Coherent Identifier About this item: 20.500.12592/kq5nk3

A New Revenue Tool

2019

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Summary

The opinions and recommendations in this report, and any errors, are those of the authors, and do not necessarily reflect the views of the publishers or funders of this report. [...] A New Revenue Tool: The case for a Greater Toronto and Hamilton Area sales tax Introduction This paper looks at how much revenue could be raised from a sales tax in the City of Toronto or in the Greater Toronto and Hamilton Area (GTHA). [...] A 2 per cent sales tax in the City of Toronto would raise a billion dollars and a 1 per cent sales tax would raise half a billion dollars, if there were no change to the HST credit. [...] But because sales taxes have a bigger impact on low- income people, some of the revenues could be used to enhance the prov- incial sales tax credit in order to offset the impact of the increased tax for those with limited incomes. [...] To illustrate the potential impact of increasing the tax along with an en- hanced tax credit, we have modelled a 25 per cent increase in the sales tax credit (rising from a maximum of $307 to $380 per person) for a 1 per cent increase in the sales tax and a 50 per cent increase in the sales tax credit (rising from $307 to $460) for a 2 per cent sales tax increase.

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economics economy taxation tax revenue payments sales tax tax value-added tax tax credit greater toronto area harmonized sales tax government finances hst

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