Uploading or Downloading: You, Me and the HST

I spent some time this morning trying to sort out the question of prepaid death expenses with someone in the Ministry of Finance in Victoria. It was both humorous and at the same time frustrating conversation. My concern is with when it would be necessary to pay the HST on such services, May 1, as was recently quoted in the local papers, or July 1, as the agreement generally reads.

The fundamental question revolves around the difference between when a good or service is paid and delivered relative to when it is contracted. Both our provincial and federal governments want to ensure that devious citizens cannot outwit their clutches by contracting before July 1, 2010 for goods or services which will not be delivered and paid for, until after July 1. One can understand the logic of this strategy –except in the case of burial expenses. One really doesn’t want, in order to save the 12% in HST taxes, to be forced to die before July 1, an act which one hopes is, in the end, involuntary.

It appears from my conversation this morning that the answer depends on the accounting practices of the service provider and leans toward the July 1 deadline being the operative one, but no assurances were offered. A visit to the Ministry of Finance in Ottawa via the internet seemed to support this view.

But the upshot of all this was to confirm that, while the province and our municipalities complain of the downloading of the costs of services, in this case the province has found a means to upload the costs of PST collection by giving the responsibility to Ottawa through the HST. I was informed that one of the main savings to be made with the HST was the loss of BC government jobs associated with the PST. Of course the fact that we will all now be paying Peter instead of Paul to collect our taxes seems to be lost.

Whether government services are downloaded or uploaded, it is the same sheep being shorn, and shorn, and shorn……

Ron Bolin

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