The Manitoba Provincial Sales Tax went up one percentage point, to eight per cent, on July 1, 2013. (BRANDON SUN)
The days of the seven per cent provincial sales tax are over in Manitoba — a sad reality for some shoppers in Brandon on Tuesday.
"I don’t think it should be going up at all. We pay enough taxes as it is," said Darlene McKay, who was shopping at the Corral Centre on the first business day since the one per cent PST hike came into effect.
McKay added that the provincial government "shouldn’t have been able to force it."
"They were supposed to go to a vote," she said.
PST increased from seven per cent to eight per cent July 1, a decision that has been met with widespread criticism since it was announced in April.
"I don’t think anybody likes it," said Ryan Johnson, manager at Extreme Electronics. "On the bigger purchases … it is substantially more taxes. Even though it is one per cent, when people are coming in and getting $5,000 to $10,000 (purchases), it does add a couple hundred bucks."
Provincial officials estimate that increasing the PST would raise nearly $277 million for provincial coffers by the next budget, and would cost the average Manitoba household about $300 per year.
When the PST increase was announced in the spring, Premier Greg Selinger said the province will show "very concrete results for it," such as flood protection and highway improvement.
The Progressive Conservatives claim the Selinger government is on the wrong side of the law in hiking the PST without holding a public referendum. The NDP has said that it’s within its rights to implement a tax hike before passing the enabling legislation.
Rich Pentney, sales manager at Murray Auto Centre, said the PST increase has been "top of mind" for a lot of customers.
"In the grand scheme of things, the one per cent isn’t a real big difference but it certainly adds to your cost of ownership, so our customers have let us know that by the amount of the business we did in June," he said.
The average vehicle sells for about $35,000, so Pentney says "everything really went up $350 today."
"That’s not a lot when you’re talking about a $35,000 vehicle, but it’s $350 more than it was on Saturday," he said.
Pentney said the dealership will adapt to the change.
"Everything will be fine. We’re still going to be business as usual," he said.
Meanwhile at TSC Country Hardware Store, the extra one per cent on the bill had shoppers asking questions.
"Everybody’s just asking if the PST has gone up and everybody is not happy about it," said service manager Donna Peters. "Personally, I think (the province) should have had a referendum."
But for other shoppers in Brandon Tuesday, the one per cent increase doesn’t bother them.
"I didn’t even know about it and I didn’t notice when I paid my bill," said Katherine McLarty, after shopping at Walmart. "It’s not going to have that big of an effect on me."
Another shopper, Mark Daeninck, said "one per cent isn’t much. I’m OK with it."
"My concern is what are they actually going to spend the money on," he said, adding he hopes the provincial government lives up to the promise of improving roads and infrastructure.
with files from the Winnipeg Free Press
Republished from the Brandon Sun print edition July 3, 2013