Tories set to introduce HST bill

The federal Conservatives are set to introduce legislation next week that would allow provinces to harmonize the provincial sales tax and federal GST on products and services.

While the legislation will not be put to a confidence vote, it would put the Liberals in the position of either supporting a measure unpopular with consumers or opposing the wishes of the B.C. and Ontario Liberal governments. Both have moved ahead with plans to merge the taxes.

"This is not a complicated decision," according to draft talking points prepared for Finance Minister Jim Flaherty, obtained by The Canadian Press. "Either Parliament supports the right of the provinces to choose a harmonized value-added tax or it does not."

"This legislation will have the support of the Official Opposition or it will not. If it does, we expect the bill to win approval before the Christmas recess," the notes say.

The NDP opposes the Harmonized Sales Tax (HST). But on Friday, the Bloc Québécois told reporters it would support the proposed bill.

Liberal Leader Michael Ignatieff has said that if the Liberals formed a government, they would not cancel HST agreements signed with the provinces. But it was unclear whether they would support this proposed federal bill.

The Liberal governments of Ontario and B.C. have moved ahead with plans to merge the taxes.

The HST would raise the price on some consumer goods that had previously been exempt from sales tax. The National Citizens Coalition estimates the HST will cost the average taxpayer an additional $800 to $1,000 annually.

But the Canadian Federation of Independent Business says harmonization will save business $100 million a year in reduced red tape.

Upon introducing legislation to harmonize Ontario's eight per cent sales tax with the five per cent GST, Premier Dalton McGuinty pointed to a study the government commissioned that shows moving to a single sales tax would help create almost 600,000 jobs over 10 years.

Jay Hill, the Tory House leader in the Commons, and Flaherty met with Liberal House leader Ralph Goodale on the matter on Thursday, in an attempt to find a compromise.

Goodale's office would not say where the Liberals stand.

"We want to see the bill before we do anything," a spokesman said.