Defending the HST

So a lot of people out there are telling you that the Ontario and BC governments are raising your taxes. How you ask? The HST they tell you. Your (un)friendly neighbourhood curmudgeon is here to tell you otherwise. The HST will save businesses money. The HST will increase investment in Ontario and BC. The HST should drive consumer prices down overall.

First, a bit of a history lesson. The Ontario and BC governments announced plans to harmonize their provincial sales taxes with the federal goods and services tax to create a combined tax; the harmonized sales tax (HST). Everyone panicked and got all up in arms thinking the price of goods and services in Ontario and BC will go up. These people are ignoring the fact that harmonization already happened in New Brunswick, Nova Scotia, Newfoundland and Labrador, and Quebec. And the overall consumer prices in those provinces are no worse off than they were before. A study by Michael Smart for the CD Howe Institute suggests otherwise; consumer prices fell. But most people west of Quebec fail to recognize there is anything east of Ottawa and began to create anxiety with wild stories of tax hikes and Armageddon.

The truth is the HST is going to be good for all of you. First, the cost of doing business in Ontario and British Columbia is going way down. Business owners currently pay 8% PST in Ontario and 7% PST in BC on items consumed in operating their business; generally anything that is not directly resold or further processed or manufactured. That 8% and 7% is not currently recoverable. Post harmonization, the PST going away and is being replaced, for the most part, by the fully recoverable HST. Most businesses will pay a combined 13% or 12% and will be entitled to an equal and offsetting credit. That means there will no longer be any unrecoverable sales taxes payable by businesses. So, businesses save money.

The tax savings realized by business will lead to more investment. With more money in hand, businesses will be able to invest more in new technology and new people. We will all benefit. It's the trickle down effect, the money businesses save and invest lead to more money for other businesses and that trickles down to me and you (hopefully more to me).

It is true that consumers will initially pay more direct sales tax than we currently do as things like houses and services are subject to tax at 13% in Ontario or 12% in BC rather than the current 5% GST rate. However, those houses and services have an indirect tax component (the 8% PST in Ontario and the 7% in BC) that we currently don't see, so the true tax increase is probably more like 2% (based on a study performed a long time ago in NFLD that I cannot share with you). That indirect tax is removed and, provided vendors pass those savings along, the true impact won't be that bad.

Now there are problems, of course, like charities, colleges, universities, hospitals, etc. will pay more taxes and they generally don't recover the HST they pay in the same way as ordinary businesses. I've studied the impact on a few of these organizations and found that, due to a gracious HST rebate mechanism, they will in fact be better off. This may not be true for all, granted, but I assume that the Province will provide additional funding for those organizations that it is required to fund.

I haven't gone into hardly any detail here (BTW, this is my area of expertise), but I hope to make two points to all of you. 1) it's all going to be OK, in fact, it will probably be better after the first few years; and 2) if you run a business, pass those Ontario PST savings along. This is crucial to all of us.

One final point on whether or not the HST is a tax hike. Ontario and BC are losing their PSTs; the HST is a federal tax. While there is a complicated formula that creates a transfer payment from Canada to Ontario and BC, the truth is, harmonization will result in Ontario and BC collecting less tax, even with the transfer payment. This is not a tax hike folks, it is a reduction in overall taxes collected. Look it up, it's in the Ontario budget papers. The reason to harmonize it is to increase investment in the provinces and make the provinces more competitive in the global marketplace.

Now, sit back and relax. It's going to be OK. The world didn't end in the Atlantic Provinces and Quebec and it's not going to end in Ontario and BC.

Three Jerks on the Radio

I voiced my distaste for the Team 1200's morning show personalities in a recent post. My overall gripe is that on a morning sports radio show the hosts rarely talk about sports. Secondary to this is that they biased to the point that they don't even discuss other games. In fact, they rarely, if ever, talk about baseball, football or any sport without an Ottawa connection. Finally, they aren't funny at all. If they were funny I could probably live with the lack of sports content.

On Wednesday October 7th I conducted a bit of an experiment. I decided to track the content of the show to see if it was just me getting my hate on or if the jerks really ignore the sports content in their morning sports show.

Before I get into the details I should briefly touch on the general format during my listening time (7 am to 7:45 and 8:30 am to 8:50 am). The show has a 1 to 3 minute sports update every 20 minutes by someone other than the jerks. Pretty standard sports radio fare. So 3 to 9 minutes of every hour has guaranteed sports content. There are traffic and weather updates as well. Finally, there is a contest every day called the Dirty Dozen at around 7:30. Callers are asked 12 questions and if they get at least 6 right they win. If they don't they have to recite some stupid "I am not a man" speech.

For purposes of this experiment I've restricted my notes on the content to the discussion by the jerks. I'm ignoring the 20/20 update and the traffic and weather. The jerks get a point for every segment that involves sports and lose a point for every segment that doesn't. You'd expect the score to be above zero. Anything below zero is a fail.

Today the first words I heard from the jerks were a discussion of David Letterman's apology to his wife followed by the attractiveness, or lack thereof, of said wife. Score - 1 for the jerks.

Next up was some praise for their Swedish God's goal against a guy in his first ever NHL game (a goal he should score). Score back to even.

This was followed by an interview with Cyril Leeder, president of the Sens that began with a chat about Homer Simpson. They played the Simpsons "na, na, na, na, na, na, na, na leader" (think Batman) clip as the intro which brought Homer about. I'll be generous and give the jerks another point since Mr. Leeder has a sports connection.

The interview with Cyril Leeder continued with a request to bring back the ice girls that shovel the snow during breaks in the game. I already gave you a point for the interview, but I'm taking one away now because the request lead directly to a conversation about whether or not a girl wearing a hockey helmet was sexy. They then try to make a joke about needing to wear a helmet while ploughing (their word, not mine) your wife. Not funny at all. Score back to zero.

The Dirty Dozen was up next with the categories being New York Islanders dynasty, sports siblings and the Rideau Canal. 2 points for the jerks and 1 against since there was no sports connection to the canal questions. The jerks are above water.

At this point I went to the office to grab some supplies and came directly home to jump in the car and drive about 25 minutes west of my home. A perfect opportunity to continue the experiment. This particular portion of their show included chats about:

• Boston Candy (-1);
• teen drinking (-1);
• smashing cars (-1);
• hat trick trivia (+1);
• travelling to Jamaica (-1);
• starvation insurance (-1);
  
• fighting in hockey (+1);
• leafs suck (+1);
• Brittania drive-in (-1); and
• Letterman's wife again (-1).

You should double check my math, but the total score I have is -3. I can live with some non-sports banter from time to time, but this is an average day with more non-sports chat than sports chat, not to mention no discussion of:

• the huge playoff game between the Tigers and Twins to decide who gets to make the ALDS (the Twins won in extra innings);
• out of town hockey games, like the exhilarating Flyers v Caps game; or
• any other actual game that happened the night before or upcoming Wednesday night other than the Sens beating the Leafs.

You'd think in a city of 1,000,000 people you could find 3 interesting people, with good voices, that have sports knowledge and a bit of charm.

If you want to hear real sports radio, check out the Team 990. Sure, they talk about the Habs a lot but they also understand that there are other teams in the NHL and other sports that people are interested in hearing about.

Office Hovering

Hey Office Hoverer. You know who you are. You stand by the door hovering while I have a conversation with my colleague. You have something to say to one of us and it must be important because you just stand there waiting while we talk about whatever subject we are talking about. I assume if it wasn't important and timely you'd just go back to your desk and check in later. But you don't, you stick around, hovering. But if it's so important and timely, then why don't you interrupt us and say whatever it is you have to say. It'd be way better than having you hover there.

You Can't Buy "Being Green"

I wake up to the radio every morning. It annoys me and I'm not sure why I do it. I suppose I should just use an alarm sound, a CD, an MP3, or anything other than those 3 jerks on the Team 1200 who never talk about sports unless it's about the Swedish God Daniel Alfredsson. But my rant today isn't aimed at the Three Jerks on the Radio. No, today I've got a gripe with a particular advertisement that I hear every morning.

The ad is for a hot tub and the selling point is that this particular brand of hot tub is "green". I'm not going to name the company because they shouldn't get any free air. But I just don't see how buying a hot tub could ever be considered being green. If you buy a hot tub you are going to be using more water and energy than you currently use. Being green means consuming less energy and less water than you currently do. In fact, you should consume as little as possible. Being green does not mean buying a product that consumes less energy and water than its counterparts, especially when that particular product is one that you can live without.

Jerks.