Most retailers are prepared for the tax cut, but consumers still have lingering questions

Kristin Goff
Sun

OTTAWA — Retailers are ready to cut the GST by one percentage point on Jan. 1 without much difficulty, according to the Retail Council of Canada.

But in case some haven’t had time to brief staff during the Christmas rush on all the details of the switch to a five-per-cent GST tax rate, it could be wise for consumers to know how the changes will apply.

Some of the changes aren’t as straightforward as you might guess.

Take this example, based on information from tax consultant, KPMG Canada:

If you exchange the purple shirt Aunt Maxine gave you at Christmas for the same shirt in the colour blue on Jan. 2, are you due a refund on the difference in the GST?

The answer is yes, although we’re talking small change — 30 cents on a $30 shirt.

“If the shirt is purchased before Jan. 1, 2008 and returned on or after that date, the GST refund on the returned shirt will be six per cent. The exchange will be considered a purchase of a new shirt, which will be taxed at five per cent because it took place after Dec. 31, 2007,” according to KPMG.

While it is true that retailers have just gone through their busiest season of the year, Derek Nighbor of the Retail Council of Canada expects things to go smoothly when the lower tax rate goes into effect.

Retailers and other types of businesses have already reduced the GST once. On July 1, 2006, the GST was reduced to six per cent from seven per cent with relatively few reported problems, said Nighbor, vice-president of national affairs for the Retail Council.

“Our sense is, that as with the first iteration, retailers large and small will be ready,” he said.

“It is a big chunk of money.”

Nighbor estimates the tax reduction will put $5 billion into the pockets of consumers.

In most cases, the GST appears separately on bills for goods and services, making it relatively easy to see whether you are getting the reduction you are due.

But businesses do have the option of including the tax within their prices. During the last GST reduction, some businesses chose to increase their prices by an amount equal to the tax reduction, so the $12 price of a movie ticket or the $1.50 cost of a vending-machine treat stayed the same for consumers, but represented a seemingly painless way to raise prices for the business operator.

The Canada Revenue Agency has a toll-free GST information line for consumers and businesses from 8:15 a.m. to 8 p.m., Monday through Friday, to answer questions (1-866-959-7797 English, 1-866-959-7798 French). There is also information for consumers and businesses on the Internet at www.gst.gc.ca.

Here is a sampling of questions and answers for consumers, taken from information by Canada Revenue Agency (CRA) and KPMG.

Q. What GST rate applies if I return a purchase for a cash refund?

A. If the item was purchased before Jan. 1, the cash refund should be based on the six-per-cent GST that applied at the time of purchase.

Q. What is the GST rate on the chimney cleaning done on Dec. 17, if I don’t pay until Jan. 4?

A. The GST rate is usually based on the earlier of the date that payment is made or the date the supplier issues an invoice. So if the chimney sweeper gave you a bill on Dec. 17, the rate would be six-per-cent GST. But it could be five per cent if the invoice was issued after Jan. 1, regardless of when the work was done. CRA also cautions that there can’t be an “undue” delay in issuing invoices in order to jump to the lower GST rate.

Q. I made lots of purchases in December with my credit card. Since I won’t get the bill until January, does the lower five per cent GST rate apply?

A. No such luck. You’ve already paid the six-per-cent rate when you made the December purchase, and your credit-card company doesn’t owe you a rebate.

Q. I bought furniture in October under a “don’t pay a cent” deal which delays payment until October 2008. What is the GST rate?

A. You still have to pay last year’s six-per-cent GST because you became owner of the furniture in 2007.

Q. If I purchase hockey tickets in December to attend a February game, what is the GST rate?

A. Six per cent. It is based on when you pay.

Q. What should I do if I am charged six per cent GST on a purchase made after Jan. 1, 2008?

A. First request a refund from the company that overcharged the tax. If that doesn’t work, you can file for a rebate from the government on taxes paid in error, using the form GST189, known as the General Application for Rebate of GST/HST. The form is available from GST information phone line staff or on the CRA website: www.cra-arc.gc.ca.

© The Vancouver Sun 2007

Home Hardware’s computer program can take the stress out of remodelling your home

Joanne Hatherly
Sun

James Cook uses Home Works software on a computer at a Home Hardware store. Photograph by : Ray Smith, CanWest News Service

Everybody loves to try before they buy. Consider taste-test tables set up in grocery store aisles, or the mandatory road-test for a car.

But renovating a house is a bigger undertaking than sipping on a can of Coke or test-driving a car, so it can be challenging for homeowners to stretch their imaginations to visualize the effects of a makeover.

Would the living room look better with ceramic tile or hardwood floors? How about the front door: Should it be a craftsman, colonial or mission?

The computer revolution changed all that, so that now with the click of a mouse, the phrase “what you see is what you get” is becoming reality.

At the end of 2006, Home Hardware introduced HomeWorks, a home-imaging software package that allows consumers to piece together a digital do-over. It paints, installs doors and windows, refloors rooms, sets up new columns, re-surfaces the driveway and more.

Andrew Pantelides, a national product manager at Home Hardware in Montreal, says the software was designed for contractors and as an in-store retail tool, but they quickly saw it “had legs” for the customer’s in-home use.

They linked it up with more than 30 national suppliers so the package uses manufacturers’ windows, doors, flooring, interior and exterior paints, landscaping, siding, roofs, screens, masonry, stone pavers, railings and more.

It might be the most comprehensive digital remodelling package on the market. Other retailers are picking up the trail, as well. Browse the Rona website that features virtual walk-throughs on home plans and downloadable landscaping plans. (rona.ca).

Before HomeWorks, the best-known digital imaging application for the home was introduced through paint manufacturers’ websites where browsers could digitally repaint virtual rooms. Benjamin Moore has its Personal Colour Viewer; Glidden had Color@HomeII, Sherwin-Williams Color Visualizer, and Behr Paint Your Place.

Increasingly, manufacturers have posted these packages on their sites as free downloads. Upgrades that allow shoppers to use photos of their own homes can be purchased for less than $20.

Other home-related manufacturers and retailers followed. Now consumers can digitally tinker with landscaping, design their own closet organizer, and figure out how to make over kitchens and bathrooms.

The programs have grown more sophisticated while they’ve become simpler to use. Daryl Stanley at Victoria‘s Floor Covering International retail started using a digital flooring program in October. He still bumps around as he navigates the program, but in a short time, he has become adept enough that the program has changed his sales calls.

“I used to draw diagrams for customers,” says Stanley. “Now I can show them whatever it is they want — tile, hardwood, carpet, luxury vinyl. If they want to see what Brazilian cherry will look like in their living room, I can show it to them.”

He notes, however, that consultation is still a big part of the selection process. “I don’t think any program can make it perfect, and there are still things to discuss.”

Those things include lifestyle, traffic and decorating preferences.

How easy — or hard — is it to use HomeWorks? The proof, in this case, is in the computer’s disk drawer.

Ross Bay Home Hardware owner-manager Greg Hellyer invited a reporter to navigate the program with James Cook, 23, a staffer who had never used it.

The program loads quickly into the store’s computer. Cook wanders through the options and opens a detailed illustration of a craftsman-style house complete with porch. He scrolls through paint choices — the variety is as wide as the stock on the store’s shelves. He picks a brand and then a style, which opens a sidebar of colour choices.

The program is brand specific — those 30 to 40 big-name suppliers Pantelides mentioned — and provides a product list that users can take to the store, which means when they order a specific paint colour, that’s the colour they will get.

Cook cautions, however, that colours on a computer monitor do not always look the same on the wall, so customers should check the paint colours in the store.

The software designers planned ahead on the HomeWorks program: It not only provides images of products available through the store, it also lists regional availability. For example, when Cook selected a particular type of masonry, the system advised him that it was only available in Eastern Canada.

“What that tells you is that we would have to order that in,” Cook says.

Use the Internet to download updates, so the user won’t select items that are no longer stocked.

Before Cook shuts down the program, he stumbles over one unexplored key.

“Ah, the tutorial!” Cook says as a detailed how-to list pops up. “Ordinarily, it would be a good idea to look at that first.”

PLANTING IDEAS

Nothing “greens” a home better than a few well-placed plants. For most of us, that means using the trial-and-error method — purchasing the plant, selecting a pot that dovetails nicely with our home’s interior look, and then stepping back to measure the overall effect.

It’s simple, and for the most part it works, but what about when the pot in question is more than one metre tall and hauling it to your home produced enough back strain that you dread the idea of returning it? What if your plant acumen is somewhat on the low side and you’ve lost some money when you put those shade-friendly plants under a south-facing skylight, thus scorching the leaves to an autumnal brown?

A little digital enhancement might go a long way in making this process easier. Such a service — its roots well-established in hotels, businesses and malls — is creeping into the residential market.

Joanne Craft, B.C. vice-president for Initial Tropical Plants, says residential clients are taking advantage of the technology that allows them to show how a home would look with a variety of plant selections.

“It’s created a huge ‘wow’ factor with our clients,” says Craft.

The process is as simple as a consultation, taking photos of the home and digitally enhancing them to show the plant selections in the exact location.

No more brain-strain while you try to imagine how that palm tree would look in your foyer.

“With digital imaging, clients can make that decision very easily,” Craft says.

Getting others in the act is simple, too, by e-mailing the images around for those second, third and fourth opinions. Most of the homes taking advantage of this service fall into the “mansion” category, says Craft, but she can see its appeal to the mid-range market, especially with the growing interest in home interiors.

Plants are, after all, the ultimate organic green accent.

© The Vancouver Sun 2007

‘I am at peace with myself and my religion’

Province

The Province interviewed Benazir Bhutto when she visited in 1991

The following are excerpts from a Province story by former staffer Lyn Cockburn when Benazir Bhutto visited Vancouver on Jan. 22, 1991:

She is above all a tightrope walker. She walks the line between the old and the new. She balances delicately between Muslim tradition and the modern world.

For example, she wears an approximation of the veil, something she did not do when she studied at Harvard and Oxford.

She agreed to an arranged marriage with Asif Ali Zardari, a wealthy businessman. On the other hand, she promises to increase the rights of women in Pakistan.

She was in Vancouver yesterday and I interviewed her just hours before she was to address the black-tie World Affairs fund-raising dinner at the Hyatt Regency.

We sit at a huge conference-style table in her [hotel] suite. She is composed; I am a little nervous.

“Sit over on this side, I’m a little hard of hearing,” she says, instantly making me feel better.

There is a dignity about her, a presence, a sense of power, a feeling of serenity.

She knows exactly what she wants to say and she says it. For however long she wants to say it. If you try to interrupt her to ask another question, she says calmly, “May I please finish my sentence.”

Her tones are measured, considered and, in some cases, careful.

She is ever on that tightrope.

For example, she is aware that she has often been accused of being an insincere Muslim educated in western ways.

“I am at peace with myself and my religion,” she says.

“I am deeply religious. I believe in the power of prayer but I don’t believe that fundamentalist Muslims have any right to tell me or the people of Pakistan how to run our lives.

“We are answerable to God, not the fundamentalists.”

Bhutto states that she and her Pakistan People’s Party represent the liberal face of Islam while the fundamentalists would take Muslims back to the world of centuries ago.

“Islam is not just a set of narrow, rigid laws,” she says.

If she is a trifle circumspect when discussing religion, she makes up for it when she talks about the Oct. 24, 1990, election which gave her a mere 45 seats in the 217-member National Assembly.

“It was rigged,” she states flatly.

A Canadian team of observers was present for that election and declared the polling largely free and fair.

Bhutto points out that the Canadian team went home right after the election while a French team did not. “The French observers said publicly that fraudulent ballots were added after the polls closed at night,” she says.

“We won that election,” she announces, conviction evident in her voice. “And we would win again.”

© The Vancouver Province 2007

 The Les Twarog Team Honors a Courageous Woman…

Naramata operation is owned by two investment industry veterans

Michael Kane
Sun

David and Cynthia Enns are investment industry veterans who’ve switched to winemaking at Laughing Stock Vineyards. Their flagship bottle is adorned with ticker tape showing stock prices on the day the grapes were picked. Photograph by : David Szabo/Special to the Vancouver Sun

Laughing Stock Vineyards Portfolio 2005, Naramata Bench, Okanagan Valley: David and Cynthia Enns are investment industry veterans who’ve switched to winemaking at Laughing Stock Vineyards. Their flagship bottle is adorned with ticker tape showing stock prices on the day the grapes were picked.

When the financial services industry is clamouring for your retirement savings this February, two investment veterans will be singing a discordant but possibly more delightful tune.

David and Cynthia Enns will be inviting people to invest in Portfolio, their award-winning Okanagan red wine with its distinctive circular ticker-tape label quoting actual stock prices from the day the grapes were harvested.

Those who pay $35 a bottle in February will be saving $5 on the retail price when the wine is released six months later. While that’s a modest financial return for entering this futures market, it does guarantee delivery of a wine that is becoming increasingly popular and difficult to find.

$50 a bottle on the shelf in wine stores in Vancouver, so the futures program is a really advantageous way to make sure you are on the list,” said Cynthia Enns, the marketing half of the partnership behind Laughing Stock Vineyards, a boutique estate on the Naramata Bench north of Penticton.

The Enns, who met while toiling in the mutual fund industry, are well aware of the investment mantra that past returns are no guarantee of future performance, but they’re hoping their next liquid investment will prove as successful as the last.

Portfolio, their flagship product, is a classic Bordeaux blend featuring cabernet sauvignon, merlot and cabernet franc varietals. The current edition, Laughing Stock Portfolio 2005, collected the gold medal for Meritage Red at the 2007 Canadian Wine Awards.

That’s especially gratifying for 50-year-old winemaker Enns because it was his first independently produced vintage from the winery at Laughing Stock. The first two vintages, the 2003 and 2004, were produced with the help of consultant Ian Sutherland at his nearby Poplar Grove Winery.

Enns picked up his passion for wine while living in France as a child and started making it in a neighbour’s garage when the couple lived in Crescent Beach, near White Rock.

He recalls trucking in his first batch of grapes from Walla Walla in southeastern Washington state in the border-clogged days after Sept. 11, 2001. Since then he has taken winemaking courses at the University of California at Davis and at Okanagan College.

Still, it was a leap of faith when the couple transitioned from successful careers in the investment industry and their own distribution and marketing company, Credo Consulting, to an uncertain future in winemaking.

Cynthia Enns, now 39, was turning her back on an MBA. When they bought two hectares (five acres) in Naramata, they stuck with the playful name Laughing Stock because not a few people thought they were crazy.

Yet there was some marketing method to their madness. They reasoned their financial industry connections would resonate with the many wine aficionados in the business community.

With the task of making a small Okanagan winery stand out from a field of about 150, Cynthia Enns made “initial public offerings” of “private placements” to chief financial officers, trying to convince them that the gift of a bottle or even a case of Portfolio would impress valuable clients.

This year’s corporate customer targets included Telus, Ballard, QLT, Royal Bank and CIBC — all companies whose stock prices are quoted on the Portfolio bottle thanks to the novel label designed by Bernie Hadley-Beauregard of Vancouver’s Brandever

Strategy Inc.

Laughing Stock also produces a chardonnay and a pinot gris, and this year introduced a new wine for grapes that are surplus to requirements or don’t quite make the cut for the premium Portfolio offering. In keeping with the financial theme, the new wine is called Blind Trust.

As with many small producers in the Okanagan, their products rarely show up in BC Liquor Stores or the VQA outlets which sell exclusively B.C. wines. Laughing Stock typically sells out through more profitable channels, including their mailing list and about 150 restaurants in Vancouver and Whistler.

Less than 10 per cent is sold through their tasting room because it is often closed, even at the height of the tourist season.

“We’re supposed to be here for the lifestyle, so it’s nice to have some balance between making and marketing wine and making sure we get the boat into the water a bit in the summer,” Cynthia said. That suits their nine-year-old son, Joshua, just fine.

Laughing Stock’s wine futures program generates important early cash flow in a business that requires large and patient capital investment but it is limited to six months because the Enns don’t want to promote their wine until they have a good idea what it looks like. February’s offering will feature grapes that were picked in 2006 and are well advanced in the wine-making process.

Bigger producers, like Tinhorn Creek in Oliver, are able to offer merlot futures at a 20-per-cent discount in May with the wine shipped 18 months later.

Tinhorn Creek introduced futures in the late 1990s as a way of getting around regulations that prohibited wine discounts, said marketing manager Shaun Everest.

“Those regulations have been lifted and now the futures program is really a way for consumers to make sure they are going to get access to something before it gets snapped up,” he said. “Many long-term buyers of the futures like to keep a few bottles for several years to see how they age.”

© The Vancouver Sun 2007

It will soon work here, but with so many un-named streets, it