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Ontario’s HST Still May Apply To Mutual Funds

On June 3rd, the Ontario Ministry of Revenue released an information notice about the proposed single sales tax or HST (Harmonized Sales Tax).

The information notices outlines the government’s assessment of the impact the new HST would have on Ontario’s economy. Operating on the same tax base at the federal GST and with essentially the same rules, the Ontario government argues that the current retail sales tax can become embedded in the price of finished goods. By harmonizing with the GST, this embedding of the RST would be eliminated and overall prices on some goods would fall.

Non-Taxable Sales

Some items that are currently subject GST will be zero-rated for the purposes of the Ontario HST. As announced earlier this year [1], this list will include:

Noticeably Missing

Despite the concerns in the media about the impact the new HST would have on investors throughout the country, no relief appears to be in order for financial services, and in particular mutual funds.

I highlighted this issue [1] on March 26th by showing that the cost to a mutual fund investor would be $25,000 over a 35 year period.* [1]

You can read some of the other press on this issue by following the attached links:

[2]