09/14/2011 07:11 EDT | Updated 01/12/2012 02:19 EST

Federal and Quebec governments extend HST negotiations deadline

OTTAWA - The federal and Quebec governments have agreed to extend the deadline on their negotiations to get a deal on a harmonized sales tax, expected to be worth about $2.2 billion.

Finance Minister Jim Flaherty and Quebec Finance Minister Raymond Bachand say the talks are going well and they expect a deal to be reached by the end of the month.

The Conservatives had promised during the campaign for the May 2 federal election to reach an accord by Sept. 15.

The two parties are apparently working out technical details.

A potential sticking point has been whether Quebec could be compensated for harmonizing its provincial sales tax with the federal GST, yet still collect the tax itself.

Earlier this week, Industry Minister Christian Paradis said Quebec will be able to continue collecting its own sales tax as part of the accord.

One contentious question has involved the list of items to be taxed; for instance, products like baby cribs and books are subject to the federal GST but not the provincial sales tax.

Quebec sought harmonization compensation from the federal government after it reached similar deals with Ontario and British Columbia.