Charge GST on everything

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Re: Charge GST on everything

Postby eezee » 26 Feb 2012 15:00

I'm sure the Austrian economy appreciated your contribution :wink:
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Re: Charge GST on everything

Postby adrian2 » 26 Feb 2012 15:55

Shine wrote:What irritates me is the recharging of GST/PST/VAT on used items like cars, boats, and other items from which GST/PST/VAT has already been collected at the initial sale.

I realize the issue around house/condo sales complicates the issue, however on consumer items the tax should be reduced at least, if not eliminated. After all, one does pay transfer fees and additional costs for large consumer items like cars, boats, motorcycles and such.

GST and/or HST are Value Added Taxes. A used car, in the vast majority of cases, sells for less than a new one, hence there is no value added. This was one of the few examples where the introduction of HST, replacing GST+PST, was supposed to lower the price of used cars; alas, in its infinite wisdom, Dalton Mc.Guinty decided that we Ontarians will continue to pay the old 8% PST on used cars (there was no GST), and just to make it easier for the unwashed to understand, we're going to pay 13%, not 8%, in a "pseudo-HST" collected by the province only. Instead of going from 8% to 0%, it's from 8% to 13%. Hurray!
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Re: Charge GST on everything

Postby Bylo Selhi » 26 Feb 2012 17:06

adrian2 wrote:alas, in its infinite wisdom, Dalton Mc.Guinty decided that we Ontarians will continue to pay the old 8% PST on used cars... , and just to make it easier for the unwashed to understand, we're going to pay 13%, not 8%, in a "pseudo-HST" collected by the province only.

How are used cars taxed in other provinces?

Hint: Tax rise on private car sales hidden: B.C. NDP
The B.C. government already charges the seven-per-cent provincial sales tax (PST) on private vehicle sales and had planned to keep it there, according to its September 2009 budget. Sales of used vehicles, boats and aircraft by dealers will rise to 12 per cent when the new harmonized sales tax (HST) — which combines the PST and the five-per-cent federal goods and services tax (GST) — goes into effect July 1. But the B.C. government now plans to raise the PST on private sales of automobiles, boats and cars to 12 per cent the same day as the HST goes into effect.

Did I miss the news item about Dalton becoming premier of BC? ;)
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Re: Charge GST on everything

Postby newguy » 26 Feb 2012 22:08

According to revenue Quebec both GST and PST are charged here. 5% + 9.5% (I don't know about other provinces but here the PST is on the total after adding GST so it's 9.5%*1.05 = 9.975% PST here.

http://www.revenuquebec.ca/en/citoyen/t ... achat.aspx

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Re: Charge GST on everything

Postby adrian2 » 26 Feb 2012 22:59

newguy wrote:According to revenue Quebec both GST and PST are charged here.

As per your link, there is no GST for a used car sale between two individuals (which is the case where ON and BC have decided to jack up the tax instead of dropping it to zero). QST is not a true VAT (it predates GST), in that respect it's like the old provincial PST.

newguy wrote:5% + 9.5% (I don't know about other provinces but here the PST is on the total after adding GST so it's 9.5%*1.05 = 9.975% PST here.

That's the distinct society, tax-on-tax. The Quebecois couldn't stand being shoulder to shoulder with a federal tax, so they had to be on top of it :P .
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Re: Charge GST on everything

Postby newguy » 27 Feb 2012 11:22

adrian2 wrote:
newguy wrote:According to revenue Quebec both GST and PST are charged here.

As per your link, there is no GST for a used car sale between two individuals (which is the case where ON and BC have decided to jack up the tax instead of dropping it to zero). QST is not a true VAT (it predates GST), in that respect it's like the old provincial PST

True, I just noticed that. Strange that dealers still have to charge it. Stranger still that the car adds seem to be only by dealers who have to charge 5% more.

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Re: Charge GST on everything

Postby twa2w » 27 Feb 2012 15:04

True, I just noticed that. Strange that dealers still have to charge it. Stranger still that the car adds seem to be only by dealers who have to charge 5% more.



Car dealers have to charge tax on used cars because a purchaser of a new car who has the trade in, only pays tax on the net trade in value. The dealer then collects the remaining tax owing from the purchaser of the trade in. (which is usually marked up in price so the overall tax collected by the government on a new vehicle purchase is lower with cash sale than one with a trade in.

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Re: Charge GST on everything

Postby adrian2 » 27 Feb 2012 15:13

twa2w wrote:Car dealers have to charge tax on used cars because a purchaser of a new car who has the trade in, only pays tax on the net trade in value. The dealer then collects the remaining tax owing from the purchaser of the trade in. (which is usually marked up in price so the overall tax collected by the government on a new vehicle purchase is lower with cash sale than one with a trade in.

That's because there are two sets of transactions, one is the new car sale, which has value added from manufacturer to end consumer, and the other is the used car sale, which has value added from owner #1 -> dealer -> new owner. So there is more value added if there is a trade in compared to a cash sale of the new car.
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