Finance to do away with GST, HST on hospital parking for patients, visitors

OTTAWA – Hospital patients and visitors are getting some relief on the cost of parking, courtesy of the same federal government that unceremoniously closed a loophole last year forcing them to pay taxes on the fees.

The government announced the plan to stop charging GST or HST on hospital parking on Friday, less than a year after ending a tax break on fees at public institutions where the parking lot was run by a non-profit partner.

Hospitals had complained that they would have to absorb the tax, resulting in reduced parking revenues that they use to supplement their annual health care budgets.

Shortly after the measure was introduced in the 2013 budget, the government said the change was intended to ensure consistent tax treatment.

“These are companies that are supplying parking to hospitals and they were getting a special tax reduction,” then-junior finance minister Ted Menzies told the Commons last March.

“We do not think that is necessary.”

But the Finance Department is now proposing to soften part of that measure to exempt hospital parking fees from the GST or HST.

The Opposition New Democrats denounced the move as hypocritical, accusing the governing Conservatives of making tax policy “by the seat of their pants.”

“A year later the Conservatives have realized that it is taxing sick Canadians which is unnecessary, and isn’t going to win them any votes,” the party said in a statement.

“It took (Finance Minister Jim Flaherty) less than a year to realize this policy was unfair.”

In a statement Friday, Flaherty said he expected hospitals to pass on the tax savings by reducing the cost of hospital parking. But a number of hospitals were hoping the government would reverse its decision and had not yet factored the tax into their own budgets.

A charitable foundation set up by the Children’s Hospital of Eastern Ontario in Ottawa generates about $1.8 million annually that goes directly into the overall patient care budget.

Adding the HST meant the foundation would have had to collect up to an additional $234,000 from hospital patients and visitors, or hold parking rates steady and absorb the loss.

No tax was ever levied.

“We’ve been holding off doing that because we knew the government was reconsidering that direction in the budget,” said Alex Munter, the hospital’s president and CEO.

“So we’re very pleased that the government listened to the concerns from hospitals.”

Other institutions affected by last year’s tax loophole change, however, remain on the hook for parking taxes.

The Harper government said it would keep amendments in place to eliminate the tax exemption for parking provided by a charity set up or used by a municipality, university, public college or school.

The department is accepting public comments on the proposal until Feb. 24.




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Finance to do away with GST, HST on hospital parking for patients, visitors

  1. Dear Leader is throwing us pre-election table scraps. Guess we should enjoy it and rejoice, while we still have a public healthcare system.

  2. Ridiculous. Why only hospitals? Why not universities too? Playing to his base once again. Everyone should be obligated to pay the same taxes.

    • I believe there is a school of though that university students should be using public transportation as much as possible. This is not always feasible for hospital patients who are often disabled and on quarantine do to their illnesses. If we are serious about promoting a green world, we should really be subsidizing better environmental choices like public transportation rather than individuals each driving a vehicle and parking at at public venues.

      • Or people getting off of work for taxes come to visit loved ones in need of some social comfort.

        We have become tax slaves of state when everything has to have a realized and hidden taxes in it. Modern taxation has made us economic slaves of statism state.

        • I’m starting to think you’re a Canadian Taxpayers bot. It’s the same message over and over and over…

  3. Good for the institutions that ate the cost. But any bet that, where the tax was applied, they’ll now just keep the higher rate and pocket the extra?

    • Do you really think some institution in healthcare “ate the cost” without a cut happening in a service somewhere else in healthcare? The truth is that funding is finite so when costs go up cuts happen.

  4. Why not eliminate GST/HST completely? Less costs in collections, people left with more of their money after (hidden or realized) taxes will spend more on other peoples to have more jobs.

    Even a higher standard of living as inflated prices due to hidden taxes go down. Less government is the best answer for everyone.

    • I hear you don’t have to pay taxes on the moon.

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