” fe rvices Tax (GST) will [replace | the existing | Federal Sales Tax. i t federal sales tax system has. been. pushed beyond its limits an: tain the demands placed upon it-* ‘The structural weaknesses -. m have given some corporations the opportunity ‘to reduce the amou * they would otherwise pay. For a tax systern with 75,000 taxpaying corpors th re 22,000" special arrangements and administrative interpretations ‘shone the best : “machines; supplies and equipment companies : to duce their products. This ér levels of investment and er output will lead a: I... Atuetz Quebec | Oncanz Prams righ Conte _ Once the GST i is in place; families. ‘earning less thas: $30, 000 a year will be better. -. _ off. This will be achieved through a combination of income tax changes. First; low . income Canadiaris will receive the néw GST Credit. Second, the. middle Personal ; income tax rate will be reduced from 26 per cent to 25 per. cent. * ‘The GST. Czedit:will be paid every three months and in advance 2 of expenses. igible | Canadian households will receive their first credit cheque in December a 4990, before the January ; 11991 GST start-up date. About 9 million Canadians will receive Credit cheques. The GST Credit will be calculated on the basis of income tax returns. Every income tax rcturn will contain a one-page form showing Canadians how to apply for the GST Credit. The amount of the Credit will depend on ‘alte Setae on family size and income. The basic adult credit will be $275. Most single adults wil! be able to get an additional credit of up to $140, for a total of $415. The child credit will.be-$100. Single parents will receive an adult.Credit of $275 for one of their :-childxen. Cal dian households with incomes Derceange change =tcome Tae Memucton + Federal Soles Tas a *Fenteg (ST Crease eligible ‘for the full Credit, will for example receive cheques of $187.50, four times over the course of the year, for a total of $750. can continue to > provide Canadians with a standard of services s that i is‘ ae 29 - Sunday, August 27, 1989 - Nosth Shore News It WILL ELIMINATE HIDDEN TAXES. Right now, everywhere i ia this country every time Canadians buy a good or service made in Canada, they a are paying federal sales tax. For example, a substantial: .- amount of sales tax is presently buried in house prices. Under the existing sys' itis clearly impossible for Canadians to know how much federai Sales tax they ”- are’ paying.’ There aré four different rates on a variety of different products and the tax is buried throughout the production process, At will be clear to Canadians when they are paying tie 9 per cer GST. The broad base‘of the GST: means it will apply to almost everything. The few ‘exceptions will” be widely known. ° - Some retailers in Canada will have cash registers that are capabie of showing the GST separately at the chéck-out counter, while other retailers will not. The’ ~ federal government will provide an incentive to retailers to assist them } in acquiring Y the cash registers to show the GST separately. _ : In all cases, the {deral government will provide retailers with signs for their stores that clearly indicate: that the 9 per cent GST i ‘is being ‘applied. | wo" aa 1, For consumers, the GST will be similat to a retail sales fax, at the rate of 9 per cent on the retail price of goods and.services. The .- . GST will replace the existing federal ‘sales tax, which i is hidden at tthe : a ” manufacturer’s level. ? 2. The GST will apply to virtuatly a all goods: and services soldi in. Canada; however, Canadians will not be charged tax when they buy the - “following GOODS: basic groceries; prescription drugs; medical appli- °- |” ances such as eye-glasses and wheel chairs; residential rents and. + existing h houses. . 3. Canidians will not be charged tax wher they buy the following SERVICES: loans, mortgages, securities and insurance Policies; health and dental care; most education services; “daycare services; legal © aid; ‘and municipal transit and passenger ferry services. A. Newly. constricted houses will be taxed, however, most new. ‘home , buyers will not see a significant increase in the price of a new. y house resulting from the GST, because there will be a $3900 million GST: housing rebate. In many parts of the country price incresses. ‘will be less than half a per cent. Indeed, many communities shoutd see lower prices as a result of the GST rebate. The main exception willl be Toronto, where extraordinarily high land prices may cause price: of new housing to increase by about. AYA. ‘5. Because the present federal sales tax will be removed, prices. will Eb ; : , not’automatically rise by.9 per cent when the GST is introduced. ‘+ «The prices of some things will bé lower, and others higher. The prices . - , of many big-ticket items for example, that are taxed at 13.5 per - cent under the present system, will be lower once the 9 per cent GST. is in place. The price of other items that are not taxed under the present system will increase. | Finally, weli before the GST is up and running, the; government will be tetling Canadians about the GST and informing them about the kinds of price changes they can expect for key goods and services - when the GST. replaces the existing federal sales tax. - - “ : For instance, here are a few examples of what consumers might et expect: : — ITEM) PRE-TAX REFORM($) _ : - Air. Conditioner 780.00 © . . 770.00 .. Chr: . : 25,000.00 > 14,700.00. -. Snow Tires 200.007 "203.00 Hotei Accommodation 90.00 3k 95.00" af “POST-TAX REFORM($) ||.”