Nova Scotia to boost HST

Nova Scotia to boost HST

HALIFAX—Starting this summer, dinner out at the province’s restaurants are going to cost more.

The ruling NDP, in their 2010 budget, have raised the Harmonized Sales Tax back to a Canada-wide high of 15 per cent, a two per cent increase, which takes effect July 1.

Finance Minister Graham Steele said the extra two per cent is expected to generate an additional $215 million in 2010 revenue.

“Through these targeted and strategic measures, we will make life more affordable for Nova Scotian families, while still maintaining the government’s focus on getting back to balance and living with its means,” Steele said, in a media statement.

Nova Scotia currently runs a deficit nearing $500 million, but that is predicted to drop to $222 million in 2010-2011. Its debt load will hit $14 billion this year.

Changes to taxation rates will reduce corporate income tax rates for small business from five per cent to 4.5 per cent on the first $400,000 of taxable income, starting on Jan. 1, 2011.

Diapers, children’s clothing and footwear and feminine hygiene products are exempt from the 10 per cent provincial sales tax, but the federal Goods and Services Tax still applies. The government said the exemption would save residents $8 million in 2010-2011.

Conservative finance critic Allan MacMaster said imposing taxes on Nova Scotians makes the province less competitive in the long run.

“Tax increases do not stimulate the economy, rather they put less disposable income in the hands of Nova Scotians and they negatively impact the competitive edge we have in Atlantic Canada,” MacMaster said, in a statement.