Federal Liberals like Ujjal Dosanjh refer to B.C.’s controversial harmonized sales tax as the “Harper sales tax”. But with a looming fall election, the Vancouver South MP can’t offer any assurances that a Liberal government in Ottawa would slam the brakes on the HST.
“You know what? Ultimately it is the decision of the provincial government whether or not to do HST,” Dosanjh told the Georgia Straight in a phone interview. “We as a federal government will not be pushing if British Columbia were to change its mind.”
The budget update laid out by B.C. Liberal finance minister Colin Hansen earlier this month states that the implementation of the HST and related measures on July 1, 2010, will be “subject to the approval of the Legislature of British Columbia and the Parliament of Canada”.
For budget year 2009-2010, the Conservative government will give $750 million in transition payments to the province to facilitate the shift to HST. B.C. expects to receive $374 million and $475 million in budget years 2010-2011 and 2011-2012. These federal transfers total about $1.6 billion.
Asked how federal Liberals will act if an HST-related measure is brought to a vote before Parliament, which will resume session on September 14, Dosanjh said: “When and if it comes, we’ll take a look at it.”
For now, Dosanjh’s beef is that the federal government “should not be pushing for the imposition of higher taxes on ordinary people in British Columbia at a time when they can ill afford those higher taxes”.
NDP MP Don Davies (Vancouver Kingsway) accused Liberals of insincerity with respect to the HST issue.
“People forget that the federal budget that was passed in February, that the Liberals voted for, contained in it a clear message”¦.if we go back and read the budget, it’s got clear provisions for the HST,” Davies told the Straight. “And it provided for the budgetary money, the federal bribe money, to the provinces to implement it.”
Because the HST shift requires agreement and implementation by both levels of government, he noted that it can be stopped in Ottawa if the federal government chooses to do so.
“But once again it’s just massive Liberal hypocrisy,” Davies said.
A memorandum of agreement signed by Hansen and federal Conservative finance minister Jim Flaherty in July this year regarding the adoption of the HST provides that both governments will “use their best efforts” to enter into a Canada-B.C. Comprehensive Integrated Tax Co-ordination Agreement on or before September 30, 2009.
The accord also states that the two parties will attempt to complete all undertakings, “including any necessary legislative processes and the signing of appropriate agreements”, before March 31, 2010.
On top of the $1.6 billion in federal transfers for HST implementation, the province expects to save about $30 million annually in administrative costs that will be borne by the federal government.
According to Davies, New Democrats have been opposed to the HST from the beginning. “We voted against that [2009 federal] budget for a lot of reasons, including that,” he said. “That last budget contained very regressive tax provisions where they shifted the tax burden from corporations on to consumers.”
Conservative MP John Cummins (Delta–Richmond East) confirmed that the federal government has as large a role as the provincial government does in bringing in the HST.
“There would have to be action [in Parliament], because the deal related to the collection of taxes and the disbursement of funds,” Cummins told the Straight. “There would have to be legislation.”
He also said that Conservatives aren’t so much worried about an HST backlash in the province because of the party’s record in steering Canada out of recession.
“The Liberals have not come up with a different plan,” Cummins added. “One day they’d be criticizing us because we weren’t spending enough money in the stimulus package, and then the next day they’re critical of us because the deficit was too large. Well, you can’t have it both ways.”
A public forum on the HST organized by the provincial NDP will be held today (September 10) at the Alice MacKay Room of the Vancouver public library’s central branch (350 West Georgia Street) from 7 p.m. to 9 p.m. On September 19, former Social Credit premier Bill Vander Zalm will launch a citizens’ initiative to rescind the HST.