that if you didn’t pay GST before on something, you are not paying HST on it now.

That includes basic groceries such as milk, eggs, bread, fruit, vegetables, fresh meat, poultry and fish.

Tax on your snack foods has increased. For example, you were paying five per cent GST on pop, chips, candy and chocolate bars. This increased to 12 per cent on July 1st. The result – a bag of chips that cost $3.15 with GST now costs $3.36 with HST.

Many of the items you use for camping like coolers, lanterns, tents, sleeping bags and BBQs were already charged 12 per cent tax (GST + PST). That remains unchanged with the HST.

If you’re checking into a hotel, you’ll pay slightly less tax under the HST. On July 1st, the seven per cent provincial portion of the HST replaced the previous eight per cent Hotel Room Tax. Some communities may also levy an additional local hotel room tax of up to two per cent for tourism marketing.

If you plan to travel by cruise ship, air, bus, or rail from B.C. to international destinations such as San Francisco, Las Vegas and Alaska, you will not pay any more tax than you did before July 1st.

If you plan to travel from B.C. to anywhere in Canada, you will pay more tax. Before July 1^st, domestic travel was subject to five per cent GST. Now you pay 12 per cent HST.

However, if you plan to travel on BC Ferries, no GST or PST was charged in the past and you will not pay HST now.

Finally, if you’re planning a road trip, you won’t pay the provincial portion of the HST on gas and diesel.

For more examples, please refer to the What’s Taxable and What’s Not list.

The HST will put B.C. farmers and ranchers on a more level playing field with farmers in Alberta and in other provinces that currently enjoy the advantages of a harmonized sales tax.

The B.C. Agriculture Council says the HST will have a “significant and positive impact on agriculture overall,” estimating primary producers such as ranchers will save about $15 million each year under the HST.

Under the PST, farmers receive an exemption from tax only on a limited list of items used solely for farm purposes. While farmers are able to claim an exemption from PST on certain types of farm equipment, such as tractors and incubators, they are required to pay PST on other types of equipment and goods they purchase for their business – and do not get any of that tax back.

Under the HST, farmers generally will be able to claim input tax credits for HST paid on all of their farm inputs used for commercial activities, including many that were taxable under the PST, such as farm trucks, excavators, culverts, barns, air compressors, forklifts, orchard heaters, computers, and other equipment.

The HST will also reduce compliance costs for farmers and the businesses that sell to them. Instead of the duplication that exists with two taxes, the GST and the PST, the HST has one substantially harmonized tax base and one set of administrative rules. B.C. businesses are expected to save $150 million annually in compliance costs under the new streamlined HST system.

As the Harmonized Sales Tax comes into effect on July l, about 1.1 million British Columbians, including seniors, will start receiving the new quarterly B.C. HST Credit.

Because you will pay more under the HST for some goods and services, the B.C. Government is providing an HST credit to reduce the impact on low and modest income British Columbians. The first cheques will be sent the week of July 5, 2010.

How much will you receive?

If you’re single and earn up to $20,000 a year, you can expect a B.C. HST credit of up to $230 annually.

If your family income is $25,000 or less, you’ll receive an annual B.C. HST credit of up to $230 for each family member.

Eligible singles and families above the income thresholds can receive a partial B.C. HST Credit.

Will the B.C. HST Credit help?

Example: family of four, annual income of $30,000

Under the old system, a typical family with an annual income of $30,000 paid $740 in Provincial Sales Tax (PST). With HST, they would now be expected to pay $967, meaning an extra $205 in tax. However, this family will now be eligible for a B.C. HST credit of $762.

So it turns out that under HST this family will have $535 more to spend on their family’s needs.

> See how the HST will impact other people with different incomes

You might wonder why HST is starting to show up on some of your invoices, like your cable bill.

Are you being double-taxed? No.

Companies that bill in advance for services provided on or after July 1, 2010 are required to collect HST. Companies are also required to collect PST and GST for services provided before July 1.

It’s necessary for all three taxes to appear on your bill during this transition, as your billing cycle is not likely to coincide exactly with the implementation of HST on July 1.

It is not double taxation: PST and GST are paid on services provided prior to July 1 and not on those provided after, and  HST is paid on services provided after July 1 and not on those provided before.

Find out more about what’s changing and what’s not with HST.

More information:

• HST Invoicing Requirements