By now everyone knows the HST (harmonized sales tax or "hated sales tax") came into effect in Ontario on July 1st. Many are still confused as to its impact on our lives.

In real estate there seems to be a lot of misinformation.

There is no HST payable on the sale of resale residential property in Shelburne or Orangeville, just as there was no GST before July 1st.  New residential construction does attract HST in various amounts under certain conditions. Buying a working farm, commercial property and most vacant land is now taxed at a full 13%  on the purchase.

There are definitely extra costs to home owners in Dufferin County who sell their houses after July 1st and, to a lesser extent, extra fees for home buyers.

Real estate commissions now attract tax at a rate of 13% instead of the former 5%, as do lawyers' fees and the bill from the home inspector. There is no change to tax charged on home insurance and CMHC insurance which is still taxed at 8% in Ontario.

One of the biggest changes most will notice is the extra cost for utilities, which have already seen a steady rise. Your hydro bill, gas bill, and internet service invoices now contain an extra tax of 8%, and the plumber and electrician are also required to charge 13% tax on their services. There is no change to the tax rate on phone and cable television services; they already are charged a tax rate of 13%.

It seems Ontario residents now pay more in taxes than before July 1st.

For a full list of all the tax changes, click here.