Ontario's Hidden Green Tax

If you reside in Ontario, you already know that Canada Day 2010 will also hail the inception of Ontario's new 13% Harmonized Sales Tax (HST). What you may not know is that you are most likely to begin paying another new tax as early as May.

While yet not formally announced, the Liberal government will be imposing a new levy on hydro bills throughout the province to help cover $53 million of the government's conservation and green energy program. Opponents of this measure call the levy a hidden tax that is unnecessary. While the Liberals claim that the average hydro bill will only increase by $4 annually, this claim fails to acknowledge that the HST will already increase hydro bills by an additional 8%.

Defending their decision, Liberals maintain that the only alternative is to continue operating the province's energy system by burning coal, thus contributing to an unhealthy environment. The money from the levy would pay for home audits and institute a program to help industrial and commercial firms convert to solar power. The focus of the program will be conservation, rather than merely converting to new infrastructures, which could prove to be extremely costly to taxpayers.

Critics of the government's green plan question whether all the affordable conservation options have been investigated, rather than turning immediately to the consumers' pockets. The most effective program would be one that will help the maximum number of hydro users conserve. Furthermore, producers of "green power" appear to be the prime beneficiaries of this new program, as opposed to actually transforming Ontario into a "green" province.

Whether the environment will win or lose in the long term is still most uncertain. What is certain, though, is that Ontario residents will begin paying more for hydro in the near future. Hopefully, they will be investing in their environment, not just in their government.

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Ontario's Growth Spurt

Get ready, Canada! Ontario is about to set a new record.

With the country now emerging from the recession, it's time to take stock and assess the damages. As a province dependant heavily on its manufacturing sector, Ontario's GDP was one of the worst performing, matching those of Newfoundland and Labrador, contracting in 2009 by 3.5%. However, as many companies have a need to restock depleted inventories, Ontario is now benefiting from a business boom. Economic forecasts predict that Ontario's GDP will grow by 2.4% in 2010, outpacing the national rate that is projected at 2.3%. This will be the first time in eight years that Ontario has excelled in terms of national growth. This growth is expected to continue into 2011 and reach 2.8%, although national levels are expected to reach 3% next year. Economists fear, though, that restocking inventory will only provide temporary relief. As the warehouses and shelves are filled, orders will taper off and return to earlier levels.

The growth in the GDP is good news for a province that is burdened by a massive deficit, the largest of all the nation's provinces. Higher energy prices as well as competitive foreign markets are making it difficult to cope with the deficit. On the other hand, the HST, due to take begin on July 1, is expected to help ease the deficit burden. Combined with the HST, new, lower corporate taxes are expected to attract investments and new jobs to the province.

While manufacturing will experience a temporary post-recession growth spurt, Canada's abundant natural resources will still lead the way economically. Saskatchewan is expected to remain the leader among provinces, based on the strength of its oil, potash, agriculture and uranium sectors. British Columbia and Newfoundland, both of whom suffered during the recession, are also expected to experience significant economic expansion in the coming year.

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