Quebec’s finance minister says that it should get compensation for harmonizing its sales tax with the GST, as Ontario is set to do following the announcement that it will be harmonizing the sales tax regime in that province.

Monique Jérôme-Forget welcomed Ontario’s decision to go ahead and harmonize its provincial sales tax with the federal GST. She also noted that the federal government will pay Ontario $4.3 billion over two years to help its transition to a harmonized tax. And she pointed out that the federal government previously paid close to $1 billion to three Atlantic provinces that harmonized their sales taxes with the GST in 1997.

Yet Quebec never received any compensation for harmonizing its sales tax from the very outset, she noted. “Quebec was the first province to harmonize with the GST in the early 1990s. A value-added tax is good for companies that export. Quebec has no regrets about making what was a difficult decision at the time,” she said.

However, she did reiterate the demand to the federal government that Quebec taxpayers get compensation, too. “On a per capita basis, the compensation offered to Ontario represents an amount of $2.6 billion for Quebec. Quebec’s economy also faces major challenges and such an injection of funds in Canada’s two largest provinces could only be positive for Canada’s economy as a whole,” she argued.

IE