Federal Finance Minister Jim Flaherty says there will be no HST compensation deal for Quebec in his sixth budget, expected to be tabled in February or March.
"No, I don't think we'll be there by then," he said in an interview with CBC Radio's The House, aired Saturday, when asked if his government is going to set aside sales tax compensation money for Quebec.
Bloc Québécois Leader Gilles Duceppe said earlier in the week that his party will vote against the Conservatives' budget if it doesn't include $2 billion in compensation for Quebec for harmonizing the federal GST and the provincial sales tax.
Flaherty said he doesn't believe compensation will be a sticking point in talks with Quebec. But he said the province must meet several conditions in order to make harmonization a reality there.
"One of the most important ones is that you actually have to have a harmonized tax base," he said. "B.C. and Ontario have done that." He added that the Atlantic provinces also adopted the HST years ago. Prince Edward Island is the exception in the region.
"If Quebec wants to harmonize its base with the federal base, you have to go through a whole list of items, and those discussions are still going on. There is still a long list with respect to which there is not agreement."
Flaherty said while his officials have been holding discussions on harmonization with their counterparts in the Quebec government, they are not talking with the Bloc.