Canadian Manufacturers & Exporters

Canadian Manufacturers & Exporters

July 23, 2009 18:46 ET

Harmonized Sales Tax Announcement a Positive Step Forward - Full Harmonization Required: CME

VANCOUVER, BRITISH COLUMBIA--(Marketwire - July 23, 2009) - Today's announcement by British Columbia Premier Gordon Campbell that the province will harmonize its sales tax with the federal GST starting on July 1, 2010, is a positive signal that BC is open for business, according to Canadian Manufacturers & Exporters.

"Ultimately, this announcement will help make BC exports more competitive in global markets," says Craig Williams, vice president of CME British Columbia. "We are pleased that the government is working with our sector and look forward to achieving full harmonization as it will improve cash flow and reduce the paper burden on businesses. It's critically important that the manufacturing and exporting industries remain vibrant, thereby ensuring BC's ongoing economic prosperity.

"The Olympics will put BC on the global podium next February and this sends a clear message that BC means business."

Today's announcement is in line with CME's recommendation (in BC, and across Canada) to harmonize the provincial sales tax with the GST, noting that this would help make the province's exports more competitive by reducing compliance costs and allowing BC business to collect provincial input tax credits. The government estimates that this move will save BC manufacturers more than $140 million per year.

CME hopes that BC businesses will be allowed to take full advantage of the harmonized sales tax starting immediately on July 1, 2010. While consumers will see the new HST come into effect on that date, businesses might have to wait until 2018 to witness the full positive impact of harmonization. The agreement mentions that temporary restrictions of input tax credits will be placed on certain business purchases for a period of five years based on a list of items to be determined by the BC government.

"We look forward to working with the government to ensure that inputs used by manufacturers will be eligible for input tax credits so that BC products become more competitive outside the province," adds Williams.

Canadian Manufacturers & Exporters is Canada's leading trade and industry association and the voice of manufacturing and global business in Canada.

The association represents more than 10,000 companies in Canada, many of which have extensive operations in the US. More than 85% of CME's members and their US entities are small and medium-sized enterprises engaged in manufacturing, global business and service-related industries.

CME's membership network accounts for an estimated 82% of total manufacturing production and 90% of Canada's exports.

Contact Information

  • CME British Columbia
    Craig Williams
    Vice President
    604-713-7804