sales tax

Ontario's PCs Just Defeated a Bill to Remove HST From Groceries. Here's the Math on Why Sales Tax Hits the Middle Class Hardest.

On May 27, 2026, the Doug Ford Progressive Conservative government in Ontario voted down Bill 113, the Fair Prices and Tax-Free Groceries Act, 2026, introduced by NDP MPP Tom Rakocevic. The bill would have removed the entire 13% Harmonized Sales Tax (HST) from all food and drink sold in Ontario — including the prepared meals, deli food, snacks, restaurant meals, and many packaged products that currently carry HST (most basic groceries are already zero-rated). The bill also proposed ending the secret lease covenants that allow major grocery chains like Loblaws and Sobeys to block competing stores from opening nearby. The Ontario Liberal Party has a narrower proposal: remove the provincial portion of HST (the 8% provincial share) from prepared food purchases under $20, costing approximately $500 million per year in foregone revenue, partly offset by a corporate-profit surtax and a high-income tax surtax. This article walks the defeated bill, the structural incidence of HST on Ontario households, the GST/HST credit and why it does not reach the middle class, and the honest caveats — including the fact that universally consumed goods cut in tax also benefit the wealthy in absolute-dollar terms.