Raise the Hammer

Yes my competitors' cost of doing business will go up too. But my competitors still thrive all within the same industry. What if this hurst entire industry sectors? ie shrinks that industry pie altogether. It doesn't matter then if my competitor's costs went up the same as mine, because our pie is smaller, because our entire industry is more expensive from everything from rent to paper clips.

In business, if my competitors are doing well, generally everyone in the industry is doing well. Eg. if Walmart is doing well, so is Sears and Canadian Tire. If the marketing services industry is hit, so is everyone... myself and my competitors. To call us competitors is not like we hate each other, when our industry suffers we all stand together. Just like GM, Ford and Chrysler do when they have to. We're competitors but we're colleagues all making a living in the same industry.

When I re-sell printing or media to my clients, I'm exempt from the RST because I'm reselling it, I only pay 5% GST. RST is only charged once... to the end user. Now I will be charged 13% HST from a printer instead of 5%. If I add more value-added services along the way to the end product, like translation, web coding, etc services that were only subject to the GST and now will be subject to HST and you can see how this increases the cost of the final product.

RST was not taxed on business services, only products. Ontario has a huge Financial Services sector. Toronto competes with other world financial cities, London, NYC, Tokyo, Hong Kong, and Frankfurt. Business, financial, banking, legal, and accounting services just got 8% more expensive to global clients.

And we don't just compete locally and internationally, we compete provincially. Big services companies will have an office in Calgary, Toronto and Montreal. Guess which of those cities got more expensive to do business with? I don't know... will that mean Pricewaterhouse, RBC, Deloite, Cossette, Publicis etc move more of their business to the Quebec and Alberta offices?

I'm not convinced it's better, but I'm hopeful. So far it seems like it matters to me.