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| FTLComm - Tisdale - April 1, 2000 |
| In general the March 30th provincial budget attempted to widen the sales tax to more
closely mirror the federal Goods and Services Tax. Let us leave it to others to explain
why and what might have prompted the government to follow this course but for our
purposes here we shall try to outline the changes. |
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- The provincial E&H tax now applies to the following:
- Repairs
- Computer services
- Used Goods
- Nonprescription drugs and medicines
- Equipment Maintenance contracts
- Bedding plants, Trees and shrubs
- Pet food, Veterinary drugs and medicines
- Dry cleaning and laundry services
- Telephone Answering services
- Real Estate Fees
- Credit Reporting, Collection services, Security and Investigation
services
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Repairs
If you have to pay to have some work done on tangible personal property such as
vehicles, equipment, appliances or furniture you will now have to pay an addition
6% for the work done. Up until now you only had to pay tax on the materials used
in the repair work now the tax is expanded to the labour involved.
Exceptions: Real property such as fences, home renovations,
painting or fixing your driveway are not taxable at this time nor is labour repair
charges on farm equipment.
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Computer services
This one affects FTLComm. We must no charge tax on the work we do on customer
machines, software fixes, the software we write or adapt, work on databases, data
entry and essentially all computer related services. One nasty part of this includes
set up and installation charges. In some cases a computer company may charge a separate
fee for configuring equipment for a customer, this will be taxed as will 6% on top
of the freight to Saskatchewan and and importation charges. If we charge mileage
to a customer for a service call we must invoice those charges on a separate invoice
otherwise they are taxable. For those who lease computer equipment their lease payments
will now be subject to provincial taxes and at the end of the lease the re-marketed
equipment is of course also taxable.
Software taxes are extended to lease, and licenses, any related transfer or installation
charges and desktop publishing. Web page design and maintenance are now taxable as
are hosting and storage fees. If you get FTLComm to touch up a picture for you or
create a pamphlet that is now taxable.
Exceptions: Manuals and technical bulletins, provided
they are on a separate invoice are not taxable nor are charges for training.
On interesting wrinkle is that very small businesses doing less then $10,000 business
annually are not required to collect taxes. This is the same provision under the
federal GST regulations.
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Used Goods
This provision could be the toughest one to swallow. It applies to any and all
used goods sold by an individual of more than $300 and private sale of vehicles valued
at more the $3,000. Businesses that sell used goods will charge the tax on all used
sales.
All vehicles including motor homes, boats and all terrain vehicles will be taxed
when sold by a dealer.
Exception: Used mobile homes used for residential
use are exempt from the tax.
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Nonprescription drugs and medicines
If you don't have a prescription from your doctor for a drug or medicinal product
it is taxable so that includes pain relievers, vitamins, and ointments. (This one
might have a good chance of being challenged since vitamins and supplements are "food"
and foods are exempt the government might not have this one covered.)
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Equipment Maintenance contracts
This one is confusing to me, the maintenance service contracts are now taxable
but the parts, labour, materials and supplies are not. So essentially the tax falls
on the sum of the contract and thus covers all the other parts within the contract.
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Bedding plants, Trees and shrubs
And we thought it couldn't be done, well this tax provision goes after plants
and dirt in a big way. Bedding plants, grass seed, garden seed, bulbs, trees, shrubs
and even sod are taxable.
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Pet Food, Veterinary Drugs and Medicines
Spot, fluffy and the goldfish are all going to eat taxed food from now on, as
will all their medicines and supplements
Exceptions: Farm veterinarian services, medication
and supplies for farm animals are exempt provided specific land locations are stated.
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Dry cleaning and laundry services
Provincial tax now applies to your dry cleaning bill and any laundry services
you use, it also applies to coat hangers, detergent and garment bags.
Exception: Coin-operated laundering is exempt.
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Telephone Answering services
SaskTel's $14 per month messaging service now becomes taxable.
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Real Estate Fees
The Realtor's fees and commission for the sale of real property are now taxable.
Exception: When a a Realtor does an appraisal or
property inspection no taxes are placed on top of these fees.
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Credit Reporting, Collection services, Security and Investigation
services
Since few of us hire collection agencies this one is not a problem but in cities
and even here in town buildings monitored by security agencies with intruder alarms
will now have to pay taxes on this service. Even the use of guard dogs is taxable
as is armoured car services. (You can expect the banks to move that little charge
on to you every time you use an ATM which is service by armoured car companies)
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July 1
A few provisions are not going into affect until July 1 and they include taxing
of advertising services, professional services such as legal, accounting, architects,
business consulting and engineering, commercial building cleaning and employment
agencies.
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-----The Indian War of 2000
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This provision of the expansion of the provincial sales tax is the one that could
very well take us back to 1885.
Today the Federation of Saskatchewan Indians filed papers in court and one band has already removed their children
from a provincial school.
The charging of taxes off reserve to treaty Indians contravenes the Indian Act, the treaties and
common sense. The courts will rule in favour of the First Nations simply because
the Treaties are in effect as long as the grass grows, the sun shines and waters
flow. Those treaties explicitly state that treaty people will "never" pay
taxes, they will receive free education and health care, "Always" There
are no exceptions, no location parameters and every challenge to the treaties so
far have failed.
The treaties are actually even more fundamental legally and more binding then the
constitution because they supersede it and were signed before it, they are even more
entrenched in common law then the Quebec Act which had the effect of causing the thirteen colonies to go their
own way and form the United States.
We really didn't need this irritation this year, this seemingly minor provision that
makes a few folks who do not understand the importance of international agreements
(that's what a treaty is) think that this will bring fairness, are sadly mistaken.
We are all living on Indian land that we have now the right to use because of the
peaceful settlement of the treaties before the ending of the nineteenth century.
Our payment for this whole massive country is very small, sales taxes and the support
of this population. Break the treaties and go back to the negotiating tables now
and see what they would charge you for the land Regina and Saskatoon sit on. There
was no "right of conquest" the land was turned over peacefully in return
for a long term contract. To break that contract for 6% is inordinately foolish.
Think of it this way, the contracts were signed in good faith if they are broken
the injured party would be legally correct in demanding the assessed value of all
land, improvements and extracted minerals since the treaties were signed, plus injuries
and hardship and interest since the 1880s. Can we afford that?
Only a fraction of Saskatchewan Indians are Cree, who prefer pacifist non-confrontational negotiations, do not think
for a minute that the rest of the First Nations will not identify this move by the
provincial government as the last straw. Economic insurrection followed by nasty
race relations are a certainty and with half of Regina and Saskatoon's population
disaffected First Nations people, the Minster of finance and the premier have committed
a blunder that could take generations to sort out.
-Timothy W. Shire
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