HST hike on P.E.I. coming Saturday
Islanders will soon be paying a little more for most products and services, as the P.E.I. government is about to raise the Harmonized Sales Tax by one percentage point on Saturday.
The HST will go from 14 per cent to 15 per cent, and the cost of living is expected to rise by about 0.5 per cent as a result.
"For most people that are financing and so forth they're looking at $2, $2.50 every couple of weeks," explained Ron Martin, the sales manager at Reliable Motors in Charlottetown.
The dealership advertised the tax hike, hoping it would entice customers to buy before October 1.
"It really hasn't had a big big factor on us this month so I'm assuming going forward it probably won't affect things a whole lot."
In the housing market, the HST does not apply to the purchase of an existing home — just to agent services, new home construction and lots. But some buyers are moving to close deals on building lots before Oct. 1, realtors said.
Less money to spend
"If your lot was $50,000, there would be the 14 per cent on top of that. So that would be going up one per cent, which would be $500," explained Joel Ives with Century 21/Colonial Realty.
The HST increase could leave people with less money to spend on housing, Ives said.
The increase will bring in an extra $11 million for this fiscal year and an additional $22 million in future years, according to the province — extra revenue that's necessary to simply maintain core services, it said.
And with increases to rink and facility rentals, some sporting groups complain they will feel the pinch — pain that will likely be passed on to families who will have to pay a bit more for registrations.
- MORE P.E.I. NEWS I Water bottling plant plans altered after public pressure
- MORE P.E.I. NEWS I Charlottetown to cut more diseased elm trees this fall
