P.E.I. budget announces increase in HST

The harmonized sales tax is going up on P.E.I., to 15 per cent in October.

HST will be 15% come October

Finance Minister Allen Roach delivered a deficit budget on Tuesday. (Province of P.E.I.)

The harmonized sales tax is going up on P.E.I., to 15 per cent in October.

The increase was announced in the annual budget speech in the legislature Tuesday, presented by Finance Minister Allen Roach.

In his budget speech, Roach said an increase in revenue was necessary to maintain core services in the province, and an increase in the HST was the best option.

"Experts agree that increasing consumption taxes like the HST are less harmful to economic growth than increasing income taxes for individuals," said Roach.

The tax, currently 14 per cent, will go up effective Oct. 1.

The province estimates the increase will provide a further $11 million in revenue over the half year it is in effect in 2016-17, and an extra $22 million in future years.

A made in P.E.I. decision

Roach told the media in the budget lockup that the province was not influenced in its HST decision by increases in the tax in Nova Scotia and New Brunswick.

"Not at all," said Roach.

"We have our own budget process on Prince Edward Island."

During that budget process, said Roach, government officials heard Islanders were concerned about cuts to services, and decided to move to increase revenues rather than reduce expenditures.


To encourage thoughtful and respectful conversations, first and last names will appear with each submission to CBC/Radio-Canada's online communities (except in children and youth-oriented communities). Pseudonyms will no longer be permitted.

By submitting a comment, you accept that CBC has the right to reproduce and publish that comment in whole or in part, in any manner CBC chooses. Please note that CBC does not endorse the opinions expressed in comments. Comments on this story are moderated according to our Submission Guidelines. Comments are welcome while open. We reserve the right to close comments at any time.