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June 16, 2006
Tax rage!
This story is missing all kinds of information:
To reduce the GST, the city [of Toronto] would have to change billing systems, websites and printed publications to reflect the new, slightly lower fees, staff reported.
It might also force an amendment to the municipal code or other bylaws.
So ostensibly they're just not going to do it. Everything run by the city — golf courses, parking lots, whatever — will continue to charge 7% "GST", or so The Sun tells us. (This article suggests the city just won't be refunding already-paid fees, which would make more sense, but it doesn't explain the entire Sun article, as you'll see below.)
Point is, the GST will be 6% on July 1. There's no "wiggle room". If you're charging a 7% tax, it's not the GST. If the $10 widgets I sell in Calgary continue to ring up at $10.70 after July 1, then I have raised the price of my widgets by $0.10. This is well within my rights, but it can't possibly be legal to overcharge on a tax and pocket the change. But it sure sounds like they're going to try:
…councillor and city budget chief David Soknacki said he agrees with staff that the administrative costs will catch up with any small savings taxpayers might get, wiping out the benefit.
"With any luck we won't have to raise fees as much next year," Soknacki said.
It's like something from an alternate universe. Changing your systems to deal with a tax change is just a cost of doing business — even for cabs, who are supposedly "not switching because each cabbie would lose a half-day's work getting the meter changed." Sure they would. We are to believe that somewhere in the Gordian circuitry of a Toronto taximeter is a white-hot uranium 7, which would need to be carefully replaced with a white-hot uranium 6. Ridiculous.
It should take 30 seconds to make the change — if it takes half a day, well, they bought some pretty crappy meters, didn't they? With Pulsar Technology Systems' taximeters, you can "change rates instantly with the push of a button." Centrodyne's offer easily "programmable tax rates". I suspect this "half a day" thing involves the testing any meter has to undergo once it has been altered. Perhaps the City could make an exception in this case. If not, tough luck. Not only am I not going to pay 7% GST on my cab fares, but I'm going to slash my baseline taxicab tip rate from 20% to 10% to (over)compensate. Fa fa fa!
Posted by Chris Selley at June 16, 2006 08:34 PM
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Comments
The GST reduction, the largest single transfer of wealth to private corporations in the history of Canada. No company (or city) is going to reduce what it charges for a service...the price has been established already by the market.
Posted by: loopy at June 18, 2006 12:57 AM
Two thoughts:
1) If an organization collects "too much" GST, I think they have to give all money collected as GST over to the feds, not keep the extra bit for themselves.
2) Does anyone believe that if taxes were going UP by 1% the city would say "Oh, that's too much trouble... we'll continue to charge the lower rate"?
Posted by: Brian ![[TypeKey Profile Page]](http://www.tartcider.com/blog/nav-commenters.gif)
at June 19, 2006 02:47 PM
Many nations have sales taxes or VAT that changes every year to match budget surpluses/deficits. California for instance changes its sales tax every year. Many European nations change the VAT regularly (such as Germany going from 16% to 19%). These folks just assume that timid Canadians will just roll over and take it. I think they are right. After all the average Eastern Canadian MO is "avoid conflict and ill will at all cost."
Posted by: Joe at June 22, 2006 05:07 PM
Many nations have sales taxes or VAT that changes every year to match budget surpluses/deficits. California for instance changes its sales tax every year. Many European nations change the VAT regularly (such as Germany going from 16% to 19%). These folks just assume that timid Canadians will just roll over and take it. I think they are right. After all the average Eastern Canadian MO is "avoid conflict and ill will at all cost."
Posted by: Joe at June 22, 2006 05:08 PM