I'm so glad you could stop by. This is my personal blog of daily life and my journey through life. You will find a strong emphasis on family and friends as well as finding my ancestors through genealogy. Unlike my other blogs this blog is more of a catch-all so any topic is fair game.

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Friday, July 09, 2010

Ten Ways to Avoid Paying HST in Ontario

say no to HST
Towards the end of last year I posted about the proposed Harmonized Sales Tax (HST) scheduled to go into effect on July 1, 2010 in Ontario and British Columbia.  Despite campaign promises of new new taxes the HST effectively introduces a new 8% tax on 17% of consumer goods and services in Ontario.  There has been rather vocal opposition to the HST and continues to be opposition even though it is now in effect.  The HST has resulted in a dramatic increase in the underground economy to the point the McGuinty government has spent taxpayers dollars warning against using the underground economy to avoid paying the HST.  The bottom line is a price increase of 8% on anything right now while we are still in a recession is hitting people while they are still down.  The hardest hit will be those on fixed incomes.  Unfortunately in McGuinty's ultimate wisdom the HST now applies to home heating fuel, electricity and gasoline so unless you go solar or go without and don't drive a vehicle you will end up paying some GST.  The average person is expected to pay somewhere $1,000 extra per year as a result of the HST.  With a few shopping and lifesyle modification you can cut that cost by half if not more!  Here are ten ways to minimize what HST you have to pay and avoid the HST you can get away with not paying:

  1. utilities - Reducing the amount used will reduce the amount of HST on your utility bill.  Lower your temperature setting by 2ºC in the winter and raise the air conditioner setting by 2ºC in the summer.  Turn off the air conditioner whenever possible.  Winterize your home to reduce heating costs. Practice energy conservation.  The less energy you use the less impact by HST. If you can switch to wood heat since there is no HST on wood.  If possible switch to solar for supplemental heating and switch as much electrical use to solar as possible.  Ideally your home can be covered to fully solar for electricity and water heating.  This can be a DIY expandable project that doesn't break the bank but will eliminate electricity from the grid entirely saving you both the cost of electricity and the HST on it.
  2. underground economy - The underground economy is alive and well thanks to the HST.  Essentially what this means is you pay cash for goods and services.  The government would have you believe this is extremely risky but if you know who you are dealing with it isn't.  Use local services that will offer a discount plus no HST if you pay cash.  In older terms it meant doing something "under the table" so the concept is not a new one, it's just growing in popularity thanks to the HST.
  3. barter - Bartering has always been a frugal way of getting what you want without any cash outlay.  For example I trade some of my garden extras for other produce I don't grow or extra fresh caugh local fish.  Each person in the barter ends up with what they want with no money changing hands.  Hair cuts now have 8% HST added so a frugal person will either cut their hair themselves or trade something like extra produce or even offer to babysit the hairdresser's kids for a couple of hours in return for a hair cut.
  4. reduce spending - The reality is many spend simply for the sake of spending making no distinction between needs and wants.  
  5. yard/estate/garage sales and resale shops - Buying those items you need used is eco-friendly recycling and you avoid paying any HST.
  6. shop outside of Ontario - Washington State has announced that they will be giving BC residents a tax break for shopping there due to the HST.  That's a pretty good incentive for BC residents to shop in the US rather than BC.  In Canada BC, ON, NS, NB and NL have HST.  The rest of the provinces do not.  Those in ON close to the Quebec and Manitoba borders can shop there without paying HST.  Those in border areas to Minnesota, Michigan, and New York can shop in the US without paying HST although it may be assessed when returning to Canada if you were not out of the country for 24 hours.  In general gassing up in the US is overlooked so not only do you get cheaper gas but also don't pay the HST.  At the same time basic groceries don't have HST added on but many are cheaper in the US so during a gas trip do a bit of grocery shopping as well.
  7. magazine subscriptions - Magazine subscriptions will now be 8% more expensive.  In this day of the internet which will also have an addition 8% tax, eliminate any magazine subscriptions.  Magazines are not eco-friendly to begin with.  In many cases you can read them for free at the library and there's always the trading amongst friends.  Many magazines are now offering online subscriptions as well so while you are paying 8% on your internet bill you won't be on your online subscription.  
  8. home repairs/service calls/landscaping/home renovations - These services now have an additional 8% tax on them.  The simple solution to avoiding tax on these services is to become a do-it-yourselfer (DIYer).  There are several online sources and library resources to help you and chances are you already know someone who wouldn't mind sharing their knowledge.  Doing it yourself is going to save all the costs of hired labour as well!
  9. real estate commissions - An additional 8% tax is now applied to real estate commissions something that doesn't sit well with since our house is currently on the market.  Our solution baring an acceptable offer will be to remove our house from the market something many will likely do.  Unless you are moving to lessen the commute to work it is usually cheaper to stay where you are and upgrade.
  10. hunting and fishing licences - There is now an additional 8% tax on these licences.  Those who qualify as Aboriginals under the Canadian Constitution Act (1982) do not require either licence so it is more important now to know your rights!
Garden Gnome


  1. Anonymous3:23 PM

    Quebec has had HST for years. You should change your information.

  2. Quebec does not have HST! Quebec has GST of 7.5% but is also applied to the federal QST of 5% GST so the effective provincial rate is 7.87%. The GST rate will increase to 8.5% on January 1, 2011 and 9.5% on January 1, 2012.

    To recap - no HST in Quebec. Quebec has GST (general sales tax) and QST (Quebec sales tax).


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