TORONTO, Ont. –The Ontario Trucking Association (OTA) has strongly defended a move by the province of Ontario to harmonize the federal Goods and Services Tax (GST) with the Provincial Sales Tax (PST).

While much public and political opposition was voiced against the proposed Harmonized Sales Tax (HST), OTA leader David Bradley appeared before the Ontario Legislature’s Standing Committee on Finance recently to voice the industry’s support for the change.

“Moving to harmonize the PST and the Multi-Jurisdictional Tax (MJVT) with the GST has been a key recommendation of virtually every OTA pre-budget submission since the early 1990s,” Bradley said, adding the change was “long overdue.”

Bradley noted equipment buyers will benefit from the harmonization of the taxes.

“The current Ontario sales tax system for business inputs is out-dated, inefficient, stymies investment in safety and the environment and is ultimately uncompetitive,” Bradley said. “Ontario-based trucking companies pay provincial sales tax on virtually all business inputs, whether in the form of the 8% PST or the complicated MJVT. These taxes are applied not only to the purchases of equipment and parts, but also on maintenance and repair labour service. The fact is that the more Ontario carriers invest in safety, in reducing their environmental footprint and in productivity, the more tax they pay.”

Bradley cited a 2004 study by the Institute of International Business at the Rotman School of Management that found Ontario carriers were at a 31% tax disadvantage compared to fleets from New York, Ohio and Michigan. “The HST will give us a simpler, fairer, harmonized system that applies sales tax in a more appropriate manner that minimizes inequities and opens the way for economic growth,” Bradley insisted.