Randall Denley wrote in "Double dose of HST for landlords; Passing on increased costs to tenants not allowed", (Ottawa Citizen, July 4, 2010):
"The harmonized sales tax is here, but few will feel it as acutely as landlords. They are facing an eight-per-cent increase in the cost of heating and a wide range of services, but the province won't let them recoup the money from tenants.
Premier Dalton McGuinty says that his HST is "strong medicine," but he's ordering a double dose for people in the rental housing industry. It's a purely political move designed to prevent a tenant revolt against the HST. It will shelter tenants from the real costs of housing in the short term, certainly until after the next provincial election. For a politician, that's a job well done, but it's not fair and it will drive up rents ultimately.
Landlords are facing the HST on utilities, repairs, legal services, accounting, landscaping, snow removal, property management and garbage disposal.
The biggest burden will be on the heating bill. About 85 per cent of tenants have heat included in their rent, but the eight-percentage-point increase in sales tax will be the landlords' problem, along with any underlying increase in the price of the heating fuel itself.
According to the provincial landlords' organization, the HST will add about five per cent to overall costs of operating a rental building, even after some HST-related savings are taken into account. That's on top of anticipated inflation of about two per cent.
Faced with those cost increases, landlords will only be allowed to increase rents by 0.7 per cent, the lowest limit in the 35-year history of rent regulation in Ontario. And it gets worse. The 0.7-per-cent figure is based on the increase in the consumer price index between May 2009 and May 2010, so the government is allowing landlords to recoup inflation that has already taken place, but not until next year. The guideline announced in June applies to rents starting in January 2011. Rents can only go up once every 12 months, so the tiny increase could take place as late as December 2011. Landlords had hoped to get at least partial recovery of the HST through a longstanding mechanism that allows them to get increases above rent guidelines if there are extraordinary costs. They were shooting for a total increase of 2.5 to 3 per cent. Once it became apparent that the HST would affect renters, the McGuinty government quickly acted to cancel the provision, calling it a "loophole." The political calculation was simple. There are a lot of renters, particularly in vote-rich Toronto. There are shielded from many of the HST's effects, but a rent increase would have been apparent and unpopular. It would also have created pressure on the government to shell out more money for shelter allowances for people on social assistance. The easy solution was to stick it to landlords. There are obviously far fewer of them and landlords are not a well-loved group anyway. The problem for landlords is that they are businesspeople. They can't just run a deficit the way the McGuinty government does. The rents a landlord obtains have to at least cover his costs or the investment doesn't make any sense. And yet, they are in a business where government tells them how much they can increase their revenues, while choosing to turn a blind eye to demonstrable cost increases the government itself has caused. One of the few areas where landlords can cut costs is property maintenance and that's just what they will do, says John Dickie, chair of the Eastern Ontario Landlord Organization. That's bad for tenants because it will reduce the quality of the rental stock, Dickie says. The government is just fooling tenants when it maintains that they will be sheltered from the HST, Dickie says. As new tenants move in, they will face higher rents as a result of HST-driven higher costs. Rent-increase limits apply to tenants, not units. There might be an impression that landlords are all giant corporations, but most of them are small investors. There an estimated 10,000 landlords in Ottawa and all but a few hundred are little guys struggling to make their revenues exceed their expenses. Like so much about this HST, the rent issue has been handled deceptively. Municipal Affairs and Housing Minister Jim Bradley says the government's approach offers "real protection for tenants" while "ensuring that landlords can recover increases in their costs." Neither part of that statement is true. Tenants will face higher costs when they move. Landlords will recoup their increased costs only to the extent that they cause future consumer price inflation, and then only years after the fact. Homeowners are bearing the full brunt of the HST from Day 1. There is no reason why tenants should get special treatment, especially not at the expense of landlords."
Liberal MPP Jim Bradley, the FLICKING liar from St.Catharines, gets caught with his pants down again, exposing his trademarked greasy scumbag Liberal duplicity.
Neither part of Jim Bradley's deluded deception is true, as Denley rightly notes.
Yet, McGuinty's congenital Liberal liars and deceivers are so far out of touch with reality that they actually believe that the Grit sputum which they smugly spit out at us, is not [cannot!] be sputum - they think it is sound policy.
Liberal scumbags such as Jim Bradley simply cannot see any longer through their mounting piles of horse shit.
Let's see how the St.Catharines Standard (aka The Liberal Jim Bradley Fan Club) ignores this story about their Gritty Golden Boy, as they have so many others.
Where's that in-depth Standard analysis on this issue? Where's that insightful interview with McGuinty's Municipal Affairs minister Jim Bradley?
Oh, yeah - there wasn't one, and ain't gonna be one.
What's Jim got to do with any of this, anyhow?
We love Jimmy.
Jimmy can do no wrong.
Jimmy's our special friend.
Jimmy's the King'O'Niagara.
We are Jimmy's Fan Club.
Time for a good ole global-warming story, perhaps...