The combined new rate will be 12% and will apply to most goods and services (there are a number of exemptions). Currently, the PST is 7% and applies to most goods, while the GST is 5% and applies to goods and services. Accordingly, the effect of the harmonization will be to apply provincial taxes to services that were previously not subject to the provincial tax.
But this should not affect the taxes that lawyers have to apply to their bills. This is because years ago the provincial government singled out legal services, and required lawyers to collect the PST on their fees. Lawyers are accordingly already required to add the 5% GST and 7% PST to their accounts. [But see Mr. Laarakker's comment in the comments section below concerning the increased tax on disbursements, which I had overlooked when I wrote this post.]
The harmonization should (at least in theory) be beneficial to law firms and many other small business by reducing the administration involved in collecting and remitting two separate taxes.
I am concerned about the effect of the harmonized taxes on the affordability of houses. The Provincial Government's press release indicates that there will be a rebate on new residential housing as follows:
A partial rebate of the provincial portion of the single sales tax for new housing to ensure that new homes up to $400,000 will bear no more tax than under the current PST system, while homes above $400,000 will receive a flat rebate of about $20,000.
Although I have not been able to find up-to-date statistics, I have no doubt that the median price of new single detached residences is well in excess of $400,000 for greater Vancouver, Victoria and Kelowna.
Sales of used residential houses are exempt from GST, and I assume will be exempt from the new harmonized tax.
The Provincial Government also announced that there will be additional tax credits for low income earners.