Bill Vander Zalm (former BC Premier, 1986-1991 & Fight HST co-chair) explains in a opinion editorial for the Vancouver Province why the HST is still wrong for BC:
This Canada Day, instead of celebrating the birth of our great nation, many people will be lamenting the death of our democracy with the implementation of the HST. By taking a dictatorial approach to the tax, the B.C. government ensured that the debate about the HST became one of who will have the final say in a democracy -- the government or the people who elect it?
Now, a group of "businessmen" are acting as a front for the government and are trying to quash the petition in court. But the Liberals aren't fooling anybody, and recalls just became that much easier.
With the Recall and Initiative Act, people have a chance to hold the government accountable before another election. This is a tremendous tool, because it's been the game of all governments to play "bait and switch" with voters early in their mandates in the hope of manipulating the people at election time to get re-elected.
If we succeed with the petition to repeal the HST, that game will end in B.C., forever.
Premier Campbell plans to travel B.C. to try to change the debate to the so-called "merits" of the HST. But here again the Liberal attempt to manipulate the people's reaction to their Hated Sales Tax will fail. The HST is not only bad politics, but it is bad policy:
1. First, it is a cruel tax that will hurt low-income, fixed-income, students, working families and seniors the most. It takes B.C. from a "progressive" tax system to a "regressive" system, where people with lower and middle incomes will pay proportionately more tax than others.
2. It will kill jobs and damage economic activity as people curb consumption to make up for the extra cost. The Liberal line that business will create jobs because of a refund cheque has not been backed up by a single company promising a single job when the HST arrives. All we've seen so far is job losses, like the $18-million housing project in Squamish that was recently cancelled because of the HST.
3. It eliminates fees paid to businesses to collect PST. HST must be collected for free.
4. It will drive up inflation as people demand higher wages to pay the extra seven-per-cent cost, offsetting any benefits to businesses from the input credits. Everywhere in Europe where the HST (called a VAT) has been implemented, it has driven up costs.
5. It will push the economy underground. In the U.K., VAT evasion is over $20 billion per year. In Greece, it is estimated that over 80 per cent of people no longer pay taxes. In France, the government was forced to lower the VAT to 5.5 per cent from 19 per cent on restaurant meals in order to save the industry from collapse and to stem the tide of uninvoiced cash transactions.
6. It will make B.C. less competitive. Our biggest trading partners are in Alberta, Washington, Oregon and Asia, where there is no HST, not Ontario. HST provinces like Newfoundland, Nova Scotia and New Brunswick have the highest unemployment and largest per-capita deficits, while Saskatchewan and Manitoba, where there is no HST, have booming economies and the highest job creation.
7. It will cost more to administer. Ottawa is hiring all of B.C.'s 1,200 provincial tax collectors, yet the only thing that will change is instead of calculating the GST at five per cent, they will calculate the HST at 12 per cent.
8. The federal government will take $250 million per year from B.C. in additional income taxes for costs previously considered a "write off" under PST, which will now become taxable under HST. So much for the benevolence of their $1.6-billion transition "gift" -- not a bad rate of interest.
9. The HST is more complex. The HST agreement has 16 pages of calculus formulas outlining the revenue sharing with B.C. that will require math geniuses or computers (or both) to figure out. And the federal government will do the calculating.
10. It will destroy B.C.'s sovereignty over provincial taxation. Ottawa will now set the rates, determine our exemptions and will calculate and distribute the revenues to B.C. The HST is as much a power grab by Ottawa as it is a money grab by the Liberals. B.C. does not need to give away control of our taxes in order to reform them. That is a false choice, and one the B.C. government wants to avoid talking about at all costs.
There isn't anything in this world that can't be improved, including our tax system. But the government must cancel the HST. Then, and only then, can we have a real debate. Otherwise, the premier is simply forcing the same bad policy on the people without their input or approval. And no matter how nicely they try to dress that up, it's just more dictatorship.
Canada Day 2010 does not mark the day the government forced the HST on us. It marks the day British Columbians stood up and said "Enough!"
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