Squinty McGuinty has done it again!!   HST applies to the resale of vehicles.  However, traditionally only RST/PST @ the rate of 8% was applied to the private resale of a vehicle.  HST does NOT apply to private resales of vehicle, however, to make it fair for the Automotive Industry, a 13% RST/PST will be applied withing the HST.  This means you will no pay 5% more for your vehicle when purchasing at a fair price from a private seller.

There is a note attached to this on our government website:

Private Resale of Vehicles (including Registration)
Ontario will maintain the PST on private transfers of used vehicles at a rate of 13 per cent to help ensure a level playing field between sales by dealerships and private sales.
Tax changes to 13% (Was 8%)

ARE THEY SERIOUS???  Level playing field????  WTF are you talking about???  So do we get a rebate on the vehicle we sold to effectively “trade in”?  If so, then you have a level playing field.  Private sellers have always had a disadvantage as the tax savings form the trading of the old vehicle was not there.

New Car Dealers traditionally mark up used/pre-owned vehicles by 20% with a minimum of $3000 profit.  So when trading in a vehicle you are given a value that is 20% below market value plus the estimated cost on reconditioning.

I recently purchased a new vehicle.  The trade value of my old vehicle was so low that I was be better to sell it privately.

Let’s do the math on an example:

New Vehicle outright purchase $42,000plus GST & RST 13% ($5460) = $47,460

Trading an old vehicle: New Vehicle $42,000, Trade-in value $14,000 plus GST & RST 13% ($3640) = $31,640 (for the purpose of comparison New vehicle plus tax, plus value of trade = $45640) a savings of  $1820 (basically taxes on the value of the trade)

OK, now let’s sell the old vehicle privately!!

Take the outright purchase price total of $47,460 (including taxes) and then subtract the selling price of the old vehicle minus any expenses.

Selling Price:  $17,000 ($3000 difference compared to trade-in value)
Costs: Advertising $0  Ontario Safety Certificate and Emissions test: $500
Net Value for old vehicle: $16,500

Now lets do the math:  $47,460 – $16,500 = $30,960

Difference:  $30,960 (net cost of new vehicle considering sale of old vehicle – $28,000 (net value of new vehicle minus the trade in value) = $2,960

Add to this the fact that prior to July 1, 2010, the purchaser of my private sale vehicle did not have to pay GST, 5% savings for him, plus the vehicle price was likely less than a dealers sale price.  A savings of $850 GST

In the last scenario that saved the consumers an estimated $6,525,  our governments were paid:

GST:  $2,100 New Vehicle Purchase + $25 for vehicle repairs = Total $2,125

RST/PST: $ 3,360 on new Vehicle purchase + $40 tax on repairs + $1,360 on the old vehicle sale = $4760

Total TAX paid:  $4,760, none of which is recoverable due to the trade clause a dealer has.

So, lets see the tax revenue from the dealer sale: (Considering a trade value of $14,000)

GST:  $1,400 New Vehicle Purchase

RST/PST: $ 2,240 on new Vehicle purchase

Resale of trade @ $17,000 = GST $950  PST $1,360 = $2310

Total TAX paid:  $5,950

Dealer Profits on trade: $17700 – trade value $14,000 – repairs $500 = $3200*

This does not include the dealer administration fee which is nothing more than added profit margin.  This “fee” ranges from $99-$699

So let’s review:

We needed to make this a level playing field for dealers??  Or the dealers need to be able to gouge consumers more then they do today?  This is ALL about increased tax revenue for the Ontario Government.    McGuilty promised no additional taxes!

Remember this when you vote at the next provincial election!

The latest road blockade at the GM plant in Oshawa brings up the issue of unions, or union members, engaging in criminal behavior for personal gain. The criminal activities include bullying, threatening, assault, vandalism, and now blockades. All of these activities have been executed under the disguise of unionization.

Criminal activity in Canada is criminal activity and no company, government or union should support this behavior and leave its victims helpless. Yet in almost every case of criminal activity by union members, there is a stipulation of immunity in the settlement agreement.

It is time we put a stop to criminals being immunized against prosecution! their victims are being treated unjustly. A law that prevents the negotiation of criminal charges needs to be enacted!

There is a place for unions, to protect workers in situations where they are being treated unfairly. A union should be there to negotiate contracts on behalf of its members so that wages and benefits are fair and working conditions are safe. Past that, power hungry executive wanna be’s like Buzz-off Hargrove should be put in jail so that there are no more victims of his union. Buzz does not stand alone in this.

Job security is not negotiable! How possibly can you guarantee job security without crippling a business’s flexibility to compete in the market place. You want to know why the Japanese are the industry leaders in Automotive Manufacturing? It is clearly because the employees are motivated to do quality work. Motivation for quality is something that is severely lacking in North American Auto manufacturing.

Seniority should not play a factor in the promotion of employees. Although the original principal behind this was to protect older employees from being passed over due to age. Now companies are forced to promote undeserving candidates purely because they passed the right educational requirement. Employees with less tenor and more drive and motivation are likely better candidates than the lazy 40 year old that is looking for an easier day and more money.

Now I know your ready to scream out loud in my comments section, but remember I agree there is a place for Unions, I just think they forgot where that is!