TAX NEWS - 2010

Canada B.C. Tax: B.C. couple say their dream honeymoon cancelled due to HST

Michael Pritchard and Miranda Simms have cancelled plans for their dream honeymoon because of the harmonized sales tax.

The young couple will tie the knot at Hatley Castle on July 17, more than two weeks after the tax takes effect. They were hit with $786 in taxes on their catering bill for their nuptials -- because the tax hit is climbing to 12 per cent from five per cent after July 1.

Their parents are helping with the wedding photography and decorations, but the couple is paying for the rest of their wedding costs. When you combine that with the fact Pritchard and Simms recently took on a mortgage for a condo in Langford, and are saving so Simms can attend Royal Roads University for business school, the catering bill meant something had to give.

"We were going to go somewhere nice and hot -- Mexico or Cuba," said Pritchard, who has never travelled further than Calgary.

"It was going to be fun going out to Mexico to an all-inclusive resort. It would be a pretty good vacation."

Instead, the couple has had to settle for something a little closer to home -- Tigh-Na-Mara in Parksville -- in order to cover their catering bill.

Couples such as Pritchard and Simms are expected to pay between $532 and $623 more in tax each year because of the HST, according to numbers crunched by Statistics Canada for the Times Colonist.

Pritchard and Simms say they plan to dine out less, and will watch how much money they spend at Serious Coffee and Tim Hortons. "We live right across from Tim Hortons, so we try to go every day and get a coffee or bagel for breakfast," Pritchard said. "Add that on every day -- that's a lot of money we spend on going for coffee. You keep adding on more cents on top of that, and it all piles up at the end of the year."

Pritchard and Simms eventually intend to settle in Kelowna and buy a house. But Pritchard is wary about what the HST might mean for those plans. While the tax will only increase for new homes over $525,000 -- out of the couple's price range -- they're worried about the increased tax on real estate commissions and renovations they could eventually face.

"My goal is to get a fixer-upper that you can put a little bit of money in," Pritchard said.

"If you want to live at least comfortably, having a suite on there is what allows it. That's a lot of renovations -- $20,000 or $30,000. Add a 12 per cent tax on there, and it adds up."