Math

A house is being renovated for \$50,000. Right now the HST is 12% and is charged on all renovations. After April the HST will be gone and be replaced with PST of 7% and the GST of 6%. Renovations will only have to charge GST. How much money will the homeowner save if they wait until April to get the renovations done?

1. right now tax is .12(50000) = 6000

after april
PST= .07(50000) = 3500
GST = .06(50000) = 3000
new tax is 6500

so savings is 6500-600 = 500

What I had suggested in the earlier post is to simply take the difference in the percents
12% vs (6+7)%
that difference is 1%
and 1% of 50000 = 500

posted by Reiny
2. my answer is wrong, I did not read the question carefully enough

after april they are charged only the GST
which is .06(50000) = 3000

so they would save \$3000

posted by Reiny

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