3 ways you'll notice the HST increase on big ticket items
Taxpayers aren't the only ones worried about what a hike to HST will mean. Some businesses are worried the higher tax rate will mean people in Newfoundland and Labrador will spend less.
People in the province will pay more tax on everything HST is added to, from a dinner out at a restaurant to building supplies for a construction project.
1. New build home
The average price of a newly-constructed home in this province may already seem pretty steep for some buyers, but a higher HST means more tax added to the bill.
For example, a brand new home by Karwood Contracting can be yours for almost $450,000 right now. By next year, an extra two percentage points on the HST will boost that by almost $8,900.
Homebuilders are worried there could be a big slowdown in the housing market with the new tax rate.
"With the banks tightening a lot of their rules on qualification it's just another increase in costs that sometimes will put people out of the bracket," said Randy Oram, with Karwood.
2. Brand new wheels
If you're in the market for a new car, the taxes are going to make a difference, too. And if you're looking for a luxury car, chances are there will be an even more noticeable difference.
The higher the price tag, the higher the taxes you're going to pay on a luxury vehicle.
If you've been dreaming of getting behind the wheel of a $50,000 car, keep in mind that next January it will cost you another $1,000 with higher HST.
One St. John's dealership told CBC News they're worried the already soft car sales in the city could slow even further, down from a high a few years ago.
3. Furnishings and fixings
If you can afford that new-build house despite the increased HST, the difference could be felt if you're looking to furnish that home.
Anyone looking for even just a new couch will see a higher total on their receipt — albeit not as high as some bigger ticket items. On a $1,000 sofa, you're looking at an extra $20 in tax.
A local furniture store said they're not worried a new tax rate will hurt sales because furniture is something most people will buy anyway, and an extra $20 on a couch won't sway most buyers.
The new HST doesn't come into effect until Jan. 1 next year, so expect retailers to put the push on advertising to get customers in the doors before the tax hike.
