With varying combined federal and provincial sales taxes (i.e. the HST in a lot of provinces, BC's abomination) there are major differences between most provinces and Alberta. Alberta famously has no provincial component and thus their sales tax is the 5% federal component. Ontario's total is 13% with the 5% federal component.
Now 8% isn't a massive difference for the end consumer, but it isn't insignificant either. Canada is also a massive country, so it isn't physically easy for an Ontarian to travel to Alberta to save. As far as I know for internet sales, it isn't easy to fake being from Alberta if you're an Ontarian.
So I'm wondering if Alberta has more retail sales than would ordinarily warrant if sales taxes were the same in all provinces? New Hampshire has no sales taxes and makes significant sales to other states, however the New England states are small in area so it isn't a big deal to travel from Massachusetts. Albertans have higher incomes than other Canadians while also having lower provincial taxes. So if retail sales are higher for Alberta as a whole, it isn't easy to tease out if there's any additional purchases by non-Albertans.
Now what there might be is those living part-time in Alberta working in the petroleum industry who travel back and forth between the Maritime provinces make a lot purchases of goods and take them back whenever they go back East. Nominally they might be residents of Alberta, however they could be taking additional stuff back to family members and friends that would normally be purchased in the Maritimes. Again it would probably be hard to tease that out (although maybe some economist has tried).
Anyways, whatever small effect there was is part of a larger effect where Alberta has both lower provincial sales and income taxes. Nova Scotia is a province that seems to be in a death spiral of high income and sales taxes required to pay for an overlarge and relatively over paid public sector workforce. Ontario seems to be going down this road as well, with significantly increased income taxes since Dalton McGuinty was elected, with recent additional taxes at the highest income levels. If Alberta didn't exist, this would still be problematic, but with the existence of Alberta and the option for any Canadian to move there and especially large incentives for those making the most income expect more people to move from Ontario to Alberta.
A blog about Hamilton and Ontario politics and economy. Or whatever I find interesting.
Showing posts with label sales tax. Show all posts
Showing posts with label sales tax. Show all posts
Tuesday, September 9, 2014
Sunday, March 9, 2014
A Closer Look at Ontario's February Employment Numbers from StatsCan
Here's the StatsCan numbers for Ontario comparing February's employment numbers with January's:
January February
Population 11,278.4 11,287.3
Labour force 7,438.2 7,448.7
Employment 6,882.8 6,888.9
Full-time 5,600.6 5,605.9
Part-time 1,282.2 1,283.0
Unemployment 555.4 559.8
Participation rate 66.0 66.0
Unemployment rate 7.5 7.5
Employment rate 61.0 61.0
Quite minor differences, with no change in the participation rate and the unemployment rate.
Also available is the February 2014 versus February 2013 comparisons percentage comparisons. Employment was up 0.4% year over year, however population was up by 1.2%. That could cause problems for Ontario's budget since expenses like health are based off of population while income tax (and to a lesser extent sales tax) is going to strongly correlate with employment numbers (especially full-time considering how progressive Ontario's provincial income tax is).
January February
Population 11,278.4 11,287.3
Labour force 7,438.2 7,448.7
Employment 6,882.8 6,888.9
Full-time 5,600.6 5,605.9
Part-time 1,282.2 1,283.0
Unemployment 555.4 559.8
Participation rate 66.0 66.0
Unemployment rate 7.5 7.5
Employment rate 61.0 61.0
Quite minor differences, with no change in the participation rate and the unemployment rate.
Also available is the February 2014 versus February 2013 comparisons percentage comparisons. Employment was up 0.4% year over year, however population was up by 1.2%. That could cause problems for Ontario's budget since expenses like health are based off of population while income tax (and to a lesser extent sales tax) is going to strongly correlate with employment numbers (especially full-time considering how progressive Ontario's provincial income tax is).
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