Car insurance hike 19%; HST adds to consumer woes | Coming Depression

Canada’s province of Ontario and British Columbia are setting the stages to introduce harmonized sales taxes across the board in their respective provinces. The several next few paragraphs outline the HST.

Ontario plans a major tax reform that will combine both the provincial and federal sales tax on products and services. The combined tax of five per cent GST and eight per cent Ontario sales tax won’t change the price on most items. But many items that used to be exempt from sales tax will no longer be so.

Consumers are most likely to notice an increase in the price of gasoline and heating fuels. Electricity will no longer be exempt from provincial sales tax, nor will tobacco, personal services like haircuts, membership fees for clubs and gyms, newspapers and magazines, taxi fares and the professional services of lawyers, architects and accountants. Real estate commissions will also be taxed.

If the HST were not enough of a hassle for the everyday working Canadian, private car insurance companies in the province of Ontario, Canada, are planning on implementing a monstrous 19 per cent fee increase across the board. The Financial Services Commission of Ontario recently approved rate changes for a number of insurance companies. According to the commission’s report, the average rate increase over the first three quarters of 2009 was 6.2 per cent.

But a report in the Toronto Star says that rates could actually increase by an average of 9.1 per cent across Ontario, with premiums increasing by as much as 14 per cent in the Toronto area. Insurance companies said increasing physiotherapy and rehabilitation costs for people who have been injured in collisions are driving the premium increases.

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