Manitoba NDP Premier Greg Selinger
Credits: BRIAN DONOGH/WINNIPEG SUN/QMI AGENCY
WINNIPEG - Manitobans, open your wallets.
Everyone will be paying a little more to the provincial government starting Sunday. The 7% provincial sales tax (PST) will be charged on a whole slew of hairdressing and salon services starting July 1. A $35 vehicle registration increase also takes effect. The same tax will be levied on several types of insurance premiums, including property, land titles and group life insurance, effective July 15.
The NDP government will rake in $106.5 million from the tax hike.
"This is a big tax increase and the reality is it never needed to be this way in Manitoba if we would've done a better job at controlling our spending for years we wouldn't of had to raise taxes," said Janine Carmichael, Manitoba director of the Canadian Federation of Independent Business.
Gordon Wood, an optician whose income helps support his wife and three growing sons, said he's fed up with the province shelling out millions for a new football stadium and convention centre expansion that force him, as a taxpayer, to fund events he can't afford tickets to.
"I can't keep paying more and more taxes. I have to eat," Wood said.
Businesses affected by the tax expansion have criticized and lobbied government for delays.
Insurance leaders successfully pushed for the exemption of critical illness and disability insurance from the levy and to delay the addition of new insurance taxes from July 1 to July 15. Meanwhile, the Manitoba Hairstylists' Association pushed for a delay in the PST addition to their services, as some salon owners demanded the province pre-empt the levy altogether.
The MHA found the tax implementation -- which exempts some services when combined with a haircut but not when they're offered alone -- so confusing, it felt salons would be better off applying a tax to all services instead.
Some hairdressers felt especially singled out, since the tax only applies to haircuts that cost $50 or more.
"Now this tax will apply to my clients because of my skill. Do you not pay tax on a bill under $50 for a plumber? What made them pick on hairdressers?" said Joanne Rempel, owner of Colors Beauty and Wellness.
Spa owners worry their industry's growing unregulated segment will gain an advantage over licensed spas, which must add the levy.
"An increase of the underground home aesthetics economy increases the standards of health risks to clients. Home operators are not subject to inspections for cleanliness and health standards," said Diane Sidebottom Roulston, owner of Giselle's Professional Skin Care and Day Spa.
So far, the government has not announced any changes to the PST on beauty services.
- with files from Nicole Dube
Here's a breakdown of what Manitobans will pay PST on, starting next month:
- Haircuts, hairstyling, conditioning, perms, washing, blow-drying, up-dos, coloring and highlights EXCEPT when these services occur along with a haircut and the total bill for all services is less than $50
- Hair weaves and other extensions, eyelash extensions, brow and lash tints
- Hair removal services
- Gift cards for services sold after June 30, 2012
- Pedicures, manicures, facials, make-up application, laser skin treatments, skin exfoliation, body polishes, microderm abrasion, scrubs, wraps and peels
- Ear and body piercing, tattooing, and tattoo removal
- Scalp treatments, hydrotherapy, foot detox, mud baths and wraps, sauna and steam bath services, aromatherapy, Vichy shower, hot stone therapy, bathing, non-dental teeth whitening, and tanning
- All haircuts less than $50, unless combined with services that bring the pre-tax bill above $50
- Cosmetic injections such as botox, if provided by a nurse or medical doctor
- Massage therapy, physiotherapy, reflexology and chiropractic treatments
- Children's face-painting
Insurance coverage now subject to PST:
- Property and casualty
- Group life
- Trip cancellation
- Land titles
- Goods in transit
- Credit and credit protection insurance
- Legal expense
- Identity theft
- Balance protection
- Contracts added or renewed before July 14, 2012
- Self-insurance, individual life, individual or group health, disability, critical illness, endowment, trip interruption and basic autopac insurance for registered vehicles
- Premiums paid under the Canada Pension Plan, Employment Insurance Act or Workers Compensation Act
- Liability for registered aircraft
- Insurance for licensed commercial fishing boats, sea-going vessels (those on inland waters are taxable)
- Property coverage on First Nations reserves
- Farmers' buildings, equipment and crop coverage used for income (hobby farms excluded)