Federal Liberals will support HST in Ontario, B.C.

OTTAWA - Liberal Leader Michael Ignatieff said Tuesday his party will support legislation enabling Ontario and British Columbia to harmonize their sales taxes with the federal GST.

The governing Conservatives will introduce legislation this week that will set the stage for Ontario and B.C. to implement a harmonized sales tax. The move had put pressure on Ignatieff, who derided the controversial tax as the "Harper Sales Tax" but stopped short of opposing it, to clarify his party's position.

On Tuesday, Ignatieff said the Liberals, who lobbied for the provinces to harmonize their sales taxes with the GST under former prime minister Jean Chretien, would not budge from their longtime support for the HST.

"Our party for 15 years has supported sales tax harmonization. This is a request from the provinces, because they believe it'll improve the competitiveness of their economy and create jobs," Ignatieff said after convening a special meeting of his caucus to discuss the tax. "We will support this legislation in Parliament."

The Liberal leader then took a swipe at Prime Minister Stephen Harper for distancing himself from the HST in recent months, as consumer opposition has mounted.

"Let me just observe that Stephen Harper's walked away from this issue, not taking any responsibility for it, trying to pretend he has nothing to do with it," Ignatieff said. "This is initiated by Mr. Harper, and leadership means taking responsibility for your decisions. I've done so today. I wonder why he has not."

The Liberal leader said the vote by his MPs would be "whipped," meaning they will be expected to support the party's stance.

In Ontario, Premier Dalton McGuinty congratulated Ignatieff "for making a difficult, but fundamentally principled decision."

The HST is expected to save businesses billions of dollars, but raise the cost of some consumer items, such as heating oil in Ontario and restaurant meals in B.C.

Ignatieff's announcement left the NDP as the only party opposing the tax. The Bloc Quebecois indicated last week that they would also support the bill.

NDP Leader Jack Layton accused the Liberals of turning their backs on "hard-working families."

"Everywhere I go people are extremely unhappy about paying a new tax all over Ontario and British Columbia, small businesses, individuals, families, seniors, young people, you name it," Layton told reporters. "They were never told about it when these parties ran for election and now they're getting whacked with this new tax and the Liberals have decided to join with the Conservatives to make it happen. We think it's wrong."

Finance Minister Jim Flaherty has said the bill will be similar to legislation passed in the 1990s that enabled Newfoundland, Nova Scotia and New Brunswick to harmonize their sales taxes.

The federal government is providing $4.3 billion to Ontario and $1.6 billion to B.C. to implement the measure.