DEFINITION of 'Harmonized Sales Tax (HST)'

A Canadian tariff scheduled to be implemented on July 1, 2010, that combines the federal goods and services tax (GST) with the provincial sales tax (PST). According to the C.D. Howe Institute, a Canadian public policy organization, the HST is primarily an attempt to build a more efficient tax system, and not to increase sales tax revenues. Proponents believe that replacing the cumbersome provincial sales tax (PST) with a one-time, value-added tax will benefit consumers by simplifying the tax system and eliminating some of the current disincentives that many producers face.

BREAKING DOWN 'Harmonized Sales Tax (HST)'

The notion of a harmonized sales tax is nothing new. In 1991, the province of Saskatchewan, under the Progressive Conservative government of Premier Grant Devine, combined its existing PST with the GST, a move that proved to be tremendously unpopular. In the general election that year, the New Democratic Party under Roy Romanow swept to a landslide victory, due at least in part to a pledge to reverse the "harmonization."



Apparently, little has changed on the public perception front. A 2010 Ipsos Reid poll, conducted on behalf of Canwest News Service and Global National, revealed that 82% of British Columbians and 74% of Ontarians opposed the government's plans to harmonize the sales tax.

RELATED TERMS
  1. Consumption Tax

    A tax on the purchase of a good or service. Consumption taxes ...
  2. Dividend Tax Credit

    The amount a Canadian resident applies against their tax owing ...
  3. Goods and Services Tax - GST

    A Canadian value-added tax levied on most goods and services ...
  4. Taxes

    An involuntary fee levied on corporations or individuals that ...
  5. Direct Tax

    A tax that is paid directly by an individual or organization ...
  6. Effective Tax Rate

    The average rate at which an individual or corporation is taxed. ...
Related Articles
  1. Taxes

    Use Tax Vs. Internet Sales Tax: How Are They Different?

    Learn about the differences between a use tax and an Internet sales tax. Find out about transactions in which the taxes apply, and to whom they apply.
  2. Taxes

    How Are Capital Gains And Dividends Taxed Differently?

    Individuals in the 25% or higher tax bracket pay a 20% tax on long-term capital gains.
  3. Taxes

    5 States Without Sales Tax

    Learn about the five states that do not charge sales taxes and about other taxes the states levy instead in order to generate revenue.
  4. Taxes

    Do Tax Cuts Stimulate The Economy?

    Learn the logic behind the belief that reducing government income benefits everyone.
  5. Taxes

    A Concise History Of Changes In U.S. Tax Law

    We look at how U.S. taxes have changed since their inception.
  6. Taxes

    Internet Sales Tax Vs. Brick & Mortar Sales Tax

    Learn about the differences between sales taxes and Internet sales taxes, and the goods and services that typically incur each type of tax.
  7. Taxes

    Understanding Taxes

    Taxes are mandatory fees that individuals and corporations must pay to their governments.
  8. Financial Advisor

    3 Federal Income Tax Facts You Didn't Know

    Learn about three federal income tax facts that most Americans may not know from one of the most trusted financial resources on the Web.
  9. Taxes

    5 Most Taxing Taxes for Americans

    There’s not much that unites Americans like their hatred of taxes. Here's a list of taxes we dislike the most.
  10. Taxes

    Calculating Net of Tax

    Net of tax is a figure that has been adjusted for taxes.
RELATED FAQS
  1. Does location matter for taxes when calculating gross sales?

    Learn more about gross sales taxes and how merchants are impacted by them. Find out if different business locations are impacted ... Read Answer >>
  2. What are the differences between regressive, proportional and progressive taxes?

    Understand the differences between the most common tax systems including regressive taxes, proportional taxes and progressive ... Read Answer >>
  3. What's the difference between the marginal tax rate system and a flat tax?

    Find out about the difference between marginal tax rates and flat taxes. Gain insights on both systems and the arguments ... Read Answer >>
  4. Is progressive tax the same thing as marginal tax rate?

    Learn how a marginal tax rate is a form of a progressive tax rate. Learn the pros and cons of such a tax policy and who may ... Read Answer >>
  5. What is the difference between a regressive tax versus a progressive tax?

    Determine how progressive and regressive taxes impact your personal finances, and learn more about how you pay both types ... Read Answer >>
  6. What is the difference between a state income tax and a federal income tax?

    Learn the difference between state income tax and federal income tax based on tax rates, deductions, tax credits and taxable ... Read Answer >>
Hot Definitions
  1. Cover Letter

    A written document submitted with a job application explaining the applicant's credentials and interest in the open position. ...
  2. 403(b) Plan

    A retirement plan for certain employees of public schools, tax-exempt organizations and certain ministers. Generally, retirement ...
  3. Master Of Business Administration - MBA

    A graduate degree achieved at a university or college that provides theoretical and practical training to help graduates ...
  4. Liquidity Event

    An event that allows initial investors in a company to cash out some or all of their ownership shares and is considered an ...
  5. Job Market

    A market in which employers search for employees and employees search for jobs. The job market is not a physical place as ...
  6. Yuppie

    Yuppie is a slang term denoting the market segment of young urban professionals. A yuppie is often characterized by youth, ...
Trading Center