Quebec City, Quebec, Canada (AHN) – After waiting for almost 20 years, Quebec will receive on Friday $ 2.2 billion from the Canadian federal government for implementing the harmonized sales tax in 1992.
The belated payment is expected to end the dispute between Ottawa and the French-speaking province that had been asking the federal government for compensation for 19 years.
Ottawa justified the delay because unlike Ontario, New Brunswick and British Columbia, which fully implemented the HST, the federal government still handled the tax’s administration for the province. Ontario and BC implemented the HST in July 2010, but BC residents voted in a referendum to revert to the provincial sales tax.
The Tories decided to settle the matter during the spring election campaign by offering a final agreement with Quebec. Prime Minister Stephen Harper and Quebec Premier Jean Charest will ink the deal on Friday.
In exchange for the lump sum payment from Ontario, the provinces turned over control of their sales tax to the federal government. Ottawa paid Ontario $ 4.3 billion and New Brunswick $ 364 million. It will collect back the $ 1.6 billion payment it gave to BC last year after BC residents opted to revert to the old separate collection of federal and provincial sales taxes.
Quebec was actually the first Canadian province to implement the HST. The move is also seen as the Tories’ way of courting more Quebec votes. In the last election the province voted in 59 New Democratic Party members, which led to the NDP becoming the official federal opposition party and the Bloc Quebecois losing their influence in the province.
There are no comments yet. Why not be the first to speak your mind.