I don’t typically like the “doom and gloom” style of reporting. ¬†After all, too much gloom tends to grow on a person, right?

However, here is a gloomy scenario that could play out in Nova Scotia.  First, a quick refresher.  In 2006 the HST rate in Nova Scotia dropped from 15% to 14%, and then dropped again in 2008 down to 13%.  These rate cuts happened after the federal government cut their federal portion of the HST.  Few people complained.

Now, however, both Nova Scotia and the federal Canadian government are severely in the red. ¬†The provincial NDP government has as good as said that they are going to raise the HST rate. ¬†On February 1, 2010 NDP Finance Minister Steele stated that: ¬†“Over the six public sessions we‚Äôve had, I would say people can accept that part of the solution is an increase in taxes, particularly the HST.” Face it, whenever a Finance Minister says something like that, we can expect a tax increase!

Over in the federal camp, the Conservatives are dead set against raising taxes. ¬†But the official opposition, the Liberals, are mumbling about increasing the GST/HST back up to what it used to be. ¬†Fortunately the odds are against it, but there’s obviously potential for both the provincial and the federal governments to increase our HST by a couple of percentage points.

The bottom line is that we may as well expect to be back up to 15% in the next year or two, and let’s hope it doesn’t go past that! ¬†It’s going to be interesting to watch, at the least.

Filed under: Business tax, Consumer Tax by David Boese 2 Comments »