Business owners and consumers are bracing themselves for a July 1 provincial sales tax hike. Some retailers feel it will send consumers across the border, while others are employing strategies to keep them here.
"This province here does not understand small business and they crucify us with tax," said Frank Gibson, who owns Phoenix Woodwork & Interiors. Gibson came to Manitoba from Alberta to revive a dying business and re-made it into Phoenix, which now brings in $6 million annually.
"It was the biggest mistake of my life," he said, explaining the planned tax hike will cost him tens of thousands of dollars.
Gibson said he has million-dollar contracts, signed when the PST was seven per cent. When it jumps to eight per cent next month, Gibson said he will have to pay the difference. He said he is so upset with the NDP government's implementing the tax, he is considering shutting down the company, which employs 55 people, and moving back to Alberta.
"This province here does not understand small business and they crucify us with tax," he said.
Many business owners are worried the one per cent increase will cause many Manitobans to shop elsewhere, notably in the U.S.
A lot of of Manitobans already buy building supplies in the states, said Rob Borthistle, owner of Selkirk Home Hardware. The PST increase "is just one more reason to push somebody over the edge to do that," he said.
In the cases of customers who have purchased but not yet paid for deck or home packages, Borthistle said he will have to tell those buyers that if they wait to pay until July, they will have to pay eight per cent PST.
"That one per cent could be thousands of dollars," he said, giving cross-border shoppers one more reason to head south.
Consumers eye impending PST hike
Instead of going to the states, Winnipegger Barry Wiens has pushed up a major purchase to avoid getting dinged by the hike.
Wiens and his son decided to start a $30,000 renovation project earlier to avoid the extra per cent.
"Every per cent counts," said Wiens.
"Everybody hangs off as long as possible, but this year it’s, ‘OK. Let’s get ‘er done before July 1."
Wiens said he saved $245 by purchasing before July 1.
But Wiens isn’t exactly against the tax hike -- he just hopes his tax dollars are well spent.
"If they’ don’t make good use of this money, they’re going to be gone next time," he said.
Retailers warning customers
The owners of some hardware stores in Manitoba are trying to get the word out about buying before the hike.
Rob Borthistle owns Selkirk Home Hardware and has been calling his customers to remind them to purchase early.
"[We’re] letting them know, ‘Come in and do this now,’ because we don’t want you to be hit with that hundreds or thousands of dollars," said Borthistle.