TORONTO, Ont. — The Ontario trucking industry stands to benefit from the province’s harmonization of the provincial sales tax with the federal GST, according to the Ontario Trucking Association (OTA).

“For the Ontario trucking industry the fact that the government has moved forward on its budget commitment to harmonize the provincial sales tax (PST) with the federal goods and services tax (GST) starting next year is extremely good news,” OTA chief David Bradley said. “OTA has been seeking this announcement for a number of years and it’s been a key recommendation of virtually every OTA pre-budget submission this decade. The introduction of the legislation today is great news for the industry.” 

As part of the transition to the Harmonized Sales Tax (HST), the Multi-Jurisdictional Tax (MJVT) will be wound down and would no longer apply to renewals or new registrations under the IRP as of July 1, 2010.

Also, trucks would no longer be slapped with an RST (exit tax) when they cease to be registered under the IRP, also as of July 1, 2010.

“OTA has had the opportunity to work closely with the government on the transition rules and we had made the case that the fairest way to wind down the MJVT was to do so without imposing any exit tax on those vehicles already in the MJVT system. We’re extremely pleased that the government was receptive to our point of view and that the legislation introduced today eliminates the MJVT without imposing an exit tax,” Bradley said. “This is a huge win for the OTA and the trucking industry; it will save fleets with trucks registered in IRP about $2,000 per vehicle.”

Bradley added, “For far too long the trucking industry has been living with a business input tax system that is outdated, archaic, uncompetitive, administratively burdensome and discriminatory. In a low margin industry like trucking, taxes on business inputs, which a company must pay whether it is generating a profit or not, are regressive and a drag on investment in newer technologies. Trucking, more than most other industries in Ontario, has had to endure a situation where the more they invest in equipment that is more efficient, more productive, safer and more environmentally-friendly, the more tax they have had to pay.”