Thank you.
This amendment excludes the luxury tax from the harmonized sales and goods and services tax, so it's trying to avoid the “tax on the tax” issue. In some cases, it can actually make the effective rate on some of these goods in excess of almost 30%. This tax on a tax is quite punitive on some goods with high prices. Let's not forget that we are also already collecting HST on the sale, so let's make sure we're not overly punitive on this front.