Gabriel Yiu: The B.C. Liberal government's HST can be stopped
By Gabriel Yiu
Premier Gordon Campbell has said harmonizing the federal GST and the provincial sales tax in a new HST is the best thing he could do for B.C.’s economy. Finance Minister Collin Hansen has claimed that the public opposes the HST because they don’t understand it sufficiently.
It’s too much that our government leaders should insult the public’s intelligence with these comments.
Hansen has been all over the media. He has also met with the B.C. Restaurant and Foodservices Association and the Canadian Alliance of Chinese Associations. This shows that the B.C. Liberals are feeling the heat; otherwise, how can anyone get to meet the finance minister so easily? Normally, even if the minister is willing to see you, you have to wait for weeks.
The crucial question is this: will these organizations abandon or diminish their fight after having the chance to talk to the finance minister?
Hansen has stated very clearly that the B.C. Liberal government is going to implement the HST. He might look tough and decisive, but the final decision still depends on the public’s response.
If the opposition to the new tax is too loud and too strong--and if it would undermine the foundation of support for B.C. Liberals--the harmonization plan could still be abandoned.
In their landslide victory in 2001, the B.C. Liberals captured 77 of 79 legislative seats. With a one-party regime and with the opposition in disarray, the Campbell government abruptly announced the privatization of the Coquilhalla Highway--selling this public tolled highway to private business.
The plan triggered a huge uproar. Even though the B.C. Liberal government tried hard to promote the “benefits” of the privatization, local residents knew too well that it was just a government plot to create a cash cow. And the public would have to pay more to use the highway.
Eventually, due to strong community opposition that shook the foundation of support for the B.C. Liberals in the Interior, the Campbell government cancelled the plan. That resulted in the defeat of the first B.C. Liberal privatization scheme and the government’s loss of $6 million.
In September 2008, in order to strengthen B.C. Liberal support in the Interior, Campbell abolished the toll for using the Coquilhalla Highway.
Likewise, Campbell’s sudden reversal and violation of his election promise regarding the HST has aroused a public uproar, and it affects the entire province. So far, we’ve heard that many long-time B.C. Liberal supporters, including some of the party’s business friends, are discontent. Some of them feel betrayed.
So the crucial factor in toppling the HST is whether or not British Columbians (including traditional B.C. Liberal supporters and those who usually don’t pay attention to political affairs) accept the words of the finance minister that the harmonization is a done deal, and swallow it.
In the '90s when the Atlantic provinces harmonized their sales taxes, Newfoundland reduced its provincial sales tax by four percent point, while New Brunswick and Nova Scotia cut theirs by three percent. This year, the Ontario government plans to give $1,000 rebates as part of its HST plan.
Here in B.C., the Campbell government is harmonizing the federal and provincial sales taxes without reducing the tax rate. Nor is it providing a rebate. Campbell and Hansen dare to deny that it’s a tax grab.
We already have a carbon tax that will increase 50 percent annually. Now, we’re given the highest B.C. tax increase in history: according to the CD Howe Institute, the HST would grab $4 billion from B.C. residents in three years!
If we give free rein to the B.C. Liberal party to retract an election promise--and we swallow this bitter pill--then Campbell will do whatever he likes in the future without regard to public opinion.
Is the HST already a done deal? Well, it depends. What if a quarter million people signed petitions against it? What if a great many B.C. Liberal party members tore up their membership cards and returned them? Or if people and businesses who've donated to the party sent an ultimatum to the B.C. Liberals that they will never donate again? Do you think that the B.C. Liberal government would still stand firm on the HST?
If there is a federal election in fall, would the hated HST not become an election issue in B.C.? In the last federal campaign, the Conservatives' favourite sport in B.C. was hitting the carbon tax. Next time, we'll see whether or not federal Liberal Leader Michael Ignatieff hits back with the HST.
Gabriel Yiu is a small businessperson, media commentator, and former candidate for the B.C. NDP.
Aug 9, 2009 at 10:23am
As a small business person, the HST seems like a very sound idea to me. I am not a member of any political party and am not a fan of the Liberals, the NDP or the Greens.
I think much of the uproar on this proposed tax is driven more by political positioning than by common sense. You'd think we were the first jurisdiction to implement such a method. We are not and in those others, the sky didn't fall.
Sometimes I lean to the left politically, and when I do, I think "great, more tax to pay for the social programs that we all enjoy." When I lean to the right, I think "great, the tax will be much easier to administer and save business money."
At any rate, the arguments will go on and on and it will all help the Media sell newspapers, bring traffic to web sites, sell advertising on TV... they will love this debate. And here I am feeding into it. :-)
Aug 9, 2009 at 11:50am
Its seems the officials were speaking to the author when they said citizens do not understand HST sufficiently. As previous poster points out it cuts costs and headaches for businesses, very small to very large. It also cuts costs for government. Also the Ontario decision to give a $1000 rebate to citizens is counter-productive, and in a time of budget deficits, it was a sound decision to keep that money in BC governement hands. With 8 million citizens, they're giving away 8 billion dollars? which could be used to save social programs? The few items that are no longer going to be PST exempt should never have been exempt anyway. They are non-necessities.
The NDP wants to increase spending on social programs, yet decrease taxes. Take a lesson from California, you can not have both.
I feel like I am a crazy house when I read articles like this, but sane posters like those above save me from losing my hair. Cheers.
Aug 9, 2009 at 12:42pm
There are real winners and losers with the HST, that's fair argument. Imagine the outrage if an NDP government implemented the HST and/or the carbon tax? Our parliamentary system necessitates opposition, and plenty of individuals on both sides of the spectrum are opposing this bill!
That said, I agree somewhat with Doug. Scandinavian welfare states have thrived generally on a formula of low corporate taxes, high consumptive taxes, but with plenty of provisions to protect low-income households through extensive rebates. Gordo and Colin have done a piss poor job of showcasing how they're planning to protect our most vulnerable by this tax increase, and yet they blame voters for being mis-informed?
Although unlikely to pass, starting the BC Initiative process to strike down this unheralded part of the BC Liberal election platform would seem to be a sensible step forward.
If it fails miserably, the BCL can feel secure that they won't suffer long term political damage; if it passes -- even just the first stage of acquiring 10% from every Electoral District -- then the public will be sending a strong message of dissent against this, maybe even overturning it.
Aug 9, 2009 at 7:25pm
I run a small business called the Young Actors Project.
I'm a private teacher who teaches drama workshops in elementary schools. I will now have to charge more to my customers without seeing any benefit back. I have no heavy machinery to buy for any rebate. This price increase might make my program too expensive for some schools. Perhaps I'll have to lower my prices to keep it affordable. Everyone keeps saying how the hst is great for businesses - but as a small business person, from my perspective, this doesn't work in my favour at all.
Aug 9, 2009 at 11:56pm
Going back to the 1st comment by John. Yes, the implementing the HST can help cut back business costs by eliminating the problems PST has caused to many businesses BUT isn't it more efficient to instigate a CRA reform of the PST stupidities than to have BC residents pay for CRA's incompetence to work with local businesses?
The HST here is obviously a "hidden agenda" (Olympics, money grab, pleasing businesses, blah blah blah) and I have no understanding of how and why businesses should even support it just so that it makes it easier for businesses to not have to deal with PST.
The PST issue SHOULD NOT be an issue to justify the implementation of the HST.
Aug 10, 2009 at 8:09am
What's a CRA?
Aug 10, 2009 at 11:27am
Well I doubt the HST is gonna be stopped, Gordo has gone public during the Premiers' meeting a few days back saying he's going ahead. So what should I, as an INFORMED consumer, do? Here's what: I'll get my wife to cut my hair, I'll stop going to the restaurants (imagine having to pay tips based on an inflated bill caused by the HST), I'll buy more stuff when I'm in the US, I'll try to fly domestic only when it's absolutely necessary, in short I'll cut back my spending. I want more cash in my pocket, and we have the power to control our expenditure. Face it Gordo, I'll keen to see just what repercussions your tax grab will have on consumerism in BC.
Aug 10, 2009 at 6:27pm
>>The few items that are no longer going to be PST exempt should never have been exempt anyway. They are non-necessities.
Hmm. We don't live in California; heat in BC is a necessity, and does not look to be 'exempt.' Sounds like there are a few trolls here on the board. Mr. Hansen, is that you?
Aug 10, 2009 at 8:08pm
There is absolutely no way savings will be passed onto the consumer. This tax no matter what color you paint it is still a tax grab. Big business will receive a huge break and the consumer is going to pay more, Period. Besides, why would anyone believe Campbell or his finance minister.
Aug 10, 2009 at 11:49pm
Can't be done. As long as Carole James is hanging like a millstone around the neck of the progressive movement, there is no chance that a conventional protest movement has any chance of stopping the Gordo.
Poll just out - more than half of NDP voters want her gone.
In fact because James is so useless as a leader El Gordo feels perfectly safe coming up with health care cuts and the HST. With more effective leadership he wouldn't have dared.
Carol James needs to resign and a more effective leader found. Jenny Kwan, Adrian Dix, Jim Sinclair, Ken Georgetti - somebody please help.
The only way at this point to stop the Gordo requires progressives across BC to buy BCLiberal party memberships en mass, vote out the party apparatchik riding by riding, vote for massive policy changes and a new leader. We need to undo the fascist hijack of our Liberal party and send them packin off to the BC Con party that needs their leadership.