July 15 2010 by Ellen Roseman
The Ontario Ombudsman wants to wade into this stinking pool of surcharges that are popping up on sales receipts. That’s great news.
Lately, I’ve been thinking that an eco fee really is a tax. Here’s why.
In my latest column, I said the goal was to shift the cost of disposing of hazardous wastes from taxpayers to product manufacturers and importers. That’s what I was told by Stewardship Ontario.
But everyone knows that businesses don’t absorb extra costs for long. They pass the costs on to consumers and that’s exactly what is happening.
Ontario Electronic Stewardship is a similar program for recycling computers, printers, TVs and phones. As you can see here, the fees have gone up substantially. Businesses will get consumers to swallow the cost.
These stewardship programs are shifting costs from municipal taxpayers to consumers. You and I are still paying to recycle hazardous wastes, but now it’s through a user-pay system.
It would be great if we could avoid buying these costly-to-dispose products, but we can’t. Today, the Canadian Consumer Specialty Products Association (CCSPA) and the Consumers Council of Canada (CCC) asked the Government of Ontario to remove soaps, detergents and cleaning products from the eco fee program.
â€œConsumers do not throw out half-empty containers of soap or detergent,â€ says CCC President Don Mercer. â€œRather, they buy what they need and use it up. The eco fee, in effect, charges consumers for a service they will not use.â€
Ontario makes money from eco fees. The harmonized sales tax is applied on top of the fees, so there’s a huge potential for higher revenue.
Blogger Preet Banerjee picked up on this point in his recent post.
Many readers told me they were shocked to see taxes piled on other taxes. Gasoline, for example, is already heavily taxed by both federal and provincial governments. Now it has the 13 per cent HST on top.
Some said they’ve seen stores charging 5 cents for plastic bags, adding HST (0.65 cents) and rounding up the cost to 6 cents. Is this even legal?
One reader, who paid 64 cents to mail a letter — since HST is added to the 57-cent cost of a postage stamp — pointed out that a stamp is also a tax.
Ontario should admit that eco fees are actually a tax. As such, they should be made visible and standardized. There should be a complete list published in booklet form, just as was done for the HST.
This is not a program of making businesses pay more. It’s a pass-through to the consumer.