Harmonized Sales Tax: Why?


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Essay #: 058448
Total text length is 8,596 characters (approximately 5.9 pages).

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The beginning:
Harmonized Sales Tax: Why?
The Harmonized Sales Tax, or HST, has been implemented in several provinces across Canada and is planned to be implemented in British Columbia in 2010. A combination of two different taxes, namely a Provincial Sales Tax (PST) and the federal Goods and Services Tax (GST), the HST usually acts to increase the overall tax burden on consumers because of the fact that the federal government insists on matching rates for harmonization, and the GST is in many cases higher than PST rates. In this way, the HST has caused both consumers and local business owners to become upset, because they believe it will increase their costs. The provincial governments have argued, on the other hand, that although consumers may bear...
The end:
.....e imposed as a hidden value-added tax, rather than a selective external tax, it might be possible to offset political concerns and provide a psychological boost to spending and the GDP of the country.References
Murrell, D. and Yu, W. "The Effect of the Harmonized Sales Tax
on Consumer Prices in Atlantic Canada." Canadian Public Policy 26.4 (2000): 452-461.
Sherman, D. "Policy Forum: Tax-Included Pricing for HST—Are We
There Yet?" Canadian Tax Journal 57.4 (2009): 839-856.
Smart, M. The economic impacts of value added taxation:
Evidence from the HST provinces. Toronto: University of Toronto, 2007.
Smart, M. and Bird, R. "The Economic Incidence of Replacing a
Retail Sales Tax with a Value-Added Tax." Canadian Public Policy 35.1 (2009): 85-97.