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'Harmonized' tax rates mean many Canadians will pay more

A helicopter, top right, starts a controlled burn behind an evacuated home in Lillooet, British Columbia, on Tuesday in an attempt to reduce the amount of fuel for a wildfire burning on Mount McLean.

Associated Press

A helicopter, top right, starts a controlled burn behind an evacuated home in Lillooet, British Columbia, on Tuesday in an attempt to reduce the amount of fuel for a wildfire burning on Mount McLean.

More Canadians will be paying higher sales taxes if the federal government gets its way to "harmonize" the rates nationally.

This will combine provincial sales taxes with the federal goods and services tax for a combined rate of 13 percent, for example, in Ontario, and 12 percent in British Columbia.

The two provinces have signed lucrative agreements to harmonize their taxes next year as the federal government offered billions of dollars to ease the transition.

While making it easier and less expensive for businesses to collect and remit just one tax, it will be more costly for consumers.

That's because the combined rate will be expanded to include many items and services now subject to just the federal tax. In most places, this includes gasoline, home heating oil and natural gas, clothing, haircuts, plumbing repairs and other services.

Finance Minister Jim Flaherty said the government is prepared to cut a check to the three holdout provinces — Saskatchewan, Manitoba and Prince Edward Island — if they agree to merge their taxes.

Nova Scotia, New Brunswick and Newfoundland/Labrador earlier combined their taxes, while Quebec partially harmonized its rates. Oil-rich Alberta imposes no provincial sales tax.

Harper, Obama plan White House meeting

Perhaps Canadian Prime Minister Stephen Harper will be having a beer with President Barack Obama next month.

It was announced that Harper will travel to Washington on Sept. 16 to meet with Obama.

This will be the eighth meeting between the neighboring countries' leaders but Harper's first visit with Obama in the White House.

Items expected to be on the agenda include the economy, international affairs, energy and the environment.

News in brief

• British Columbia still has 126 major forest fires burning but crews are making progress due to relief from last week's heat wave. Most of the blazes, including one on Mount McLean, were caused by lightning. About 2,500 Okanagan residents had to leave their homes because of a fire on Terrace Mountain. Two fires are burning in the Whistler area including Ruby Bowl on Blackcomb Mountain and Crystal Ridge.

• Canadian theater impresario Garth Drabinsky was sentenced to seven years in prison for fraud in the hundreds of millions of dollars. His partner, Myron Gottlieb, was given six years. The fraud dealt with financial affairs of their now-bankrupt Livent company, which was behind such Canadian and Broadway hits as Phantom of the Opera.

Facts and figures

Canada's unemployment rate was steady at 8.6 percent last month as the labor market shed another 45,000 jobs, more than expected.

The Canadian dollar is lower at 92.32 cents U.S., while the U.S. greenback returns $1.0832 Canadian, before bank exchange fees.

The Bank of Canada interest rate is unchanged at 0.25 percent, and the prime lending rate is 2.25 percent.

Stock markets are higher, with Toronto's composite index at 10,893 points and the TSX Venture index at 1,191 points.

Lotto 6-49: (Wednesday) 2, 5, 12, 31, 34 and 48; bonus 44. (Aug. 1) 13, 14, 24, 31, 40 and 48; bonus 44. Super 7: (July 31) 8, 12, 14, 15, 19, 23 and 33; bonus 41.

Regional briefs

• British Columbia has had its third swine flu death, pushing Canada's total from the H1N1 virus to 62. The B.C. Center for Disease Control said 634 residents have tested positive for the virus. Across Canada, there have been about 1,300 people who have required hospital treatment.

• Donald Marshall, a Nova Scotia man who spent 11 years in prison for a murder he didn't commit, has died. Marshall, who was 55, suffered from kidney failure resulting from antirejection drugs from a double-lung transplant six years ago. He was convicted at age 17 of murder in the 1971 stabbing death of Sandy Seale but was acquitted in 1983 after another man was found responsible.

• Divers believe they have discovered the wreckage of a U.S. Army Air Corps seaplane that crashed in the St. Lawrence River during World War II. There were nine people on the PBY-5A Catalina when it wet down in 1942 near Longue-Pointe-de-Mingan in eastern Quebec. Four crew members survived the crash.

Jim Fox can be reached at

'Harmonized' tax rates mean many Canadians will pay more 08/08/09 [Last modified: Saturday, August 8, 2009 8:32pm]
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