2010 Ontario Budget Impact Paper

The 2010 Ontario budget that was presented by the Honourable Dwight Duncan, Minister of Finance for the Government of Ontario on March 25, 2010, was reviewed and contained no new income tax measures affecting the federal public service pay or pension payments for 2010. However, there are some personal tax measures that employees may find informative from a personal perspective, effective in 2010.

ITEMS OF INTEREST

Ontario Sales Tax Combined With The Federal GST Effective July 1, 2010

Effective July 1, 2010, Ontario's provincial sales tax will be combined with the federal goods and services tax (GST) to create a federally administered harmonized sales tax (HST). The HST will have a combined tax rate of 13 per cent, and will generally use the same rules and tax base as the federal GST. Insurance premiums will continue to be subject to an 8% retail sales tax (RST).

Ontario Sales Tax Transition Benefit

To help Ontarians adjust to the HST, the provincial government has announced an Ontario Sales Tax Transition Benefit which will be provided to eligible individuals and families as follows:

• Benefits will be delivered to eligible Ontario tax filers aged 18 and over;
• Eligible families with an income of $160,000 or less will receive three payments totalling $1,000;
• Eligible single people with an income of $80,000 or less will receive three payments totalling $300;
• The first benefit will arrive in June 2010, the second in December 2010, and the third in June 2011.

To review the 2010 Ontario Budget documents, please visit the following Web site:

Budget 2010