The Conservative government plans to bring in legislation connected to the harmonized sales tax in the coming months, giving it the tool to bring about its own demise should Prime Minister Stephen Harper wish to capitalize on the Liberals' current misfortunes.
Government officials confirmed that the agreements under which Ontario and British Columbia will harmonize their retail sales tax with the federal goods and services tax call on Ottawa to bring forward HST legislation by March 31, 2010.
"The HST agreements with Ontario and British Columbia will require federal legislation to levy the provincial portion of the HST," said Jack Aubry, a spokesman for the Finance Department.
With the Conservative Party doing well in public opinion polls, opposition parties are on the constant lookout for so-called "poison pills" that the Tories could use to force an election at an opportune time for them, in spite of repeated Conservative assurances that they do not want to do so.
A second official indicated that the HST legislation is not imminent and will not be included as part of a budget bill to be tabled this week.
Nonetheless, the HST bill will likely put a short timeline on the NDP's support for the minority government. Some New Democrats see the growing controversy over the HST as a potential opportunity to make gains in Ontario and B.C., should there be a fall election.
Any vote on a Finance bill related to the HST would be a matter of confidence. New Democrats indicated yesterday that they would likely have to vote against the government on such a bill, given their vocal opposition to the tax changes.
NDP Leader Jack Layton raised the HST issue in Question Period yesterday, which triggered a sharp rebuke from the Prime Minister.
"This government lowered the GST, the federal sales tax, twice. The NDP voted against it and argued against it both times," Mr. Harper said. "That is why nobody thinks they have any credibility on talking about sales taxes."
Liberal MP Denis Coderre's resignation this week as Liberal Leader Michael Ignatieff's Quebec lieutenant has party strategists reassessing the political landscape.
Mr. Layton talked strategy last night with his MPs in a closed-door gathering over Greek takeout in a West Block committee room.
The NDP has yet to say officially how it will vote in a Liberal no-confidence motion on the agenda for tomorrow. Some said privately that it's highly unlikely they would vote to defeat the government this week, especially after supporting the Tories last night in a 175-105 vote that sent the government's employment insurance legislation to be studied by a committee.
What is still up for debate within the NDP is whether to keep the government in power beyond the few weeks required to pass the EI bill into law. The Liberals and the Bloc Québécois voted against the bill. Mr. Ignatieff was absent.