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It has been quite a week for the BC and Canadian Financial world.
On July 23rd, the BC Government announced its intention to harmonize its existing 7% Provincial Sales Tax (PST) with the Federal 5% Goods and Services Tax (GST) into a single Harmonized Sales Tax (HST) of 12%. The HST would be effective as of July 1, 2010. The BC and federal governments are currently drafting the HST legislation. There is quite a bit of dialogue in the media right now about the expected impact of this new tax on industries such as the restaurant industry, as well as the purchasers of new homes. Now is the time to lobby the politicians, as the new HST – as it was described in the initial press release will increase taxes to the consuming public as some consumer services (that are currently only subject to 5% GST) will become HST taxable at 12%, such as restaurant meals, dry cleaning, professional services, haircuts and beauty services, etc.
On July 28th the USD/CAD hit a lot of 1.0750 overnight – the lowest since October 3rd last year. Since rising to a four-year high above 1.3000 in mid-March, USD/CAD has now fallen over 21%. This is good news if you purchase products from the USA or you are planning a visit down to the States; this is not good news if you have a USD revenue stream, as the value of your revenue in Canadian dollars has shrunk by 21% since March.
Coulson Group continues to operate due in no small part to its decision to diversify its product mix to the World market place. While we continue to make all strategic decisions in our Head Office in Port Alberni, we have both human and physical assets operating in other parts of the World. We continue to entertain options for our aircraft on other continents, and it will be interesting to see where everything is working six months from now.
The operational decision to match our Harvesting output with our Lumber Sales Program is proving to be working well. We have limited our exposure in unsold inventories, and have picked up some new customers, as well. Coulson Manufacturing continues to produce a quality product, consistently. Customers like that.
So, in recap, the volatility continues. Throw in political decisions like the HST and market changes like the USD/CAD rates, and we still continue to find our way.